UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                      WASHINGTON, D.C.  20549
                  -----------------------------

                            FORM 10-Q

        Quarterly Report Pursuant to Section 13 or 15 (d)
             of the Securities Exchange Act of 1934


For the Quarterly Period Ended          Commission File Number
       June 30, 2002                          0-20160

                  -----------------------------

                    COVEST BANCSHARES, INC.
     (Exact name of registrant as specified in its charter)


          Delaware                           36-3820609
(State or other jurisdiction       (I.R.S. Employer Identification
     of incorporation or                      Number)
        organization)

749 Lee Street, Des Plaines, Illinois               60016
(Address of Principal Executive Offices)          (Zip Code)

Registrant's telephone number, including area code: (847) 294-6500

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  -----

As of July 23, 2002, the Registrant had issued and outstanding 4,403,803
shares of the Registrant's Common Stock.  In addition, it had also
repurchased 906,928 shares which were being held as treasury stock and 81,477
shares which were being held as unallocated ESOP shares.

                         COVEST BANCSHARES, INC.


                            Table of Contents


PART I.   FINANCIAL INFORMATION (UNAUDITED)                   PAGE NO.


          Item 1.   Financial Statements                         3


          Item 2.   Management's Discussion and
                    Analysis of Financial Condition and
                    Results of Operations                       15


PART II.  OTHER INFORMATION


          Item 1.   Legal Proceedings                           30


          Item 2.   Changes in Securities                       30


          Item 3.   Defaults upon Senior Securities             30


          Item 4.   Submission of Matters to a Vote of
                    Security Holders                            30

          Item 5.   Other Information                           30


          Item 6.   Exhibits and Reports                        31


          Form 10-Q Signatures                                  32















PART 1.   FINANCIAL INFORMATION
Item 1.   Consolidated Financial Statements
          (Unaudited)


COVEST BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)

(Dollars in thousands, except
 per share data)

                                             JUNE 30, 2002        DEC 31, 2001
ASSETS                                       -------------        ------------
------------
CASH ON HAND AND IN BANKS                        $ 13,376            $  6,552

INTEREST BEARING DEPOSITS                          16,480                  21
                                                 --------            --------
   Cash and Cash Equivalents                       29,856               6,573

SECURITIES:
   Securities Available-for-Sale                   55,354              40,897
   Mortgage-Backed and Related
      Securities Available-for-Sale                 3,012               3,948
   Federal Home Loan Bank and
      Federal Reserve Bank Stock                    7,504               7,319
                                                 --------            --------
TOTAL SECURITIES                                   65,870              52,164

LOANS RECEIVABLE:
   Commercial Loans                                51,786              47,024
   Multi-Family Loans                             225,955             223,613
   Commercial Real Estate Loans                    72,300              79,443
   Construction Loans                              47,379              58,796
   Commercial/Municipal Leases                      1,121               1,778
   Mortgage Loans                                  55,598              58,175
   Consumer Loans                                  42,382              46,273
   Mortgage Loans Held for Sale                       869               1,065
                                                 --------            --------
      TOTAL LOANS RECEIVABLE                      497,390             516,167
   Allowance for Loan Losses                     (  6,650)            ( 6,547)
                                                 --------            --------
LOANS RECEIVABLE, NET                             490,740             509,620

ACCRUED INTEREST RECEIVABLE                         2,923               3,281
PREMISES AND EQUIPMENT                              9,241               9,466
OTHER REAL ESTATE OWNED                               746                 661
GOODWILL                                            1,235               1,338
MORTGAGE SERVICING RIGHTS                             177                 222
OTHER ASSETS                                        3,459               2,404
                                                 --------            --------
TOTAL ASSETS                                     $604,247            $585,729
                                                 ========            ========




See accompanying notes to unaudited consolidated financial statements



COVEST BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Continued)
(Unaudited)

(Dollars in thousands, except per share data)

                                             JUNE 30, 2002        DEC 31, 2001
                                             -------------        ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
LIABILITIES:
   Deposits:
      Non-Interest Bearing                       $ 34,376            $ 30,993
      Interest Bearing Checking                    30,588              29,339
      Savings Accounts                             74,210              52,141
      Money Market Accounts                        98,339             113,864
      Certificates of Deposit                     172,898             172,055
      Jumbo CDs                                     2,831              11,834
      Purchased CDs                                55,963              45,776
                                                  -------             -------
                                                  469,205             456,002
   Short-Term Borrowings and Securities
      Sold U/A to Repurchase                       27,217              29,425
   Long-Term Advances from Federal
      Home Loan Bank                               49,000              44,000
   Advances from Borrowers for Taxes and
      Insurance                                     5,599               4,865
   Accrued Expenses and Other Liabilities           6,701               6,286
                                                  -------             -------
TOTAL LIABILITIES                                 557,722             540,578

STOCKHOLDERS' EQUITY:
   Common Stock, par value $.01 per share;
      7,500,000 authorized shares; 4,403,803
      shares issued at 6/30/02 and 12/31/01
      respectively                                     44                  44
   Additional Paid-in Capital                      18,325              17,268
   Retained Earnings                               44,090              41,360
   Treasury Stock, 906,928 shares and
      965,580 shares, held at cost 6/30/02
      and 12/31/01, respectively                  (15,407)            (14,290)
   Unearned ESOP shares                            (1,450)                  -
   Accumulated Other Comprehensive Income             923                 769
                                                 --------            --------
TOTAL STOCKHOLDERS' EQUITY                         46,525              45,151
                                                 --------            --------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY       $604,247            $585,729
                                                 ========            ========




See accompanying notes to unaudited consolidated financial statements







<TABLE>
<CAPTION>
COVEST BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Unaudited)
(Dollars in thousands, except per             THREE MONTHS ENDED    SIX MONTHS ENDED
 share data)                                   JUNE 30,  JUNE 30,  JUNE 30,  JUNE 30,
                                                 2002      2001      2002      2001
INTEREST INCOME                                -------   -------   -------   -------
<S>                                            <C>        <C>       <C>       <C>
   Loans and Leases Receivable                 $ 8,301   $ 9,685   $17,282   $20,181
   Mortgage-Backed and Related Securities           52        95       114       225
   Taxable Securities                              493       478       907       890
   Tax Exempt Securities                            63        92       126       184
   Other Interest and Dividend Income              192       403       312       591
                                               -------   -------   -------   -------
   Total Interest Income                         9,101    10,753    18,741    22,071
INTEREST EXPENSE
   Deposits                                      3,191     5,113     6,433    10,697
   Advances from Federal Home Loan Bank            711       703     1,415     1,574
   Other Borrowed Funds                             59       124       150       305
                                               -------   -------   -------   -------
   Total Interest Expense                        3,961     5,940     7,998    12,576
                                               -------   -------   -------   -------
NET INTEREST INCOME                              5,140     4,813    10,743     9,495
   Provision for Loan Losses                       164       250       636       500
                                               -------   -------   -------   -------
NET INTEREST INCOME AFTER PROVISION FOR
   LOAN LOSSES                                   4,976     4,563    10,107     8,995
NON-INTEREST INCOME
   Loan Charges and Servicing Fees                 218       270       441       473
   Loan Prepayment Fees                            494       292       956       338
   Mortgage Banking Fees                           137       203       268       360
   Deposit Related Charges and Fees                308       294       606       552
   Gain/(Loss) on Sale of Securities/Loans           -        (1)       74       375
   Insurance and Annuity Commissions                 7        31        23        46
   Other                                            89        58       121       121
                                               -------   -------   -------   -------
   Total Non-Interest Income                     1,253     1,147     2,489     2,265
NON-INTEREST EXPENSE
   Compensation and Benefits                     1,849     1,650     3,737     3,205
   Commissions and Incentives                      145       285       338       622
   Occupancy and Equipment                         472       470       957       959
   Federal Deposit Insurance Premium                20        21        40        44
   Data Processing                                 266       280       526       498
   Advertising                                     204       255       410       401
   Other Real Estate Owned                          73        83       273        80
   Amortization of Goodwill                         51        51       103       102
   Amortization of Mortgage Servicing Rights        18        28        44        35
   Other                                           475       536       964     1,005
                                               -------   -------   -------   -------
   Total Non-Interest Expense                    3,573     3,659     7,392     6,951
                                               -------   -------   -------   -------
INCOME BEFORE INCOME TAXES                       2,656     2,051     5,204     4,309
Income Tax Provision                              (976)     (739)   (1,911)   (1,562)
                                               -------   -------   -------   -------
NET INCOME                                     $ 1,680   $ 1,312   $ 3,293   $ 2,747
                                               =======   =======   =======   =======
Basic Earnings per Share                         $0.49     $0.34     $0.96     $0.71
Diluted Earnings per Share                       $0.47     $0.33     $0.91     $0.70

Comprehensive Income                           $ 1,976   $ 1,397   $ 3,447   $ 3,317

See accompanying notes to unaudited consolidated financial statements
</TABLE>

COVEST BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Dollars in thousands)                                   SIX MONTHS ENDED
                                                        JUNE 30,     JUNE 30,
                                                          2002         2001
OPERATING ACTVITIES                                    --------    ---------
   Net Income                                          $ 3,293      $ 2,747
   Adjustments to Reconcile Net Income to
    Net Cash from Operating Activities
   Depreciation and Amortization of
        Premises and Equipment                             450          421
   ESOP Compensation Expense                                50            -
   Provision for Loan Losses                               636          500
   Net Gain on Sales of
        Securities/Loans                                   (74)        (375)
   Federal Home Loan Bank Stock Dividend                  (185)        (241)
   Change In:
     Prepaid Expenses and Other Assets                    (907)        (249)
     Accrued Interest Receivable                           358          710
     Accrued Expenses and Other Liabilities              1,071        1,360
                                                     ---------    ---------
NET CASH FROM OPERATING ACTIVITIES                       4,692        4,693

CASH FLOWS FROM INVESTING ACTIVITIES
   Loan Originations, Net of Principal
     Payments                                           (1,924)     (33,203)
   Proceeds from Sale of Loans                          20,083       54,547
   Principal Payments on Mortgage-Backed
     and Related Securities                                968        1,174
   Purchases of Securities                             (32,146)     (40,444)
   Proceeds from Sales and Maturities
     of Securities                                      17,930       31,223
   Purchase of Office Properties and
     Equipment                                            (225)        (161)
                                                     ---------    ---------
NET CASH FROM INVESTING ACTIVITIES                       4,686       13,136

CASH FLOWS FROM FINANCING ACTIVITIES
   Net Increase in Deposits                             13,203        4,240
   Borrowings                                            5,000        1,470
   Repayment of Borrowings                              (2,208)     (18,520)
   Net Increase in Mortgage
     Escrow Funds                                          734           40
   Purchase of Common Stock Net of Proceeds
     from Exercise of Stock Options                     (2,261)      (1,377)
   Dividend Paid                                          (563)        (614)
                                                     ---------    ---------
NET CASH FROM FINANCING ACTIVITIES                      13,905      (14,761)
                                                     ---------    ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS               23,283        3,068

CASH AND CASH EQUIVALENTS, BEGINNING                     6,573       10,522
                                                     ---------    ---------
CASH AND CASH EQUIVALENTS, ENDING                      $29,856      $13,590
                                                     =========    =========


See accompanying notes to unaudited consolidated financial statements

<TABLE>
<CAPTION>
COVEST BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(Unaudited)
(Dollars in thousands)

Three months ended JUNE 30, 2002 and 2001
<S>                                 <C>            <C>         <C>        <C>       <C>            <C>

                                    COMMON
                                    STOCK AND                                     ACCUMULATED
                                    ADDITIONAL                           UNEARNED OTHER
                                    PAID-IN        RETAINED   TREASURY   ESOP     COMPREHENSIVE
                                    CAPITAL        EARNINGS     STOCK    SHARES   INCOME/(LOSS)    TOTAL
----------------------------------------------------------------------------------------------------------
Balance at December 31, 2000          $17,545       $36,783   ($6,244)        -        ($50)      $48,034

Net Income                                            2,747                                         2,747

Change in Unrealized Gain on
  Securities Available-for-Sale,
  Net of Taxes                                                                          570           570
                                                                                                  -------
       Comprehensive Income                                                                         3,317

Cash Dividends ($.16 per share)                        (614)                                         (614)

Purchase of Treasury Stock                                     (1,205)                             (1,205)

Treasury Stock Reissued in
  Conjunction with Stock Option
  Exercises                              (443)                    112                                (331)

Tax Benefits Related to Employee
  Stock Option Plans                      159                                                         159
-----------------------------------------------------------------------------------------------------------

Balance at June 30, 2001              $17,261       $38,916   ($7,337)        -        $520       $49,360
===========================================================================================================

Balance at December 31, 2001          $17,312       $41,360  ($14,290)        -        $769       $45,151

Net Income                                            3,293                                         3,293

Change in Unrealized Gain on
  Securities Available-for-Sale,
  Net of Taxes                                                                          154           154
                                                                                                    -----
       Comprehensive Income                                                                         3,447

Cash Dividends ($.16 per share)                        (563)                                         (563)

Purchase of Treasury Stock                                     (5,053)                             (5,053)

Treasury Stock Reissued in
  Conjunction with Stock Option
  Exercises and ESOP Plan                 356                   3,936    (1,500)                    2,792

Release of ESOP Shares                                                       50                        50

Tax Benefits related to Employee
  Stock Option Plans                      701                                                         701
----------------------------------------------------------------------------------------------------------

Balance at June 30, 2002              $18,369       $44,090  ($15,407)  ($1,450)       $923       $46,525
==========================================================================================================

See accompanying notes to unaudited consolidated financial statements
</TABLE>


                                         COVEST BANCSHARES INC.
                               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                              (Unaudited)
<TABLE>
<CAPTION>
AVERAGE BALANCE SHEET
The following table sets forth certain information related to the Company's average balance sheet.  It
reflects the average yield on assets and average cost of liabilities for the periods indicated, on a
fully tax equivalent basis, as derived by dividing income or expense by the average daily balance of
assets or liabilities, respectively, for the periods indicated. (Dollars in Thousands)

                                                               THREE MONTHS ENDED
                                     -------------------------------------------------------------------
                                                JUNE 30, 2002                     JUNE 30, 2001
                                     --------------------------------- ---------------------------------
                                        AVERAGE                AVERAGE    AVERAGE             AVERAGE
                                        BALANCE   INTEREST   YIELD/COST   BALANCE  INTEREST  YIELD/COST
                                       --------   --------   ----------   -------  --------  ----------
INTEREST EARNING ASSETS:
<S>                                     <C>         <C>         <C>        <C>       <C>        <C>
  Commercial Loans(A)(B)               $ 53,045    $   784      5.91%    $ 37,564   $   707     7.53%
  Multi-Family Loans(A)(B)              226,610      3,465      6.12      185,345     3,614     7.80
  Commercial Real Estate Loans(A)(B)     78,944      1,407      7.13       84,036     1,729     8.23
  Construction Loans(A)(B)               48,437        865      7.14       51,603     1,285     9.96
  Commercial/Muni Leases(B)               1,288         20      6.21        3,594        55     6.12
  Mortgage Loans(A)(B)                   55,439      1,036      7.47       63,677     1,248     7.84
  Consumer Loans (A)                     43,273        725      6.70       49,276     1,047     8.50
  Securities                             47,177        588      4.99       42,735       618     5.78
  Mortgage-Backed and Related
    Securities                            2,906         52      7.16        5,366        95     7.08
  Equity Investments                      9,405        121      5.15        8,268       121     5.85
  Other Investments                      17,686         71      1.61       26,814       282     4.21
                                       --------    -------      ----     --------   -------     ----
Total Interest-Earning Assets          $584,210    $ 9,134      6.25%    $558,278   $10,801     7.74%
Non-Interest Earning Assets              19,613                            18,736
                                       --------                          --------
  TOTAL ASSETS                         $603,823                          $577,014
                                       ========                          ========
INTEREST-BEARING LIABILITIES:
  Interest-Bearing Checking            $ 30,349    $   101      1.33%    $ 23,952   $    81     1.35%
  Savings                                69,520        434      2.50       43,137       269     2.49
  Money Market                          101,601        440      1.73      119,506     1,091     3.65
  Certificates of Deposits              170,067      1,642      3.86      171,830     2,573     5.99
  Jumbo CDs                               3,673         22      2.40        9,619       141     5.86
  Purchased CDs                          62,327        552      3.54       60,746       958     6.31
  FHLB Advances                          67,000        711      4.25       45,000       703     6.25
  Other Borrowed Funds                   10,260         59      2.30       12,095       124     4.10
                                      ---------    -------      ----     --------   -------     ----
Total Interest-Bearing Liabilities     $514,797    $ 3,961      3.08%    $485,885   $ 5,940     4.89%
Non-Interest Bearing Deposits            32,014                            27,350
Other Liabilities                        11,002                            14,869
                                      ---------                          --------
TOTAL LIABILITIES                      $557,813                          $528,104

Stockholders' Equity                     46,010                            48,910
                                       --------                          --------
TOTAL LIABILITIES AND
   STOCKHOLDERS' EQUITY                $603,823                          $577,014
                                       ========                          ========
NET INTEREST INCOME                                $ 5,173                          $ 4,861
                                                   =======                          =======
NET INTEREST RATE SPREAD (C)                                    3.17%                           2.85%
                                                                ====                            ====
NET INTEREST MARGIN (D)                                         3.54%                           3.48%
                                                                ====                            ====
(A) Includes cash basis loans.
(B) Includes deferred fees/costs.
(C) Interest Rate Spread is calculated by subtracting the average cost of interest-bearing liabilities
    from the average rate on interest-earning assets.
(D) Net Interest Margin is calculated by dividing net interest income by average interest-earning assets.
</TABLE>

<TABLE>
<CAPTION>
AVERAGE BALANCE SHEET
The following table sets forth certain information related to the Company's average balance sheet.  It
reflects the average yield on assets and average cost of liabilities for the periods indicated, on a
fully tax equivalent basis, as derived by dividing income or expense by the average daily balance of
assets or liabilities, respectively, for the periods indicated.  (Dollars in thousands)

                                                                 SIX MONTHS ENDED
                                     -------------------------------------------------------------------
                                                JUNE 30, 2002                    JUNE 30, 2001
                                     --------------------------------- ---------------------------------
                                        AVERAGE                AVERAGE    AVERAGE             AVERAGE
                                        BALANCE   INTEREST   YIELD/COST   BALANCE  INTEREST  YIELD/COST
                                       --------   --------   ----------   -------  --------  ----------
INTEREST EARNING ASSETS:
<S>                                       <C>       <C>         <C>         <C>      <C>        <C>
  Commercial Loans(A)(B)               $ 51,869    $ 1,537      5.93%    $ 37,652   $ 1,475     7.83%
  Multi-Family Loans(A)(B)              228,432      7,284      6.38      179,832     7,067     7.86
  Commercial Real Estate Loans(A)(B)     80,067      2,907      7.26       81,515     3,350     8.22
  Construction Loans(A)(B)               51,578      1,894      7.34       50,148     2,518    10.04
  Commercial/Muni Leases(B)               1,449         44      6.07        4,198       126     6.00
  Mortgage Loans(A)(B)                   56,491      2,130      7.54       88,710     3,436     7.75
  Consumer Loans (A)                     44,121      1,485      6.73       50,383     2,209     8.77
  Securities                             43,354      1,099      5.07       39,620     1,169     5.90
  Mortgage-Backed and Related
    Securities                            3,112        114      7.33        6,481       225     6.94
  Equity Investments                      9,267        237      5.11        8,235       246     5.97
  Other Investments                       9,393         75      1.60       15,953       345     4.33
                                       --------    -------      ----     --------   -------     ----
Total Interest-Earning Assets          $579,133    $18,806      6.49%    $562,727   $22,166     7.88%
Non-Interest Earning Assets              19,135                            18,307
                                       --------                          --------
  TOTAL ASSETS                         $598,268                          $581,034
                                       ========                          ========
INTEREST-BEARING LIABILITIES:
  Interest-Bearing Checking            $ 29,860    $   198      1.33%    $ 23,409   $   145     1.24%
  Savings                                63,985        794      2.48       42,756       529     2.47
  Money Market                          105,111        904      1.72      120,768     2,552     4.23
  Certificates of Deposits              170,276      3,416      4.01      168,851     5,117     6.06
  Jumbo CDs                               6,366         84      2.64        9,433       286     6.06
  Purchased CDs                          55,676      1,037      3.73       64,016     2,068     6.46
  FHLB Advances                          66,088      1,415      4.28       50,359     1,574     6.25
  Other Borrowed Funds                   13,009        150      2.32       12,799       305     4.79
                                      ---------    -------      ----     --------   -------     ----
Total Interest-Bearing Liabilities     $510,371    $ 7,998      3.13%    $492,391   $12,576     5.11%
Non-Interest Bearing Deposits            31,553                            25,911
Other Liabilities                        10,536                            14,140
                                      ---------                          --------
TOTAL LIABILITIES                      $552,459                          $532,442

Stockholders' Equity                     45,809                            48,592
                                       --------                          --------
TOTAL LIABILITIES AND
   STOCKHOLDERS' EQUITY                $598,268                          $581,034
                                       ========                          ========
NET INTEREST INCOME                                $10,808                          $ 9,590
                                                   =======                          =======
NET INTEREST RATE SPREAD (C)                                    3.36%                           2.77%
                                                                ====                            ====
NET INTEREST MARGIN (D)                                         3.73%                           3.41%
                                                                ====                            ====
(A) Includes cash basis loans.
(B) Includes deferred fees/costs.
(C) Interest Rate Spread is calculated by subtracting the average cost of interest-bearing liabilities
    from the average rate on interest-earning assets.
(D) Net Interest Margin is calculated by dividing net interest income by average interest-earning assets.
</TABLE>


(1) 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 for interim financial information and with the
instructions to Form 10-Q and Regulation S-X.  Accordingly, they do not
include all the information and footnotes required by accounting principles
generally accepted in the United States of America for complete financial
statements.

The results of operations and other data for the three-month and six-month
periods ended June 30, 2002 are not necessarily indicative of results that may
be expected for the entire year ending December 31, 2002.

In the opinion of management, the unaudited consolidated financial statements
contain all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial information of CoVest Bancshares,
Inc. (the "Company"), including its wholly owned subsidiary, CoVest Banc (the
"Bank").

Certain amounts in prior consolidated financial statements have been
reclassified to conform to the June 30, 2002 presentation.


(2) Nature of Operations

The Company is a bank holding company organized under the laws of the state of
Delaware.  It provides a full line of financial services to customers within
six counties in northeast Illinois from its three branch locations.

A reconciliation of the numerators and denominators for earnings per common
share dilution computations for the three month periods ended June 30, 2002
and 2001 are presented below: (dollars and shares in thousands)


                                           Three Months Ended June 30,
                                        --------------------------------
                                               2002            2001
                                               ----            ----
Earnings per share:
  Net Income                                 $1,680          $1,312
  Weighted average common shares
    outstanding                               3,432           3,832
                                              -----           -----
  Basic earnings per share                    $0.49           $0.34
                                              =====           =====

Earnings per share assuming dilution:
  Net Income                                 $1,680          $1,312
  Weighted average common shares
    outstanding                               3,432           3,832

  Add: dilutive effect of assumed
         exercises of stock options             169              89
                                              -----           -----
  Weighted average common and dilutive
    potential common shares outstanding       3,601           3,921
                                              =====           =====
  Diluted earnings per share                  $0.47           $0.33
                                              =====           =====

A reconciliation of the numerators and denominators for earnings per common
share dilution computations for the six month periods ended June 30, 2002 and
2001 are presented below: (dollars and shares in thousands)


                                           Six Months Ended June 30,
                                        --------------------------------
                                               2002            2001
                                               ----            ----
Earnings per share:
  Net Income                                 $3,293          $2,747
  Weighted average common shares
    outstanding                               3,440           3,851
                                              -----           -----
  Basic earnings per share                    $0.96           $0.71
                                              =====           =====

Earnings per share assuming dilution:
  Net Income                                 $3,293          $2,747
  Weighted average common shares
    outstanding                               3,440           3,851

  Add: dilutive effect of assumed
         exercises of stock options             165              75
                                              -----           -----
  Weighted average common and dilutive
    potential common shares outstanding       3,605           3,926
                                              =====           =====
  Diluted earnings per share                  $0.91           $0.70
                                              =====           =====

At June 30, 2002, no options to purchase shares were excluded in the
computation of diluted earnings per share because all of the options' exercise
prices were lower than the average market price of the common stock.  At June
30, 2001, options to purchase 305,000 shares were not included in the
computation of diluted earnings per share because the options' exercise prices
were greater than the average market price of the common stock and were
therefore, antidilutive.


(3) Stock Repurchase Program

The following table summarizes the Company's stock repurchase programs.

                                                           Average
                   Date          Date      # of Shares    Price per
    Program#     Announced     Completed   Repurchased      Share
    ========     =========     =========   ===========    =========
      24th        3/29/02       6/18/02       100,000       $21.32
      25th        6/18/02          -            5,476       $22.04

The Company repurchased 105,476 shares in the second quarter of 2002.

The Company announced its 25th stock repurchase program on June 18, 2002,
enabling the Company to repurchase 100,000 shares of its outstanding common
stock.


(4) Cash Dividend

The regular quarterly dividend for the second quarter of 2002 was paid at $.08
per share.  The same quarterly dividend was paid for the second quarter of
2001.

(5) Regulatory Capital Requirements

Pursuant to the Financial Institutions Reform, Recovery and Enforcement Act of
1989 ("FIRREA"), as implemented by regulations promulgated by the Office of
the Comptroller of the Currency (the "OCC"), national banks must meet three
separate minimum capital requirements. The following table summarizes, as of
June 30, 2002, the Company's and Bank's capital requirements under FIRREA and
their actual capital ratios.  As of June 30, 2002, the Company and the Bank
exceeded all current minimum regulatory capital requirements.


                                                                To Be Well
                                                             Capitalized Under
                                            For Capital      Prompt Corrective
                                Actual    Adequacy Purpose   Action Provisions
JUNE 30, 2002              Amount  Ratio   Amount Ratio       Amount   Ratio
==============              ------  ------  ------ ------     ------   -----
                                        (Dollars in Thousands)
Total Capital
(to Risk Weighted Assets)
   Company                   $49.5  12.3%    $32.1  8.0%       $40.1    10.0%
   Bank                       49.4  12.3      32.0  8.0         40.0    10.0
Tier I Capital
(to Risk Weighted Assets)
   Company                   $44.4  11.1%    $16.0  4.0%       $24.0     6.0%
   Bank                       44.3  11.1      16.0  4.0         24.0     6.0
Tier I Capital
(to Average Assets)
   Company                   $44.4   7.3%    $24.2  4.0%       $30.2     5.0%
   Bank                       44.3   7.4      24.0  4.0         30.0     5.0

Risk Weighted Assets (Company)  $400,832
Average Assets (Company)         603,823
Risk Weighted Assets (Bank)      400,274
Average Assets (Bank)            600,974


                                                                To Be Well
                                                             Capitalized Under
                                            For Capital      Prompt Corrective
                                Actual    Adequacy Purpose   Action Provisions
JUNE 30, 2001              Amount  Ratio   Amount Ratio      Amount   Ratio
==============              ------  ------  ------ ------    ------   -----
                                        (Dollars in Thousands)
Total Capital
(to Risk Weighted Assets)
   Company                   $52.5  13.0%    $32.3  8.0%       $40.4    10.0%
   Bank                       49.9  12.4      32.2  8.0         40.3    10.0
Tier I Capital
(to Risk Weighted Assets)
   Company                   $47.4  11.7%    $16.2  4.0%       $24.2     6.0%
   Bank                       44.8  11.1      16.1  4.0         24.2     6.0
Tier I Capital
(to Average Assets)
   Company                   $47.4   8.2%    $23.1  4.0%       $28.9     5.0%
   Bank                       44.8   7.8      22.9  4.0         28.6     5.0

Risk Weighted Assets (Company)  $404,008
Average Assets (Company)         577,014
Risk Weighted Assets (Bank)      402,623
Average Assets (Bank)            572,858

(6) New Accounting Pronouncement

In 2001, the Financial Accounting Standard Board issued SFAS No. 142,
"Goodwill and Other Intangible Assets," which requires that goodwill no longer
be amortized to earnings, but instead be reviewed for impairment.  The
amortization of goodwill ceases upon adoption of SFAS No. 142, which for most
companies, will be January 1, 2002.  The goodwill recorded by the Company is
related to a branch acquisition.  This goodwill will continue to be accounted
for under SFAS No. 72, "Accounting for Certain Acquisitions of Banking or
Thrift Institutions," (excluded from the scope from SFAS No. 142) and continue
to be amortized to expense.


(7) Special Note Concerning Forward-Looking Statements

This document (including information incorporated by reference) contains, and
future oral and written statements of CoVest Bancshares, Inc., a Delaware
corporation (the "Company") and its management may contain, forward-looking
statements, within the meaning of such term in the Private Securities
Litigation Reform Act of 1995, with respect to the financial condition,
results of operations, plans, objectives, future performance and business of
the Company.  Forward-looking statements, which may be based upon beliefs,
expectations and assumptions of the Company's management and on information
currently available to management, are generally identifiable by the use of
words such as "believe," "expect," "anticipate," "plan," "intend," "estimate,"
"may," "will," "would," "could," "should" or other similar expressions.
Additionally, all statements in this document, including forward-looking
statements, speak only as of the date they are made, and the Company
undertakes no obligation to update any statement in light of new information
or future events.

The Company's ability to predict results or the actual effect of future plans
or strategies is inherently uncertain.  Factors which could have a material
adverse effect on the operations and future prospects of the Company and its
subsidiaries include, but are not limited to, the following:

The strength of the United States economy in general and the strength of
the local economies in which the Company conducts its operations which may
be less favorable than expected and may result in, among other things, a
deterioration in the credit quality and value of the Company's assets.

The economic impact of the terrorist attacks that occurred on September
11th, as well as any future threats and attacks, and the response of the
United States to any such threats and attacks.

The effects of, and changes in, federal, state and local laws, regulations
and policies affecting banking, securities, insurance and monetary and
financial matters.

The effects of changes in interest rates (including the effects of changes
in the rate of prepayments of the Company's assets) and the policies of
the Board of Governors of the Federal Reserve System.

The ability of the Company to compete with other financial institutions as
effectively as the Company currently intends due to increases in
competitive pressures in the financial services sector.

The inability of the Company to obtain new customers and to retain
existing customers.

The timely development and acceptance of products and services, including
products and services offered through alternative delivery channels such
as the Internet.

Technological changes implemented by the Company and by other parties,
including third party vendors, which may be more difficult or more
expensive than anticipated or which may have unforeseen consequences to
the Company and its customers.

The ability of the Company to develop and maintain secure and reliable
electronic systems.

The ability of the Company to retain key executives and employees and the
difficulty that the Company may experience in replacing key executives and
employees in an effective manner.

Consumer spending and saving habits which may change in a manner that
affects the Company's business adversely.

Business combinations and the integration of acquired businesses which may
be more difficult or expensive than expected.

The costs, effects and outcomes of existing or future litigation.

Changes in accounting policies and practices, as may be adopted by state
and federal regulatory agencies and the Financial Accounting Standards
Board.

The ability of the Company to manage the risks associated with the
foregoing as well as anticipated.

These risks and uncertainties should be considered in evaluating forward-
looking statements and undue reliance should not be placed on such statements.
Additional information concerning the Company and its business, including
other factors that could materially affect the Company's financial results, is
included in the Company's filings with the Securities and Exchange Commission.


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

OVERVIEW
--------
The Company's business activities currently consist of ownership of the Bank,
and investments in other equity securities.  The Bank's principal business
consists of attracting deposits from the public and investing these deposits,
together with funds generated from operations, primarily in commercial loans,
multi-family, commercial real estate loans, and consumer loans.  The Bank's
deposit accounts are insured to the maximum allowable by the Federal Deposit
Insurance Corporation (the "FDIC").

The Bank's results of operations are dependent primarily on net interest
income, which is the difference between the interest earned on its loans and
securities portfolios, and the interest paid on deposits and borrowed funds.
The Bank's operating results are also affected by loan commitment and
servicing fees, loan service release fees, customer service charges, fees from
annuity and insurance products, and other income.  Operating expenses of the
Bank include employee compensation and benefits, equipment and occupancy
costs, federal deposit insurance premiums and other administrative expenses.

The Bank's results of operations are further affected by economic and
competitive conditions, particularly changes in market interest rates.
Results are also affected by monetary and fiscal policies of federal agencies,
and actions of regulatory authorities.


FINANCIAL CONDITION
-------------------
Total assets increased by 3% to $604.2 million as of June 30, 2002, as
compared to $585.7 million at December 31, 2001. Total liabilities increased
by 3% to $557.7 million, as compared to $540.6 million as of December 31,
2001.  Stockholders' equity increased by 3% to $46.5 million, as compared to
$45.2 million as of December 31, 2001.

Cash and cash equivalents increased to $29.9 million at June 30, 2002 from
$6.6 million at December 31, 2001. The change was from the increase in
deposits and from the sale of multi-family loans in the latter part of April
2002. The funds will be used to pay off higher yielding purchased certificates
of deposits and Federal Home Loan Bank term advances.

Securities increased by 26% to $65.9 million from $52.2 million as of December
31, 2001. U.S. government agencies increased 47% to $46.9 million from $31.9
million as of December 31, 2001. The issues consisted of Federal Home Loan
Bank Multi-Step Agencies with maturities out to 5 years, callable semi-
annually with coupon resets annually. Initial coupons range for 3.75% to
5.00%. Investments not used to secure public fund repurchase agreements and
deposits will be sold as needed to fund higher yielding variable rate loans.

Net loans receivable decreased 4% to $490.7 million as of June 30, 2002, as
compared to $509.6 million as of December 31, 2001.  It has been the Company's
strategy for the last year to concentrate on funding short-term adjustable
rate loans to minimize our exposure to rising interest rates. Commercial loans
increased to $51.8 million compared to $47.0 million as of December 31, 2001.
Commercial real estate loans decreased to $72.3 million compared to $79.4
million as of December 31, 2001. Construction loans decreased to $47.4 million
compared to $58.8 million as of December 31, 2001. The Company is not actively
expanding its new construction lending, but still is funding prior commitments
and expects to see an overall decrease in balances by year-end. Multi-family
loans increased slightly to $226.0 million compared to $223.4 million as of
December 31, 2001. The multi-family loan portfolio is comprised of adjustable
rate loans with floors established upon origination. The Company continues to
originate adjustable rate multi-family loans; however, prepayments with
regular payments exceeded the originations. In April 2002, the Company sold
$20.1 million of its multi-family loan portfolio to better position itself in
an increasing rate environment. The sale consisted of 5-year adjustable rate
loans where the rate is fixed for the first 5-year term and then reprice off
the 5-year Treasury index for the next five years.  There was no gain or loss
on the transactions and the loans were sold at 7% pass-through until the next
rate adjustment date. At the next rate adjustment date, the service fee will
be set at .25% and the pass through rate will be adjusted accordingly. The
gross coupon rates range from 7.25% to 9.625%. The overall average gross rate
was 8.00%.  The Company retains the servicing of the loans and a 50/50 split
of the prepayment fee was negotiated for the life of the contract. Mortgage
loans decreased to $55.6 million compared to $58.2 million as of December 31,
2001. Consumer loans decreased to $42.4 million compared to $46.3 million as
of December 31, 2001.

Total deposits increased 3% to $469.2 million as of June 30, 2002, as compared
to $456.0 million as of December 31, 2001. Savings deposits increased 42% to
$74.2 million compared to $52.1 million as of December 31, 2001. The High
Yield Money Market account decreased 14% to $98.3 million compared to $113.9
million as of December 31, 2001. The Company believes that the decrease in the
High Yield Money Market account is caused by the decline in the 91-day
Treasury Bill rate to which the account is indexed.  The Company also believes
that the decrease in the average High Yield Money Market account index rate to
1.72% caused the savings deposits to increase as the savings account rate
remained at a fixed 2.50%. Non-interest bearing checking accounts and interest
bearing checking accounts increased $3.4 million, or 11%, and $1.3 million, or
4%, respectively. The decrease in jumbo certificates of deposits by $9.0
million was offset by an increase in purchased certificates of deposit by
$10.2 million. The Company had not purchased any out-of-market certificates of
deposits since March 2002.  Certificates of deposit remained at relatively the
same level at $172.9 million.

Total borrowings increased 4% to $76.2 million compared to $73.4 million as of
December 31, 2001. Short-term borrowings decreased $2.2 million. Included in
short-term borrowings is a $2.2 million note incurred in connection with the
Company's stock repurchase program.  This borrowing will be repaid from the
dividends from the Bank over the next several quarters. Long-term borrowings
increased $5.0 million. An 18-month advance was taken in January 2002 to fund
loan growth. Long-term borrowings consisted of FHLB Term Advances and are the
primary source of funding subject to collateral availability.

Stockholders' equity totaled $46.5 million at June 30, 2002. The number of
shares outstanding excluding unallocated Employee Stock Ownership Plan shares
was 3,415,398 and the book value per common share outstanding was $13.62.

On February 22, 2002, the Employee Stock Ownership Plan purchased 81,477
shares of CoVest Bancshares, Inc. common stock, held in the Company's
treasury, for an aggregate purchase price of $1,500,000, or $18.41 per share.
A new loan, internally financed, in the amount of $1.5 million plus interest
will be repaid over a period of fifteen years from earnings generated by the
Company. $50,000 plus interest have been paid during the first six months of
2002.

The Company announced its 24th stock repurchase program on March 29, 2002,
enabling the Company to repurchase 100,000 shares of its outstanding stock.
The repurchase was completed on June 18, 2002.  A total of 100,000 shares were
repurchased at an average price of $21.32.

The Company announced its 25th stock repurchase program on June 18, 2002,
enabling the Company to repurchase 100,000 shares of its outstanding stock.  A
total of 5,476 shares were repurchased at an average price of $22.04.

At June 30, 2002, the allowance for loan losses was $6.6 million as compared
to $6.5 million as of December 31, 2001. The Company recognized net charge-
offs of $533,000 and provided an additional $636,000 during the first six
months of 2002. Management believes that the allowance for loan losses at June
30, 2002, was at a level adequate to absorb probable incurred losses on
existing loans. However, there can be no assurance that such losses will not
exceed estimated amounts.

At June 30, 2002, total non-performing loans amounted to $2,285,000, or 0.38%
of total assets compared to $2,538,000, or 0.43% of total assets at December
31, 2001. A $1,540,000 motel property in Wisconsin that had been categorized
as a non-accrual loan as of December 31, 2001, was foreclosed on and sold in
April, 2002. An additional $240,000 of this loan was charged-off prior to its
move to Other Real Estate Owned. A $1,426,000 multi-family loan was classified
in non-accrual status in June 2002. The Company charged off $159,000 of this
loan during the second quarter.

The Company had no impaired loans as of June 30, 2002.

Total Other Real Estate Owned increased to $746,000 at June 30, 2002 compared
to $661,000 as of December 31, 2001.  The properties represent one single-
family property for $85,000 and an undeveloped commercial real estate property
in Chicago for $661,000. The Company has received purchase contracts on both
properties and expects no losses.


The following table sets forth the amounts and categories of non-performing
loans and assets.

                                         JUNE 30, 2002     DEC 31, 2001
                                         -------------     ------------
                                            (Dollars in Thousands)
Non-accruing Loans:
  Commercial Loans                          $    -          $     -
  Multi-family Loans                         1,426                -
  Commercial Real Estate Loans                   -            1,540
  Construction Loans                             -               48
  Commercial/Municipal Leases                    -                -
  Mortgage Loans                               491              668
  Consumer                                      17               43
                                            ------           ------
  Total                                      1,934            2,299

Accruing Loans Delinquent 90 days or More:
  Commercial Loans                          $    -          $     -
  Multi-family Loans                             -                -
  Commercial Real Estate Loans                   -              100
  Construction Loans                             -                -
  Commercial/Municipal Leases                    -               20
  Mortgage Loans                               301              119
  Consumer                                      50                -
                                            ------           ------
  Total                                        351              239
                                            ------           ------
      Total Non-performing Loans            $2,285           $2,538


Other Real Estate Owned                        746              662
Other Repossessed Assets                         -                -
                                            ------           ------
      Total Non-performing Assets           $3,031           $3,200
                                            ======           ======
Total Non-performing Loans as
  a Percentage of Net Loans                   0.47%            0.50%
                                              ====             ====
Total Non-performing Assets as
  a Percentage of Total Assets                0.50%            0.55%
                                              ====             ====


LIQUIDITY
---------
The Company's primary sources of funds are deposits, principal and interest
payments on loans and mortgage-backed securities, and funds provided by other
operations. While scheduled loan and mortgage-backed securities repayments and
maturities of short-term investments are a relatively predictable source of
funds, deposit flows and loan prepayments are greatly influenced by general
interest rates, economic conditions, competition and the restructuring
occurring in the banking industry.

The Company's cash flows are a result of three principal activities: operating
activities, investing activities and financing activities. Net cash provided
by operating activities was $4.7 million, for the six months ended June 30,
2002.  Net cash provided by investing activities was $4.7 million for the six
months ended June 30, 2002. Net cash provided by financing activities was
$13.9 million for the six months ended June 30, 2002.

The Company uses its liquidity to meet its ongoing commitments to fund
maturing certificates of deposit and deposit withdrawals, repay borrowings,
fund existing and continuing loan commitments, and pay operating expenses. At
June 30, 2002, the Company has commitments to originate loans totaling $36
million and its customers had approved but unused lines of credit totaling $38
million. The Company considers its liquidity and capital resources to be
adequate to meet its foreseeable short and long-term needs. The Company
expects to be able to fund or refinance, on a timely basis, its material
commitments and long-term liabilities.


SELECTED RATIOS
---------------
                                        THREE MONTHS ENDED    SIX MONTHS ENDED
                                          JUNE 30, JUNE 30,   JUNE 30, JUNE 30,
                                             2002     2001       2002     2001
                                           ------    -----     ------   ------
Annualized Return on Avg. Equity            14.61%   10.73%     14.38%   11.31%
Annualized Return on Avg. Equity (Core)*    14.61    10.73      14.38    10.28
Annualized Return on Avg. Assets             1.11     0.91       1.10     0.95
Annualized Return on Avg. Assets (Core)*     1.11     0.91       1.10     0.86
Book Value per Share                       $13.62   $12.92     $13.62   $12.92
Closing Market Price per Share             $22.46   $15.32     $22.46   $15.32

Earnings per Primary Share:
   Basic                                    $0.49    $0.34      $0.96    $0.71
   Basic (Core)*                            $0.49    $0.34      $0.96    $0.65
   Diluted                                  $0.47    $0.33      $0.91    $0.70
   Diluted (Core)*                          $0.47    $0.33      $0.91    $0.64

Net Interest Margin                          3.54%    3.48%      3.73%    3.41%
Ratio of Operating Expense to
   Average Total Assets, Annualized          2.37%    2.54%      2.47%    2.39%
Ratio of Net Interest Income to
   Non-Interest Expense                      1.44x    1.32x      1.45x    1.37x


* Core net income: Net income, adjusted for the after tax effect of the gain of
sale of loans, that occurred in the first quarter of 2001.


RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2002 AND 2001
-----------------------------------------------------------------------------
Net income was $1,680,000 for the second quarter of 2002, up 28% over
$1,312,000 for the same period in 2001. Basic earnings per share were $0.49, a
44% increase compared to $0.34 for the second quarter of 2001. Diluted
earnings per share were $0.47, a 42% increase compared to $0.33 for the second
quarter of 2001.

Return on average equity and return on average assets during the second
quarter of 2002 were 14.61% and 1.11% respectively, compared to 10.73% and
0.91% for the second quarter in 2001.

The Company's efficiency ratio improved to 55.89% compared to 61.39% in the
second quarter of 2001. The Company's goal is to maintain an efficiency ratio
at lower than 56% for 2002.

Cash earnings (net income adjusted for the after tax impact of amortization of
goodwill) for the second quarter of 2002 were $1,711,000, or $0.50 (basic) and
$0.48 (diluted) earnings per share, compared to $1,343,000, or $0.35 (basic)
and $0.34 (diluted) earnings per share for the same period in 2001.

Net interest income for the second quarter of 2002 increased $327,000, or 7%
compared to the same period in 2001.  The increase in net interest income can
be attributed to the Company being in a liability sensitive position, where
liabilities reprice faster than assets, in 2001 when rates were declining.
The net interest spread for the second quarter of 2002 was 3.17% compared to
2.85% for the same period in 2001. The weighted average yield on interest-
earning assets was 6.25% for the second quarter of 2002, a decrease of 149
basis points compared to 7.74% in 2001. The weighted average cost of interest-
bearing liabilities was 3.08% for the second quarter of 2002, a decrease of
181 basis points compared to 4.89% in 2001. The sale of the $54 million of the
mortgage loan portfolio in March 2001 provided the Company with funds to
payoff higher cost borrowings and afforded the Company the opportunity to
price its deposits moderately.  The increase in average non-interest bearing
deposits by $4.7 million, or 17%, also contributed to this situation. Net
interest margin was 3.54% for the second quarter of 2002 compared to 3.48% for
the same period in 2001. The Company is currently asset sensitive.

The Company's total interest income (tax equivalent) on earning assets
decreased 15% to $9,134,000 for the second quarter of 2002 compared to
$10,801,000 for the same period in 2001. Average balance of interest earning
assets increased 5% to $584.2 million for the second quarter of 2002 compared
to $558.3 million for the same period in 2001. The Federal Reserve's rate
reductions in 2001 caused a decrease in the Company's loan index rates and
prompted prepayments in the loan portfolio, particularly in the multi-family
loan portfolio, which is mostly comprised of adjustable rate loans with floors
established upon origination. Loan costs associated with the sale of the $20.1
million from the multi-family loan portfolio amounted to $139,000. Loan costs
associated with loan prepayments in the multi-family loan portfolio amounted
to $78,000. Average yield earned on loans for the second quarter of 2002 was
6.55%, a 160 basis point decrease compared to 8.15% for the same period in
2001. Average yield earned on investment securities for the second quarter of
2002 was 5.12%, an 80 basis point decrease compared to 5.92% for the same
period in 2001. Other investments, which is comprised of overnight
investments, yielded 1.61% for the second quarter, a 260 basis point decrease
compared to 4.21% in 2001. The increased volume of loans and investments
partially offset the effect of the income reduction from falling interest
rates.

It has been the Company's strategy for the last year to concentrate of funding
short-term adjustable rate loans to minimize our exposure to rising interest
rates. The Company sold $20.1 million of its multi-family loan portfolio in
April 2002 to better position itself in an increasing rate environment. The
sale consisted of 5-year adjustable rate loans where the rates are fixed for
the first 5-year term and then reprice off the 5-year Treasury index for the
next five years.  The loans were sold at 7% pass through until the next rate
adjustment date, where the service fee will be set at .25% and the pass
through rate will be adjusted accordingly. The gross coupon rates range from
7.25% to 9.625%. The Company desires to originate prime based rate multi-
family loans, as a result, payoffs from normal business have exceeded
originations. The liquidity from the sale will enable the Company to price its
deposits moderately. In July 2002, the Company prepaid a $6 million FHLB Term
Advance maturing October 2002 at a rate of 2.39%.

Total interest expense decreased 33% to $3,961,000 for the second quarter of
2002 compared to $5,940,000 for the same period in 2001. The average cost of
deposits was 2.92% for the second quarter of 2002, a 185 basis point decrease
compared to 4.77% for same period of 2001. The average costs of certificates
of deposit, jumbo CDs and purchased CDs reduced by 213, 346 and 277 basis
points respectively. The sale of the $54 million in the mortgage loan
portfolio in March 2001 provided liquidity and afforded the Company the
opportunity to price its deposits moderately and lower than market. The
average cost of borrowings decreased to 3.99%, a 180 basis point decrease
compared to 5.79% for the second quarter of 2001.   The cost of FHLB Term
Advances decreased by 200 basis points in the second quarter of 2002. The
Company was able to pay off its higher cost advances in the early part of 2001
and took on advances in the latter part of 2001 when rates were lower.

The provision for loan losses was $164,000 for the second quarter of 2002, a
34% decrease compared to $250,000 for the same period in 2001. The Company
provided for loan losses equal to net charge-offs for the second quarter of
2002.

On a quarterly basis, management of the Company meets to review the adequacy
of the Allowance for Loan Losses. Each loan officer grades his or her
individual commercial credits and the Company's outsourced loan review
function validates the officer's grades. In the event that loan review results
in a downgrade of the loan, it is included in the allowance analysis at the
lower grade. The grading system is in compliance with the regulatory
classification and the allowance allocated to the loans based on the
regulatory grading, except in instances where there are known differences
(i.e. collateral value is nominal, etc.) Once the specific portion of the
allowance is calculated, management then calculates an historical portion for
each loan category based on loan loss history, current economic conditions and
trends in the portfolio, including delinquencies and impairments.




LOAN LOSS ALLOWANCE ANALYSIS.  The following table sets forth an analysis of
the Company's allowance for loan losses for the periods indicated.

                                            THREE MONTHS ENDED
                                            JUNE 30,   JUNE 30,
                                              2002        2001
                                           ----------  ----------
                                           (Dollars in Thousands)

Balance at Beginning of Period               $6,650     $5,545
Charge-offs:

  Commercial Loans                                -          -
  Multi-family Loans                            159          -
  Commercial Real Estate Loans                    -          -
  Construction Loans                              -          -
  Commercial/Municipal Leases                     -          -
  Mortgage Loans                                  -          -
  Consumer                                       21         58
                                             ------     ------
  Charge-offs Total                             180         58

Recoveries:

  Commercial Loans                                8          -
  Multi-family Loans                              -          -
  Commercial Real Estate Loans                    -          -
  Construction Loans                              -          -
  Commercial/Municipal Leases                     -          -
  Mortgage Loans                                  -          -
  Consumer                                        8         15
                                             ------     ------
  Recoveries Total                               16         15
                                             ------     ------
  Net Charge-offs                               164         43


Additions Charged to Operations                 164        250
                                             ------     ------
Balance at End of Period                     $6,650     $5,752
                                             ======     ======
Ratio of Net Charge-offs During
  the Period to Average Loans
  Outstanding During the Period                0.03%      0.01%

Ratio of Allowance for Loan
  Losses to Non-performing Loans               2.91x      1.69x

Ratio of Allowance for Loan
  Losses to Total Outstanding Loans            1.34%     1.19%


Non-interest income increased  $106,000, a 9% increase to $1,253,000 for the
second quarter of 2002 compared to $1,147,000 for the same period in 2001.
Loan prepayment fees increased $202,000, mostly from prepayments in the multi-
family loan portfolio. Loan charges and servicing fees decreased $52,000,
mostly due to a decrease in the investor servicing fees. The low interest rate
environment continues to generate payoffs of mortgage loans. Document
preparation fees decreased $27,000. Mortgage banking fees decreased $66,000
due to lower mortgage loan originations during the second quarter of 2002,
compared to that in 2001. Deposit related charges and fees, and other income,
remained relatively the same for both periods.  The increase in non-interest
bearing checking accounts was centered in corporate checking accounts.  The
increase in service fees on account analysis was offset by a decrease in NSF
fees. Also included in other income for the second quarter of 2002 was $65,000
representing interest on 1992 and 1993 State of Illinois income tax refunds.

Non-interest expense decreased $86,000, a 2% decrease to $3,573,000 for the
second quarter of 2002 compared to $3,659,000 for the same period in 2001.
Compensation and benefits increased $199,000. Full time equivalent number of
employees remained at 133 for both periods. Base compensation increased
$43,000. Group medical insurance increased $126,000 due to the Company's
accruing for maximum claims level.  The Company incurred $25,000 for the
principal payment of the ESOP loan. Commissions and incentives decreased
$140,000 due to fewer mortgage loan originations. Advertising expense
decreased $51,000. Professional fees decreased $51,000 mainly due to smaller
legal expenses in the second quarter of 2002. Loan related expenses decreased
$21,000. Other real estate owned related expenses decreased $10,000.

Income tax expense for the second quarter of 2002 increased $237,000 to
$976,000, compared to $739,000 for the same period in 2001. The effective tax
rate was 37% for the second quarter of 2002 and 36% for the second quarter of
2001.


RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2002 AND 2001
------------------------------------------------------------------------------
Net income increased $546,000, or 20%, to $3,293,000 for the first six months
of 2002 compared to $2,747,000 for the same period in 2001. Basic earnings per
share were $0.96, a 35% increase compared to $0.71 per share for the same
period in 2001. Diluted earnings per share were $0.91, a 30% increase compared
to $0.70 for the same period in 2001. Included in net income for 2001 was a
$407,000 pretax gain on sale of single family mortgages. Core net income (net
income adjusted for the after tax effect of the gain on sale of loans) was
$2,498,000 for the first six months of 2001, or $0.65 (basic) and $0.64
(diluted) per share. Basic earnings and diluted earnings per share for the
first six months of 2002 increased 48% and 42% respectively, as compared to
the same period in 2001 on core earnings.

Return on average equity and return on average assets for the first six months
of 2002, were 14.38% and 1.10% respectively, compared to 11.31% and 0.95% for
the same period in 2001. Return on average equity and return on average assets
for the first half of 2001, without the gain on sale of mortgage loans, were
10.28% and 0.86% respectively.

The Company's efficiency ratio improved to 55.86% compared to 59.11% for the
first six months of 2001. The Company's goal is to maintain an efficiency
ratio of below 56% for 2002.

Cash earnings (net income adjusted for the after tax impact of amortization of
goodwill) for the first six months of 2002 were $3,355,000, or $0.98 (basic)
and $0.93 (diluted) earnings per share, compared to $2,809,000, or $0.73
(basic) and $0.72 (diluted) earnings per share for 2001. Core cash earnings
(net income, exclusive of the gain on sale of loans, adjusted for the after
tax impact of amortization of goodwill) for the first six months of 2001, were
approximately $2,560,000, or $0.66 (basic) and $0.65 (diluted) earnings per
share.

Net interest income for the first six months of 2002 increased $1,248,000, or
13%, to $10,743,000 compared to $9,495,000 for the same period in 2001.
Interest income decreased 15% while interest expense decreased 36% for the
first six months of 2002 as compared to the same period in 2001. Average yield
on average interest earning assets was 6.49%, a 139 basis point decrease from
7.88% for 2001. Average cost on interest bearing liabilities was 3.13%, a 198
basis point decrease from 5.11% for 2001. Net interest spread for the first
six months of 2002 was 3.36% compared to 2.77% for the same period in 2001.
Net interest margin was 3.73% for the first six months in 2002 compared to
3.41% in 2001. The increase in non-interest bearing deposits by $5.6 million,
or 22%, contributed to the increase in interest margin.

The Company's total interest income (tax equivalent) on earning assets
decreased 15% to $18,807,000 for the first six months of 2002 compared to
$22,166,000 for the same period in 2001. The average balance of interest
earning assets increased 3% for the first six months of 2002. The increase in
loans was partially offset by a decrease in overnight investments.  The
Federal Reserve's interest rate cuts in 2001 caused a decrease in the
Company's loan index rates. Average yield on loans decreased to 6.72%, a 148
basis point decrease compared to 2001. Average yield on investments in
securities decreased to 5.20%, an 84 basis point decrease compared to that in
2001. Average yield on other investments, which is comprised of overnight
investments, decreased to 1.60%, a 273 basis point decrease compared to 2001.

It has been the Company's strategy for the last year to concentrate of funding
short-term adjustable rate loans to minimize our exposure to rising interest
rates. The Company sold $20.1 million of its multi-family loan portfolio in
April 2002 to better position itself in an increasing rate environment. The
sale consisted of 5-year adjustable rate loans where the rates are fixed for
the first 5-year term and then reprice off the 5-year Treasury index for the
next five years.  The loans were sold at 7% pass through until the next rate
adjustment date, where the service fee will be set at .25% and the pass
through rate will be adjusted accordingly. The gross coupon rates range from
7.25% to 9.625%. The Company desires to originate prime based rate multi-
family loans, as a result, payoffs from normal business have exceeded
originations. The liquidity from the sale will enable the Company to price its
deposits moderately. In July 2002, the Company prepaid a $6 million FHLB Term
Advance maturing October 2002 at a rate of 2.39%.

Total interest expense decreased 36% to $7,998,000 for the first six months of
2002 compared to $12,576,000 for the same period in 2001. The average balance
of interest bearing deposits slightly increased by $2.0 million in the first
six months of 2002 compared to the same period in 2001. The average cost of
deposits decreased to 2.98%, a 200 basis point decrease from 4.98% for the
same period in 2001. The average balance on the High Yield Money Market
account decreased while the average balance on savings accounts increased. The
Company believes that the decline in the 91-day Treasury Bill rate to which
the account is indexed caused the decline in the High Yield Money Market
Account. The Company also believes that consumers shifted their balances from
the High Yield Money Market account that averaged 1.72% to savings accounts
that remained fixed at 2.50%. The average balance of borrowings increased
$15.9 million while the average cost of borrowings decreased to 3.96%, a 199
basis point decrease from the same period in 2001.

The provision for loan losses was $636,000 for the first six months in 2002
compared to $500,000 for the same period in 2001. The increase in the
commercial loans and multi-family loans portfolio along with the net charge-
offs of $533,000 prompted the Company to increase its provision for loan
losses. Management believes that the allowance for loan losses at June 30,
2002, was at a level adequate to absorb probable incurred losses on existing
loans. However, there can be no assurance that such losses will not exceed
estimated amounts.

On a quarterly basis, management of the Company meets to review the adequacy
of the Allowance for Loan Losses.  Each loan officer grades his or her
individual commercial credits and the Company's outsourced loan review
function validates the officers' grades.  In the event that loan review
results in a downgrade of the loan, it is included in the allowance analysis
at the lower grade.  The grading system is in compliance with the regulatory
classifications and the allowance is allocated to the loans based on the
regulatory grading, except in instances where there are known differences
(i.e. collateral value is nominal, etc.)  Once the specific portion of the
allowance is calculated, management then calculates a historical portion for
each loan category based on loan loss history, current economic conditions and
trends in the portfolio, including delinquencies and impairments. As a result
of this analysis, management believes that the allowance for estimated losses
on loans at June 30, 2002 was at a level adequate to absorb probable incurred
losses on existing loans, although there can be no assurance that such losses
will not exceed the estimated amounts.

LOAN LOSS ALLOWANCE ANALYSIS.  The following table sets forth an analysis of
the Company's allowance for possible loan losses for the periods indicated.

                                              SIX MONTHS ENDED
                                            JUNE 30,    JUNE 30,
                                               2002       2001
                                           ----------  ----------
                                           (Dollars in Thousands)

Balance at Beginning of Period               $6,547     $5,655
Charge-offs:

  Commercial Loans                               20          -
  Multi-family Loans                            159          -
  Commercial Real Estate Loans                  240        271
  Construction Loans                              -          -
  Commercial/Municipal Leases                     -          -
  Mortgage Loans                                 49          -
  Consumer                                       87        161
                                             ------     ------
  Charge-offs Total                             555        432

Recoveries:

  Commercial Loans                               10          -
  Multi-family Loans                              -          -
  Commercial Real Estate Loans                    -          -
  Construction Loans                              -          -
  Commercial/Municipal Leases                     -          -
  Mortgage Loans                                  -          -
  Consumer                                       12         29
                                             ------     ------
  Recoveries Total                               22         29
                                             ------     ------
  Net Charge-offs                               533        403


Additions Charged to Operations                 636        500
                                             ------     ------
Balance at End of Period                     $6,650     $5,752
                                             ======     ======
Ratio of Net Charge-offs During
  the Period to Average Loans
  Outstanding During the Period                0.10%      0.08%

Ratio of Allowance for Possible
  Loan Losses to Non-performing Loans          2.91x      1.69x


Non-interest income increased $224,000, or 10% for the first six months of
2002 compared to the same period in 2001. Core non-interest income, excluding
the $407,000 gain on sale of loans in 2001 was $1,858,000. Non-interest income
for the first six months of 2002 increased $631,000 compared to core non-
interest income for the same period in 2001. Loan prepayment fees increased
$618,000.  Deposit related charges and fees increased $54,000. Net gain on
sale of securities increased $106,000. In 2001, the Company had a $32,000 loss
on the sale of securities.  Loan charges and servicing fees decreased $32,000.
Mortgage banking fees decreased $92,000. CoVest Investments income decreased
$23,000. Other income was at the same level for the first six months of 2002
and 2001. NACC income decreased $60,000 as the credit card servicing
relationship was terminated in February 2002. Other income increased $67,000,
which included $65,000 representing partial interest on 1992 and 1993 State of
Illinois income tax refund.

Non-interest expense increased $441,000, or 6%, for the first six months of
2002 compared to the comparable period in 2001. Compensation and benefits
increased $532,000. Base compensation increased $140,000. Medical insurance
increased $273,000 as the Company is accruing for the maximum claims
liability.  Principal related to the ESOP loan, amounted to $50,000 for the
first six months of 2002. Employer taxes increased $58,000. 401K employer
match increased $13,000. Education and training increased $30,000 while
employee relation expenses decreased $15,000. Commissions and incentives
decreased $284,000 due to fewer mortgage loan originations in the first six
months of 2002 compared to the same period in 2001. Expenses on other real
estate owned assets increased $192,000, which was comprised of back taxes,
foreclosure expenses and expenses incurred in selling the properties. Data
processing expenses increased $28,000 due to check imaging being introduced in
the third quarter of 2001. Professional services decreased $29,000. Loan
related expenses decreased $24,000. General and administrative expenses
increased $7,000.

Income tax expense increased $349,000 to $1,911,000 for the six month period
ending June 30, 2002, compared to $1,562,000 for the same period in 2001. The
effective tax rate was 37% for the six months ended June 30, 2002 as compared
to 36% for the six months ended June 30, 2001.


QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.  In an attempt to
manage the Company's exposure to changes in interest rates, management
closely monitors the Company's interest rate risk.

Interest rate risk results when the maturity or repricing intervals and
interest rate indices of the interest-earning assets, interest-bearing
liabilities, and off-balance sheet financial instruments are different,
creating a risk that changes in the level of market interest rates will
result in disproportionate changes in the value of, and the net earnings
generated from, the Company's interest-earning assets, interest-bearing
liabilities, and off-balance sheet financial instruments. The Company's
exposure to interest rate risk is managed primarily through the Company's
strategy of selecting the types and terms of interest-earning assets and
interest-bearing liabilities which generate favorable earnings, while
limiting the potential negative effects of changes in market interest rates.
Since the Company's primary source of interest-bearing liabilities is
customer deposits, the Company's ability to manage the types and terms of
such deposits may be somewhat limited by customer preferences in the market
areas in which the Company operates. Borrowings, which include FHLB advances,
short-term borrowings, and long-term borrowings, are generally structured
with specific terms which in management's judgment, when aggregated with the
terms for outstanding deposits and matched with interest-earning assets,
mitigate the Company's exposure to interest rate risk. The rates, terms and
interest rate indices of the Company's interest-earning assets result
primarily from the Company's strategy of investing in loans and securities (a
substantial portion of which have adjustable-rate terms) which permit the
Company to limit its exposure to interest rate risk, together with credit
risk, while at the same time achieving a positive interest rate spread from
the difference between the income earned on interest-earning assets and the
cost of interest-bearing liabilities.

The Company has been setting floors on its non-retail adjustable rate loans
as a protection in a falling rate environment since the introduction of that
type of product to its loan mix.  On October 9, 2001, the Company entered
into an Interest Rate Cap Agreement with Morgan Keegan for a notional amount
of $10 million for three years, against the 91 day Treasury Bill rate, at the
strike rate of 4.50%.  The Company paid a fixed amount of $113,000 covering
the entire 3-year agreement.  A weekly weighted average calculation will be
used to determine Morgan Keegan's position and will be liable for the
difference when the 91 day Treasury Bill rate exceeds 4.50%.  The Company
believes that the move will help cushion the impact of rising rates,
particularly on the High Yield Money Market account that is indexed to the
weekly 91 day Treasury Bill auction.  The derivative instrument is recorded
at its fair value and any change in fair value of the derivative is recorded
in interest expense.

In addition to periodic gap reports comparing the sensitivity of interest-
earning assets and interest-bearing liabilities to changes in interest rates,
management utilizes a monthly report ("model") prepared by the Bank which
measures the Bank's exposure to interest rate risk.  The model calculates the
present value of assets, liabilities, off-balance sheet financial
instruments, and equity at current interest rates, and at hypothetical higher
and lower interest rates at one percent intervals.  The present value of each
major category of financial instrument is calculated by the model using
estimated cash flows based on weighted average contractual rates and terms at
discount rates representing the estimated current market interest rate for
similar financial instruments.  The resulting present value of longer term
fixed-rate financial instruments are more sensitive to change in a higher or
lower market interest rate scenario, while adjustable-rate financial
instruments largely reflect only a change in present value representing the
difference between the contractual and discounted rates until the next
interest rate repricing date.


The following table presents the Company's exposure for the next twelve
months, to hypothetical changes in interest rates at the dates indicated.


                            JUNE 30, 2002

   Change in                                        Percent Change in
 Interest Rates            Percent Change in        MV of Portfolio
  (basis points)          Net Interest Income            Equity
----------------         ---------------------     -------------------
     +200                         +7%                      -5%

     +100                         +3                       -2

        0                          0                        0

     -100                         -5                       +1

     -200                         -6                       +5


                            JUNE 30, 2001

   Change in                                        Percent Change in
 Interest Rates            Percent Change in        MV of Portfolio
  (basis points)          Net Interest Income            Equity
----------------         ---------------------     -------------------
     +200                         -5%                      -5%

     +100                         -3                       -3

        0                          0                        0

     -100                         +3                       +5

     -200                         +7                      +12


The following table presents the Company's cumulative gap position as of the
dates indicated:
                            JUNE 30, 2002              JUNE 30, 2001
                           ---------------            --------------
(Dollars in Thousands)

      92 days                  $44,859                   ($40,609)
     184 days                  $43,048                   ($76,113)
     365 days                  $28,135                   ($82,414)


Gap represents the difference of repricing opportunities between the Company's
assets and liabilities for the next twelve months.

Certain shortcomings are inherent in the method of analysis presented in the
foregoing table.  For example, although certain assets and liabilities may
have similar maturities or periods to repricing, they may react in different
degrees to changes in market interest rates.  Also, the interest rates on
certain types of assets and liabilities may fluctuate in advance of changes in
market interest rates, while interest rates on other types may lag behind
changes in market rates. Additionally, certain assets, such as adjustable-rate
mortgage loans, have features that restrict changes in interest rates on a
short-term basis and over the life of the loan.  Further, in the event of a
change in interest rates, prepayment and early withdrawal levels could deviate
significantly from those assumed in calculating the tables.  Finally, the
ability of many borrowers to service their debt may decrease in the event of a
significant interest rate increase.

In addition, the previous table does not necessarily indicate the impact of
general interest rate movements on the Company's net interest income because
the repricing of certain categories of assets and liabilities are subject to
competitive and other pressures beyond the Company's control.  As a result,
certain assets and liabilities indicated as maturing or otherwise repricing
within a stated period may in fact mature or reprice at different times and at
different volumes.


PART II - OTHER INFORMATION
COVEST BANCSHARES, INC.


ITEM 1.  LEGAL PROCEEDINGS
         There are no material pending legal proceedings to which the Company
         or any of its subsidiaries is a party other than ordinary routine
         litigation incidental to their respective businesses.


ITEM 2.  CHANGES IN SECURITIES
         None


ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
         None


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

On April 23, 2002, the annual meeting of stockholders was held.
George T. Drost and David M. Miller were elected to serve as Class I
directors with terms expiring in 2005.  Continuing to serve as Class
II directors with terms expiring 2003 are James L. Roberts and Frank
A. Svoboda, Jr.  Continuing to serve as Class III directors with
terms expiring 2004 are Gerald T. Niedert and David B. Speer.  The
stockholders also ratified the appointment of Crowe, Chizek and
Company L.L.P., as the Company's independent public accountants for
the year ending December 31, 2002.

There were 3,452,177 issued and outstanding shares (4,403,803 issued,
less 870,149 shares of treasury stock and 81,477 shares of
unallocated ESOP shares) of Common Stock at the time of the annual
meeting.  3,062,292 shares were voted at the meeting.  The voting on
each item presented at the annual meeting was as follows:

Election of Directors             FOR             WITHHELD
---------------------             ---             --------
George T. Drost                3,056,515           5,776
David M. Miller                3,053,690           8,601

Ratification of Accountants
---------------------------

    FOR         AGAINST           ABSTAIN          BROKER NON VOTES
    ---         -------           -------          ----------------
3,050,944         2,977             8,371               -0-


ITEM 5.  OTHER INFORMATION
         None



ITEM 6.  EXHIBITS AND REPORTS

     (a) Exhibits

Exhibit 10.1
Amendment 2002-1 to CoVest Bancshares, Inc. 1992 Stock Option and
Incentive Plan

Exhibit 10.2
Amendment 2002-1 to CoVest Bancshares, Inc. 1996 Stock Option and
Incentive Plan

Exhibit 10.3
Amendment to Employment Agreement between CoVest Bancshares, Inc. and
James L. Roberts dated January 20, 1999

Exhibit 10.4
Amendment to Employment Agreement between CoVest Bancshares, Inc. and
Paul A. Larsen dated April 27, 1999

Exhibit 10.5
Amendment to Agreement Regarding Post Employment Restrictive
Covenants between CoVest Bancshares, Inc., CoVest Banc, National
Association and Paul A. Larsen dated April 27, 1999

Exhibit 10.6
Amendment to Agreement Regarding Post Employment Restrictive
Covenants between CoVest Bancshares, Inc., CoVest Banc, National
Association and J. Stuart Boldry, Jr. dated December 31, 1999

Exhibit 10.7
Change of Control and Non-Compete Agreement between CoVest
Bancshares, Inc. and Joseph J. Gillings dated June 4, 2002


(b) Reports on Form 8-K

A report on Form 8-K was filed on April 23, 2002 to report under Item
5 the Company's earnings for the first quarter of 2002.

A report on Form 8-K was filed on May 21, 2002 to report under Item 5
the declaration of a regular quarterly dividend.

A report on Form 8-K was filed on June 18, 2002 to report under Item
5 the completion of the 24th stock repurchase program and the
announcement of the 25th stock repurchase program.




                             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.



COVEST BANCSHARES, INC.



DATED: JULY 23, 2002






BY:     /s/ JAMES L. ROBERTS
        JAMES L. ROBERTS
        PRESIDENT AND
        CHIEF EXECUTIVE OFFICER






BY:     /s/ PAUL A. LARSEN
        PAUL A. LARSEN
        EXECUTIVE VICE PRESIDENT,
        TREASURER AND
        CHIEF FINANCIAL OFFICER