<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

                   Annual report pursuant to Section 13 of the
                         Securities Exchange Act of 1934

                    For the fiscal year ended March 31, 2002

                          Commission File No.: 0-25504


                             WEST TOWN BANCORP, INC.
             (exact name of registrant as specified in its charter)


                    DELAWARE                             36-3962962
         (State or other jurisdiction of         (I.R.S. Employer Id. No.)
          incorporation or organization)


                  4852 West 30th Street, Cicero, Illinois 60804
                    (Address of principal executive offices)


       Registrant's telephone number, including area code: (708) 652-2000
        Securities registered pursuant to Section 12(b) of the Act: None
           Securities registered pursuant to Section 12(g) of the Act:

                     Common Stock, par value $0.01 per share
                                (Title of class)


         The registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days.

                  Yes  X                    No ___
                      ---


         Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB.  X
                               ---

         As of May 31, 2002 there were issued and outstanding 205,397 shares of
the Registrant's common stock which is traded over the counter through the
National Daily Quotation System "Pink Sheet" published by the National Quotation
Bureau, Inc. The aggregate market value of the voting stock held by
non-affiliates of the Registrant based on the estimated value of the stock on
May 31, 2002 was $2,464,764 (205,397 shares at $12 per share). For purposes of
this calculation directors and officers of the Registrant are considered
non-affiliates of the Registrant.

                       DOCUMENTS INCORPORATED BY REFERENCE

         The Annual Report to Stockholders for the year ended March 31, 2002 is
incorporated by reference into Part II of this Form 10-KSB.

         The Proxy Statement for the 2002 Annual Meeting of Stockholders is
incorporated by reference into Part III of this Form 10-KSB.

<PAGE>

                                      INDEX

PART I                                                                     PAGE
                                                                           ----

Item 1.  Business .......................................................    1

Additional Item.  Executive Officers of the Registrant ..................   27

Item 2.  Properties .....................................................   27

Item 3.  Legal Proceedings ..............................................   27

Item 4.  Submission of Matters to a Vote of Security Holders ............   27


PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder
         Matters ........................................................   27

Item 6.  Selected Financial Data ........................................   27

Item 7.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations ..........................................   27

Item 8.  Financial Statements and Supplementary Data ....................   27

Item 9.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure ...........................................   28


PART III

Item 10. Directors and Executive Officers of the Registrant .............   28

Item 11. Executive Compensation .........................................   28

Item 12. Security Ownership of Certain Beneficial  Owners and
         Management .....................................................   28

Item 13. Certain Relationships and Related Transactions .................   28


PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on
         Form 8-K .......................................................   29

Item 15. SIGNATURES .....................................................   30



<PAGE>

                                     PART I

Item I. Business.
-----------------

General

         West Town Bancorp, Inc. (also referred to as the "Company") was
incorporated under Delaware law on May 6, 1994. On March 1, 1995, the Registrant
acquired West Town Savings Bank (the "Bank") as a part of the Bank's conversion
from a mutual to a stock state chartered savings bank. The Registrant is a
savings bank holding company and is subject to regulation by the Office of the
Illinois Commissioner of Banks and Real Estate (the "OBRE"), the Federal Deposit
Insurance Corporation (the "FDIC") and the Securities and Exchange Commission
(the "SEC"). Currently, the Registrant does not transact any material business
other than through the Bank and West Town Insurance Agency, the Bank's
wholly-owned subsidiary. The Registrant received conversion proceeds amounting
to $1.9 million, of which $944,000 was utilized to acquire all of the capital
stock of the Bank. At March 31, 2002, the Company had total assets of $61.0
million and stockholders' equity of $4.2 million (7.0% of total assets).

         West Town Savings was originally organized in 1922 as an
Illinois-chartered savings and loan association. In 1992 it converted to an
Illinois chartered savings bank. The Bank is a member of the Federal Home Loan
Bank (the "FHLB") System and its deposit accounts are insured up to applicable
limits by the FDIC.

         The Bank's principal business has been and continues to be attracting
deposits from the general public and investing those deposits, together with
funds generated from operations, primarily in one-to-four family,
owner-occupied, fixed-rate loans and commercial real estate loans and to a
lesser extent, multi-family residential mortgage loans, land and construction
loans, mortgage-backed securities and other short-term investments, including
U.S. Government and federal agency securities and other marketable securities.
The Bank's revenues are derived principally from interest on its mortgage loan
and mortgage-backed securities portfolios and interest and dividends on its
investment securities. The Bank's primary sources of funds are deposits,
principal and interest payments on loans and mortgage-backed securities.

Market Area

         The Bank has been, and continues to be, a community-oriented savings
institution offering a variety of financial sources to meet the needs in the
community it serves. The Bank's deposit-gathering area is concentrated in the
neighborhoods surrounding its offices which are located in the Chicago suburbs
of Cicero and North Riverside, in Cook County. The Bank's lending base primarily
covers the same area. Management believes that its offices are located in
communities that can generally be characterized as stable, residential
neighborhoods of predominately one-to-four family residences, mixed with a
commercial segment of a diverse group of retail service businesses.

                                       -1-

<PAGE>

Lending Activities

         Loan and Mortgage-Backed Securities Portfolio Compositions. The loan
portfolio composition consists primarily of conventional fixed-rate,
first-mortgage loans secured by one-to-four family residences and, to a lesser
extent, multi-family residences. At March 31, 2002, the total loans outstanding
were $26.0 million, of which $15.0 million were one-to-four family residential
mortgage loans, or 57.8% of the loan portfolio. Of this amount, purchased
mortgage loans totaled approximately $9.7 million, or 64.9% of one-to-four
family loans. All purchased mortgage loans were originated in the Chicago
metropolitan area. At that same date, multi-family residential mortgage loans
totaled $1.0 million, or 4.0% of the loan portfolio.

         The Bank participates in a mortgage loan secured by commercial
properties located in the Chicago area. At March 31, 2002, the investment in
non-residential mortgage loans totaled approximately $1.1 million, or 4.4% of
the loan portfolio.

         During the current period, the Bank purchased a $980,000 participating
interest in a construction loan for the purpose of constructing a planned unit
development in Morton Grove, Illinois. It is anticipated that this project will
be completed by April 30, 2003. The Bank is also participating in a construction
loan for the purpose of constructing one-to-four family dwellings in Streamwood,
Illinois. The Bank's total commitment to this project totals $690,000, and is
scheduled to be repaid by June 30, 2003. At March 31, 2002, construction loans
totaled approximately $1.7 million, or 6.4% of the loan portfolio.

         On June 30, 2001, the Bank, through its wholly owned subsidiary, West
Town Insurance Agency, purchased 50,000 shares or 23.7% of the issued and
outstanding stock of Commercial Loan Corporation ("CLC") at a purchase price of
$125,000. CLC, which is owned by Chicagoland financial institutions, processes,
underwrites, documents and services commercial loans for financial institution
investors. The services performed by CLC include monitoring post closing
performance of the loan, preparation of loan summaries, ongoing analysis of the
performance of the loan and the borrower including review of financial and
operating statements of the borrower and collection and remittance of all loan
payments. CLC entered into a master loan participation agreement with each of
its shareholders or their affiliates, whereunder the investors, after performing
prudent underwriting, would purchase participations in pools offered by CLC. The
rates paid on the pools to the Bank ranged from 4.25% to 9.50% and consisted of
both fixed and variable rates. As of March 31, 2002 the Bank had purchased an
interest in the pools totaling approximately $6.7 million. Of this amount, $3.8
million or 14.6% of the total loan portfolio were secured lines of credit (total
credit line extended totaled approximately $6.2 million), $1.6 million or 6.2%
were secured by non-real estate business assets, and $1.3 million or 5.1% were
secured by commercial or investment real estate.

         Other loans, totaling approximately $1.0 million or 4.0% of total
loans, consisted of loans on deposit accounts and home improvement and auto
loans.

         The Company and its subsidiaries also invest in mortgage-backed
securities. At March 31, 2002, the amortized cost of total mortgage-backed
securities aggregated $22.5 million or 36.9% of total assets, of which .2% were
backed by adjustable rate mortgage ("ARM") loans and 99.8% were backed by
fixed-rate loans with expected durations of less than ten years. All of the
mortgage-backed securities at March 31, 2002 were insured or guaranteed by
either the Government National Mortgage Bank ("GNMA"), the Federal National
Mortgage Bank ("FNMA") or the Federal Home Loan Mortgage Corporation ("FHLMC"),
except for collateralized-mortgage obligations totaling approximately $2.5
million.

Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995

         Management's Discussion and Analysis of Financial Condition and Results
of Operations and Item 1 - Description of Business that are not historical facts
are forward-looking statements subject to the safe harbor created by the Private
Securities Litigation Reform Act of 1995. The Company cautions readers of this
Annual Report on form 10-KSB that a number of important factors could cause the
Company's actual results in 2002 and beyond to differ materially from those
expressed in any such forward-looking statements. These factors include, without
limitation the general economic and business conditions affecting the Company's
customers; changes in interest rates; the adequacy of the Bank's allowance for
loan losses; competition from, among others, commercial banks, savings and loan
associations, mutual funds, money market funds, finance companies, credit
unions, mortgage companies, and the United States Government; limited
partnership activities; federal and state legislation, regulation and
supervision of the Bank and its subsidiaries; the risk of defaults on loans; and
contractual, statutory and regulatory restrictions on the Bank's ability to pay
dividends to the Company.

                                       -2-

<PAGE>

         The following table sets forth the composition of the loan portfolio
and mortgage-backed securities portfolio of the Company and its subsidiaries in
dollar amounts and in percentages of the respective portfolios at the dates
indicated. Mortgage-backed securities are shown at amortized cost and not fair
value.

<TABLE>
<CAPTION>
                                                                             At March 31,
                                   -----------------------------------------------------------------------------------------------
                                        2002                2001                2000               1999                1998
                                   -----------------  -----------------   ----------------   -----------------   -----------------
                                            Percent            Percent            Percent             Percent             Percent
                                   Amount   of Total  Amount   of Total   Amount  of Total   Amount   of Total   Amount   of Total
                                   ------   --------  ------   --------   ------  --------   ------   --------   ------   --------
                                                                       (Dollars in Thousands)
<S>                                <C>       <C>      <C>      <C>        <C>       <C>      <C>      <C>       <C>       <C>
Mortgage loans:
One-to-four family                 $ 15,001   57.78%   22,579   70.51%    17,678    84.16%    19,249    89.37%   17,141    89.20%
Multi-family                          1,049    4.04       609    1.90        254     1.21        345     1.60       440     2.29
Commercial real estate                1,148    4.42     1,589    4.96        808     3.85         67      .31        88      .46
Construction                          1,670    6.43     1,090    3.40      2,048     9.75      1,674     7.77     1,368     7.12
                                   --------   -----    ------   -----     ------   ------     ------   ------    ------   ------
  Total mortgage loans               18,868   72.67    25,867   80.77     20,788    98.97     21,335    99.05    19,037    99.07
                                   --------   -----    ------   -----     ------   ------     ------   ------    ------   ------
Other loans:
Secured lines of credit               4,444   17.12     3,591   11.21          -        -          -        -         -        -
Business loans                        1,617    6.23     1,755    5.48          -        -          -        -         -        -
Loans on deposit accounts                36     .14       165     .52         26      .12          7      .03        23      .12
Consumer loans                          997    3.84       645    2.02        192      .91        197      .92       157      .81
                                   --------   -----    ------   -----     ------   ------     ------   ------    ------   ------
  Total other loans                   7,094   27.33     6,156   19.23        218     1.03        204      .95       180      .93
                                   --------   -----    ------   -----     ------   ------     ------   ------    ------   ------
  Total loans receivable             25,962  100.00%   32,023  100.00%    21,006   100.00%    21,539   100.00%   19,217   100.00%
                                   --------  ======    ------  ======     ------   ======     ------   ======    ------   =====
Less:
Loans in process                        716               500              1,236               1,291                626
Unearned discounts and
 deferred loan fees                      49                79                 79                  86                 88
Allowance for loan losses               117                99                 58                  52                 46
Allowance for uncollected
 interest                                 -                 -                  -                   -                  5
                                   --------            ------             ------              ------             ------
Loans receivable, net              $ 25,080            31,345             19,633              20,110             18,452
                                   ========            ======             ======              ======             ======
Mortgage-backed securities:
FHLMCs                             $  9,613   42.65%      393    5.23%        54     3.40%       245    25.84%      664    40.46%
FNMAs                                 5,243   23.26     3,343   44.50        371    23.33        456    48.12       636    38.76
GNMAs                                 5,187   23.01     3,276   43.61      1,165    73.27        246    26.04       341    20.78
CMOs                                  2,496   11.08       500    6.66          -        -          -        -         -        -
                                   --------  ------    ------  ------     ------   ------     ------   ------    ------   ------
  Total mortgage-backed securities   22,539  100.00%    7,512  100.00%     1,590   100.00%       947   100.00%    1,641   100.00%
                                             ======            ======              ======              ======             ======
Net premiums (discounts)                 (5)              (10)               (15)                 (9)                (9)
                                   --------            ------              -----              ------             ------
Net mortgage-backed securities     $ 22,534             7,502              1,575                 938              1,632
                                   ========            ======              =====              ======             ======
</TABLE>

                                       -3-


<PAGE>

         The following tables set forth the Company and its subsidiaries' loan
riginations and loan and mortgage-backed securities purchases, sales and
principal repayments for periods indicated.

<TABLE>
<CAPTION>
                                                            Year Ended March 31,
                                                    ---------------------------------
                                                     2002         2001          2000
                                                     ----         ----          ----
                                                             (In Thousands)
<S>                                                <C>           <C>          <C>
Mortgage loans (gross):
  At beginning of period                           $ 25,867       20,788       21,335
                                                   --------      -------      -------

  Mortgage loans originated:
   One-to-four family                                 3,639          855          115
   Multi-family                                           -            -            -
   Commercial real estate                                 -            -            -
                                                   --------      -------      -------
     Total mortgage loans originated                  3,639          855          115
                                                   --------      -------      -------

  Mortgage loans purchased:
   One-to-four family                                   775        8,367        1,785
   Non-residential                                        -          849          750
   Construction                                         980          690          400
                                                   --------      -------      -------
     Total mortgage loans purchased                   1,755        9,906        2,935
                                                   --------      -------      -------

     Total mortgage loans originated and
       purchased                                      5,394       10,761        3,050
                                                   --------      -------      -------

  Participation loans sold                                -          (83)        (707)
  Transfer of loans to foreclosed real estate             -            -            -
  Principal repayments                              (12,393)      (5,599)      (2,890)
                                                   --------      -------      -------

  At end of period                                 $ 18,868       25,867       20,788
                                                   ========      =======      =======


Other loans (gross):
  At beginning of period                           $  6,156          218          204
                                                   --------      -------      -------

  Other loans originated:
   Secured lines of credit                            1,352          663            -
   Loans on deposit accounts                             70          205           25
   Consumer loan                                        602          540           83
                                                   --------      -------      -------
     Total other loans originated                     2,024        1,408          108
                                                   --------      -------      -------

  Other loans purchased:
   Secured lines of credit                            2,855        5,324            -
   Business loans                                     1,939        2,071            -
                                                   --------      -------      -------
     Total other loans purchased                      4,794        7,395            -
                                                   --------      -------      -------

     Total other loans originated and
      purchased                                       6,818        8,803          108
                                                   --------      -------      -------

   Principal repayments                              (5,880)      (2,865)         (94)
                                                   --------      -------      -------

  At end of period                                 $  7,094        6,156          218
                                                   ========      =======      =======

Mortgage-backed securities (gross):
  At beginning of period                           $  7,512        1,590          947

   Mortgage-backed securities purchased              27,359        6,887        1,000
   Mortgage-backed securities sold                        -            -            -
   Amortization and repayments                      (12,332)        (965)        (357)
                                                   --------      -------      -------

  At end of period                                 $ 22,539        7,512        1,590
                                                   ========      =======      =======
</TABLE>

                                       -4-

<PAGE>

         Loan Maturity and Repricing. The following table shows the maturity or
period to repricing of the Company and its subsidiaries' loan and
mortgage-backed securities portfolios at March 31, 2002. Mortgage-backed
securities are shown at amortized cost, not fair value, and consist of loans
with adjustable rates and fixed rates. Information for a presentation of such
adjustable rate loans based on contractual terms to maturity is unavailable and
therefore such loans are shown as being due in the period during which the
interest rates are next subject to change. The table does not include
prepayments or scheduled principal amortization. Prepayments and scheduled
principal amortization on loans and mortgage-backed securities totaled $31.0
million, $9.0 million and $4.8 million for the years ended March 31, 2002, 2001
and 2000, respectively.

<TABLE>
<CAPTION>
                                                                         At March 31, 2002
                             -------------------------------------------------------------------------------------------------------
                                                                                                                  Totals
                                                                                                       -----------------------------
                             One-to-                                      Secured                       Total     Mortgage-
                             Four      Multi-  Commercial                 Lines of  Business  Other     Loans       Backed
                             Family    Family  Real Estate  Construction   Credit    Loans    Loans   Receivable  Securities  Total
                             -------   ------- -----------  ------------ ---------  --------  ------  ----------  ----------  -----
                                                                            (In Thousands)
<S>                          <C>       <C>     <C>          <C>          <C>        <C>     <C>        <C>         <C>     <C>  <C>
Amounts due:
 Within one year             $ 1,279        88       -       1,670        3,387        560       27       7,011       41     7,052
                             -------   -------  ------     -------      -------    -------  -------     -------  -------   -------
 After one year:
  One to three years             950         -      97           -            -         71       92       1,210        2     1,212
  Three to five years          2,514       961     267           -            -        986      424       5,152       18     5,170
  Five to ten years            1,882         -     784           -        1,057          -      153       3,876        5     3,881
  Ten to twenty years          2,648         -       -           -            -          -      337       2,985        -     2,985
  Over twenty years            5,728         -       -           -            -          -        -       5,728   22,473    28,201
                             -------   -------  ------     -------      -------    -------  -------     -------  -------   -------
    Total due or repricing
      after one year          13,722       961   1,148           -        1,057      1,057    1,006      18,951   22,498    41,449
                             -------   -------  ------     -------      -------    -------  -------     -------  -------   -------
    Total amount due
     or repricing            $15,001     1,049   1,148       1,670        4,444      1,617    1,033      25,962   22,539    48,501
                             =======   =======  ======     =======      =======    =======  =======
Less:
 Loans in process                                                                                          (716)       -      (716)
 Unearned discounts,
  premiums, and
  deferred loan fees, net                                                                                   (49)      (5)      (54)
 Allowance for loan losses                                                                                 (117)       -      (117)
 Allowance for
  uncollected interest                                                                                        -        -         -

                                                                                                        -------  -------   -------
   Loans receivable and
    mortgage-backed
    securities, net                                                                                     $25,080   22,534    47,614
                                                                                                        =======  =======   =======
</TABLE>

                                       -5-

<PAGE>

         The following table sets forth at March 31, 2002, the dollar amount of
all loans and mortgage-backed securities due or repricing after March 31, 2003,
and whether such loans have fixed interest rates or adjustable interest rates.

                                                 Due or Repricing after
                                                     March 31, 2003
                                             ------------------------------
                                             Fixed      Adjustable    Total
                                             -----      ----------    -----
                                                       (In Thousands)

Mortgage loans:
   One-to-four family                     $ 13,722            -      13,722
   Other                                     1,376          733       2,109
Other loans                                  3,120            -       3,120
                                          --------        -----      ------
Total loans receivable                      18,218          733      18,951
Mortgage-backed securities                  22,498            -      22,498
                                          --------        -----      ------
Total loans receivable and
 mortgage-backed securities               $ 40,716          733      41,449
                                          ========        =====      ======

         One-to-Four Family Mortgage Lending. The Bank offers first mortgage
loans secured by one-to-four family residences, including townhouse and
condominium units, in the Bank's primary lending area. Typically, such
residences are single-or-two family homes that serve as the primary residence of
the owner. Loan originations are generally obtained from existing or past
customers, members of the local communities, local real estate agent referrals
and builder/developer referrals within the Bank's area.

         The Bank offers fixed-rate loans and adjustable-rate loans on
one-to-four family residential properties. The Bank's fixed-rate mortgage loans
are made for terms of 15 to 30 years. Interest rates charged on fixed-rate loans
are competitively priced based on market conditions and the cost of funds.
Origination fees range from zero points to 2.5% depending on the interest rate
charged and other factors. Generally, the Bank's standard underwriting
guidelines conform to FHLMC guidelines with periodic exceptions granted to
customers with long-standing relationships on a case-by-case basis, which are
approved by the President and ratified by the Board of Directors.

         The Bank makes one-to-four family residential mortgage loans in amounts
up to 80% of the appraised value of the secured property. Originated mortgage
loans in the Bank's portfolio generally include due-on-sale clauses which
provide the Bank with the contractual right to deem the loan immediately due and
payable in the event that the borrower transfers ownership of the property
without the Bank's consent. It is the Bank's policy to enforce due-on-sale
provisions.

         The Bank also purchases pools of one-to-four family mortgage loans from
area lenders. These purchased loans are subject to the Bank's underwriting
standards. Purchased loans totaled $9.7 million at March 31, 2002, representing
37.5% of the loan portfolio. Adjustable rate pools totaled $195,700, with fixed
rate pools totaling $9.5 million at March 31, 2002.

         Multi-Family Lending. In the Chicago metropolitan area, the Bank
originates fixed-rate multi-family loans with terms of 15 to 30 years. These
loans are generally made in amounts up to 80% of the appraised value of the
secured property. Most of the Bank's multi-family loans are not owner-occupied.
In making such loans, the Bank bases its underwriting decision primarily on the
net operating income generated by the real estate to support the debt service,
the financial resources and income level of the borrower, the borrower's
experience in owning or managing similar property, the marketability of the
property and the Bank's lending experience with the borrower. The Bank also
receives a personal guarantee from the borrower. The largest multi-family loan
at March 31, 2002 is in the Bank's primary market area and had an outstanding
balance of $286,000. This loan is secured by an apartment building located in
the Chicago metropolitan area.

                                       -6-

<PAGE>

         Commercial Lending. The Bank's commercial loans are secured by either
non-real estate assets of the business borrowers or are commercial real estate
loans secured by real estate located in the Chicago metropolitan area. The
largest commercial real estate loan at March 31, 2002, was a $733,000
participation loan on five commercial properties. The underwriting criteria for
commercial lending is governed by a loan policy which incorporates standard
underwriting guidelines including those guidelines prescribed by regulatory
agencies.

         Construction Lending. The Bank currently is participating in a $980,000
construction loan for the purpose of constructing a planned unit development in
Morton Grove, Illinois. It is anticipated that this project will be completed by
April 30, 2003. The Bank is also participating in a construction loan for the
purpose of constructing one-to-four family dwellings located in Streamwood,
Illinois. The Bank's investment in this project approximates $690,000, and is
scheduled to be repaid by June 30, 2003.

         Other Lending. The Bank also offers home improvement loans, secured by
second mortgages on collateralized single-family residences. Other loans also
include loans made to depositors and are collateralized by the related deposit
accounts, and automobile loans. Home improvement, auto and loans against deposit
accounts comprised only 3.98% of the Bank's total loans receivable at March 31,
2002.

         Loan Approval Procedures. All loan applications are considered by the
Bank's President, who has the authority to approve all loans, except those in
excess of $500,000, which loans may only be approved by the Bank's Board of
Directors. The President may also approve consumer loans up to $150,000. The
Bank's Board of Directors ratifies all loans approved by the Bank's President.

         The Bank's loan originations are subject to its written underwriting
standards and loan origination procedures. The Bank is an equal opportunity
lender. Decisions on loan applications are made on the basis of detailed
applications and property valuations (consistent with the Bank's written
appraisal policy) by qualified independent appraisers. The loan applications are
designed primarily to determine the borrower's ability to repay and the more
significant items on the application are verified through use of credit reports,
financial statements, tax returns and/or confirmations.

         The Bank requires evidence of marketable title and lien position
(generally consisting of a title survey and legal opinion) as well as fire and
extended coverage casualty insurance in amounts at least equal to the principal
amount of the loan or the value of improvements on the property, depending on
the type of loan. The Bank also requires flood insurance to protect the property
securing its interest when the property is located in a flood plain or otherwise
deemed prudent by management.

         Mortgage-Backed Securities. The Company and its subsidiaries have
investments in mortgage-backed securities and have, at times, utilized such
investments to complement its mortgage lending activities. During the year ended
March 31, 2002, the Company and its subsidiaries purchased $22.4 million in
mortgage-backed securities. At March 31, 2002, the amortized cost of
mortgage-backed securities totaled $22.5 million, or 36.9% of total assets, of
which all were designated as held to maturity and are carried at amortized cost.
The fair value of such securities totaled approximately $22.6 million at March
31, 2002. See Note 2 to the Consolidated Financial Statements in the 2002 Annual
Report to Stockholders. At March 31, 2002, $20.0 million, or 88.9% of the
mortgage-backed securities portfolio was directly insured by the GNMA, the FNMA
or the FHLMC.

                                       -7-

<PAGE>

Delinquencies and Classified Assets

         Delinquent Loans. When a loan becomes between 30 and 45 days
delinquent, the Bank contacts the borrower either by telephone, in person or by
mail. If a delinquency continues and a loan is delinquent 90 days, several
courses of action are possible including directing the Bank's attorney to send a
30-day letter advising the borrower of possible legal action or an authorization
to accommodate the special needs of the borrower in the case of hardship. A
physical inspection is ordered to evaluate the condition of the property. When a
loan is four or more months delinquent, arrangements are made to obtain title,
begin foreclosure, or both, unless a written repayment plan has been signed by
both the borrower and the Bank. The Board of Directors reviews a complete list
of all delinquent loans that are 60 days or more delinquent and is apprised of
the action taken to bring the loan current.

         The remedies available to the Bank in the event of a default or
delinquency with respect to certain residential mortgage loans, and the
procedures by which such remedies may be exercised, are governed by the loan
documents and Illinois law. Under the lending documents used by the Bank, the
Bank is prohibited from accelerating the maturity of a residential mortgage
loan, commencing any legal action (including foreclosure proceedings) to the
collect on such loan, or taking possession of any loan collateral until the
lender has first provided the delinquent borrower with at least 30 days' prior
written notice specifying the nature of the delinquency and the borrowers's
right to correct such delinquency. In the event default is not cured on or
before the date required in the notice, the Bank may, at its option, require
immediate payment in full of all sums secured by the mortgage without further
demand and may institute foreclosure proceedings.

         Assuming the foreclosure is uncontested, the Bank can complete the
foreclosure and obtain a deed to the collateral property within eight to ten
months of filing the complaint in Illinois. Under Illinois law, the mortgagor
has a Right of Reinstatement. Specifically, the mortgagor has the right to cure
all defaults that existed had no acceleration occurred provided that such cure
is made prior to the expiration of 90 days from the date the court obtains
jurisdiction over the mortgagor.

         Loans are placed on non-accrual status when, in the judgement of
management, the probability of collection of interest is deemed to be
insufficient to warrant further accrual. When a loan is placed on non-accrual
status, previously accrued but unpaid interest is deducted from interest income.
As a matter of policy, the Bank does not accrue interest on loans past due 90
days or more. All previously accrued but unpaid interest is deducted from
interest income. Consumer loans more than 120 days delinquent are generally
written-off.

         Classified Assets. Regulations of the FDIC and OBRE require that each
insured institution review and classify its assets on a regular basis. The Bank
has adopted a Classification of Assets Policy and has made the President of the
Bank responsible for approving classifications and valuation allowances and for
making appropriate recommendations as to the changes in procedures and policies
to the Board for approval. In addition, in connection with examinations of
insured institutions, OBRE and FDIC examiners have authority to identify problem
assets and, if appropriate, require them to be classified. There are three
classifications for problem assets: substandard, doubtful and loss. Substandard
assets must have one or more defined weaknesses and are characterized by the
distinct possibility that the insured institution will sustain some loss if the
deficiencies are not corrected. Doubtful assets have the weaknesses of
substandard assets with the additional characteristic that the weaknesses make
collection or liquidation in full on the basis of currently existing facts,
conditions and values questionable, and there is a high possibility of loss. An
asset classified as loss is considered uncollectible and of such little value
that its continuance as an asset of the institution is not warranted. The Bank's
Classification of Assets Policy also contains a special mention category,
described as assets which do not currently expose the Bank to a sufficient
degree of risk to warrant classification but do possess credit deficiencies or
potential weaknesses deserving management's close attention. Assets classified
as substandard or doubtful require the institution to establish general
allowances for loan losses. If an asset or portion thereof is classified loss,
the insured institution must either establish specific allowances for loan
losses in the amount of 100% of the portion of the asset classified as a loss or
charge-off such amount. A portion of general loss allowances established to
cover possible losses related to assets classified substandard or doubtful may
be included in determining an institution's regulatory capital, while specific
valuation allowances for loan losses generally do not qualify as regulatory
capital.

                                       -8-

<PAGE>

         Real Estate Owned. Real estate acquired by the Bank as a result of
foreclosure or by deed-in-lieu of foreclosure is classified as real estate owned
until it is sold. When property is acquired, it is recorded at the lower of cost
or fair value at the date of acquisition and any write-down resulting therefrom
is charged to the allowance for losses on loans. All incidental costs, such as
insurance and real estate taxes, incurred in maintaining the Bank's lien on the
collateral property are capitalized between the date the loan becomes delinquent
and the date of acquisition. After the date of acquisition, all costs incurred
in maintaining the property are expensed and costs incurred for the improvement
or development of such property are capitalized. The Bank had no foreclosed real
estate owned on its books at March 31, 2002.

         Delinquent Loans. At March 31, 2002, 2001 and 2000, delinquencies in
the Bank's loan portfolio were as follows:

                                                   At March 31, 2002
                                   ---------------------------------------------
                                        60-89 Days          90 Days or More
                                   --------------------    ---------------------
                                   Number     Principal     Number     Principal
                                     of       Balance         of       Balance
                                    Loans     of Loans       Loans     of Loans
                                   ------     ---------    -------     ---------
                                                      (In Thousands)

One-to-four family                    -       $   -            -        $   -
Multi-family                          -           -            -            -
Commercial real estate                -           -            -            -
Land and Construction                 -           -            -            -
                                     ---      ------          ---       -----
  Total loans                         -       $   -            -        $   -
                                     ===      ======          ===       ======

Delinquent loans to total loans                   - %                       - %
                                              ======                    ======

                                                   At March 31, 2001
                                   ---------------------------------------------
                                        60-89 Days             90 Days or More
                                   --------------------     --------------------
                                   Number     Principal     Number    Principal
                                     of       Balance         of      Balance
                                    Loans     of Loans       Loans    of Loans
                                   ------     ---------     ------    ---------
                                                  (In Thousands)

One-to-four family                    -       $   -            -       $   -
Multi-family                          -           -            -           -
Commercial real estate                -           -            -           -
Land and Construction                 -           -            -           -
                                     ---      ------          ---      ------
  Total loans                         -       $   -            -       $   -
                                     ===      ======          ===      ======

Delinquent loans to total loans                   - %                      - %
                                              ======                   ======

                                                   At March 31, 2000
                                   ---------------------------------------------
                                       60-89 Days             90 Days or More
                                   --------------------     --------------------
                                   Number     Principal     Number    Principal
                                     of       Balance         of      Balance
                                    Loans     of Loans      Loans     of Loans
                                   ------     ---------     ------    ---------
                                                 (In Thousands)

One-to-four family                     2      $   34            -       $   -
Multi-family                           -           -            -           -
Commercial real estate                 -           -            -           -
Land and Construction                  -           -            -           -
                                     ---      ------          ---       -----
  Total loans                          2      $   34            -       $   -
                                     ===      ======          ===       =====

Delinquent loans to total loans                  .16%                       - %
                                              ======                    =====

                                       -9-

<PAGE>

         Non-performing Assets. The following table sets forth information
regarding loans which are 90 days or more delinquent. The Bank continues
accruing interest on delinquent loans 90 days or more past due, but reserves
100% of the interest due on such loans, thus effecting a non-accrual status. At
March 31, 2002 there were no other known problem assets except as described
above or as included in the table below.

                                                      At March 31,
                                         ---------------------------------------
                                         2002   2001      2000      1999   1998
                                         ----   ----      ----      ----   ----
                                                      (In Thousands)

Non-accrual delinquent mortgage loans    $  -      -         -         -     96

Total real estate owned, net of
  related allowance for losses              -      -         -         -      -
                                         ----   ----      ----      ----   ----

  Total non-performing assets            $  -      -         -         -     96
                                         ====   ====      ====      ====   ====

Non-performing loans to total loans         -%     -         -         -    .50

Total non-performing assets to total
  assets                                    -%     -         -         -    .33


         Allowance for Loan Losses. The determination of the allowance for loan
losses involves material estimates that are susceptible to significant change in
the near term. The allowance for loan losses is maintained at a level adequate
to provide for losses through charges to operating expense. The allowance is
based upon past loss experience and other factors which, in management's
judgement, deserve current recognition in estimating losses. Such other factors
considered by management include growth and composition of the loan portfolio,
the relationship of the allowance for losses to outstanding loans, and economic
conditions. Management believes that the allowance is adequate. While management
uses available information to recognize losses on loans, future additions to the
allowance may be necessary based on changes in economic conditions. In addition,
various regulatory agencies, as an integral part of their examination process,
periodically review the Company's allowance for losses. Such agencies may
require the Company to recognize additions to the allowance based on their
judgements about information available to them at the time of their examination.

         The following table sets forth the Bank's allowance for loan losses at
the dates indicated.

                                                     At March 31,
                                       -----------------------------------------
                                       2002    2001      2000      1999     1998
                                       ----    ----      ----      ----     ----
                                                    (In Thousands)

Balance at beginning of period       $   99      58        52        46       40
Provision for loan losses                18      41         6         6        6
Charge-offs                               -       -         -         -        -
                                     ------     ---       ---       ---      ---
Balance at end of year               $  117      99        58        52       46
                                     ======     ===       ===       ===      ===

Ratio of allowance for loan losses
 to net loans receivable at the
 end of period                          .46%    .32       .30       .26      .25
Ratio of allowance for loan losses
 to total non-performing assets at
 the end of period                      N/A     N/A       N/A       N/A    48.05
Ratio of allowance for loan losses
 to non-performing loans at the end
 of the period                          N/A     N/A       N/A       N/A    48.05

                                      -10-

<PAGE>

         The following table sets forth the allocation of the Bank's allowance
for loan losses by loan category and the percent of loans in each category to
total loans receivable, net, to the end of the periods indicated. The portion of
the loan loss allowance allocated to each loan category does not represent the
total available for future losses which may occur with the loan category since
the total loan loss allowance is a valuation reserve applicable to the entire
loan portfolio.

<TABLE>
<CAPTION>
                                                                                                March 31,
                    -----------------------------------------------------------------------------------------------
                                2002                           2001                              2000
                    ------------------------------- -----------------------------   -------------------------------
                                           Percent                        Percent                           Percent
                                          of Loans                       of Loans                          of Loans
                                  Loan     in Each              Loan      in Each                 Loan      in Each
                    Amount of   Amounts   Category  Amount of  Amounts   Category   Amount of   Amounts    Category
                    Loan Loss      by     To Total  Loan Loss    by      To Total   Loan Loss     by       To Total
                    Allowance   Category    Loans    Allowance  Category   Loans     Allowance   Category    Loans
                    ------------------------------  ------------------------------  -------------------------------
                                                                                       (Dollars in Thousands)
<S>                  <C>      <C>         <C>        <C>        <C>       <C>        <C>      <C>        <C>
One-to-four
 family              $ 15     $ 15,001    57.78%       22        22,579    70.51%      18      17,678     84.16%
Multi-family            3        1,049     4.04         9           609     1.90        1         254      1.21
Commercial real
 estate                 9        1,148     4.42        12         1,589     4.96        2         808      3.85
Construction            4        1,670     6.43         3         1,090     3.40        5       2,048      9.75
Secured lines of
 credit                39        4,444    17.12        34         3,591    11.21        -           -         -
Business loans         16        1,617     6.23        18         1,755     5.48        -           -         -
Loans on deposit
 accounts               -           36      .14         -           165      .52        -          26       .12
Consumer loans          1          997     3.84         1           645     2.02        1         192       .91
Unallocated            30            -        -         -             -        -       31           -         -
                     ----     --------   ------      ----       -------   ------      ---     -------    ------
    Total            $117     $ 25,962   100.00%       99       $32,023   100.00%      58      21,006    100.00%
                     ====     ========   ======      ====       =======   ======      ===     =======    ======

<CAPTION>
                   ---------------------------------------------------------------------
                                1999                                 1998
                   -----------------------------------   -------------------------------
                                             Percent                            Percent
                                             of Loans                          of Loans
                                    Loan      in Each                 Loan      in Each
                   Amount of      Amounts   Category     Amount of  Amounts     Category
                   Loan Loss       by        To Total    Loan Loss    by        To Total
                   Allowance     Category    Loans       Allowance  Category     Loans
                   -----------------------------------   --------------------------------
<S>                <C>          <C>         <C>          <C>        <C>        <C>
One-to-four
 family                 20       19,249       89.37%         17      17,141     89.20%
Multi-family             1          345        1.60           2         440      2.29
Commercial real
 estate                  1           67         .31           1          88       .46
Construction             5        1,674        7.77           4       1,368      7.12
Secured lines of
 credit                  -            -           -           -           -         -
Business loans           -            -           -           -           -         -
Loans on deposit
 accounts                -            7         .03           -          23       .12
Consumer loans           1          197         .92           1         157       .81
Unallocated             24            -           -          21           -         -
                       ---      -------     -------         ---     -------   -------
   Total                52       21,539      100.00%         46      19,217    100.00%
                       ===      =======     =======         ===     =======   =======
</TABLE>

                                      -11-

<PAGE>

Investment Activities

         The investment policy of the Company and its subsidiaries, which is
established by the Board of Directors and implemented by the Asset/Liability
Committee, is designed primarily to provide and maintain liquidity, to generate
a favorable return on investments without incurring undue interest rate and
credit risk, and to complement the Bank's lending activities. State chartered
savings institutions have the authority to invest in various types of liquid
assets, including United States Treasury obligations, securities of various
federal agencies, certain certificates of deposit of insured banks and savings
institutions, certain bankers acceptances, repurchase agreements and loans on
federal funds. Subject to various restrictions, state chartered savings
institutions may also invest a portion of their assets in commercial paper,
corporate debt securities and asset-backed securities. At March 31, 2002, the
Company and its subsidiaries had investment securities in the aggregate amount
of $576,000. The investment portfolio, except for FHLB stock, is classified as
available for sale.

         The following table sets forth certain information regarding the book
value of the Company and its subsidiaries' investment securities portfolio at
the dates indicated.

                                                      At March 31,
                                             ------------------------------
                                             2002         2001         2000
                                             ----         ----         ----
                                                     (In Thousands)

Interest-bearing deposits:
  Certificates of deposit                 $  1,095        1,963        7,395
  FHLB daily investment                      8,448        4,784        3,372
  Other                                        298           18           63
                                          --------       ------       ------
   Total interest-bearing deposits        $  9,841        6,765       10,830
                                          ========       ======       ======
Investment securities:
  U.S. Government securities
   and obligations                        $      -            -            -
  FHLB-Chicago stock                           297          200          186
  Corporate equity investments (1)             180          170          170
  Corporate debt securities (1)                 99           93           79
                                          --------        -----        -----
   Total investment securities            $    576          463          435
                                          ========        =====        =====
___________________
(1)  For a complete description, see Note 4 to the "Notes to Consolidated
     Financial Statements" in the 2002 Annual Report to Stockholders.

                                      -12-

<PAGE>

         The table below sets forth certain information regarding the carrying
value, weighted average yield and maturities of the Company and its
subsidiaries' investment securities at March 31, 2002.

<TABLE>
<CAPTION>
                                                                   At March 31, 2002
                                 -------------------------------------------------------------------------------------------
                                   One Year or Less      One to Five Years              Total Investment Securities
                                 -------------------    -------------------     --------------------------------------------
                                                                                 Average
                                            Weighted               Weighted     Remaining             Approximate   Weighted
                                 Carrying    Average    Carrying    Average     Years to    Carrying     Market      Average
                                  Value       Yield      Value       Yield      Maturity     Value       Value        Yield
                                 --------   --------    --------   --------     ---------   --------  -----------   --------
                                                                  (Dollars in Thousands)
<S>                              <C>          <C>       <C>        <C>          <C>          <C>       <C>          <C>
FHLB-Chicago stock               $  297        5.00%        -           -            -          297         297        5.00

Corporate equity investments        100         N/A         -           -            -          100         180         N/A

Corporate debt securities             -           -       100       11.00            1          100          99       11.00
                                 ------        ----      ----       -----          ---        -----       -----       -----

  Total                          $  397        5.00%      100       11.00            1          497         576        5.20
                                 ======        ====      ====       =====          ===        =====       =====       =====
</TABLE>

                                      -13-

<PAGE>

Sources of Funds

         General. Deposits, repayments on loans and mortgage-backed securities
and stockholders' equity are the primary sources of the Bank's funds for use in
lending, investing and for other general purposes.

         Deposits. The Bank offers a variety of deposit accounts having a range
of interest rates and terms. The Bank's deposits consist of passbook and
statement savings, demand deposits, money market accounts, and certificate
accounts. The flow of deposits is influenced significantly by general economic
conditions, changes in money market and prevailing interest rates and
competition. The Bank's deposits are obtained primarily from the area in which
its offices are located. The Bank relies primarily on customer service and
long-standing relationships with customers to attract and retain these deposits.
Certificate accounts in excess of $100,000 are not actively solicited by the
Bank nor does the Bank use brokers to obtain deposits. Management constantly
monitors the Bank's deposit accounts and, based on historical experience,
management believes it will retain a large portion of such accounts upon
maturity.

         The following table presents the deposit activity of the Bank for the
periods indicated.

                                              Year Ended March 31,
                                      ----------------------------------
                                         2002         2001         2000
                                         ----         ----         ----
                                                  (In Thousands)

Deposits                             $  56,140       42,296       15,562
Withdrawals                            (52,243)     (29,491)     (12,764)
                                     ---------     --------     --------
Net deposits                             3,897       12,805        2,798
Interest credited on deposits            2,218        1,942        1,230
                                     ---------     --------     --------
  Total increase in deposits         $   6,115       14,747        4,028
                                     =========     ========     ========

         At March 31, 2002, the Bank had outstanding $9.8 million in deposit
accounts in amounts of $100,000 or more maturing as follows:

                           Maturity Period                           Amount
                           ---------------                           ------
                                                                  (In Thousands)

                           Three months or less                      $ 3,875
                           Over three through six months               2,132
                           Over six through twelve months              1,338
                           Over twelve months                          2,494
                                                                     -------

                               Total                                 $ 9,839
                                                                     =======

                                       -14-

<PAGE>

         The following table sets forth the distribution of the Bank's deposit
accounts at the dates indicated and the weighted average interest rates on
deposits presented.

<TABLE>
<CAPTION>
                                                    At March 31,
                              --------------------------------------------------------
                                      2002               2001               2000
                              ------------------   ----------------   ----------------
                                        Percent            Percent            Percent
                                        of Total           of Total           of Total
                               Amount   Deposits   Amount  Deposits   Amount  Deposits
                              --------  --------   ------  --------   ------  --------
                                                 (Dollars in Thousands)
<S>                           <C>       <C>        <C>     <C>        <C>     <C>

Passbook accounts             $  7,995    15.58%    6,218    13.75%    5,743    18.85%
                              --------   ------    ------   ------    ------   ------
Demand deposit accounts          2,296     4.47     1,281     2.83       517     1.70
                              --------   ------    ------   ------    ------   ------
Money market accounts            4,850     9.45     6,046    13.38     1,017     3.34
                              --------   ------    ------   ------    ------   ------
Certificate accounts

  Ninety-one day                   867     1.69       105      .23       253      .83
  Six to twelve months           5,493    10.70     2,517     5.57     1,842     6.05
  Twelve to eighteen months     20,086    39.14    21,067    46.61    15,639    51.34
  Eighteen to thirty months      4,630     9.02     3,709     8.20     1,633     5.36
  Thirty to sixty months         1,032     2.01       636     1.41       748     2.46
  Sixty months                     431     0.84       241      .53       179      .59
  IRA and Keogh                  3,545     6.91     3,290     7.28     2,792     9.17
  Other                             95     0.19        95      .21        95      .31
                              --------   ------    ------   ------    ------   ------
    Total                       36,179    70.50    31,660    70.04    23,181    76.11
                              --------   ------    ------   ------    ------   ------

Total deposits                $ 51,320   100.00%   45,205   100.00%   30,458   100.00%
                              ========   ======    ======   ======    ======   ======

Weighted average rate                      3.38%              5.47%              4.97%
                                           ====               ====               ====
</TABLE>

         The following table presents, by various rate categories, the amount of
certificate accounts outstanding at March 31, 2002, 2001, and 2000 and the
periods to maturity of the certificate accounts outstanding at March 31, 2002.

<TABLE>
<CAPTION>
                                                            Period to Maturity
                                                            from March 31, 2002
                                At March 31,           ------------------------------
                         --------------------------          Within      One to
                          2002      2001      2000     One Year  Five Years(1)  Total
                         -----      ----      ----     --------  -------------  -----
                                                (In Thousands)
<S>                    <C>         <C>       <C>       <C>       <C>           <C>
Certificate accounts:
   4.99% or less       $ 24,690     1,105     3,655     19,311      5,379      24,690
   5.00% to 5.99%         8,773     5,146    10,261      8,182        591       8,773
   6.00% to 6.99%         2,133    23,201     9,265      1,961        172       2,133
   7.00% to 7.99%           583     2,208         -        528         55         583
                       --------    ------    ------     ------      -----      ------
    Total              $ 36,179    31,660    23,181     29,982      6,197      36,179
                       ========    ======    ======     ======      =====      ======
</TABLE>

_________
(1) The Bank does not offer certificate accounts with a period to maturity
exceeding five years.

                                      -15-

<PAGE>

Borrowings

         Deposits are the primary source of funds of the Bank's lending and
investment activities and for its general business purposes. The Bank may obtain
advances from the FHLB of Chicago to supplement its supply of lendable funds,
although the Bank has not generally utilized this funding source. Advances from
the FHLB of Chicago would typically be secured by a pledge of the Bank's stock
in the FHLB of Chicago and a portion of the Bank's first mortgage loans and
certain other assets. At March 31, 2002 and 2001, the Bank had no advances
outstanding from the FHLB of Chicago or borrowings of any kind.

         In connection with the conversion, the ESOP purchased 8% of the Common
Stock issued in the Conversion (17,755 shares). Such purchase was funded by the
Company thru a 10-year loan to the ESOP in the amount of $177,550. The Bank is
making annual contributions to the ESOP to enable the ESOP to pay principal and
interest.

Subsidiary Activities

         OBRE regulations permit a state-chartered savings bank to invest up to
10% of its assets in the capital stock, paid-in surplus and unsecured
obligations of subsidiary corporations or service corporations. As of March 31,
2002, the Bank was authorized to invest approximately $6.1 million in the
capital stock and other securities of service corporation subsidiaries. As of
that date, the Bank had an equity investment of $160,197 in its wholly-owned
service corporation, West Town Insurance Agency, Inc. This company is a
full-service licensed insurance agency.

Competition

         The Bank faces significant competition in attracting deposits. Its most
direct competition for deposits has historically come from commercial banks and
savings institutions located in its market area, many of which are substantially
larger than the Bank. The Bank also faces additional significant competition for
investors' funds from short-term money market mutual funds and issuers of
corporate and government securities. The Bank competes for deposits principally
by offering depositors a variety of deposit programs, a convenient location and
hours and other services. The Bank does not rely upon any individual group or
entity for a material portion of its deposits.

         The Bank's competition for real estate loans comes principally from
mortgage banking companies, commercial banks and savings institutions. The Bank
competes for loan originations primarily through the interest rates and loan
fees it charges, and the efficiency and quality of services it provides
borrowers, real estate brokers and builders. Factors which affect competition
include the general and local economic conditions, current interest rate levels
and volatility in the mortgage markets.

Personnel

         As of March 31, 2002, the Bank had 9 full-time employees and 6
part-time employees. The employees are not represented by a collective
bargaining unit, and the Bank considers its relationship with its employees to
be excellent.

                                      -16-

<PAGE>

                      REGULATION OF WEST TOWN BANCORP, INC.

         The Company is a savings bank holding company within the meaning of the
Home Owners' Loan Act of 1933 ("HOLA"), as amended by FIRREA. As such, the
Company is registered with the OBRE, and is subject to Illinois regulation,
examinations, supervision and reporting requirements. Furthermore, the Holding
Company is permitted to engage in activities prescribed by the Commissioner.

         Per Regulation Y, the Company is also registered with the Federal
Reserve as a Bank Holding Company. The principal purposes of Regulation Y are to
regulate the acquisition of control of banks by companies and individuals, to
define and regulate the nonbanking activities in which bank holding companies
and foreign banking organizations with United States operations may engage, and
to set forth the procedures for securing approval for such transactions and
activities. The Company does not anticipate that the regulatory activities of
either the OBRE or the Federal Reserve Board will adversely affect the
activities of the Holding Company.

Affiliate Restrictions

         The affiliate restrictions contained in Sections 23A and 23B of the
Federal Reserve Act apply to all federally insured savings associations and any
such "affiliate". A savings and loan holding company, its subsidiaries and any
other company under common control are considered affiliates of the subsidiary
savings association under HOLA. Generally, Sections 23A and 23B: (i) limit the
extent to which the insured institution or its subsidiaries may engage in
certain covered transactions with an affiliate to an amount equal to ten percent
(10%) of such institution's capital and surplus, and contain an aggregate limit
on all such transactions with all affiliates to an amount equal to twenty
percent (20%) of such capital and surplus, and (ii) require that all such
transactions be on terms substantially the same, or at least as favorable to the
institution or subsidiary, as those provided to a non-affiliate. The term
"Covered transaction" includes the making of loans, purchase of assets, issuance
of a guarantee and similar other types of transactions. Also, a savings
institution may not make any loan to an affiliate unless the affiliate is
engaged only in activities permissible for bank holding companies. Only the
Federal Reserve Board may grant exemptions from the restrictions of Sections 23A
and 23B. The Commissioner, however, may impose more stringent restrictions on
savings associations for reasons of safety and soundness.

Qualified Thrift Lender Test

         The regulations require that any savings bank holding company that
controls a savings institution that fails the qualified thrift lender test, as
explained under "Regulation of West Town Savings Bank - Qualified Thrift Lender
Test", must, within one year after the date on which the institution ceases to
be a qualified thrift lender, register as and be deemed a bank holding company
subject to all applicable laws and regulations.

                                      -17-

<PAGE>

                      REGULATION OF WEST TOWN SAVINGS BANK

         As a state-chartered and federally insured savings bank, West Town
Savings Bank is subject to extensive regulation. Lending activities and other
investments must comply with various statutory and regulatory capital
requirements. The Bank is regularly examined by its federal and state regulators
and files periodic reports concerning the Bank's activities and financial
condition. The Bank's relationship with its depositors and borrowers also is
regulated to a great extent by both federal and state laws, especially in such
matters as the ownership of savings accounts and the form and content of the
Bank's mortgage documents.

The Effects of FDICIA

         In December, 1991, the Federal Deposit Insurance Corporation
Improvement Act of 1991 ("FDICIA") was enacted into law. FDICIA provides for,
among other things, the recapitalization of the Bank Insurance Fund; enhanced
federal supervision of depository institutions, including greater authority for
the appointment of a conservator or receiver for undercapitalized institutions;
the adoption of safety and soundness standards by the federal banking
regulators, on matters such as loan underwriting and documentation, interest
rate risk exposure and compensation and other employee benefits; the
establishment of risk-based deposit insurance premiums; liberalization of the
qualified thrift lender test; greater restrictions of the qualified thrift
lender test; greater restrictions on transactions with affiliates; and mandated
consumer protection disclosures with respect to deposit accounts. See
"-Insurance of Accounts and Regulation by the FDIC," "-Regulatory Capital
Requirements" and "-Qualified Thrift Lender Test".

Insurance of Accounts and Regulation by the FDIC

         The Bank is a member of the Savings Association Insurance Fund ("SAIF")
which is administered by the FDIC. Savings deposits are insured up to $100,000
per insured member (as defined by law and regulation) by the FDIC and such
insurance is backed by the full faith and credit of the United States
Government. As insurer, the FDIC imposes deposit insurance premiums and is
authorized to conduct examination of and to require reporting by the
FDIC-insured institutions. It also may prohibit any FDIC-insured institution
from engaging in any activity the FDIC determines by regulation or order to pose
a serious risk to the FDIC. The FDIC also has the authority to initiate
enforcement actions against savings associations, after giving the OBRE an
opportunity to take such action, and may terminate the deposit insurance if it
determines that the institution has engaged or is engaging in unsafe or unsound
practices, or is in an unsafe or unsound condition.

         Since the Bank is a state-chartered savings bank, the FDIC is its
primary federal regulator.

                                      -18-

<PAGE>

Office of Banks and Real Estate

         The OBRE is the Bank's primary state regulator. As regulator, the OBRE
has extensive authority over the operations of the Bank and other
state-chartered savings banks. As part of this authority, the Bank is required
to file periodic reports with the OBRE and is subject to periodic examination by
the OBRE.

         The OBRE established regulations affecting the operations of the Bank,
including regulations that affect the Bank's lending and investment activities.
The OBRE also has extensive enforcement authority, including the issuance of
cease-and-desist and removal orders and the initiation of injunctive actions.

         The OBRE assesses quarterly fees based upon asset size and charges its
regulated institutions for periodic examinations.

Federal Home Loan Bank System

         The FHLB System, consisting of twelve FHLBs, is under the jurisdiction
of the Federal Housing Finance Board ("FHFB"). The designated duties of the FHFB
are to: supervise the FHLBs; ensure that the FHLBs carry out their housing
finance missions; ensure that the FHLBs remain adequately capitalized and able
to raise funds in the capital markets; and ensure that the FHLBs operate in a
safe and sound manner.

         While the Bank is no longer required to be a member since its
conversion to a state-chartered savings bank in 1995, the Bank has chosen to
remain a member. Among other benefits, the FHLB provides a central credit
facility primarily for member institutions. It is funded primarily from proceeds
derived from the sale of consolidated obligations of the FHLB System. It makes
advances to members in accordance with policies and procedures established by
the FHFB and the Board of Directors of the FHLB of Chicago. At March 31, 2002,
the Bank had no advances from the FHLB of Chicago. See "Sources of Funds -
Borrowings".

Qualified Thrift Lender Test

         Under FIRREA and state savings bank regulations, a state-chartered
savings bank must maintain at least 60% of its total tangible assets in
"qualified thrift investments" on an average basis in three out of every four
quarters and two out of every three years. Under the QTL statutory and
regulatory provisions, all forms of home mortgages, home improvement loans, home
equity loans and loans on the security of other residential real estate and
mobile homes, as well as shares of FHLB stock, investments or deposits in other
insured institutions, securities issued by the FNMA, FHLMC, GNMA and other
mortgage-related securities, are considered qualified thrift investments.
Investments in non-subsidiary corporations or partnerships whose activities
include servicing mortgages or real estate development are also considered
qualified thrift investments in proportion to the amount of primary revenue such
entities derive from housing-related activities. Also included in qualified
thrift investments are mortgage servicing rights, whether such rights are
purchased by the insured institution or created when the institution sells loans
and retains the right to service such loans.

         A savings bank that fails to become or maintain a qualified thrift
lender shall either become a commercial bank (other than a savings bank) or be
subject to restrictions specified in FIRREA. A savings bank that converts to a
commercial bank must pay applicable exit and entrance fees involved in
converting from the SAIF fund to the BIF fund of the FDIC. A savings bank that
fails to meet the QTL test and does not convert to a commercial bank will be:
(1) prohibited from making any new investment or engaging in activities that
would not be permissible for national banks; (2) prohibited from establishing
any new branch office where a national bank located in the savings institutions
home state would not be able to establish a branch office; (3) ineligible to
obtain new advances from any FHLBs; and (4) subject to limitations on the
payment of dividends comparable to the statutory and regulatory dividend
restrictions applicable to a national bank. Also, beginning three years after
the date on which the savings bank ceases to be a qualified thrift lender, the
savings bank would be prohibited from retaining any investment or engaging in
any activity not permissible for a national bank and would be required to repay
any outstanding advances to any FHLB. A savings bank may requalify as a
qualified thrift lender if it thereafter complies with the QTL test.

         As of March 31, 2002, the Bank was in compliance with the QTL test with
a QTL ratio of 81.03%.

                                      -19-

<PAGE>

Capital Requirements

         Under OBRE regulations, a savings bank must satisfy two minimum capital
requirements: core capital and risk-based capital. Savings banks must meet both
of the standards in order to comply with the capital requirements.

         The minimum core capital requirement is three percent of adjusted total
assets (the "leverage limit" requirement). Core capital is defined to include
common stockholders' equity, non-cumulative perpetual preferred stock and any
related surplus, and minority interests in equity accounts of consolidated
subsidiaries, less (i) any unidentifiable intangible assets (other than
purchased mortgage servicing rights); (ii) the amount by which purchased
mortgage servicing rights exceed the lower of 90% of determinable fair market
value, 90% of original costs, or current amortized book value; and (iii) equity
and debt investments in subsidiaries that are not "includable subsidiaries",
which is defined as subsidiaries engaged solely in activities not impermissible
for a national bank, engaged in activities impermissible for a national bank but
only as an agent for its customers, or engaged solely in mortgage-banking
activities.

         In calculating adjusted total assets, adjustments are made to total
assets to give effect to the exclusion of certain assets from capital and to
appropriately account for the investment in and assets of both includable and
nonincludable subsidiaries.

         The FDIC is required to evaluate capital before approving various
applications by depository institutions. The FDIC also must evaluate capital as
an essential component in determining the safety and soundness of state
nonmember banks it insures and supervises and in determining whether depository
institutions are in any unsafe or unsound condition. Generally, all FDIC insured
banks must maintain "core" or "Tier I" capital of at least 3.0% of total assets.
The rule further provides that a bank operating at or near the 3.0% capital
level is expected to have well diversified risks, including no undue interest
rate risk exposure, excellent control systems, good earnings, high asset
quality, high liquidity and well managed on - and off - balance sheet
activities, and in general, be considered a strong banking organization with
composite 1 rating under the CAMEL rating system for banks. For all but the most
highly rated banks meeting the above conditions, the minimum core capital ratio
will be increased to not less than 4.0% of total assets. Under the regulations
of the OBRE, savings banks are required to maintain a core capital ratio of at
least 3.0%.

         Savings banks must also maintain capital equal to at least 8.0% of
risk-weighted assets. Total capital consists of the sum of core and
supplementary capital, provided that supplementary capital cannot exceed core
capital, as previously defined.

         Supplementary capital includes (i) permanent capital instruments such
as cumulative perpetual preferred stock, perpetual subordinated debt, and
mandatory convertible subordinated debt, (ii) maturing capital instruments such
as subordinated debt, intermediate-term preferred stock and mandatory redeemable
preferred stock, subject to an amortization schedule, and (iii) general
valuation loan and lease allowances. Supplementary capital may not exceed the
Bank's core capital for purposes of calculating the Bank's compliance with
regulatory capital requirements.

         The risk-based capital regulation assigns each balance sheet asset held
by a savings institution to one of four risk categories based on the amount of
credit risk associated with that particular class of assets. Assets not included
for purposes of calculating capital are not included in calculating
risk-weighted assets. The categories range from 0% for cash and U.S. Government
securities that are backed by the full faith and credit of the U.S. Government
up to 100%. Qualifying residential mortgage loans (including multi-family
mortgage loans) are assigned a 50% risk weight.

         The book value of assets in each category is multiplied by the weighing
factor (from 0% to 100%) assigned to that category. These products are then
totaled to arrive to total risk-weighted assets. Off-balance sheet items are
included in risk-weighted assets by converting them to an approximate balance
sheet "credit equivalent amount" base on a conversion schedule. These credit
equivalents are then assigned to risk categories in the same manner as balance
sheet assets and are included in risk-weighted assets.

                                      -20-

<PAGE>

         The FDIC has been considering adopting a proposed rule for adding an
interest rate risk component to the regulatory capital rule. The proposal would
require, if adopted, that an institution hold capital against interest rate risk
exposure in an amount equal to 50% of the market value of portfolio equity
(i.e., aggregate net market value of assets, liabilities, and off-balance sheet
items) that would result from a immediate 200 basis point increase or decrease
in interest rates. If adopted, this component of the risk-based capital
requirement would require that an institution maintain additional capital
related to the amount of risk attendant to its interest rate position.

         At March 31, 2002 and 2001, the Bank met all of its capital
requirements. See Note 13 to the Consolidated Financial Statements in the 2002
Annual Report to Stockholders.

Dividend Limitations

         OBRE regulations require the Bank to give the OBRE thirty days advance
notice of any proposed declaration of dividends to the Holding Company, and the
OBRE has the authority under its supervisory powers to prohibit the payment of
dividends to the Holding Company. In addition, a Bank may not declare or pay a
cash dividend on its capital stock if the effect thereof would be to reduce the
regulatory capital of the Bank below the amount required for the liquidation
account established pursuant to the Bank's Plan of Conversion. The OBRE imposes
uniform limitations on the ability of savings banks to engage in various
distributions of capital such as dividends, stock repurchases and cash-out
mergers. The regulations utilize a three-tiered approach which permits various
level of distributions based primarily upon the savings bank's capital level.

         In the first tier, a savings bank that has capital in excess of the
capital requirements and that has not been notified by the OBRE that it is in
need of more than normal supervision, may make (without application) capital
distributions during a calendar year up to 100% of its net income to date during
the calendar year, plus one-half its surplus capital ratio at the beginning of
the calendar year. Capital distributions in excess of such amount require
advance approval from the OBRE.

         In the second tier, a savings bank that meets or exceeds its minimum
capital requirement (both before and after the proposed capital distribution),
but which has been notified by the OBRE that it shall be treated as a tier 2
bank because it is in need of more than normal supervision, may make (without
application) capital distributions ranging between 25% and 75% of its net income
during the previous four quarters.

         In the third tier, a savings bank with either capital below its minimum
capital requirements (either before and after the proposed capital
distribution), or a savings bank that meets or exceeds its capital requirement
but which has been notified by the OBRE that it shall be treated as a tier 3
bank because it is in need of more than normal supervision, may not make any
capital distributions without prior approval from the OBRE.

         The Bank has met the criteria to be in the first tier, and
consequently, would be able to distribute up to 100% of its net income during
any calendar year, plus 50% of its surplus capital ratio at the beginning of the
calendar year less any distributions previously paid during the year.

Investment Rules, Loans to One Borrower, and Aggregate Loan Limits

         Under OBRE regulations, the permissible amount of loans-to-one borrower
for state-chartered savings banks is 20% of its unimpaired capital and surplus
(25% if the security for such a loan has a "readily ascertainable" value or 30%
for certain residential development loans) or $500,000. At March 31, 2002, the
lending limitations, in essence, imposed a $711,000 limit on the Bank's
loans-to-one borrower.

         Savings banks and their subsidiaries may not acquire or retain
investments in corporate debt securities that, at the time of acquisition, were
not rated in one of the four highest rating categories by at least one
nationally recognized rating organization. At March 31, 2002, the Bank did not
have any corporate debt securities below investment grade.

                                      -21-

<PAGE>

Restrictions on Loans to Insiders

         FIRREA applies Section 22(h) of the Federal Reserve Act to non-member
savings banks and authorizes the FDIC to impose additional loan-to-insider
restrictions upon savings banks on a case-by-case basis. In general, Section
22(h) prohibits a bank from making loans or extending credit: (i) to any of its
executive officers or any person who directly or indirectly controls more than
10% of any class of voting securities of the bank where the loan amount or
extension of credit, when aggregated with other loans to that person and all
related interests of that person, would exceed 15% of a bank's unimpaired
capital and surplus for loans that are not fully secured by "readily marketable
collateral" and an additional 10% of such capital and surplus for loans fully
secured by such collateral; and (ii) to any of its executive officers, directors
or principal shareholders in an amount exceeding the higher of $25,000 or 5% of
the Bank's unimpaired capital and surplus, unless the loan or extension of
credit is pre-approved by a majority of the entire board of directors with the
interested party abstaining from participating directly or indirectly in the
voting.

         Section 22(h) also requires that all such insider loans or extensions
of credit be made on substantially the same terms, including interest rates and
collateral, as those prevailing at the time for comparable transactions with
other persons and do not involve more than the normal risk of repayment or
present other unfavorable features. Additionally, with certain exceptions,
Section 22(h) prohibits a member bank from paying an overdraft on an account at
such bank of an executive officer or director. At March 31, 2002, the Bank was
in compliance with restrictions on loans to insiders.

         Regulations issued by the FHLB Board prior to the enactment of FIRREA,
in relevant part, restricted a savings bank's loans to "affiliated persons" to
ones made in the "ordinary course of business" involving not more that the
"normal risks of collectibility" and not exceeding the loan amount that would be
available to members of the general public of similar credit status. According
to former FHLB Board regulations, loans secured by the principal residence of an
affiliated person, home improvement loans for affiliated persons and education,
consumer and credit card loans for affiliated persons must have been
pre-approved by at least a majority of the board of directors of the Bank. The
Bank was authorized, generally, to make such loans (and those secured by the
affiliated person's savings accounts at the Bank) with an interest rate not
below its current cost of funds.

Activities of Savings Bank and Their Subsidiaries

         FDIC and OBRE regulations provide that, when a savings bank establishes
or acquires a subsidiary or elects to conduct any new activity through a
subsidiary that the bank controls, the savings bank shall notify the FDIC and
OBRE thirty days in advance and provide the information each agency may, by
regulation, require. Savings banks also must conduct the activities of
subsidiaries in accordance with existing regulations and orders.

         The FDIC or the OBRE may determine that the continuation by a savings
bank of its ownership control, or its relationship to, the subsidiary
constitutes a serious risk to the safety, soundness, or stability of the bank or
is inconsistent with sound banking practices or with the purposes of the FDIC
Act. Based upon that determination, the FDIC or the OBRE has the authority to
order the savings bank to divest itself of control of the subsidiary. The FDIC
also may determine by regulation or order that any specific activity poses a
serious threat to the SAIF. If so, it may require that no SAIF member engage in
that activity directly. At March 31, 2002, the Bank had West Town Insurance
Agency as a wholly-owned subsidiary.

Brokered Deposits

         FIRREA states that no insured depository institution that fails to meet
the applicable minimum capital requirement may accept funds obtained directly or
indirectly by or through a deposit broker for deposit into one or more deposit
accounts. The FDIC is authorized to waive this prohibition on a case-by-case
basis, but only upon finding that such use of brokered deposits does not
constitute an unsafe or unsound practice. At March 31, 2002, the Bank had no
brokered deposits.

                                      -22-

<PAGE>

Investment Portfolio Policy

         Under OBRE regulations, savings banks are required to adopt and
maintain an investment policy which demonstrates the exercise of prudence in
making investment decisions. Per regulations and generally accepted accounting
principles, a financial institution is required to classify its securities into
one of three categories: securities purchased or held to maturity, securities
available for sale, and securities held for trading. Securities held in the
investment portfolio may be carried at amortized cost if the bank has documented
the intent and ability to hold the securities until maturity. Those being held
for sale or trading are to be carried at fair value. All of the Bank's
mortgage-backed securities are classified as held to maturity, since the Bank
had both the intent and ability to hold these mortgage-backed securities to
maturity, in accordance with Statement of Financial Accounting Standards 115.
The Bank's investments in corporate equity and debt securities are classified as
available for sale, and are recorded at their current fair values. See "Notes to
Consolidated Financial Statements #1 - Accounting Policies - Investment
Securities" in the Annual Report.

Transactions with Affiliates

         Pursuant to FIRREA, all financial institutions must comply with Section
23A and 23B of the Federal Reserve Act relative to transactions with affiliates
in the same manner and to the same extent as if all were Federal Reserve member
banks. Generally, Sections 23A and 23B: (i) limit the extent to which the
insured institution or its subsidiaries may engage in certain covered
transactions with an affiliate to an amount equal to 10% of such institution's
capital and surplus and place an aggregate limit on all such transactions with
affiliates to an amount equal to 20%of such capital and surplus, and (ii)
require that all such transactions be on terms substantially the same, or at
least as favorable to the institution or subsidiary, as those provided to a
non-affiliate. The term "covered transaction" includes the making of loan,
purchases of assets, issuance of a guaranty and similar other types of
transactions.

                                      -23-

<PAGE>

                           FEDERAL AND STATE TAXATION

Federal Taxation

         General. The Company and the Bank report their income on a fiscal year
basis using the accrual method of accounting and are subject to federal income
taxation in the same manner as other corporations with some exceptions,
including particularly the Bank's addition to its reserve for bad debts
discussed below. The following discussion of tax matters is intended only as a
summary and does not purport to be a comprehensive description of the tax rules
applicable to the Bank or the Company. For its taxable year ending March 31,
2002, the Company was subject to an effective federal income tax rate of 26.7%.

         Bad Debt Reserves. For fiscal years beginning prior to December 31,
1995, savings institutions which qualified under certain definitional tests and
other conditions of the Internal Revenue Code of 1986 (the "Code") were
permitted to use certain favorable provisions to calculate their deductions from
taxable income for annual additions to their bad debt reserve. A reserve could
be established for bad debts on qualifying real property loans (generally
secured by interests in real property improved or to be improved) under (i)
Percentage of Taxable Income Method (the "PTI Method") or (ii) the Experience
Method. The reserve for nonqualifying loans was computed using the Experience
Method.

         The Small Business Job Protection Act of 1996 (the "1996 Act"), which
was enacted on August 20, 1996, made significant changes to provisions of the
Code relating to a savings institution's use of bad debt reserves for federal
income tax purposes and requires such institutions to recapture (i.e., take into
income) certain portions of their accumulated bad debt reserves. The 1996 Act
repeals the reserve method of accounting for bad debts effective for tax years
beginning after 1995. Savings institutions that would be treated as small banks
are allowed to utilize the Experience Method applicable to such institutions,
while savings institutions that are treated as large banks (those generally
exceeding $500 million in assets) are required to use only the specific
charge-off method. Thus, the PTI Method of accounting for bad debts is no longer
available for any financial institution.

         A savings institution required to change its method of computing
reserves for bad debts will treat such change as a change in method of
accounting initiated by the taxpayer, and having been made with the consent of
the IRS. Any Section 481(a) adjustment required to be taken into income with
respect to such change generally will be taken into income ratably over a
six-taxable year period, beginning with the first taxable year beginning after
1995, subject to the residential loan requirement.

         Under the 1996 Act, for its current and future taxable years, the Bank
is not permitted to make additions to its tax bad debt reserves. In addition,
the Bank is required to recapture (i.e., take into income) over a six year
period the excess of the balance of its tax bad debt reserves as of March 31,
1996 other than its supplemental reserve for losses on loans, over the balance
of such reserves as of March 31, 1988. As a result of such recapture, the Bank
will incur an additional income tax liability of approximately $46,000 over the
recapture period.

                                      -24-

<PAGE>

     Distributions. Under the 1996 Act, if the Bank makes "non-dividend
distributions" to the Company, such distributions will be considered to have
been made from the Bank's unrecaptured tax bad debt reserves (including the
balance of its reserves as of March 31, 1988) to the extent thereof, and then
from the Bank's supplemental reserve for losses on loans, to the extent thereof,
and an amount based on the amount distributed (but not in excess of the amount
of such reserves) will be included in the Bank's income. Non-dividend
distributions include distributions in excess of the Bank's current and
accumulated earnings and profits, as calculated for federal income tax purposes,
distributions in redemption of stock, and distributions in partial or complete
liquidation. Dividends paid out of the Bank's current or accumulated earnings
and profits will not be so included in the Bank's income.

     The amount of additional taxable income triggered by a non-dividend is an
amount that, when reduced by the tax attributable to the income, is equal to the
amount of the distribution. Thus, if the Bank makes a non-dividend distribution
to the Company, approximately one and one-half times the amount of such
distribution (but not in excess of the amount of such reserves) would be
includable in income for federal income tax purposes, assuming a 34% federal
corporate income tax rate. The Bank does not intend to pay dividends that would
result in a recapture of any portion of its bad debt reserves.

     Corporate Alternative Minimum Tax. The Internal Revenue Code (the "Code")
imposes a tax on alternative minimum taxable income ("AMTI") at a rate of 20%.
Only 90% of AMTI can be offset by net operating loss carryovers. AMTI is
increased by an amount equal to 75% of the amount by which a corporation's
adjusted current earnings exceeds its AMTI (determined without regard to this
adjustment and prior to reduction for net operating losses). The Company and its
subsidiaries were not subject to this tax for the year ended March 31, 2002.

     Dividends Received Deduction and Other Matters. The Company may exclude
from its income 100% of dividends received from the Bank as a member of the same
affiliated group of corporations. The corporate dividends received deduction is
generally 70% in the case of dividends received from unaffiliated corporations
with which the Company and the Bank will not file a consolidated tax return,
except that if the Company or the Bank own more than 20% of the stock of a
corporation distributing a dividend 80% of any dividends received may be
deducted.

     Illinois Taxation. The Company and the Bank file Illinois income tax
returns. For Illinois income tax purposes, corporations are presently taxed at a
rate equal to 7.2% of taxable income. For this purpose, "taxable income"
generally means federal taxable income, subject to certain adjustments
(including the addition of interest income on state and municipal obligations
and the exclusion of interest income on United States Treasury obligations). The
exclusion of income on United States Treasury obligations has the effect of
reducing significantly the Illinois taxable income of savings institutions.

                                       -25-

<PAGE>

Impact of New Accounting Standards

     The following does not constitute a comprehensive summary of all material
changes or developments affecting the manner in which the Company keeps its
books and records and performs its financial accounting responsibilities. It is
intended only as a summary of sonic of the recent pronouncements made by the
Financial Accounting Standards Board ("FASB") which are of particular interest
to financial institutions.

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 141, "Business Combinations" (SFAS No. 141) and Statement of Financial
Accounting Standards No. 142, "Goodwill and Other Intangibles Assets" (SFAS No.
142). SFAS No. 141 requires that all business combinations initiated after June
30, 2001 be accounted for under the purchase method and addresses the initial
recognition and measurement of goodwill and other intangible assets subsequent
to their acquisition. SFAS No. 142 provides that intangible assets with finite
useful lives be amortized and that goodwill and intangible assets with
indefinite lives will not be amortized, but will rather be tested at least
annually for impairment. SFAS No. 142 is effective January 1, 2002 for calendar
year companies, however, any acquired goodwill or intangible assets recorded in
transactions closed subsequent to June 30, 2001 will be subject immediately to
the non-amortization and amortization provisions of SFAS No. 142. The Company
does not believe these statements will have a material impact on its
consolidated financial statements.

     In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations". This statement addresses the financial accounting and
reporting for obligations related to the retirement of tangible long-lived
assets and the related asset retirement costs. The statement is effective for
financial statements issued for fiscal years beginning after June 15, 2002, with
the initial application as of the beginning of the entity's fiscal year.
Adoption of this statement is not expected to have a material effect on the
Company's consolidated financial statements.

     In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment and Disposal of Long-Term Assets". This statement supersedes SFAS No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of," as well as the accounting and reporting of the
Accounting Principles Board (APB) Opinion No. 30, "Reporting the Results of
Operations- Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and Transactions". This
statement eliminates the allocation of goodwill to long-lived assets to be
tested for impairment and details both a probability-weighted and
"primary-asset" approach to estimate cash flows in testing for impairment of
long-lived assets. SFAS No. 144 is effective for financial statements issued for
fiscal years beginning after December 15, 2001. As such, the Company will adopt
the provisions of SFAS No. 144 on April 1, 2002. The Company does not expect
these provisions to have a material impact on its consolidated financial
statements.

                                       -26-

<PAGE>

Additional Item.  Executive Officers of the Registrant.
-------------------------------------------------------

         The following table sets forth certain information regarding the
executive officers of the Company and the Bank who are not also directors.

                             Age at      Position with the Company and Bank
Name                        03/31/02     and Past Five Years Experience
----                        --------     ----------------------------------

Jeffrey P. Kosobucki           36        Chief Financial Officer of the Company.
                                         Vice President and Chief Financial
                                         Officer of the Bank.

Item 2.  Properties.
--------------------

         The Company is located and conducts its business at the Bank's main
office located in Cicero, located at 4852 West 30th Street, Cicero, Illinois.
The Bank also maintains a branch office located 7820 W. 26th Street, North
Riverside, Illinois. See Note 6 to the Notes to Consolidated Financial
Statements for the net book value of the Bank's premises and equipment.

Item 3.  Legal Proceedings.
---------------------------

         Neither the Company nor its subsidiaries are involved in any pending
legal proceedings, other than routine legal matters occurring in the ordinary
course of business, which in the aggregate involve amounts which are believed by
management to be immaterial to the consolidated financial condition or results
of operations of the Company.

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

         None.

                                     PART II

Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters.
-------------------------------------------------------------------------------

         Information relating to the market for the Registrant's common equity
and related stockholder matters appears in the Registrant's 2002 Annual Report
to Stockholders on Page 27 and is incorporated herein by reference. On May 31,
2002, the Company had 78 registered stockholders.

Item 6.  Selected Financial Data.
---------------------------------

         The above-captioned information appears under "Selected Consolidated
Financial and Other Data of the Company" in the Registrant's 2002 Annual Report
to Stockholders on Pages 8 through 10 and is incorporated herein by reference.

Item 7. Management's Discussion and Analysis of Financial Condition and Results
-------------------------------------------------------------------------------
of Operations.
--------------

         The above-captioned information appears under "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in the
Registrant's 2002 Annual Report to Stockholders on Pages 11 through 26 and is
incorporated herein by reference.

Item 8.  Financial Statements and Supplementary Data.
-----------------------------------------------------

         The Consolidated Financial Statements of West Town Bancorp, Inc. and
its subsidiaries, together with the report thereon by Cobitz, VandenBerg &
Fennessy appear in the Registrant's 2002 Annual Report to Stockholders on Pages
F-1 through F-23 and are incorporated herein by reference.

                                       -27-

<PAGE>

Item 9. Change in and Disagreements with Accountants on Accounting and Financial
--------------------------------------------------------------------------------
Disclosure.
-----------

         None.

                                    PART III

Item 10.  Directors and Executive Officers of the Registrant.
-------------------------------------------------------------

     The information relating to Directors and Executive Officers of the
Registrant is incorporated herein by reference to the Registrant's Proxy
Statement for the Annual Meeting of Stockholders to be held on July 10, 2002, on
Pages 3 through 6. Information concerning Executive Officers who are not
directors is contained in Part I of this report pursuant to paragraph (b) of
Item 401 of Regulation S-K in reliance on Instruction G.

Item 11.  Executive Compensation.
---------------------------------

     The information relating to director and executive compensation is
incorporated herein by reference to the Registrant's Proxy Statement for the
Annual Meeting of Stockholders to be held on July 10, 2002, on Pages 10 through
15.

Item 12.  Security Ownership of Certain Beneficial Owners and Management.
-------------------------------------------------------------------------

     The information relating to security ownership of certain beneficial owners
and management is incorporated herein by reference to the Registrant's Proxy
Statement for the Annual Meeting of Stockholders to be held on July 10, 2002, on
Pages 2 through 3.

Item 13.  Certain Relationships and Related Transactions.
---------------------------------------------------------

     The information relating to certain relationships and related transactions
is incorporated herein by reference to the Registrant's Proxy Statement for the
Annual Meeting of Stockholders to be held on July 10, 2002, on Page 15.

                                       -28-

<PAGE>

                                     PART IV
                                     -------

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K.
--------------------------------------------------------------------------

1.   Independent Auditors' Report*

2.   All Financial Statements*

     (a)  Consolidated Statements of Condition as of March 31, 2002 and 2001.

     (b)  Consolidated Statements of Income for the Years Ended March 31, 2002,
          2001 and 2000.

     (c)  Consolidated Statements of Stockholders' Equity for Years Ended March
          31, 2002, 2001 and 2000.

     (d)  Consolidated Statements of Cash Flows for the Years Ended March 31,
          2002, 2001 and 2000.

     (e)  Notes to Consolidated Financial Statements

     All schedules have been omitted as the required information is either
     inapplicable or included in the Notes to Consolidated Financial Statements.

3.   Exhibits

     (3)(a) Certificate of Incorporation of West Town Bancorp, Inc.**

     (3)(b) Bylaws of West Town Bancorp, Inc.**

     11     Statement regarding Computation of Earnings Per Share

     13     2002 Annual Report to Stockholders

     21     Subsidiaries of the Registrant

     23     Consent of Independent Auditors

     *    Incorporated by reference to the Annual Report to Stockholders for the
          fiscal year ended March 31, 2002, attached as an exhibit hereto.

     **   Incorporated by reference to the Registration Statement on Form S-1,
          and amendments thereto, filed with the Securities and Exchange
          Commission.

                                  -29-

<PAGE>

                                   SIGNATURES

         Pursuant to the requirements of Section 13 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.

                                     WEST TOWN BANCORP, INC.



                                     By:   /s/ Dennis B. Kosobucki
                                           -------------------------------------
                                           Dennis B. Kosobucki
DATED:   June 5, 2002                      Chairman of the Board,
                                           President and Chief Executive Officer
                                           (Duly Authorized Representative)


         Pursuant to the requirements of the Securities and Exchange Act of
1934, this report has been signed by the following persons in the capacities and
on the dates indicated.

<TABLE>
<CAPTION>
         Name                    Title                                  Date
         ----                    -----                                  ----
<S>                              <C>                                    <C>
/s/ Dennis B. Kosobucki          Chairman of the Board                  June 5, 2002
--------------------------       President, Chief Executive Officer
Dennis B. Kosobucki              (Principal Executive Officer)


/s/ Jeffrey P. Kosobucki         Vice President and Chief               June 5, 2002
--------------------------       Financial Officer
Jeffrey P. Kosobucki             (Principal Financial Officer
                                 and Principal Accounting Officer)

/s/ Edward J. Hradecky           Director                               June 5, 2002
--------------------------
Edward J. Hradecky

/s/ John A. Storcel              Director                               June 5, 2002
--------------------------
John A. Storcel

/s/ James Kucharczyk             Director                               June 5, 2002
--------------------------
James Kucharczyk

/s/ James J. Kemp, Jr.           Director                               June 5, 2002
--------------------------
James J. Kemp, Jr.


/s/ James Kucera                 Director                               June 5, 2002
--------------------------
James Kucera

/s/ Charles J. Sourek, Jr.       Director                               June 5, 2002
--------------------------
Charles J. Sourek, Jr.
</TABLE>

                                       -30-

<PAGE>

                  [LETTERHEAD OF COBITZ, VANDENBERG & FENNESSY]

                          INDEPENDENT AUDITORS' REPORT

The Board of Directors
West Town Bancorp, Inc.
Cicero, Illinois

         We have audited the consolidated statements of financial condition of
West Town Bancorp, Inc. and subsidiaries as of March 31, 2002 and 2001 and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for each of the three years in the period ended March 31, 2002. These
consolidated financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.

         We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the consolidated financial statements are
free of material misstatements. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
consolidated financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

         In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of West Town
Bancorp, Inc. and subsidiaries at March 31, 2002 and 2001, and the results of
their operations and their cash flows for each of the three years in the period
ending March 31, 2002, in conformity with generally accepted accounting
principles.

                                   /s/ Cobitz, Vandenberg & Fennessy

April 25, 2002
Palos Hills, Illinois

                                       F-1

<PAGE>

                             WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

                 Consolidated Statements of Financial Condition

<TABLE>
<CAPTION>
                                                                      March 31,
                                                              ------------------------
                                                                 2002          2001
                                                                 ----          ----
<S>                                                        <C>             <C>
Assets
------

Cash and amounts due from depository institutions          $    423,795       370,160
Interest-bearing deposits                                     9,841,394     6,765,061
                                                             ----------    ----------
   Total cash and cash equivalents                           10,265,189     7,135,221
Mortgage-backed securities, held to maturity
  (fair value: 2002 - $22,631,400;
  2001 - $7,621,200) (note 2)                                22,534,020     7,501,917
Loans receivable (net of allowance for loan losses:
  2002 - $117,000; 2001 - $99,000) (note 3)                  25,079,838    31,344,877
Stock in Federal Home Loan Bank of Chicago                      296,800       200,500
Other investments, available for sale,
  at fair value (note 4)                                        279,200       263,000
Accrued interest receivable (note 5)                            240,327       273,425
Office properties and equipment - net (note 6)                1,489,939     1,576,557
Prepaid expenses and other assets (note 7)                      836,309     1,529,518
                                                             ----------    ----------

   Total assets                                              61,021,622    49,825,015
                                                             ==========    ==========

Liabilities and Stockholders' Equity
------------------------------------

Liabilities
-----------

Deposits (note 8)                                            51,319,909    45,204,540
Borrowed money (note 9)                                               -             -
Advance payments by borrowers for taxes and insurance            47,275        48,311
Other liabilities (note 10)                                   5,407,100       473,562
                                                             ----------    ----------
   Total liabilities                                         56,774,284    45,726,413
                                                             ----------    ----------

Stockholders' Equity
--------------------

Preferred stock, $.01 par value; authorized
  100,000 shares; none outstanding                                    -             -
Common stock, $.01 par value; authorized
  400,000 shares; 231,928 shares issued and
  204,287 shares outstanding at March 31, 2002
  and 204,787 shares outstanding at March 31, 2001                2,319         2,319
Additional paid-in capital                                    2,004,931     2,000,877
Retained earnings, substantially restricted                   2,586,524     2,460,055
Accumulated other comprehensive income,
  net of income taxes                                            50,724        46,782
Treasury stock, at cost (27,641 and 27,141 shares
  at March 31, 2002 and 2001)                                  (327,557)     (321,557)
Common stock acquired by Employee Stock Ownership Plan          (69,603)      (89,874)
                                                             ----------    ----------
   Total stockholders' equity (notes 13 and 14)               4,247,338     4,098,602
                                                             ----------    ----------

Commitments and contingencies (notes 15 and 16)

   Total liabilities and stockholders' equity              $ 61,021,622    49,825,015
                                                             ==========    ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                       F-2

<PAGE>

                             WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

                        Consolidated Statements of Income

<TABLE>
<CAPTION>
                                                        Years Ended March 31,
                                              ---------------------------------------
                                                   2002          2001          2000
                                                   ----          ----          ----
<S>                                           <C>             <C>           <C>
Interest income:
  Loans                                       $ 2,157,833     2,039,014     1,448,545
  Mortgage-backed securities                      786,189       337,619        45,271
  Investment securities                            11,000        11,000        11,000
  Interest-bearing deposits                       279,413       549,808       510,749
  Dividends on FHLB stock                          16,492        14,285        12,710
                                              -----------     ---------     ---------
     Total interest income                      3,250,927     2,951,726     2,028,275
                                              -----------     ---------     ---------

Interest expense:
  Deposits                                      2,147,511     2,078,518     1,244,964
                                              -----------     ---------     ---------

     Net interest income before provision
      for loan losses                           1,103,416       873,208       783,311
Provision for loan losses (note 3)                 18,000        40,829         6,000
                                              -----------     ---------     ---------
     Net interest income after provision
      for loan losses                           1,085,416       832,379       777,311
                                              -----------     ---------     ---------

Non-interest income:
  Loan fees and service charges                    17,337         8,168        12,530
  Rental income                                    13,137        12,121        10,316
  Deposit related fees and other income           151,032        87,807        27,010
                                              -----------     ---------     ---------
     Total non-interest income                    181,506       108,096        49,856
                                              -----------     ---------     ---------

Non-interest expense:
  Compensation, employee benefits, and
    related expenses (note 11)                    525,679       512,139       376,085
  Advertising and promotion                        18,802        27,200        31,519
  Occupancy and equipment expenses (note 6)       230,227       212,832       130,211
  Data processing                                  66,117        64,769        37,450
  Federal deposit insurance premiums                8,561         6,564        12,933
  Legal, audit, and examination services           98,517        72,175        61,935
  Other operating expenses                        143,139       115,514        90,814
                                              -----------     ---------     ---------
     Total non-interest expense                 1,091,042     1,011,193       740,947
                                              -----------     ---------     ---------

Net income (loss) before income taxes             175,880       (70,718)       86,220

Provision for income
  taxes (benefit) (note 12)                        49,411       (31,711)       24,184
                                              -----------     ---------     ---------

     Net income (loss)                        $   126,469       (39,007)       62,036
                                              ===========     =========     =========

Earnings (loss) per share - basic             $       .64          (.20)          .30
                                              -----------     ---------     ---------

Earnings (loss) per share - diluted           $       .64          (.20)          .30
                                              -----------     ---------     ---------

Dividends declared per common share           $        -             -             -
                                              -----------     ---------     ---------
</TABLE>

See accompanying notes to consolidated financial statements.

                                       F-3

<PAGE>

                             WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

           Consolidated Statements of Changes in Stockholders' Equity

                        Three Years Ended March 31, 2002

<TABLE>
<CAPTION>
                                                                       Accumulated                Common
                                            Additional                    Other                   Stock
                                   Common    Paid-in      Retained    Comprehensive   Treasury    Acquired
                                   Stock     Capital      Earnings        Income        Stock     by ESOP       Total
                                   ------   ----------   ----------   -------------   ---------   --------      -----
<S>                               <C>       <C>          <C>          <C>             <C>        <C>          <C>
Balance at March 31, 1999         $ 2,319    1,993,869    2,437,026       44,832     (107,206)   (124,416)    4,246,424

Comprehensive income:
Net income                                                   62,036                                              62,036
 Other comprehensive income,
   net of tax:
  Unrealized holding loss
   during the year                                                       (13,609)                               (13,609)
                                                          ---------      -------                              ---------

Total comprehensive income                                   62,036      (13,609)                                48,427
                                                          ---------      -------                              ---------
Purchase of treasury stock
  (12,241 shares)                                                                    (147,451)                 (147,451)
Contribution to fund ESOP loan                   3,392                                             16,454        19,846
                                  -------    ---------    ---------      -------      -------     -------     ---------

Balance at March 31, 2000           2,319    1,997,261    2,499,062       31,223     (254,657)   (107,962)    4,167,246
                                  -------    ---------    ---------      -------      -------     -------     ---------
Comprehensive income:
Net loss                                                    (39,007)                                            (39,007)
 Other comprehensive income,
   net of tax:
  Unrealized holding gain
   during the year                                                        15,559                                 15,559
                                                          ---------      -------                              ---------

Total comprehensive income                                  (39,007)      15,559                                (23,448)
                                                          ---------      -------                              ---------
Purchase of treasury stock
  (5,575 shares)                                                                      (66,900)                  (66,900)
Contribution to fund ESOP loan                   3,616                                             18,088        21,704
                                  -------    ---------    ---------      -------      -------     -------     ---------

Balance at March 31, 2001           2,319    2,000,877    2,460,055       46,782     (321,557)    (89,874)    4,098,602
                                  -------    ---------    ---------      -------      -------     -------     ---------

Comprehensive income:
Net income                                                  126,469                                             126,469
 Other comprehensive income,
   net of tax:
  Unrealized holding gain
   during the year                                                         3,942                                  3,942
                                                          ---------      -------                              ---------

Total comprehensive income                                  126,469        3,942                                130,411
                                                          ---------      -------                              ---------
Purchase of treasury stock
  (500 shares)                                                                         (6,000)                   (6,000)
Contribution to fund ESOP loan                   4,054                                             20,271        24,325
                                  -------    ---------    ---------      -------      -------     -------     ---------

Balance at March 31, 2002         $ 2,319    2,004,931    2,586,524       50,724     (327,557)    (69,603)    4,247,338
                                  =======    =========    =========      =======      =======     =======     =========
</TABLE>

See accompanying notes to consolidated financial statements.

                                      F-4

<PAGE>

                             WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

                      Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                    Years Ended March 31,
                                                           -------------------------------------
                                                              2002         2001         2000
                                                              ----         ----         ----
<S>                                                      <C>           <C>           <C>
Cash flows from operating activities:
  Net income (loss)                                     $    126,469      (39,007)      62,036
   Adjustments to reconcile net income to net cash
    from operating activities:
     Depreciation                                             93,574       90,835       47,049
     Amortization of cost of stock benefit plans              24,325       21,704       19,846
     Federal Home Loan Bank stock dividend                   (16,200)     (14,100)      (3,100)
     Provision for loan losses                                18,000       40,829        6,000
     Decrease in deferred income                             (29,132)        (442)      (7,142)
     (Increase) decrease in current and deferred federal
       and state income taxes                                 46,378        9,269      (31,713)
     (Increase) decrease in accrued interest receivable       33,098     (121,751)         776
     Increase (decrease) in accrued interest payable         (70,319)     136,475       15,002
     Change in prepaid and accrued items, net                (64,441)     (98,207)     350,078
                                                        ------------   ----------    ---------

Net cash provided by operating activities                    161,752       25,605      458,832
                                                        ------------   ----------    ---------

Cash flows from investing activities:
     Purchase of mortgage-backed securities,
         held to maturity                                (22,359,499)  (6,888,224)    (991,250)
     Proceeds from repayments of mortgage-backed
       securities, held to maturity                       12,327,396      961,864      353,631
     Purchase of Federal Home Loan Bank stock                (80,100)           -       (5,900)
     Disbursements for loans originated or purchased     (11,652,044) (20,966,887)  (4,689,865)
     Loan repayments                                      18,631,086    8,077,608    4,461,070
     Participation loans sold                                      -       82,743      707,011
     Property and equipment expenditures                      (6,956)     (19,018)  (1,139,097)
                                                        ------------   ----------   ----------

Net cash provided for investing activities                (3,140,117) (18,751,914)  (1,304,400)
                                                        ------------   ----------   ----------

Cash flows from financing activities:
     Purchase of treasury stock                               (6,000)     (66,900)    (147,451)
     Deposit receipts                                     56,140,154   42,295,532   15,562,103
     Deposit withdrawals                                 (52,242,709) (29,490,329) (12,763,981)
     Interest credited to deposit accounts                 2,217,924    1,941,717    1,229,981
     Increase (decrease) in advance payments by
      borrowers for taxes and insurance                       (1,036)      11,601       (4,322)
                                                        ------------   ----------   ----------

Net cash provided by financing activities                  6,108,333   14,691,621    3,876,330
                                                        ------------   ----------   ----------

Increase (decrease) in cash and cash equivalents           3,129,968   (4,034,688)   3,030,762
Cash and cash equivalents at beginning of year             7,135,221   11,169,909    8,139,147
                                                        ------------   ----------   ----------

Cash and cash equivalents at end of year                $ 10,265,189    7,135,221   11,169,909
                                                        ============   ==========   ==========

Cash paid during the year for:
     Interest                                           $  2,217,830    1,942,043    1,229,962
     Income taxes                                             42,400        3,500       56,754
                                                        ============   ==========   ==========
</TABLE>

See accompanying notes to consolidated financial statements.

                                       F-5

<PAGE>

                             WEST TOWN BANCORP, INC.
                                AND SUBSIDIARIES
                                ----------------

                   Notes to Consolidated Financial Statements

1)   Summary of Significant Accounting Policies
     ------------------------------------------

     West Town Bancorp, Inc. (the "Company") is a Delaware corporation
     incorporated on May 6, 1994 for the purpose of becoming the savings bank
     holding company for West Town Savings Bank (the "Bank"). On March 1, 1995,
     the Bank converted from a mutual to a stock form of ownership, and the
     Company completed its initial public offering, and with a portion of the
     net proceeds acquired all of the issued and outstanding capital stock of
     the Bank.

     The accounting and reporting policies of the Company and its subsidiaries
     conform to generally accepted accounting principles and to general practice
     within the thrift industry. The preparation of financial statements in
     conformity with generally accepted accounting principles requires
     management to make estimates and assumptions that affect the reported
     amounts of assets and liabilities and disclosures of contingent assets and
     liabilities at the date of the financial statements and the reported
     amounts of revenues and expenses during the reporting period. Actual
     results could differ from those estimates. The following is a description
     of the more significant policies which the Company follows in preparing and
     presenting its consolidated financial statements.

     Principles of Consolidation
     ---------------------------

     The accompanying consolidated financial statements include the accounts of
     the Company, and its wholly owned subsidiary, West Town Savings Bank and
     the Bank's wholly owned subsidiary, West Town Insurance Agency, Inc.
     Significant intercompany balances and transactions have been eliminated in
     consolidation.

     Industry Segments
     -----------------

     The Company operates principally in the banking industry through its
     subsidiary bank. As such, substantially all of the Company's revenues, net
     income, identifiable assets and capital expenditures are related to banking
     operations.

     Mortgage-Backed Securities, Held to Maturity
     --------------------------------------------

     Mortgage-backed securities are carried at cost, and adjusted for
     amortization of premiums and accretion of discounts. Premiums and discounts
     are amortized and accreted into income using the level-yield method. These
     securities are not carried at fair value because the Company has both the
     ability and the intent to hold them to maturity.

                                       F-6

<PAGE>

1)   Summary of Significant Accounting Policies (continued)
     ------------------------------------------------------

     Other Investments, Available for Sale
     -------------------------------------

     Investment securities are recorded in accordance with Statement of
     Financial Accounting Standards ("SFAS") No. 115 "Accounting for Certain
     Investments in Debt and Equity Securities". SFAS No. 115 requires the use
     of fair value accounting for securities available for sale or trading and
     retains the use of the amortized cost method for investments the Company
     has the positive intent and ability to hold to maturity.

     SFAS No. 115 requires the classification of debt and equity securities into
     one of three categories: held to maturity, available for sale, or trading.
     Held to maturity securities are measured at amortized cost. Unrealized
     gains and losses on trading securities are included in income. Unrealized
     gains and losses on available for sale securities are excluded from income
     and reported net of taxes as a separate component of stockholders' equity.

     The Company has designated certain equity and debt securities as available
     for sale, and has recorded these investments at their current fair values.
     Unrealized gains and losses are recorded in a valuation account which is
     included, net of income taxes, as a separate component of stockholders'
     equity. Gains and losses on the sale of securities are determined using the
     specific identification method.

     Loans Receivable and Related Fees
     ---------------------------------

     Loans are stated at the principal amount outstanding, net of loans in
     process, deferred fees and the allowance for losses. Interest on loans is
     credited to income as earned and accrued only if deemed collectible. Loans
     are placed on non-accrual status when, in the opinion of management, the
     full timely collection of principal or interest is in doubt. As a general
     rule, the accrual of interest is discontinued when principal or interest
     payments become 90 days past due or earlier if conditions warrant. When a
     loan is placed on nonaccrual status, previously accrued but unpaid interest
     is charged against current income.

     Loan origination fees are being deferred in accordance with SFAS No. 91,
     "Accounting for Nonrefundable Fees and Costs Associated with Originating or
     Acquiring Loans and Initial Direct Costs of Leases". This statement
     requires that loan origination fees and direct loan origination costs for a
     completed loan be netted and then deferred and amortized into interest
     income as an adjustment of yield over the contractual life of the loan.

     The Company has adopted the provisions of SFAS No. 114 "Accounting by
     Creditors for Impairment of a Loan" and SFAS No. 118 "Accounting by
     Creditors for Impairment of a Loan - Income Recognition and Disclosures"
     which impose certain requirements on the measurement of impaired loans.
     These statements apply to all loans that are identified for evaluation
     except for large groups of smaller-balance homogeneous loans that are
     collectively evaluated for impairment. These loans include, but are not
     limited to, residential mortgage and consumer installment loans. A loan is
     considered impaired when it is probable that a creditor will be unable to
     collect contractual principal and interest due according to the contractual
     terms of the loan agreement. Management has determined that there were no
     material amounts of loans at March 31, 2002 and 2001, nor during the three
     years ended March 31, 2002, which met the definition of an impaired loan.

                                       F-7

<PAGE>

1)   Summary of Significant Accounting Policies (continued)
     ------------------------------------------------------

     Allowance for Loan Losses
     -------------------------

     The determination of the allowance for loan losses involves material
     estimates that are susceptible to significant change in the near term. The
     allowance for loan losses is maintained at a level adequate to provide for
     losses through charges to operating expense. The allowance is based upon
     past loss experience and other factors which, in management's judgement,
     deserve current recognition in estimating losses. Such other factors
     considered by management include growth and composition of the loan
     portfolio, the relationship of the allowance for losses to outstanding
     loans, and economic conditions.

     Management believes that the allowance is adequate. While management uses
     available information to recognize losses on loans, future additions to the
     allowance may be necessary based on changes in economic conditions. In
     addition, various regulatory agencies, as an integral part of their
     examination process, periodically review the Company's allowance for
     losses. Such agencies may require the Company to recognize additions to the
     allowance based on their judgements about information available to them at
     the time of their examination.

     Depreciation
     ------------

     Depreciation of office properties and equipment are accumulated on the
     straight-line basis over estimated lives of the various assets. Estimated
     lives are 15 to 40 years for office buildings, 30 years for parking lot
     improvements, and 5 to 10 years for furniture, fixtures and equipment.

     Income Taxes
     ------------

     The Company files a consolidated federal income tax return with its
     subsidiaries. The provision for federal and state taxes on income is based
     on earnings reported in the financial statements. Deferred income taxes
     arise from the recognition of certain items of income and expense for tax
     purposes in years different from those in which they are recognized in the
     consolidated financial statements. Deferred tax assets and liabilities are
     recognized for the estimated future tax consequences attributable to
     differences between the financial statement carrying amount of existing
     assets and liabilities and their respective tax bases. Deferred tax assets
     and liabilities are measured using enacted tax rates in effect for the year
     in which those temporary differences are expected to be recovered or
     settled. The effect on deferred tax assets and liabilities of a change in
     tax rates is recognized in income for the period that includes the
     enactment date.

     Consolidated Statements of Cash Flows
     -------------------------------------

     For the purposes of reporting cash flows, the Company has defined cash and
     cash equivalents to include cash on hand, amounts due from depository
     institutions, and interest-bearing deposits in other financial
     institutions.

     Reclassifications
     -----------------

     Certain 2001 items have been reclassified to conform with the 2002
     presentation.

                                       F-8

<PAGE>

1)   Summary of Significant Accounting Policies (continued)
     ------------------------------------------------------

     Earnings Per Share
     ------------------

     Basic earnings per share is computed by dividing net income by the
     weighted-average number of common shares outstanding for the period. ESOP
     shares not committed to be released are not considered to be outstanding.
     Diluted earnings per share reflects the potential dilution that could occur
     if securities or other contracts to issue common stock were exercised or
     converted into common stock or resulted in the issuance of common stock
     that then shared in the earnings of the entity.

     Weighted average shares used in calculating earnings per share are
     summarized below:

<TABLE>
<CAPTION>
                                                          Years Ended March 31,
                                                 ---------------------------------------
                                                      2002          2001          2000
                                                      ----          ----          ----
         <S>                                     <C>               <C>           <C>
         Weighted average number of
           common shares outstanding used
           in basic EPS calculation                  196,500       196,539       203,981
         Add common stock equivalents
           for shares issuable under
           Stock Option Plans                          2,647         2,641         2,720
                                                     -------       -------       -------

         Weighted average number of shares
           outstanding adjusted for common
           stock equivalents                         199,147       199,180       206,701
                                                     =======       =======       =======

         Net income (loss)                         $ 126,469       (39,007)       62,036
         Basic earnings (loss) per share           $     .64          (.20)          .30
         Diluted earnings (loss) per share         $     .64          (.20)          .30
</TABLE>

                                      F-9

<PAGE>

2)   Mortgage-Backed Securities, Held to Maturity
     --------------------------------------------

     Mortgage-backed securities are summarized as follows:

<TABLE>
<CAPTION>
                                                          Gross         Gross
                                         Amortized      Unrealized    Unrealized     Fair
                                            Cost          Gains         Losses       Value
                                       -------------   -----------   -----------  -----------
     <S>                               <C>             <C>           <C>          <C>
     March 31, 2002
     --------------

        Participation Certificates:
            FHLMCs                     $   9,613,000        6,422         23,322    9,596,100
            GNMAs                          5,180,464       64,036              -    5,244,500
            FNMAs                          5,246,855       45,245              -    5,292,100
            CMOs                           2,493,701        8,452          3,453    2,498,700
                                       -------------   -----------   -----------  -----------

                                       $  22,534,020      124,155         26,775   22,631,400
                                       =============   ==========    ==========   ===========


     Weighted average interest rate             6.76%
                                                ====

     March 31, 2001
     --------------

        Participation Certificates:
            FHLMCs                     $     392,761          402          6,763      386,400
            GNMAs                          3,260,165       94,135              -    3,354,300
            FNMAs                          3,353,991       29,009              -    3,383,000
            CMOs                             495,000        2,500              -      497,500
                                       -------------   -----------   -----------  -----------

                                       $   7,501,917      126,046          6,763    7,621,200
                                       =============   ==========    ===========  ===========


         Weighted average interest rate         7.40%
                                                ====
</TABLE>

                                      F-10

<PAGE>

3)   Loans Receivable
     ----------------

     Loans receivable are summarized as follows:

<TABLE>
<CAPTION>
                                                                   March 31,
                                                         ---------------------------
                                                               2002          2001
                                                               ----          ----
     <S>                                                 <C>              <C>
     Mortgage loans:
        One-to-four family                               $  15,000,853    22,578,763
        Multi-family                                         1,049,499       609,277
        Nonresidential                                       1,147,509     1,588,884
        Construction                                         1,670,000     1,090,000
                                                         -------------    ----------

     Total mortgage loans                                   18,867,861    25,866,924
                                                         -------------    ----------

     Other loans:
        Secured lines of credit                              4,444,073     3,590,744
        Business loans                                       1,616,863     1,755,688
        Loans on deposit accounts                               36,271       164,968
        Consumer loans                                         997,145       644,825
                                                         -------------    ----------

     Total other loans                                       7,094,352     6,156,225
                                                         -------------    ----------

     Total loans receivable                                 25,962,213    32,023,149
                                                         -------------    ----------

     Less:
        Loans in process                                       715,756       500,521
        Deferred loan fees and discounts,
          net of premiums                                       49,619        78,751
        Allowance for loan losses                              117,000        99,000
                                                         -------------    ----------

     Loans receivable, net                               $  25,079,838    31,344,877
                                                         =============    ==========


     Weighted average interest rate                               6.69%         7.51%
                                                         =============    ==========
</TABLE>

     There were no loans delinquent three months or more at March 31, 2002 and
     2001 respectively. The Bank has established a loan loss reserve of
     $117,000.

     Activity in the allowance for loan losses is summarized as follows:

<TABLE>
<CAPTION>
                                                            Years Ended March 31,
                                                   -------------------------------------
                                                      2002          2001          2000
                                                      ----          ----          ----
<S>                                                <C>              <C>           <C>
         Balance, beginning of year                $  99,000        58,171        52,171

         Provision for loan losses                    18,000        40,829         6,000

         Charge-offs                                       -             -             -
                                                     -------        ------        ------

         Balance, end of year                      $ 117,000        99,000        58,171
                                                     =======        ======        ======
</TABLE>

     The Bank has pledged approximately $422,000 in single-family mortgage loans
     as collateral to secure deposits in excess of Federal Deposit Insurance
     Corporation insurance limitations. The balances of these loans are at least
     110% of the non-insured deposits at March 31, 2002, in accordance with the
     terms of the executed collateralization agreements with various depositors.

                                      F-11

<PAGE>

4)   Other Investments, Available for Sale
     -------------------------------------

     This portfolio is being accounted for at fair value in accordance with SFAS
     No. 115. A summary of other investments available for sale is as follows:

<TABLE>
<CAPTION>
                                                        Gross       Gross
                                        Amortized    Unrealized   Unrealized      Fair
                                          Cost          Gains       Losses        Value
                                       -----------   ----------  ------------  ----------
     <S>                               <C>           <C>         <C>           <C>
     March 31, 2002
     --------------

     Corporate equity securities       $   100,000       80,000             -     180,000
     Corporate debt securities             100,000            -           800      99,200
                                       -----------   ----------  ------------  ----------

                                       $   200,000       80,000           800     279,200
                                       ===========   ==========  ============  ==========

     March 31, 2001
     --------------

     Corporate equity securities       $   100,000       70,000             -     170,000
     Corporate debt securities             100,000            -         7,000      93,000
                                       -----------   ----------  ------------  ----------

                                       $   200,000       70,000         7,000     263,000
                                       ===========   ==========  ============  ==========
</TABLE>

     There were no sales from this portfolio during the years ended March 31,
     2002, 2001 and 2000 respectively. In addition, during the current period,
     the increase in net unrealized gains of $16,200, adjusted for the tax
     effect of $12,258, resulted in a $3,942 credit to stockholders' equity.

5)   Accrued Interest Receivable
     ---------------------------

     Accrued interest receivable is summarized as follows:

<TABLE>
<CAPTION>
                                                                March 31,
                                                         ----------------------
                                                           2002           2001
                                                           ----           ----
     <S>                                                 <C>            <C>
     Interest-bearing deposits                          $       -        14,422
     Mortgage-backed securities                           100,857        48,489
     Loans receivable                                     137,163       208,220
     Other                                                  2,307         2,294
                                                          -------       -------

                                                        $ 240,327       273,425
                                                          =======       =======
</TABLE>

                                      F-12

<PAGE>

6)   Office Properties and Equipment
     -------------------------------

     Office properties and equipment are summarized as follows:

<TABLE>
<CAPTION>
                                                                      March 31,
                                                              -----------------------
                                                                  2002          2001
                                                                  ----          ----
     <S>                                                      <C>           <C>
     Cost:
        Land - Cicero                                        $   25,532        25,532
        Land - North Riverside                                  351,975       351,975
        Office building - Cicero                                426,631       426,631
        Office building - North Riverside                       754,828       754,828
        Furniture, fixtures and equipment                       458,585       451,629
        Automobile                                               36,511        36,511
                                                             ----------     ---------
                                                              2,054,062     2,047,106

     Less accumulated depreciation                              564,123       470,549
                                                             ----------     ---------

                                                             $1,489,939     1,576,557
                                                             ==========     =========
</TABLE>

     Depreciation of office properties and equipment for the years ended March
     31, 2002, 2001 and 2000 amounted to $93,574, $90,835, and $47,049
     respectively.

7)   Prepaid Expenses and Other Assets
     ---------------------------------

     Prepaid expenses and other assets consist of the following:

<TABLE>
<CAPTION>
                                                                   March 31,
                                                            -----------------------
                                                              2002          2001
                                                              ----          ----
<S>                                                         <C>           <C>
     Current federal and state income tax
       overpayment - net                                    $   3,940        48,973
     Prepaid insurance                                         30,373        12,626
     Other prepaid expenses                                    11,458        22,079
     Cash surrender value of corporate-owned
       life insurance                                         107,049        86,263
     Amounts due on loans serviced by others                  530,741     1,233,612
     Other                                                    152,748       125,965
                                                            ---------     ---------

                                                            $ 836,309     1,529,518
                                                            =========     =========
</TABLE>

                                      F-13

<PAGE>

8)   Deposits
     --------

     Deposit accounts are summarized as follows:

                                                           March 31,
                                                  ------------------------
                                                      2002         2001
                                                      ----         ----

     Passbook accounts                          $  7,995,036    6,217,668
     Certificates                                 36,178,441   31,659,831
     Demand deposit and money market accounts      7,146,432    7,327,041
                                                ------------   ----------

       Total                                    $ 51,319,909   45,204,540
                                                ============   ==========


     The composition of deposit accounts by interest rate is as follows:

                                                       March 31,
                                              ------------------------
                                                  2002          2001
                                                  ----          ----

     Non-interest bearing                   $  1,585,688       851,334
     1.00 - 2.99%                             17,447,992     6,650,627
     3.00 - 3.99                              13,747,521        59,094
     4.00 - 4.99                               7,050,089     6,731,096
     5.00 - 5.99                               8,772,641     5,503,536
     6.00 - 6.99                               2,132,989    23,200,504
     7.00 - 7.99                                 582,989     2,208,349
                                            ------------    ----------

       Total                                $ 51,319,909    45,204,540
                                            ============    ==========

     The weighted average interest rate on deposit accounts at March 31, 2002
     and 2001 was 3.38% and 5.47% respectively.

     A summary of certificates of deposit that mature during the twelve-month
     periods indicated is as follows:

                                                             March 31,
                                                    ------------------------
                                                        2002          2001
                                                        ----          ----

     Twelve month period ended March 31, 2002     $          -    26,647,720
     Twelve month period ended March 31, 2003       29,981,709     4,324,825
     Twelve month period ended March 31, 2004        5,360,193       424,007
     Twelve month period ended March 31, 2005          356,970        45,832
     Twelve month period ended March 31, 2006          113,675       217,447
     Twelve month period ended March 31, 2007
       and thereafter                                  365,894             -
                                                  ------------    ----------

       Total                                      $ 36,178,441    31,659,831
                                                  ============    ==========

     Interest expense on deposits consists of the following:

                                             Years Ended March 31,
                                    -------------------------------------
                                       2002          2001          2000
                                       ----          ----          ----

     Passbooks                    $   130,691       152,632       147,544
     Certificates                   1,842,823     1,717,006     1,086,131
     Demand deposit and
      money market accounts           173,997       208,880        11,289
                                  -----------     ---------     ---------

       Total                      $ 2,147,511     2,078,518     1,244,964
                                  ===========     =========     =========

     The aggregate amount of deposit accounts with a balance of $100,000 or
     greater was approximately $9,839,000 and $8,041,000 at March 31, 2002 and
     2001 respectively. Deposits in excess of $100,000 are not insured by the
     Federal Deposit Insurance Corporation.

                                      F-14

<PAGE>

9)   Borrowed Money
     --------------

     In connection with the Company's initial public offering, the Bank
     established an Employee Stock Ownership Plan (ESOP). The ESOP was funded by
     the proceeds from a $177,550 loan from the Company. The loan carries an
     interest rate of eight and one-quarter percent and matures in the year
     2005. The loan is secured by the shares of the Company purchased with the
     loan proceeds. The Bank has committed to make contributions to the ESOP
     sufficient to allow the ESOP to fund the debt service requirements of the
     loan.

10)  Other Liabilities
     -----------------

     Other liabilities include the following:

                                                          March 31,
                                                   ----------------------
                                                     2002          2001
                                                     ----          ----

     Deferred income tax liability (a)          $    81,993        68,390
     Accrued interest on deposits                   175,700       246,019
     Accrued real estate taxes                       58,345        80,000
     Accrued audit fees                              18,125        16,450
     Amount due on settlement of securities       5,000,000             -
     Other accounts payable                          72,937        62,703
                                                -----------     ---------

                                                $ 5,407,100       473,562
                                                ===========     =========


     (a) The approximate tax effect of temporary differences that give rise to
         the Company's net deferred tax liability at March 31, 2002 and 2001
         under SFAS No. 109 is as follows:

                                                 Assets    Liabilities     Net
                                                 ------    -----------     ---
         March 31, 2002
         --------------

         Accelerated depreciation for
          tax purposes                         $       -      68,111     68,111
         Bad debt reserves established
          for financial reporting purposes       (42,067)          -    (42,067)
         Increases to tax bad debt reserves
          since April 1, 1988                          -      15,464     15,464
         Unrealized gain on securities
          available for sale                           -      28,476     28,476
         Stock dividends deferred for
          tax purposes                                 -      12,009     12,009
                                               ---------     -------    -------

            Total                              $ (42,067)    124,060     81,993
                                               =========     =======    =======


         March 31, 2001
         --------------

         Accelerated depreciation for
          tax purposes                         $       -      58,387     58,387
         Bad debt reserves established
          for financial reporting purposes       (35,595)          -    (35,595)
         Increases to tax bad debt reserves
          since April 1, 1988                          -      23,196     23,196
         Unrealized gain on securities
          available for sale                           -      16,218     16,218
         Stock dividends deferred for
          tax purposes                                 -       6,184      6,184
                                               ---------     -------    -------

            Total                              $ (35,595)    103,985     68,390
                                               =========     =======    =======

                                      F-15

<PAGE>

11)  Officer, Director and Employee Plans
     ------------------------------------

     Stock Option Plan
     -----------------

     On July 12, 1995, the stockholders of the Company approved the West Town
     Bancorp, Inc. Stock Option Plan. This is an incentive stock option plan for
     the benefit of the officers and employees of the Company and its affiliates
     and a directors' stock option plan for the benefit of outside directors of
     the Company. The number of shares authorized under the Plan is 22,194,
     equal to 10.0% of the total number of shares issued in the Conversion. As
     of March 31, 2002, 20,129 options had been granted, which are exercisable
     at a rate of 20% per year and expire ten years from the date of grant. The
     following is an analysis of the stock option activity for each of the years
     in the three year period ended March 31, 2002 and the stock options
     outstanding at the end of the respective periods:

                                                     Exercise Price
                                                   --------------------------
                                      Number
     Options                         of Shares       Per Share        Total
     -------                         ---------     ------------     ---------

     Outstanding at April 1, 1999      16,919     $ 10.00-12.00     $ 171,334
     Granted                              700             12.00         8,400
     Exercised                              -                               -
     Forfeited                              -                               -
                                       ------     -------------     ---------

     Outstanding at March 31, 2000     17,619       10.00-12.00       179,734
     Granted                              700             12.00         8,400
     Exercised                              -                               -
     Forfeited                              -                               -
                                       ------     -------------     ---------

     Outstanding at March 31, 2001     18,319       10.00-12.00       188,134
     Granted                              700             12.00         8,400
     Exercised                              -                               -
     Forfeited                              -                               -
                                       ------     -------------     ---------

     Outstanding at March 31, 2002     19,019     $ 10.00-12.00     $ 196,534
                                       ======     =============     =========

     Exercisable at March 31, 2002     17,330     $ 10.00-12.00     $ 176,396
                                       ======     =============     =========

     Options available for future
       grants at March 31, 2002         2,065
                                       ======


     The weighted average fair value of options granted during the years ended
     March 31, 2002, 2001 and 2000 was $12.00, $12.00 and $12.00, respectively.
     As of March 31, 2002, the weighted average exercise price for options
     outstanding was $10.18 with a weighted average remaining contractual life
     of 4.1 years.

     The Company has elected to follow Accounting Principles Board Opinion No.
     25 "Accounting for Stock Issued to Employees" ("APB 25") and related
     interpretations in accounting for its employee stock options. Under APB 25,
     because the exercise price of the Company's employee stock options equals
     the market price of the underlying stock on the date of grant, no
     compensation expense is recognized.

     The Company has implemented SFAS No. 123 "Accounting for Stock-Based
     Compensation". The Company has retained its accounting method for its stock
     based compensation plans. This statement has only resulted in additional
     disclosures for the Company, and as such, its adoption did not have, nor is
     it expected to have, a material impact on the Company's financial condition
     or its results of operations.

                                      F-16

<PAGE>

11)  Officer, Director and Employee Plans (continued)
     ------------------------------------------------

     The following summarizes the pro forma net income as if the fair value
     method of accounting for stock-based compensation plans had been utilized:

                                                  Years Ended March 31,
                                           ---------------------------------
                                              2002        2001         2000
                                              ----        ----         ----

     Net income (loss) (as reported)       $ 126,469    (39,007)      62,036
     Pro forma net income (loss)             123,026    (42,305)      58,882

     Earnings (loss) per share -
       diluted (as reported)               $     .64       (.20)         .30
     Pro forma diluted earnings (loss)
       per share                                 .62       (.21)         .28

     The pro forma results presented above may not be representative of the
     effects reported in pro form net income for future years.

     Employee Stock Ownership Plan
     -----------------------------

     In conjunction with the Conversion, the Bank formed an Employee Stock
     Ownership Plan ("ESOP"). The ESOP covers substantially all employees with
     more than one year of employment and who have attained the age of 21. The
     ESOP borrowed $177,550 from the Company and purchased 17,755 common shares
     issued in the Conversion. The Bank will make scheduled discretionary cash
     contributions to the ESOP sufficient to service the amount borrowed. In
     accordance with generally accepted accounting principles, the unpaid
     balance of the ESOP loan, which is comparable to unearned compensation, is
     reported as a reduction of stockholders' equity. Total contributions by the
     Bank to the ESOP which were used to fund principal and interest payments on
     the ESOP debt totaled $26,931, $27,569 and $27,569 for the years ended
     March 31, 2002, 2001 and 2000, respectively.

     Statement of Position No. 93-6, "Employers' Accounting for Employee Stock
     Ownership Plans" ("SOP No. 93-6") provides guidance for accounting for all
     ESOPs. SOP No. 93-6 requires that the issuance or sale of treasury shares
     to the ESOP be reported when the issuance or sale occurs and that
     compensation expense be recognized for shares committed to be released to
     directly compensate employees equal to the fair value of the shares
     committed. In addition, SOP No. 93-6 requires that leveraged ESOP debt and
     related interest expense be reflected in the employer's financial
     statements. Prior practice was to recognize compensation expenses based on
     the amount of the employer's contributions to the ESOP. The application of
     SOP No. 93-6 results in fluctuations in compensation expense as a result of
     changes in the fair value of the Company's common stock; however, any such
     compensation expense fluctuations will result in an offsetting adjustment
     to additional paid-in capital. Additional compensation expense, recognized
     as a result of the implementation of this accounting principle, was $4,054,
     $3,616, and $3,392 for the years ended March 31, 2002, 2001 and 2000
     respectively.

                                      F-17

<PAGE>

12)  Income Taxes
     ------------

     As a result of legislation that changed the method used by many savings
     banks to calculate their bad debt reserve for federal income tax purposes,
     the Bank must recapture that portion of the reserve that exceeds the amount
     that could have been taken under the experience method for tax years
     beginning after December 31, 1987. The legislation also requires thrifts to
     account for bad debts for federal income tax purposes on the same basis as
     commercial banks for tax years beginning after December 31, 1995. The
     recapture is occurring over a six year period. The commencement of the
     recapture by the Bank was delayed two years as the Bank met certain
     residential lending requirements. For the three years ended December 31,
     2002, the Bank recaptured approximately $64,500 in excess bad debt reserves
     resulting in tax payments of approximately $20,000 which were previously
     accrued. The pre-1988 reserve provisions are subject only to recapture
     requirements if the Bank no longer qualifies as a thrift. Tax bad debt
     deductions accumulated prior to 1988 by the Bank and included in retained
     earnings total approximately $412,000. No deferred income taxes have been
     provided for these bad debt deductions and no recapture of these amounts is
     anticipated.

     The provision for income taxes (benefit) consists of the following:

                                           Years Ended March 31,
                                    -----------------------------------
                                      2002          2001          2000
                                      ----          ----          ----

     Current (benefit)            $  48,066       (39,333)       10,390
     Deferred                         1,345         7,622        13,794
                                  ---------        ------        ------

                                  $  49,411       (31,711)       24,184
                                  =========        ======        ======


     A reconciliation of the statutory federal income tax rate to effective
     income tax rate is as follows:

                                                    Years Ended March 31,
                                            -----------------------------------
                                              2002         2001          2000
                                              ----         ----          ----

     Statutory federal income tax rate       34.0%        (34.0)         34.0
     Surtax exemption                        (7.3)         (5.0)        (11.7)
     State income tax                         4.8          (4.7)          6.2
     Other                                   (3.4)         (1.1)          (.5)
                                             ----          ----          ----

     Effective income tax rate               28.1%        (44.8)         28.0
                                             ====          ====          ====


     Deferred income tax expense consists of the following tax effects of timing
     differences:

                                                    Years Ended March 31,
                                             -----------------------------------
                                               2002          2001        2000
                                               ----          ----        ----

     Loan fees                             $       -           253       1,280
     Book loan loss provision in excess
      of tax bad debt deduction               (6,472)      (14,680)     (2,157)
     Depreciation                              9,724        24,712      21,288
     Recapture of bad debt reserve            (7,732)       (7,732)     (7,732)
     Stock dividends deferred for
      tax purposes                             5,825         5,069       1,115
                                           ---------        ------      ------

                                           $   1,345         7,622      13,794
                                           =========        ======      ======

                                      F-18

<PAGE>

13)  Regulatory Capital Requirements
     -------------------------------

     The Bank is subject to various regulatory capital requirements administered
     by the federal banking agencies. Failure to meet minimum total requirements
     can initiate certain mandatory and possible additional discretionary
     actions by regulators that, if undertaken, could have a direct material
     effect on the Bank's financial statements. Under capital adequacy
     guidelines and the regulatory framework for prompt correction action, the
     Bank must meet specific capital guidelines that involve quantitative
     measures of the Bank's assets, liabilities, and certain off-balance-sheet
     items as calculated under regulatory accounting practices. The Bank's
     capital amounts and classification are also subject to quantitative
     judgments by the regulators about components, risk weightings, and other
     factors.

     Quantitative measures established by regulation to ensure capital adequacy
     require the Bank to maintain minimum amounts and ratios, set forth in the
     table below, of the total risk-based and core capital, as defined in the
     regulations. Management believes, as of March 31, 2002, that the Bank meets
     all capital adequacy requirements to which it is subject.

     The Bank, according to federal regulatory standards, is well-capitalized
     under the regulatory framework for prompt corrective action. To be
     categorized as adequately capitalized, the Bank must maintain minimum total
     risk-based and core ratios as set forth in the table. There are no
     conditions or events since that notification that management believes have
     changed the institution's category.

     At March 31, 2002 and 2001, the Bank's actual capital amounts and ratios,
     minimum amounts and ratios required for capital adequacy purposes and
     minimum amounts and ratios to meet the well-capitalized criteria under
     prompt corrective action provisions, are as follows:

<TABLE>
<CAPTION>
                                                                      To Be Well-
                                                                   Capitalized Under
                                                 For Capital       Prompt Corrective
                                Actual        Adequacy Purposes    Action Provisions
                        -------------------------------------------------------------
                           Amount    Ratio     Amount    Ratio      Amount    Ratio
                        -------------------------------------------------------------
     March 31, 2002
     --------------
     <S>                 <C>         <C>       <C>       <C>        <C>        <C>
     Risk-based         $ 3,671,526  13.75%  $ 2,136,599  8.00%   $ 2,670,749  10.00%
     Core                 3,554,526   5.88     1,812,441  3.00      3,020,735   5.00

     March 31, 2001
     --------------

     Risk-based         $ 3,374,982  13.27%  $ 2,034,890  8.00%   $ 2,543,610  10.00%
     Core                 3,275,982   6.68     1,471,930  3.00      2,453,201   5.00
</TABLE>


                                                     Core        Risk-based
                                                    Capital       Capital
                                                    -------      ----------
     March 31, 2002
     --------------

     Stockholders' equity of the Bank             $ 3,605,763    3,605,763
     Unrealized gain on securities
       available for sale                             (51,237)     (51,237)
     General loss allowances                                -      117,000
                                                  -----------    ---------

     Regulatory capital computed                  $ 3,554,526    3,671,526
                                                  ===========    =========


     March 31, 2001
     --------------

     Stockholders' equity of the Bank             $ 3,275,982    3,275,982
     General loss allowances                                -       99,000
                                                  -----------    ---------

     Regulatory capital computed                  $ 3,275,982    3,374,982
                                                  ===========    =========

                                      F-19

<PAGE>

14)  Stockholders' Equity
     --------------------

     As part of the Conversion, the Bank established a liquidation account for
     the benefit of all eligible depositors who continue to maintain their
     deposit accounts in the Bank after conversion. In the unlikely event of a
     complete liquidation of the Bank, each eligible depositor will be entitled
     to receive a liquidation distribution from the liquidation account, in the
     proportionate amount of the then current adjusted balance for deposit
     accounts held, before distribution may be made with respect to the Bank's
     capital stock. The Bank may not declare or pay a cash dividend to the
     Company on, or repurchase any of, its capital stock if the effect thereof
     would cause the retained earnings of the Bank to be reduced below the
     amount required for the liquidation account. Except for such restrictions,
     the existence of the liquidation account does not restrict the use or
     application of retained earnings.

     In addition the Bank may not declare or pay cash dividends on or repurchase
     any of its shares of common stock if the effect thereof would cause
     stockholders' equity to be reduced below applicable regulatory capital
     maintenance requirements or if such declaration and payment would otherwise
     violate regulatory requirements.

     Unlike the Bank, the Company is not subject to these regulatory
     restrictions on the payment of dividends to its stockholders. However, the
     Company's source of funds for future dividends may depend upon dividends
     received by the Company from the Bank.

15)  Financial Instruments with Off-Balance Sheet Risk
     -------------------------------------------------

     The Company is a party to various transactions with off-balance sheet risk
     in the normal course of business. These transactions are primarily
     commitments to originate and to purchase loans. These financial instruments
     carry varying degrees of credit and interest-rate risk in excess of amounts
     recorded in the consolidated financial statements.

     Commitments to fund mortgage loans of $1,361,000 at March 31, 2002
     represent amounts which the Bank plans to fund within the normal commitment
     period of 60 to 90 days. Of this amount, $645,000 are in fixed rate
     commitments with rates ranging from 6.38% to 7.25% and $716,000 are in
     adjustable rate commitments. Because the credit worthiness of each customer
     is reviewed prior to extension of the commitment, the Bank adequately
     controls its credit risk on these commitments, as it does for loans
     recorded on the balance sheet. The Bank conducts all of its lending
     activities in the Chicagoland area. Management believes the Bank has a
     diversified loan portfolio and the concentration of lending activities in
     these local communities does not result in an acute dependency upon
     economic conditions of the lending region.

     The Bank has approved, but unused, home equity lines of credit of
     approximately $1,121,000 at March 31, 2002. Approval of lines of credit is
     based upon underwriting standards that generally do not allow total
     borrowings, including the line of credit, to exceed 80% of the estimated
     fair value of the customer's home. In addition, the Bank has approved but
     unused equity lines of credit on various construction and commercial
     projects of approximately $2,417,000 at March 31, 2002.

16)  Contingencies
     -------------

     The Bank is, from time to time, a party to certain lawsuits arising in the
     ordinary course of its business, wherein it enforces its security interest.
     Management, based upon discussions with legal counsel, believes that the
     Company and the Bank are not engaged in any legal proceedings of a material
     nature at the present time.

                                      F-20

<PAGE>

17)  Disclosures About the Fair Value of Financial Instruments
     ---------------------------------------------------------

     The following methods and assumptions were used to estimate the fair value
     of each class of financial instruments for which it is practicable to
     estimate that value:

     Cash and cash equivalents: For cash and interest-bearing deposits, the
     carrying amount is a reasonable estimate of fair value.

     Mortgage-backed securities: Fair values for mortgage-backed securities are
     based on average quotes received from a third-party broker.

     Loans receivable: The fair values of mortgage loans are estimated using
     discounted cash flow analyses, using interest rates currently being offered
     for loans with similar terms and collateral to borrowers of similar credit
     quality.

     Other investments: Fair values for other investments are based on quoted
     market prices received from third-party sources.

     Deposit liabilities: The fair value of savings accounts is the amount
     payable on demand at the reporting date. The fair value of fixed maturity
     certificates of deposit is estimated by discounting the future cash flows
     using the rates currently offered for deposits of similar original
     maturities.

     Financial instruments with off-balance sheet risk: Fair values of the
     Company's off-balance sheet financial instruments, which consist of loan
     commitments, are based on fees charged to enter into these agreements. As
     the Company currently charges no fees on these instruments, no estimate of
     fair value has been made.

     The fair value of the Company's off-balance-sheet instruments is nominal.

     The estimated fair values of the Company's financial instruments as of
     March 31, 2002 and 2001 are as follows:

                                                          March 31, 2002
                                                    -------------------------
                                                     Carrying        Fair
                                                      Amount         Value
                                                    ----------    -----------
         Financial assets:
           Cash and cash equivalents               $ 10,265,189    10,265,189
           Mortgage-backed securities                22,534,020    22,631,400
           Loans receivable, gross                   25,962,213    26,372,400
           Other investments, available for sale        279,200       279,200

         Financial liabilities:
           Deposits                                  51,319,909    50,144,700


                                                          March 31, 2002
                                                    -------------------------
                                                     Carrying        Fair
                                                      Amount         Value
                                                    ----------    -----------
         Financial assets:
           Cash and cash equivalents               $  7,135,221     7,135,221
           Mortgage-backed securities                 7,501,917     7,621,200
           Loans receivable, gross                   32,023,149    32,980,600
           Other investments, available for sale        263,000       263,000

         Financial liabilities:
           Deposits                                  45,204,540    45,127,700


                                      F-21

<PAGE>

18)  Condensed Parent Company Only Financial Statements
     --------------------------------------------------

     The following condensed statements of financial condition, as of March 31,
     2002 and 2001, and condensed statements of income and cash flows for the
     years ended March 31, 2002, 2001 and 2000 for West Town Bancorp, Inc.
     should be read in conjunction with the consolidated financial statements
     and the notes thereto.

                        Statements of Financial Condition
                        ---------------------------------

                                                              March 31,
                                                     --------------------------
                                                          2002          2001
                                                          ----          ----
         Assets
         ------

         Cash and cash equivalents                    $   364,169       406,173
         Loans receivable                                 177,066       198,363
         Other investments, available for sale             99,200       263,000
         Accrued interest receivable                        3,020         3,027
         Equity investment in subsidiaries              3,608,005     3,353,786
         Other assets                                      17,027         4,475
                                                      -----------    ----------

                                                        4,268,487     4,228,824
                                                      ===========    ==========
         Liabilities and Stockholders' Equity
         ------------------------------------

         Accrued taxes and other liabilities               18,907        52,418
         Common stock                                       2,319         2,319
         Additional paid-in capital                     1,988,807     1,988,807
         Retained earnings                              2,586,524     2,460,055
         Accumulated other comprehensive income,
          net of income taxes                                (513)       46,782
         Treasury stock, at cost                         (327,557)     (321,557)
                                                      -----------    ----------

                                                      $ 4,268,487     4,228,824
                                                      ===========    ==========




                              Statements of Income
                              --------------------

                                                       Years Ended March 31,
                                                   -----------------------------
                                                      2002      2001      2000
                                                      ----      ----      ----

         Interest income                           $ 37,338    54,457    57,254
         Loan fees and service charges                    -       351     1,667
         Non-interest expense                       (76,751)  (51,918)  (32,072)
                                                   --------   -------   -------

         Net income (loss) before income taxes
           and equity in earnings of subsidiaries   (39,413)    2,890    26,849
         Provision for income taxes                  11,663    (1,165)   (5,613)
                                                   --------   -------   -------

         Net income (loss) before equity in
           earnings of subsidiaries                 (27,750)    1,725    21,236
         Equity in earnings (loss) of subsidiaries  154,219   (40,732)   40,800
                                                   --------   -------   -------

         Net income (loss)                         $126,469   (39,007)   62,036
                                                   ========   =======   =======

                                      F-22

<PAGE>

18)  Condensed Parent Company Only Financial Statements (continued)
     --------------------------------------------------------------

                            Statements of Cash Flows
                            ------------------------


                                                      Years Ended March 31,
                                               ---------------------------------
                                                  2002        2001        2000
                                                  ----        ----        ----
     Operating activities:
       Net income (loss)                       $ 126,469    (39,007)     62,036
       Equity in (earnings) loss of
        subsidiaries                            (154,219)    40,732     (40,800)
       Decrease in accrued interest receivable         7          6       3,198
       Change in other items, net                 70,442     16,694      21,280
                                               ---------  ---------   ---------

     Net cash provided by
     operating activities                         42,699     18,425      45,714
                                               ---------  ---------   ---------

     Investing activities:
       Investment in subsidiary                 (100,000)         -           -
       Loan disbursements                              -    (20,686)   (286,753)
       Loan repayments                            21,297    127,720     187,321
                                               ---------  ---------   ---------

     Net cash provided by (for)
        investing activities                     (78,703)   107,034     (99,432)
                                               ---------  ---------   ---------

     Financing activities:
       Purchase of treasury stock                 (6,000)   (66,900)   (147,451)
                                               ---------  ---------   ---------

     Net cash provided for
     financing activities                         (6,000)   (66,900)   (147,451)
                                               ---------  ---------   ---------

     Increase (decrease) in cash and
        cash equivalents                         (42,004)    58,559    (201,169)

     Cash and cash equivalents at
        beginning of year                        406,173    347,614     548,783
                                               ---------  ---------   ---------

     Cash and cash equivalents at
        end of year                            $ 364,169    406,173     347,614
                                               =========  =========   =========

                                      F-23