The Milwaukee suburban market area has a stable population and household base. According to a recent census report, during the past three years, the population of Milwaukee County decreased by 0.1% and the population of Waukesha County increased by 1.0%, while the population of the United States increased by 1.0%. During that period, the number of households in Milwaukee and Waukesha Counties and in the United States increased 0.0%, 1.4% and 1.0%, respectively. In 2004, per capita income for Milwaukee and Waukesha Counties was $21,943 and $33,064, and the median household income was $41,373 and $69,404, respectively. This compares to per capita income for the State of Wisconsin and the United States of $23,962 and $24,902, respectively, and median household income of $48,283 and $46,475, respectively.

Milwaukee and Waukesha Counties have a mix of industry groups and employment sectors, including services, manufacturing and wholesale/retail trade as the basis of the local economy. These three sectors comprise approximately 70.7% of the employment base in Milwaukee County and approximately 71.2% of the employment base in Waukesha County. Waukesha County’s unemployment rate for January 2005 of 4.0% was lower than the comparable Wisconsin unemployment rate of 4.8% and lower than the national unemployment rate of 5.7%. Milwaukee County’s unemployment rate alone for the same period of 2005 was 5.8%, higher than both the Wisconsin unemployment rate and the national unemployment rate.

Consistent with the national and Wisconsin unemployment trends, Milwaukee and Waukesha Counties’ January 2005 unemployment rates were lower compared to the January 2004 unemployment rates of 6.6% and 4.6%, respectively.

The Company’s primary lending activity consists of the origination of residential mortgage loans that are primarily secured by properties located in Milwaukee and Waukesha Counties. The Company currently offers only variable-rate mortgage loans for one- to four-family properties, with an interest rate which can be adjusted at its discretion semi-annually after either a three- or five-year initial fixed rate period. This loan product, commonly known as a Wisconsin escalator, does not conform to secondary market standards and therefore can not be sold as such. The Company also offers home equity loans and home equity lines of credit, both of which are secured by owner-occupied one- to four-family residences.

The Company originates over four-family real estate loans as a significant portion of total annual loan production. Over four-family loans originated during the nine months ended March 31, 2005 totaled $116.3 million or 32.7% of all mortgage loans originated. These loans are generally located in the Company’s primary market area. Over four-family real estate underwriting policies provide that typically such real estate loans may be made in amounts of up to 80% of the appraised value of the property provided such loan complies with the Company’s current loans-to-one borrower limit. Over four-family real estate loans may be made with terms including up to 30-year amortization schedules and are offered with interest rates that are fixed up to five years or are variable and adjust at the Company’s discretion.

The Company originates construction loans to individuals and contractors for the construction and acquisition of personal and multi-family residences. The Company’s construction mortgage loans generally provide for the payment of interest only during the construction phase, which is typically up to nine months although its policy is to consider construction periods as long as 12 months or more. At the end of the construction phase, the construction loan converts to a longer term mortgage loan. Construction loans can be made with a maximum loan-to-value ratio of 90%, provided that the borrower obtains private mortgage insurance on the loan if the loan balance exceeds 80% of the lesser of the appraised value or sales price of the secured property.

The Company originates commercial real estate loans as a limited portion of total annual loan production. These loans are generally located in the Company’s primary market area. Commercial real estate underwriting policies provide that typically such real estate loans may be made in amounts of up to 80% of the appraised value of the property. Commercial real estate loans may be made with terms including up to 30-year amortization schedules and are offered with interest rates that are fixed up to five years or are variable and adjust at the Company’s discretion.

Interest expense increased $2.0 million, or 8.2%, to $26.3 million for the nine months ended March 31, 2005 from $24.3 million for the nine months ended March 31, 2004.

Net interest income increased $3.9 million, or 15.5%, to $28.6 million for the nine months ended March 31, 2005 from $24.8 million for the nine months ended March 31, 2004

Noninterest income increased by $273.0 thousand, or 11.7%, to $2.6 million for the nine months ended March 31, 2005 compared to $2.3 million for the nine months ended March 31, 2004.

Total noninterest expense increased by $2.5 million, or 16.1%, to $17.8 million for the nine months ended March 31, 2005 from $15.4 million for the nine months ended March 31, 2004.