First Savings Financial Group Inc (Form: S-1, Received: 06/13/2008 12:53:13)

FIRST SAVINGS BANK, F.S.B.

As filed with the Securities and Exchange Commission on June 13, 2008

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM S-1

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

First Savings Financial Group, Inc.

and

First Savings Bank Profit Sharing/401(k) Plan

(Exact name of registrant as specified in its charter)

Indiana

6035

37-1567871

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(IRS Employer

Identification No.)

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

(812) 283-0724

(Address, including zip code, and telephone number,

including area code, of registrant's principal executive offices)

Larry W. Myers

President and Chief Executive Officer

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

(812) 283-0724

(Name, address, including zip code, and telephone number,

including area code, of agent for service)

Copies to:


Paul M. Aguggia, Esq.		David M. Muchnikoff, Esq.
Victor L. Cangelosi, Esq.		Silver Freedman & Taff L.L.P.
Kilpatrick Stockton LLP		3299 K Street, N.W.
Suite 900		Suite 100
607 14 ^th Street, N.W.		Washington, DC 20007
Washington, DC 20005		(202) 295-4500
(202) 508-5854

Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. x

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	¨		Accelerated filer	¨
Non-accelerated filer	¨	(Do not check if a smaller reporting company)	Smaller reporting company	x

Calculation of Registration Fee



Title of each class of securities to be registered	Amount to be registered	Proposed maximum offering price per unit	Proposed maximum aggregate offering price (2)	Amount of registration fee
Common Stock $.01 par value	4,196,525 (1)	$10.00	$41,965,250	$1,650
Participation Interests	(3)	—	$2,863,454	(4)

(1)	Includes shares of common stock to be issued to First Savings Charitable Foundation, a private foundation.

(2)	Estimated solely for the purpose of calculating the registration fee.

(3)	In addition, pursuant to Rule 416(c) under the Securities Act, this registration statement also covers an indeterminate amount of interests to be offered or sold pursuant to the employee benefit plan described herein.

(4)

The securities of First Savings Financial Group, Inc. to be purchased by the First Savings Bank 401(k) and Profit Sharing Plan are included in the amount shown for common stock. Accordingly, no separate fee is required for the participation interests. In accordance with Rule 457(h) of the Securities Act, as amended, the registration fee has been calculated on the basis of the number of shares of common stock that may be purchased with the current assets of such Plan.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine.

PARTICIPATION INTERESTS IN

FIRST SAVINGS BANK, F.S.B. BANK

PROFIT SHARING/401(k) PLAN

AND

OFFERING OF 286,345 SHARES OF

FIRST SAVINGS FINANCIAL GROUP, INC.

COMMON STOCK ($.01 PAR VALUE)

This prospectus supplement relates to the offer and sale to participants in the First Savings Bank, F.S.B. Profit Sharing/401(k) Plan (the “401(k) Plan”), of participation interests and shares of common stock of First Savings Financial Group, Inc. (“First Savings Financial Group”) in connection with the First Savings Financial Group initial public offering.

401(k) Plan participants may direct the First Savings Financial Group Stock Fund trustee, to use their account balances to subscribe for and purchase shares of First Savings Financial Group common stock through the First Savings Financial Group Stock Fund. Based upon the value of the 401(k) Plan assets as of May 31, 2008, the First Savings Financial Group Stock Fund trustee may purchase up to 286,345 shares of First Savings Financial Group common stock at a purchase price of $10.00 per share. This prospectus supplement relates to the election of 401(k) Plan participants to direct the First Savings Financial Group Stock Fund trustee to invest their 401(k) Plan account balances in First Savings Financial Group common stock.

The First Savings Financial Group prospectus dated , 2008, which we have attached to this prospectus supplement, includes detailed information regarding the offering of shares of First Savings Financial Group common stock and the financial condition, results of operations and business of First Savings Bank, F.S.B. (“First Savings Bank”). This prospectus supplement provides information regarding the 401(k) Plan. You should read this prospectus supplement together with the prospectus and keep both for future reference.

Please refer to “Risk Factors” beginning on page of the prospectus.

Neither the Securities and Exchange Commission, the Office of Thrift Supervision, the Federal Deposit

Insurance Corporation, nor any other state or federal agency or any state securities commission, has

approved or disapproved these securities. Any representation to the contrary is a criminal offense.

These securities are not deposits or accounts and are not insured or guaranteed by the Federal Deposit

Insurance Corporation or any other government agency.

This prospectus supplement may be used only in connection with offers and sales by First Savings Financial Group of participation interests or shares of common stock under the 401(k) Plan in the offering. No one may use this prospectus supplement to re-offer or resell interests or shares of common stock acquired through the 401(k) Plan.

You should rely only on the information contained in this prospectus supplement and the attached prospectus. Neither First Savings Financial Group, First Savings Bank nor the 401(k) Plan have authorized anyone to provide you with different information.

This prospectus supplement does not constitute an offer to sell or solicitation of an offer to buy any securities in any jurisdiction to any person to whom it is unlawful to make such an offer or solicitation in that jurisdiction. Neither the delivery of this prospectus supplement and the prospectus nor any sale of common stock shall under any circumstances imply that there has been no change in the affairs of First Savings Bank or the 401(k) Plan since the date of this prospectus supplement, or that the information contained in this prospectus supplement or incorporated by reference is correct as of any time after the date of this prospectus supplement.

The date of this Prospectus Supplement is , 2008.

TABLE OF CONTENTS


		Page
THE OFFERING		1
Securities Offered		1
Election to Purchase First Savings Financial Group Common Stock in the Stock Offering		1
Value of Participation Interests		2
Method of Directing Transfer		2
Time for Directing Transfer		2
Irrevocability of Transfer Direction		2
Purchase Price of First Savings Financial Group Common Stock		2
Nature of a Participant’s Interest in First Savings Financial Group Common Stock		3
Voting and Tender Rights of First Savings Financial Group Stock		3

DESCRIPTION OF THE 401(k) PLAN		3
Introduction		3
Eligibility and Participation		4
Contributions Under 401(k) Plan		4
Limitations on Contributions		4
401(k) Plan Investments		6
Benefits Under the 401(k) Plan		7
Withdrawals and Distributions from the 401(k) Plan		7

ADMINISTRATION OF THE 401(k) PLAN		8
Trustee		8
Reports to 401(k) Plan Participants		8
Plan Administrator		9
Amendment and Termination		9
Merger, Consolidation or Transfer		9
Federal Income Tax Consequences		9
Restrictions on Resale		10
SEC Reporting and Short-Swing Profit Liability		11

LEGAL OPINION		12

THE OFFERING

Securities Offered

The securities offered in connection with this prospectus supplement are participation interests in the 401(k) Plan. At a purchase price of $10.00 per share, the First Savings Financial Group Stock Fund trustee may acquire up to 286,345 shares of First Savings Financial Group common stock in the stock offering (the “Stock Offering”). The interests offered under this prospectus supplement are conditioned on the close of the Stock Offering. Certain subscription rights and purchase limitations also govern your investment in the First Savings Financial Group Stock Fund in connection with the Stock Offering. See “The Stock Offering — Subscription Offering and Subscription Rights” and “— Limitations on Purchases of Shares” in the prospectus attached to this prospectus supplement for further discussion of these subscription rights and purchase limitations.

This prospectus supplement contains information regarding the 401(k) Plan. The attached prospectus contains information regarding the Stock Offering and the financial condition, results of operations and business of First Savings Bank and its affiliates. The address of the principal executive office of First Savings Bank is 501 East Lewis & Clark Parkway, Clarksville, IN 47129. The telephone number of First Savings Bank is (812) 283-0724.

Election to Purchase First Savings Financial Group, Inc. Common Stock in the Stock Offering

In connection with the Stock Offering, you may direct the First Savings Financial Group Stock Fund trustee to transfer all or a portion of your 401(k) Plan account balance to the First Savings Financial Group Stock Fund. The First Savings Financial Group Stock Fund trustee will subscribe for First Savings Financial Group common stock offered for sale in the Stock Offering in accordance with each participant’s direction. If there is not enough First Savings Financial Group common stock available in the Stock Offering to fill all subscriptions, the common stock will be apportioned and the First Savings Financial Group Stock Fund trustee may not be able to purchase all of the common stock you requested. If the Stock Offering is oversubscribed and your order is cut back, your 401(k) Plan funds (which are not invested in First Savings Financial Group common stock) will be reinvested in accordance with the investment elections that you have in place for your elective deferrals.

All eligible plan participants are permitted to direct a transfer of all or a portion of their account balances in the 401(k) Plan into the First Savings Financial Group Stock Fund. However, transfer directions are subject to subscription rights and purchase priorities. See “ Summary – Persons Who Can Order Stock in the Offering ” in the attached prospectus. First Savings Financial Group has granted rights to subscribe for shares of First Savings Financial Group common stock to the following persons in the following order of priority: (1) persons with $50 or more on deposit at First Savings Bank as of the close of business on March 31, 2007; (2) the First Savings Bank, F.S.B. Employee Stock Ownership Plan; (3) persons with $50 or more on deposit at First Savings Bank as of the close of business on June 30, 2008; and (4) except for persons eligible to subscribe for shares under categories 1 and 3, First Savings Bank’s depositors as of the close of business on , 2008, who were not able to subscribe for shares of First Savings Financial Group common stock under categories 1 and 3. If you fall into one of the above subscription offering categories, you have subscription rights to purchase shares of First Savings Financial Group common stock in the Stock Offering and you may use your account balance in the 401(k) Plan to subscribe for shares of First Savings Financial Group common stock.

The limitations on the total amount of First Savings Financial Group common stock that you may purchase in the Stock Offering, as described in the prospectus (see “ The Stock Offering — Limitations on Purchases of Shares ”), will be calculated based on the aggregate amount that you subscribed for: (a) through your 401(k) Plan account and (b) through your sources of funds outside of the 401(k) Plan. Whether you place an order through the 401(k) Plan, outside the 401(k) Plan, or both, the number of shares of First Savings Financial Group common stock, if any, that you receive will be determined based on the total number of subscriptions, your purchase priority and the allocation priorities described in the prospectus. 401(k) Plan assets which have been invested in a First Savings Bank Fixed Account in the past will not be considered for purposes of determining your subscription rights. If, as a result of the calculation, you are allocated insufficient shares to fill all of your orders, available shares will be allocated between orders on a pro rata basis.

Value of Participation Interests

As of May 31, 2008, the market value of the 401(k) Plan assets equaled approximately $2,863,453. The plan administrator has distributed quarterly statements to each participant reflecting the value of his or her beneficial interest in the 401(k) Plan as of March 31, 2008. The value of the 401(k) Plan assets represents past contributions made to the 401(k) Plan on your behalf, plus or minus earnings or losses on the contributions, less previous withdrawals.

Method of Directing Transfer

In order to facilitate your investment in the First Savings Financial Group Stock Fund in connection with the Stock Offering, you must complete, sign and submit the blue form included with this prospectus supplement (the “Investment Form”). In order to invest in the First Savings Financial Group Stock Fund, you must direct the 401(k) Plan trustee to transfer a percentage of your beneficial interest in the assets of the 401(k) Plan to the First Savings Financial Group Stock Fund (in multiples of not less than 1%). If you do not wish to invest in the First Savings Financial Group Stock Fund at this time, you do not need to take any action. The minimum investment in the First Savings Financial Group Stock Fund during the Stock Offering is $250 and the maximum individual investment is $200,000.

Time for Directing Transfer

The deadline to submit your Investment Form to John Lawson is 12:00 noon, local time, on [ ], unless extended by First Savings Bank. If you have any questions regarding the First Savings Financial Group Stock Fund, you can call John Lawson at (812) 218-6801.

Irrevocability of Transfer Direction

Once you have submitted your Investment Form, you cannot change your direction to transfer amounts credited to your account in the 401(k) Plan to the First Savings Financial Group Stock Fund. Following the closing of the Stock Offering and the initial purchase of shares in the First Savings Financial Group Stock Fund, you may change your investment directions in accordance with the terms of the 401(k) Plan.

Purchase Price of First Savings Financial Group, Inc. Common Stock

The trustee will use the funds transferred to the First Savings Financial Group Stock Fund to purchase shares of First Savings Financial Group common stock in the Stock Offering. The First Savings Financial Group Stock Fund trustee will pay the same price for shares of First Savings Financial Group common stock as all other persons who purchase shares of First Savings Financial Group common stock

in the Stock Offering. If there is not enough common stock available in the Stock Offering to fill all subscriptions, the common stock will be apportioned and the trustee may not be able to purchase all of the common stock you requested. If the Stock Offering is oversubscribed and your order is cut back, your 401(k) Plan funds (which are not invested in First Savings Financial Group common stock) will be reinvested in accordance with the investment elections that you have in place for your elective deferrals.

Nature of a Participant’s Interest in First Savings Financial Group, Inc. Common Stock

The trustee will hold First Savings Financial Group common stock in the name of the 401(k) Plan. The trustee will credit shares of First Savings Financial Group common stock acquired at your direction to your account under the 401(k) Plan. Therefore, the investment designations of other 401(k) Plan participants should not affect earnings on your 401(k) Plan account.

Voting and Tender Rights of First Savings Financial Group, Inc. Common Stock

The First Savings Financial Group Stock Fund trustee will exercise voting and tender rights attributable to all First Savings Financial Group common stock held in the First Savings Financial Group Stock Fund, as directed by participants with interests in the First Savings Financial Group Stock Fund. With respect to each matter as to which holders of First Savings Financial Group common stock have a right to vote, you will have voting instruction rights that reflect your proportionate interest in the First Savings Financial Group Stock Fund. The number of shares of First Savings Financial Group common stock held in the First Savings Financial Group Stock Fund voted for and against each matter will be proportionate to the number of voting instruction rights exercised. If there is a tender offer for First Savings Financial Group common stock, the 401(k) Plan allots each participant a number of tender instruction rights reflecting the participant’s proportionate interest in the First Savings Financial Group Stock Fund. The percentage of shares of First Savings Financial Group common stock held in the First Savings Financial Group Stock Fund that will be tendered will be the same as the percentage of the total number of tender instruction rights exercised in favor of the tender offer. The remaining shares of First Savings Financial Group common stock held in the First Savings Financial Group Stock Fund will not be tendered. The 401(k) Plan provides that participants will exercise their voting instruction rights and tender instruction rights on a confidential basis.

DESCRIPTION OF THE 401(k) PLAN

Introduction

First Savings Bank originally adopted the 401(k) Plan effective May 1, 1990 and amended and restated the plan in its entirety effective July 1, 2007. First Savings Bank intends for the 401(k) Plan to comply, in form and in operation, with all applicable provisions of the Internal Revenue Code and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). First Savings Bank may change the 401(k) Plan from time to time in the future to ensure continued compliance with these laws. First Savings Bank may also amend the 401(k) Plan from time to time in the future to add, modify, or eliminate certain features of the plan, as it sees fit. Federal law provides you with various rights and protections as a participant in the 401(k) Plan, which is governed by ERISA. However, the Pension Benefit Guaranty Corporation does not guarantee your benefits under the 401(k) Plan.

Reference to Full Text of the Plan. The following portions of this prospectus supplement summarize the material provisions of the 401(k) Plan. First Savings Bank qualifies this summary in its entirety by reference to the full text of the 401(k) Plan. You may obtain copies of the 401(k) Plan document, including any amendments to the plan and a summary plan description, by contacting John Lawson at (812) 218-6801. You should carefully read the 401(k) Plan documents to understand your rights and obligations under the 401(k) Plan.

Eligibility and Participation

If you are at least 21 years old, and you have completed one year of service with First Savings Bank, you may elect to participate in the 401(k) Plan on the January 1 ^st or July 1 ^st following or coincident with the date you satisfy the 401(k) Plan eligibility requirements.

As of May 31, 2008, 56 of the 60 eligible employees of First Savings Bank actively participated in the 401(k) Plan.

Contributions Under the 401(k) Plan

Employee Pre-Tax Salary Deferrals. Subject to certain Internal Revenue Service limitations, the 401(k) Plan permits you to make pre-tax salary deferrals each payroll period of up to 100% of your compensation. Compensation is defined for purposes of the 401(k) Plan as each participant’s Box 1, form W-2 compensation. In addition to pre-tax salary deferrals, you may make “catch up” contributions if you are currently age 50 or will be 50 before the end of the calendar year. You are always 100% vested in your elective deferrals.

First Savings Bank Safe Harbor Contributions. The 401(k) Plan provides that First Savings Bank will make matching contributions on behalf of each eligible participant with respect to each eligible participant’s elective deferrals. If you elect to defer funds into the 401(k) Plan, First Savings Bank will match 100% of your elective deferrals up to 5% of your compensation. First Savings Bank makes matching contributions only to those participants who actively defer a percentage of their compensation into the 401(k) Plan. You are always 100% vested in you employer contributions.

Rollover Contributions. First Savings Bank allows employees who receive a distribution from a previous employer’s tax-qualified employee benefit plan to deposit that distribution into a Rollover Contribution account under the 401(k) Plan, provided the rollover contribution satisfies IRS requirements.

Limitations on Contributions

Limitation on Employee Salary Deferrals. By law, your total deferrals under the 401(k) Plan, together with similar plans, may not exceed $15,500 for 2008. Eligible employees who are age 50 and over may also make additional “catch-up” contributions to the plan, up to a maximum of $5,000 for 2008. The Internal Revenue Service periodically increases these limitations. An eligible participant who exceeds these limitations must include any excess deferrals in gross income for federal income tax purposes in the year of deferral. In addition, the participant must pay federal income taxes on any excess deferrals when distributed by the 401(k) Plan to the participant, unless the plan distributes the excess deferrals and any related income no later than the first April 15th following the close of the taxable year in which the participant made the excess deferrals. Any income on excess deferrals distributed before such date is treated, for federal income tax purposes, as earned and received by the participant in the taxable year of the distribution.

Limitation on Annual Additions and Benefits. As required by the Internal Revenue Code, the 401(k) Plan provides that the total amount of contributions and forfeitures (annual additions) credited to a participant during any year under all defined contribution plans of First Savings Bank (including the 401(k) Plan and the proposed First Savings Bank Employee Stock Ownership Plan) may not exceed the lesser of 100% of the participant’s annual compensation or $46,000 for 2008.

Limitation on Plan Contributions for Highly Compensated Employees. Special provisions of the Internal Revenue Code limit the amount of pre-tax and matching contributions that may be made to the 401(k) Plan in any year on behalf of highly compensated employees, in relation to the amount of pre-tax and matching contributions made by or on behalf of all other employees eligible to participate in the 401(k) Plan. If pre-tax and matching contributions exceed these limitations, the plan must adjust the contribution levels for highly compensated employees.

In general, a highly compensated employee includes any employee who (1) was a 5% owner of the sponsoring employer at any time during the year or the preceding year, or (2) had compensation for the preceding year in excess of $100,000 and, if the sponsoring employer so elects, was in the top 20% of employees by compensation for such year. The preceding dollar amount applies for 2008 and may be adjusted periodically by the Internal Revenue Service .

Top-Heavy Plan Requirements. If the 401(k) Plan is a Top-Heavy Plan for any calendar year, First Savings Bank may be required to make certain minimum contributions to the 401(k) Plan on behalf of non-key employees. In general, the 401(k) Plan will be treated as a “Top-Heavy Plan” for any calendar year if, as of the last day of the preceding calendar year, the aggregate balance of the accounts of “Key Employees” exceeds 60% of the aggregate balance of the accounts of all employees under the plan. A Key Employee is generally any employee who, at any time during the calendar year or any of the four preceding years, is:

(1)

an officer of First Savings Bank whose annual compensation exceeds $145,000;

(2)

a 5% owner of the employer, meaning an employee who owns more than 5% of the outstanding stock of First Savings Financial Group, or who owns stock that possesses more than 5% of the total combined voting power of all stock of First Savings Financial Group; or

(3)

a 1% owner of the employer, meaning an employee who owns more than 1% of the outstanding stock of First Savings Financial Group, or who owns stock that possesses more than 1% of the total combined voting power of all stock of First Savings Financial Group, and whose annual compensation exceeds $150,000.

The foregoing dollar amounts are for 2008.

401(k) Plan Investments

Effective [ ] , the 401(k) Plan offers the following investment choices:


	Annual Rates of Return
Fund Name	2007	2006	2005

The following is a brief description of each of the investment choices offered through the 401(k) Plan.

[INSERT DESCRIPTION OF FUNDS]

In connection with the Stock Offering, First Savings Bank has added the First Savings Financial Group Stock Fund as an additional choice to the investment alternatives described above. The First Savings Financial Group Stock Fund invests primarily in the common stock of First Savings Financial Group. Participants in the 401(k) Plan may direct the First Savings Financial Group Stock Fund trustee to invest all or a portion of their 401(k) Plan account balances in the First Savings Financial Group Stock Fund during the offering. 401(k) Plan participants will not be limited in their investment in the First Savings Financial Group Stock Fund following the close of the Stock Offering.

The First Savings Financial Group Stock Fund consists of investments in the common stock of First Savings Financial Group made on the closing date of the Stock Offering. Your investment in the First Savings Financial Group Stock Fund will be recorded using the unit accounting method. If cash dividends are paid on First Savings Financial Group common stock, the trustee will, to the extent practicable, use the dividends held in the First Savings Financial Group Stock Fund to purchase shares of the common stock. Pending investment in the common stock, assets held in the First Savings Financial Group Stock Fund will be placed in the [ ] , a money market fund.

As of the date of this prospectus supplement, no shares of First Savings Financial Group common stock have been issued or are outstanding, and there is no established market for First Savings Financial Group common stock. Accordingly, there is no record of the historical performance of the First Savings Financial Group Stock Fund. Performance of the First Savings Financial Group Stock Fund depends on a number of factors, including the financial condition and profitability of First Savings Bank and general stock market conditions. See “Risk Factors” in the attached prospectus.

Once you have submitted your Investment Form, you may not change your investment directions in the Stock Offering.

Benefits Under the 401(k) Plan

Vesting. All participants are 100% vested in their pre-tax salary deferrals and employer contributions. This means that participants have a non-forfeitable right to these funds and any earnings on the funds at all times.

Withdrawals and Distributions from the 401(k) Plan

Withdrawals Before Termination of Employment. While in active service, participants may take two non-hardship withdrawals from the 401(k) Plan per plan year (subject to the restrictions set forth in the 401(k) Plan). A participant may also take one hardship withdrawal per plan year, provided the participant has a hardship event as defined by the Internal Revenue Service regulations and subject to approval by the First Savings Bank Compensation Committee. Plan loans are also permitted, subject to applicable law and Internal Revenue Service regulations. Please see the Plan Administrator for details on the loan policies and procedures.

Distribution Upon Retirement, Death or Disability. If a participant’s accounts are $1,000 or less upon termination of employment, payment will be in the form of a lump sum as of a valuation date as soon thereafter as administratively possible. If a participant’s accounts exceed $1,000 and are $5,000 or less upon termination of employment, and the participant does not elect to have his/her distribution paid, payment will be in the form of a Direct Rollover to an individual retirement plan designated by the Plan Administrator.

If termination of employment is due to Normal, Postponed Retirement, Death, or Total and Permanent Disability (as defined in the 401(k) Plan), and a participant’s account exceeds $5,000, distribution of the participant’s accounts will be in the form of a lump sum payment, upon the participant’s attainment of Normal Retirement Date, unless the participant elects (within 30 days of receipt of an election notice) to further defer distribution beyond Normal Retirement Date to a Postponed Retirement Date (subject to an Internal Revenue Service minimum distribution of benefits requirement following attainment of age 70 ¹ / 2 ), or unless the participant elects one of the following optional forms of payment:

•

Lump sum payment or in quarterly, semi-annual or annual installments over a period not exceeding the participant’s life expectancy or the joint and survivor life expectancy of the participants and his/her designated beneficiary, as selected by the participant as of any valuation date following the date of termination of employment. (Note: lump sums are subject to a mandatory 20% income tax withholding and a statutory 10% additional federal tax if paid before age 55). A participant “Rollover” within 60 days of distribution to an Individual Retirement Account (IRA), or another employer’s plan (if permitted by that plan).

•

Direct “Rollover” from the 401(k) Plan to another employer’s plan (if permitted by that plan) for accounts which are lesser or greater than $5,000.

Distribution Upon Termination for Any Other Reason. If a participant’s accounts are $1,000 or less upon termination of employment, payment will be in the form of a lump sum as of a valuation date as soon thereafter as administratively possible. If a participant’s accounts exceed $1,000 and are $5,000 or less upon termination of employment, and the participant does not elect to have his/her distribution paid,

payment will be in the form of a Direct Rollover to an individual retirement plan designated by the Plan Administrator.

If upon termination of employment, a participant’s accounts exceed $5,000, payment will be deferred to Normal Retirement Date, unless the participant elects one of the following optional forms of payment:

•

Lump sum payment as of any valuation date following the date of termination of employment. (Note: lump sums are subject to a mandatory 20% income tax withholding and a statutory 10% additional federal tax if paid before age 55). A participant “Rollover” is permitted within 60 days of distribution to an Individual Retirement Account (IRA), or another employer’s plan (if permitted by that plan).

•

Direct “Rollover” from the 401(k) Plan to another employer’s plan (if permitted by that plan) for accounts which are lesser or greater than $5,000.

Nonalienation of Benefits. Except with respect to federal income tax withholding, and as provided for under a qualified domestic relations order, benefits payable under the 401(k) Plan will not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution, or levy of any kind, either voluntary or involuntary, and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any rights to benefits payable under the 401(k) Plan will be void.

Applicable federal tax law requires the 401(k) Plan to impose substantial restrictions on your right to withdraw amounts held under the 401(k) Plan before your termination of employment with First Savings Bank. Federal law may also impose an excise tax on withdrawals from the 401(k) Plan before you attain 59 ¹ / 2 years of age, regardless of whether the withdrawal occurs during your employment with First Savings Bank or after termination of employment.

ADMINISTRATION OF THE 401(k) PLAN

Trustees

The board of directors of First Savings Bank has appointed Larry W. Myers, John P. Lawson, Jr. and Gregory A. McMurry to serve as trustees for the First Savings Financial Group Stock Fund. The Bank of New York will serve as the custodian of the shares held in the First Savings Financial Group Stock Fund and the trustee of all the other plan assets. The trustees receive, hold and invest the contributions to the 401(k) Plan in trust and distribute them to participants and beneficiaries in accordance with the terms of the 401(k) Plan and the directions of the Plan Administrator. The trustees are responsible for the investment of the trust assets, as directed by the Plan Administrator and the participants.

Reports to 401(k) Plan Participants

The Plan Administrator furnishes participants quarterly statements that show the balance in their accounts as of the statement date, contributions made to their accounts during that period and any additional adjustments required to reflect earnings or losses.

Plan Administrator

First Savings Bank currently acts as Plan Administrator for the 401(k) Plan. The Plan Administrator handles the following administrative functions: interpreting the provisions of the plan, prescribing procedures for filing applications for benefits, preparing and distributing information explaining the plan, maintaining plan records, books of account and all other data necessary for the proper administration of the plan, preparing and filing all returns and reports required by the U.S. Department of Labor and the IRS and making all required disclosures to participants, beneficiaries and others under ERISA.

Amendment and Termination

First Savings Bank expects to continue the 401(k) Plan indefinitely. Nevertheless, First Savings Bank may terminate the 401(k) Plan at any time. If First Savings Bank terminates the 401(k) Plan in whole or in part, all affected participants become fully vested in their accounts, regardless of other provisions of the 401(k) Plan. First Savings Bank reserves the right to make, from time to time, changes which do not cause any part of the trust to be used for, or diverted to, any purpose other than the exclusive benefit of participants or their beneficiaries. First Savings Bank may amend the plan, however, as necessary or desirable, in order to comply with ERISA or the Internal Revenue Code.

Merger, Consolidation or Transfer

If the 401(k) Plan merges or consolidates with another plan or transfers the trust assets to another plan, and either the 401(k) Plan or the other plan is subsequently terminated, the 401(k) Plan requires that you receive a benefit immediately after the merger, consolidation or transfer that would equal or exceed the benefit you would have been entitled to receive immediately before the merger, consolidation or transfer, if the 401(k) Plan had terminated at that time.

Federal Income Tax Consequences

The following briefly summarizes the material federal income tax aspects of the 401(k) Plan. You should not rely on this summary as a complete or definitive description of the material federal income tax consequences of the 401(k) Plan. Statutory provisions change, as do their interpretation, and their application may vary in individual circumstances. Finally, applicable state and local income tax laws may have different tax consequences than the federal income tax laws. 401(k) Plan participants should consult a tax advisor with respect to any transaction involving the 401(k) Plan, including any distribution from the 401(k) Plan.

As a “tax-qualified retirement plan,” the Internal Revenue Code affords the 401(k) Plan certain tax advantages, including the following:

(1)

the sponsoring employer may take an immediate tax deduction for the amount contributed to the plan each year;

(2)

participants pay no current income tax on amounts contributed by the employer on their behalf; and

(3)

earnings of the plan are tax-deferred, thereby permitting the tax-free accumulation of income and gains on investments.

First Savings Bank administers the 401(k) Plan to comply in operation with the requirements of the Internal Revenue Code as of the applicable effective date of any change in the law. If First Savings Bank should receive an adverse determination letter from the Internal Revenue Service regarding the 401(k) Plan’s tax exempt status, all participants would generally recognize income equal to their vested interests in the 401(k) Plan, the participants would not be permitted to transfer amounts distributed from the 401(k) Plan to an Individual Retirement Account or to another qualified retirement plan, and First Savings Bank would be denied certain tax deductions taken in connection with the 401(k) Plan.

Lump Sum Distribution. A distribution from the 401(k) Plan to a participant or the beneficiary of a participant qualifies as a lump sum distribution if it is made within one taxable year, on account of the participant’s death, disability or separation from service, or after the participant attains age 59 ¹ / 2 ; and consists of the balance credited to the participant under this plan and all other profit sharing plans, if any, maintained by First Savings Bank. The portion of any lump sum distribution included in taxable income for federal income tax purposes consists of the entire amount of the lump sum distribution, less the amount of after-tax contributions, if any, made to any other profit-sharing plans maintained by First Savings Bank, if the distribution includes those amounts.

First Savings Financial Group Common Stock Included in Lump Sum Distribution. If a lump sum distribution includes First Savings Financial Group common stock, the distribution generally is taxed in the manner described above. The total taxable amount is reduced, however, by the amount of any net unrealized appreciation on First Savings Financial Group common stock; that is, the excess of the value of First Savings Financial Group common stock at the time of the distribution over the cost or other basis of the securities to the trust. The tax basis of First Savings Financial Group common stock, for purposes of computing gain or loss on a subsequent sale, equals the value of First Savings Financial Group common stock at the time of distribution, less the amount of net unrealized appreciation. Any gain on a subsequent sale or other taxable disposition of First Savings Financial Group common stock, to the extent of the net unrealized appreciation at the time of distribution, is long-term capital gain, regardless of how long you hold the First Savings Financial Group common stock, or the “holding period.” Any gain on a subsequent sale or other taxable disposition of First Savings Financial Group common stock that exceeds the amount of net unrealized appreciation upon distribution is considered long-term capital gain, regardless of the holding period. The recipient of a distribution may elect to include the amount of any net unrealized appreciation in the total taxable amount of the distribution, to the extent allowed under IRS regulations.

We have provided you with a brief description of the material federal income tax aspects of the 401(k) Plan that are generally applicable under the Internal Revenue Code. We do not intend this description to be a complete or definitive description of the federal income tax consequences of participating in or receiving distributions from the 401(k) Plan. Accordingly, you should consult a tax advisor concerning the federal, state and local tax consequences of participating in and receiving distributions from the 401(k) Plan.

Restrictions on Resale

Any “affiliate” of First Savings Financial Group under Rules 144 and 405 of the Securities Act of 1933, as amended, who receives a distribution of common stock under the 401(k) Plan, may re-offer or resell such shares only under a registration statement filed under the Securities Act of 1933, as amended, assuming the availability of a registration statement, or under Rule 144 or some other exemption from these registration requirements. An “affiliate” of First Savings Financial Group is someone who directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, First Savings Financial Group. Generally, a director, principal officer or major shareholder of a corporation is deemed to be an “affiliate” of that corporation.

Any person who may be an “affiliate” of First Savings Financial Group may wish to consult with counsel before transferring any common stock they own. In addition, participants should consult with counsel regarding the applicability to them of Section 16 of the Securities Exchange Act of 1934, as amended, which may restrict the sale of First Savings Financial Group common stock acquired under the 401(k) Plan or other sales of First Savings Financial Group common stock.

Persons who are not deemed to be “affiliates” of First Savings Financial Group at the time of resale may resell freely any shares of First Savings Financial Group common stock distributed to them under the 401(k) Plan, either publicly or privately, without regard to the registration and prospectus delivery requirements of the Securities Act of 1933, as amended, or compliance with the restrictions and conditions contained in the exemptions available under federal law. A person deemed an “affiliate” of First Savings Financial Group at the time of a proposed resale may publicly resell common stock only under a “re-offer” prospectus or in accordance with the restrictions and conditions contained in Rule 144 of the Securities Act of 1933, as amended, or some other exemption from registration, and may not use this prospectus supplement or the accompanying prospectus in connection with any such resale. In general, Rule 144 restricts the amount of common stock which an affiliate may publicly resell in any three-month period to the greater of one percent of First Savings Financial Group common stock then outstanding or the average weekly trading volume reported on the Nasdaq Capital Market during the four calendar weeks before the sale. Affiliates may sell only through brokers without solicitation and only at a time when First Savings Financial Group is current in filing all required reports under the Securities Exchange Act of 1934, as amended.

SEC Reporting and Short-Swing Profit Liability

Section 16 of the Securities Exchange Act of 1934, as amended, imposes reporting and liability requirements on officers, directors and persons who beneficially own more than 10% of public companies such as First Savings Financial Group. Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the filing of reports of beneficial ownership. Within ten days of becoming a person required to file reports under Section 16(a), such person must file a Form 3 reporting initial beneficial ownership with the Securities and Exchange Commission (“SEC”). Such persons must also report periodically certain changes in beneficial ownership involving the allocation or reallocation of assets held in their 401(k) Plan accounts, either on a Form 4 within two business days after a transaction, or annually on a Form 5 within 45 days after the close of a company’s fiscal year.

In addition to the reporting requirements described above, Section 16(b) of the Securities Exchange Act of 1934, as amended, provides for the recovery by First Savings Financial Group of profits realized from the purchase and sale or sale and purchase of its common stock within any six-month period by any officer, director or person who beneficially owns more than 10% of the common stock.

The SEC has adopted rules that exempt many transactions involving the 401(k) Plan from the “short-swing” profit recovery provisions of Section 16(b). The exemptions generally involve restrictions upon the timing of elections to buy or sell employer securities for the accounts of any officer, director or person who beneficially owns more than 10% of the common stock of a company.

Except for distributions of the common stock due to death, disability, retirement, termination of employment or under a qualified domestic relations order, persons who are subject to Section 16(b) may be required, under limited circumstances involving the purchase of common stock within six months of the distribution, to hold the shares of common stock distributed from the 401(k) Plan for six months after the distribution date.

LEGAL OPINION

The validity of the issuance of the common stock of First Savings Financial Group will be passed upon by Kilpatrick Stockton LLP, Washington, DC. Kilpatrick Stockton LLP acted as special counsel for First Savings Financial Group in connection with the Stock Offering.

FIRST SAVINGS BANK, F.S.B.

PROFIT SHARING/401(k) PLAN

INVESTMENT FORM

Name of Plan Participant:

Social Security Number:

1. Instructions . In connection with the public offering (the “Stock Offering”) of the common stock of First Savings Financial Group, Inc. (the “Common Stock”), the First Savings Bank, F.S.B. Profit Sharing/401(k) Plan (the “401(k) Plan”) now permits participants to direct their 401(k) Plan account balances into a new fund: the First Savings Financial Group Stock Fund (“Employer Stock Fund”). The percentage of a participant’s account transferred at the direction of the participant into the Employer Stock Fund will be used to purchase shares of Common Stock in the Stock Offering.

To direct a transfer of all or a portion of the funds credited to your accounts in the 401(k) Plan to the Employer Stock Fund, you must complete and submit this form to John Lawson by 12:00 noon on [ , 2008], unless extended by First Savings Bank . A representative for the Plan Administrator will retain a copy of this form and return a copy to you. If you need any assistance in completing this form, please contact John Lawson at (812) 218-6801. If you do not complete and return this form to John Lawson by the noted deadline, your 401(k) Plan funds will continue to be invested in accordance with your prior investment directions, or in accordance with the terms of the 401(k) Plan if no investment directions have been provided.

2. Investment Directions for the Stock Offering . I hereby authorize the Plan Administrator to direct the trustee to liquidate the following percentages (in multiples of not less than 1%) of my investments in the 401(k) Plan and use the funds to invest in the Employer Stock Fund in the Stock Offering:

[INSERT FUNDS]

I acknowledge that if the Employer Stock Fund trustee cannot fill all or a portion of my order, my unused funds will be reinvested in the investment elections I have in place for my elective deferrals before the Stock Offering.

3. Purchaser Information . The ability of participants in the 401(k) Plan to purchase Common Stock and to direct their current 401(k) Plan account balances into the Employer Stock Fund is based upon the participant’s subscription rights. Please indicate your status.

Check here if you had $50.00 or more on deposit with First Savings Bank as of the close of business on March 31, 2007.

Check here if you had $50.00 or more on deposit with First Savings Bank as of the close of business on June 30, 2008.

Check here if you are a depositor of First Savings Bank as of the close of business on [ ] .

4. Acknowledgment of Participant . I understand that this Investment Form shall be subject to all of the terms and conditions of the 401(k) Plan. I acknowledge that I have received a copy of the First Savings Financial Group, Inc. Prospectus and the Prospectus Supplement and that I understand the terms and conditions of my investment in the Employer Stock Fund.



Signature of Participant				Date

Acknowledgment of Receipt by Plan Administrator. This Investment Form was received by the Plan Administrator and will become effective on the date noted below.



By:				Date

THE PARTICIPATION INTERESTS REPRESENTED BY THE COMMON STOCK OFFERED HEREBY ARE NOT DEPOSIT ACCOUNTS AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY AND ARE NOT GUARANTEED BY FIRST SAVINGS FINANCIAL GROUP, INC. OR FIRST SAVINGS BANK, F.S.B. THE COMMON STOCK IS SUBJECT TO AN INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS OF THE PRINCIPAL INVESTED.

Minimum Individual Stock Purchase in the Stock Offering is $250.

Maximum Individual Stock Purchase in the Stock Offering is $200,000.

PLEASE COMPLETE AND RETURN TO

JOHN LAWSON BY 12:00 NOON, LOCAL TIME, ON

[ , 2008], UNLESS EXTENDED BY FIRST SAVINGS BANK

PROSPECTUS

First Savings Financial Group, Inc.

(Proposed Holding Company for First Savings Bank, F.S.B.)

Up to 3,553,500 Shares of Common Stock

First Savings Financial Group is offering shares of its common stock for sale in connection with the conversion of First Savings Bank, F.S.B. from the mutual to the stock form of ownership. First Savings Financial Group will be the holding company for First Savings Bank. After the offering, 100% of First Savings Bank’s outstanding common stock will be owned by First Savings Financial Group. We also intend to establish a charitable foundation in connection with the stock offering and contribute 110,000 shares of our common stock and $100,000 in cash to the charitable foundation. We have applied to list our common stock on the Nasdaq Capital Market under the symbol “FSFG.”

If you are or were a depositor of First Savings Bank:

•

You may have priority rights to purchase shares of common stock.

If you are a participant in the First Savings Bank Profit Sharing/401(k) Plan:

•

You may direct that all or part of your current account balance in this plan be invested in shares of common stock.

•

You will receive a separate supplement to this prospectus that describes your rights under this plan.

If you fit neither of the categories above, but are interested in purchasing shares of our common stock:

•

You may have an opportunity to purchase shares of common stock after priority orders are filled.

We are offering up to 3,553,500 shares of common stock for sale on a best efforts basis, subject to certain conditions. We must sell a minimum of 2,626,500 shares to complete the offering. If, as a result of regulatory considerations, demand for the shares or changes in market conditions, the independent appraiser determines that our market value has increased, we may sell up to 4,086,525 shares without giving you further notice or the opportunity to change or cancel your order. The offering is expected to close at , Eastern time, on , 2008. We may extend this closing date without notice to you until , 2008, unless the Office of Thrift Supervision approves a later date, which will not be beyond .

Keefe, Bruyette & Woods, Inc. will use its best efforts to assist us in our selling efforts, but is not required to purchase any of the common stock that is being offered for sale. Purchasers will not pay a commission to purchase shares of common stock in the offering. All shares offered for sale are offered at a price of $10.00 per share.

The minimum purchase is 25 shares. Once submitted, orders are irrevocable unless the offering is terminated or extended beyond , 2008. If the offering is extended beyond , 2008, subscribers will have the right to modify or rescind their purchase orders. Funds received before the completion of the offering will be maintained in a segregated account at First Savings Bank or, at our discretion, at another federally insured depository institution. However, we will not maintain more than one such account. All subscriptions received will bear interest at First Savings Bank’s passbook savings rate, which is currently 0.25% per annum. If we do not sell the minimum number of shares, if we terminate the offering for any other reason, or if we extend the offering beyond , 2008 and you rescind your order, we will promptly return your funds with interest.

We expect our directors and executive officers, together with their associates, to subscribe for 192,000 shares, which equals 5.4% of the shares offered for sale at the maximum of the offering range.

The Office of Thrift Supervision conditionally approved our plan of conversion on , 2008. However, such approval does not constitute a recommendation or endorsement of this offering.

This investment involves a degree of risk, including the possible loss of principal.

Please read “Risk Factors” beginning on page .

OFFERING SUMMARY

Price Per Share: $10.00


	Minimum		Maximum		Maximum As Adjusted
Number of shares		2,626,500		3,553,500		4,086,525
Gross offering proceeds	$	26,265,000	$	35,535,000	$	40,865,250
Estimated offering expenses, excluding underwriting fees and expenses	$	1,025,000	$	1,025,000	$	1,025,000
Estimated underwriting fees and expenses ⁽¹⁾	$	222,600	$	307,800	$	356,900
Estimated net proceeds	$	25,017,000	$	34,202,000	$	39,483,000
Estimated net proceeds per share	$	9.52	$	9.62	$	9.66

(1)	Excludes fees payable if a syndicated community offering is held. For a discussion of the compensation of Keefe, Bruyette & Woods, Inc., see “The Conversion and Stock Offering — Marketing Arrangements. ”

These securities are not deposits or savings accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.

Neither the Securities and Exchange Commission, the Office of Thrift Supervision nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

For assistance, please contact the stock information center at ( ) - .

K EEFE , B RUYETTE & W OODS

The date of this prospectus is , 2008

[Map of Indiana showing office locations of First Savings Bank]

TABLE OF CONTENTS


		PAGE
Summary
Risk Factors
A Warning About Forward-Looking Statements
Selected Consolidated Financial and Other Data
Use of Proceeds
Our Dividend Policy
Market for the Common Stock
Capitalization
Regulatory Capital Compliance
Pro Forma Data
Comparison of Independent Valuation and Pro Forma Financial Information With and Without the Foundation
Our Business
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Our Management
Subscriptions by Executive Officers and Directors
Regulation and Supervision
Federal and State Taxation
The Conversion and Stock Offering
First Savings Charitable Foundation
Restrictions on the Acquisition of First Savings Financial Group and First Savings Bank, F.S.B.
Description of First Savings Financial Group Capital Stock
Transfer Agent and Registrar
Registration Requirements
Legal and Tax Opinions
Experts
Where You Can Find More Information
Index to Consolidated Financial Statements of First Savings Bank, F.S.B.

Summary

This summary highlights selected information from this document and may not contain all the information that is important to you. To understand the stock offering fully, you should read this entire document carefully.

The Companies

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

(812) 283-0724

First Savings Financial Group, Inc. This offering is made by First Savings Financial Group, an Indiana corporation incorporated in May 2008 by First Savings Bank to be its holding company. Currently, First Savings Financial Group has no assets. Following the conversion, First Savings Financial Group will own all of First Savings Bank’s capital stock and will direct, plan and coordinate First Savings Bank’s business activities. In the future, First Savings Financial Group might also acquire or organize other operating subsidiaries, including other financial institutions or financial services companies, although it currently has no specific plans or agreements to do so.

First Savings Bank, F.S.B. First Savings Bank operates as a community-oriented financial institution, with seven full-service offices in our primary market area, which encompasses Clark and Floyd Counties in Indiana and the surrounding areas. We offer a variety of deposit products and provide residential and commercial real estate loans and construction loans and, to a lesser degree, consumer loans, including home equity lines of credit, and commercial business loans to small businesses in our primary market area. At March 31, 2008, we had total assets of $212.6 million, total deposits of $174.1 million and total equity of $39.4 million.

Our predominant lending activity has been residential mortgage lending in our primary market area. Before 2005, a significant portion of the residential mortgage loans that we had originated are secured by non-owner occupied properties. Loans secured by non-owner occupied properties generally carry a greater risk of loss than loans secured by owner-occupied properties, and our non-performing loan balances have increased in recent periods primarily because of delinquencies in our non-owner occupied residential loan portfolio. See “Risk Factors – Risks Related to Our Business – Our concentration in non-owner occupied real estate loans may expose us to increased credit risk” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risk Management – Analysis of Nonperforming and Classified Assets.” Since 2005, when we hired a new President and Chief Executive Officer, we have de-emphasized non-owner occupied residential mortgage lending and have focused, and intend to continue to focus, our residential mortgage lending primarily on originating residential mortgage loans secured by owner-occupied properties.

Our Operating Strategy (page )

Our mission is to operate and grow a profitable community-oriented financial institution. We plan to achieve this by executing our strategy of:

•

continuing our historical focus on residential mortgage lending, but de-emphasizing residential mortgage lending secured by non-owner occupied properties;

•

pursuing opportunities to increase commercial real estate lending and commercial business lending;

•

providing exceptional customer service to attract and retain customers; and

•

expanding our market share and market area by opening new branch offices and pursuing opportunities to acquire other financial institutions, although we currently have no definitive plans regarding potential acquisition opportunities. We plan to open a new leased branch office in 2009 in our primary market area. We are in the initial stages of investigating potential suitable locations, but have no definitive plans or commitments with respect to a particular location.

The Conversion

Description of the Conversion

Currently, we are a federally chartered mutual savings bank with no shareholders. Our depositors currently have the right to vote on certain matters such as the election of directors and this conversion.

The conversion process that we are now undertaking involves a change from our mutual form to a stock savings bank that will result in all of First Savings Bank’s shares being owned by First Savings Financial Group. Voting rights in First Savings Financial Group will belong to its shareholders, including our employee stock ownership plan and our charitable foundation. For more information on the charitable foundation and the employee stock ownership plan, see “Summary—We Will Form the First Savings Charitable Foundation” and “Summary—Benefits of the Offering to Management—Employee Stock Ownership Plan.” We are conducting the conversion under the terms of our plan of conversion. The Office of Thrift Supervision has conditionally approved the plan of conversion, including a condition that it be approved by our members. We have called a special meeting of members for , 2008 to vote on the plan of conversion.

The following diagram depicts our corporate structure after the conversion and offering:

LOGO

Regulation and Supervision (page )

We are, and First Savings Financial Group will be upon completion of the conversion, subject to regulation, supervision and examination by the Office of Thrift Supervision. We are also subject to regulation by the Federal Deposit Insurance Corporation.

The Offering

Purchase Price

The purchase price is $10.00 per share. You will not pay a commission to buy any shares in the offering.

Number of Shares to be Sold

We are offering for sale between 2,626,500 and 3,553,500 shares of First Savings Financial Group common stock in this offering. With regulatory approval, we may increase the number of shares to be sold to 4,086,525 shares without giving you further notice or the opportunity to change or cancel your order. In considering whether to increase the offering size, the Office of Thrift Supervision will consider the level of subscriptions, the views of our independent appraiser, our financial condition and results of operations and changes in market conditions.

How We Determined the Offering Range (page )

We decided to offer between 2,626,500 and 3,553,500 shares, which is our offering range, based on an independent appraisal of our pro forma market value prepared by RP Financial, LC., an appraisal firm experienced in appraisals of financial institutions. RP Financial will receive fees totaling $40,000 for its appraisal services, plus $3,500 for each appraisal valuation update and a maximum of $5,000 for reimbursement of out-of-pocket expenses. RP Financial estimates that as of May 16, 2008, our offering range was between $26.3 million and $35.5 million, with a midpoint of $30.9 million, and that our pro forma market value was between $27.4 million and $36.6 million, with a midpoint of $32.0 million, inclusive of shares issued to the charitable foundation.

In preparing its appraisal, RP Financial considered the information in this prospectus, including our consolidated financial statements. RP Financial also considered the following factors, among others:

•

our historical, present and projected operating results and financial condition and the economic and demographic characteristics of our primary market area;

•

a comparative evaluation of the operating and financial statistics of First Savings Bank with those of other similarly situated, publicly traded companies;

•

the effect of the capital raised in this offering on our net worth and earnings potential;

•

the trading market for securities of comparable institutions and general conditions in the market for such securities; and

•

our intention to make a contribution to the First Savings Charitable Foundation of 110,000 shares of First Savings Financial Group’s common stock issued in the conversion and $100,000 in cash.

Two measures that some investors use to analyze whether a stock might be a good investment are the ratio of the offering price to the issuer’s “book value” and the ratio of the offering price per share to the issuer’s core income per share for the past 12 months. RP Financial considered these ratios, among other factors, in preparing its appraisal. Book value is the same as total equity and represents the difference between the issuer’s assets and liabilities. For purposes of the appraisal, core earnings is defined as net earnings after taxes, plus non-recurring expenses and minus non-recurring income, adjusted for income taxes in each case. RP Financial’s appraisal also incorporates an analysis of a peer group of publicly traded companies that RP Financial considered to be comparable to us.

The following table presents a summary of selected pricing ratios for the peer group companies and for us utilized by RP Financial in its appraisal. These ratios are based on our earnings for the twelve months ended March 31, 2008 and book value as of March 31, 2008 and the latest date for which complete financial data is publicly available for the peer group.


	Price to Core Earnings Multiple(1)	Price to Book Value Ratio
First Savings Financial Group (pro forma):
Minimum	*	53.13	%
Midpoint	*	57.60
Maximum	*	61.50
Maximum, as adjusted	*	65.36
Peer group companies as of May 16, 2008:
Average	21.43x	83.22	%
Median	24.34	80.79

Not meaningful.

(1)

Our pro forma loss based on financial data for the twelve months ended March 31, 2008 results in a price to core earnings multiple that is not meaningful for valuation purposes

Compared to the average pricing ratio of the peer group at the maximum of the offering range, our stock would be priced at a discount of 26.1% to the peer group on a price-to-book basis.

The independent appraisal does not indicate market value. You should not assume or expect that the valuation described above means that our common stock will trade at or above the $10.00 purchase price after the offering.

Possible Change in Offering Range (page )

RP Financial will update its appraisal before we complete the stock offering. If, as a result of regulatory considerations, demand for the shares or changes in market conditions, RP Financial determines that our pro forma market value has increased, we may sell up to 4,086,525 shares without further notice to you. If our pro forma market value at the end of the stock offering period is either below $26.3 million or above $40.9 million, then, after consulting with the Office of Thrift Supervision, we may: (i) terminate the stock offering and promptly return all funds, with interest; (ii) set a new offering range and give all subscribers the opportunity to confirm, modify or rescind their purchase orders for shares of First Savings Financial Group’s common stock; or (iii) take such other actions as may be permitted by the Office of Thrift Supervision and the Securities and Exchange Commission.

Possible Termination of the Offering

We must sell a minimum of 2,626,500 shares to complete the offering. If we do not sell the minimum number of shares, or if we terminate the offering for any other reason, we will promptly return all funds, with interest, at our current passbook rate.

After-Market Performance of Mutual-to-Stock Conversions

The appraisal prepared by RP Financial includes examples of after-market stock price performance for standard mutual-to-stock conversion offerings (i.e., excluding “second step” conversions by mutual holding companies) completed during the three-month period ended May 16, 2008. The following table presents stock price appreciation information for all standard mutual-to-stock conversions completed between January 1, 2007 and May 16, 2008. These companies did not constitute the group of ten comparable public companies utilized in RP Financial’s valuation analysis.


				Percentage Change From Initial Offering Price
Issuer (Market/Symbol)	Date of IPO	Offering Size		After 1 Day		After 1 Week		After 1 Month		Through May 16, 2008
Cape Bancorp, Inc. (CBNJ)	02/01/08	$	78.2	0.5	%	(1.0	)%	(2.0	)%	0.0	%
Danvers Bancorp, Inc. (DNBK)	01/10/08		171.9	(2.6	)	(3.1	)	2.6		17.5
First Advantage Bancorp (FABK)	11/30/07		53.6	11.7		7.0		6.5		19.2
First Financial NW, Inc. (FFNW)	10/10/07		211.6	17.3		15.0		8.1		4.9
Beacon Federal Bancorp, Inc. (BFED)	10/02/07		74.1	16.0		17.9		6.0		5.8
Louisiana Bancorp, Inc. (LABC)	07/10/07		63.5	9.5		4.0		9.1		29.3
Quaint Oak Bancorp, Inc. (QNTO)	07/05/07		13.9	(2.0	)	(7.0	)	(11.0	)	(7.0	)
ESSA Bancorp, Inc. (ESSA)	04/04/07		158.7	17.8		20.6		14.8		23.8
CMS Bancorp, Inc. (CMSB)	04/04/07		19.8	5.7		4.7		3.0		0.0
Hampden Bancorp, Inc. (HBNK)	01/17/07		75.7	28.2		25.0		23.4		12.1
All Transactions:
Average			92.1	10.2		8.3		6.1		10.6
Median			74.9	10.6		5.9		6.3		9.0
High			211.6	28.2		25.0		23.4		29.3
Low			13.9	(2.6	)	(7.0	)	(11.0	)	(7.0	)

This table is not intended to indicate how our stock may perform. Furthermore, this table presents only short-term price performance with respect to a limited number of companies that only recently completed their initial public offerings and may not be indicative of the longer-term stock price performance of these companies.

Stock price appreciation or depreciation is affected by many factors, including, but not limited to: general market and economic conditions; the interest rate environment; the amount of proceeds a company raises in its offering and its ability to successfully deploy those proceeds through originating loans and making other investments; and numerous factors relating to the specific company, including the experience and ability of management, historical and anticipated operating results, the nature and quality of the company’s assets, and the company’s primary market area. The companies listed in the table above may not be similar to First Savings Financial Group, the pricing ratios for their stock offerings were in some cases different from the pricing ratios for First Savings Financial Group’s common stock and the market conditions in which these offerings were completed were, in some cases, different from current market conditions. Any or all of these differences may cause our stock to perform differently from these other offerings. Before you make an investment decision, we urge you to carefully read this prospectus, including, but not limited to, the section “Risk Factors” beginning on page .

You also should be aware that, recently, stock prices of thrift initial public offerings have decreased. We cannot assure you that our stock will not trade below the $10.00 purchase price or that our stock will perform similarly to other recent mutual to stock conversions.

Conditions to Completing the Conversion and Offering

We are conducting the conversion and offering under the terms of our plan of conversion. We cannot complete the conversion and offering unless:

•

we sell at least the minimum number of shares offered;

•

we receive the final approval of the Office of Thrift Supervision to complete the offering; and

•

our members approve the plan of conversion.

Reasons for the Conversion and Offering (page )

Our primary reasons for the conversion and offering are to:

•

increase the capital of First Savings Bank to support future lending and operational growth;

•

enhance profitability and earnings through reinvesting and leveraging the proceeds, primarily through traditional funding and lending activities;

•

support future branching activities and/or the acquisition of other financial institutions or financial services companies;

•

implement equity compensation plans to retain and attract qualified directors, officers and staff to enhance the current incentive-based compensation programs; and

•

increase our philanthropic endeavors to the community we serve through the formation and funding of First Savings Charitable Foundation.

We Will Form the First Savings Charitable Foundation (page )

To continue our long-standing commitment to our local communities, we intend to establish a charitable foundation, named First Savings Charitable Foundation, as part of the conversion. Subject to separate approval by at least a majority of votes eligible to be cast by depositors of First Savings Bank, the charitable foundation will be funded with 110,000 shares of First Savings Financial Group common stock and $100,000 cash. This contribution to the charitable foundation would reduce net earnings by approximately $725,000, after tax, in the year in which the charitable foundation is established, which is expected to be fiscal 2008. The charitable foundation will make grants and donations to non-profit and community groups and projects located within our market areas. The amount of common stock that we are offering for sale would be greater if the conversion were to be completed without the formation of the charitable foundation. For a further discussion of the financial impact of the charitable foundation, including its effect on those who purchase shares in the offering and on the shares issued to stockholders of First Savings Financial Group, see Comparison of Independent Valuation and Pro Forma Financial Information With and Without the Foundation.”

Benefits of the Offering to Management (page )

We intend to adopt the following benefit plans and employment agreements:

Employee Stock Ownership Plan. We have adopted an employee stock ownership plan that will purchase 8% of the shares sold in the offering and contributed to the charitable foundation by means of a 15-year loan from First Savings Financial Group. As the loan is repaid and shares are released from collateral, the plan will allocate shares to the accounts of participating employees. Participants will receive allocations based on their individual compensation as a percentage of total plan compensation. Non-employee directors are not eligible to participate in the employee stock ownership plan. We will incur additional compensation expense as a result of this plan. See “Pro Forma Data” for an illustration of the effects of this plan.

Future Equity Incentive Plan. We intend to implement an equity incentive plan no earlier than six months after completion of the offering. If we implement the plan within one year after the conversion, the plan must be approved by a majority of the total votes eligible to be cast by our stockholders. If we implement the plan more than one year after the conversion, it must be approved by a majority of the total votes cast. Under this plan, we may award stock options and shares of restricted stock to key employees and directors. We will award shares of restricted stock at no cost to the recipient. We will grant stock options at an exercise price at least equal to 100% of the fair market value of our common stock on the option grant date. We will incur additional compensation expense as a result of this plan. See “Pro Forma Data” for an illustration of the effects of this plan. Under this plan, we may grant stock options in an amount up to 10% of the number of shares sold in the offering and contributed to the charitable foundation, and we may grant awards of restricted stock in an amount up to 4% of the number of shares sold in the offering and contributed to the charitable foundation. The equity incentive plan will comply with all applicable Office of Thrift Supervision regulations expect to the extent waived by the Office of Thrift Supervision.

The following table represents the total value of all shares to be available for restricted stock awards under the equity incentive plan, based on a range of market prices from $8.00 per share to $14.00 per share. The value of the grants will depend on the actual trading price of our common stock.


	Value of
Share Price	109,460 Shares Awarded at Minimum of Range		128,000 Shares Awarded at Midpoint of Range		146,540 Shares Awarded at Maximum of Range		167,861 Shares Awarded at 15% Above Maximum of Range
	(In thousands, except per share amounts)
$8.00	$	876	$	1,024	$	1,172	$	1,343
10.00		1,095		1,280		1,465		1,679
12.00		1,314		1,536		1,758		2,014
14.00		1,532		1,792		2,052		2,350

The following table presents the total value of all stock options available for grant under the equity incentive plan, based on a range of market prices from $8.00 per share to $14.00 per share. For purposes of this table, the value of the stock options was determined using the Black-Scholes option-pricing formula. See “Pro Forma Data.” Financial gains can be realized on a stock option only if the market price of the common stock increases above the exercise price at which the option is granted.


			Value of
Exercise Price	Option Value		273,650 Options Granted at Minimum of Range		320,000 Options Granted at Midpoint of Range		366,350 Options at Maximum of Range		419,652 Options Granted at 15% Above Maximum of Range
			(In thousands, except per share amounts)
$8.00	$	3.06	$	837	$	979	$	1,121	$	1,284
10.00		3.83		1,048		1,226		1,403		1,607
12.00		4.60		1,259		1,472		1,685		1,930
14.00		5.36		1,467		1,715		1,964		2,249

The following table summarizes at the maximum of the offering range the total number and value of the shares of common stock that the employee stock ownership plan expects to acquire and the total value of all restricted stock awards and stock options that are expected to be available under the equity incentive plan. At the maximum of the offering range and upon completion of the offering, we would sell 3,553,500 shares and have 3,663,500 shares outstanding after accounting for the 110,000 shares of common stock to be contributed to the charitable foundation. The number of shares reflected for the benefit plans in the table below assumes that First Savings Bank’s tangible capital will be 10% or more following the completion of the offering and the application of the net proceeds as described under “Use of Proceeds.”


	Number of Shares to be Granted or Purchased
	At Maximum of Offering Range	As a % of Common Stock Sold at Maximum of Offering Range		As a % of Common Stock Outstanding		Total Estimated Value of Grants
Employee stock ownership plan (1)	293,080	8.2	%	8.0	%	$	2,931
Restricted stock awards (1)	146,540	4.1		4.0			1,465
Stock options (2)	366,350	10.3		10.0			1,403

Total	805,970	22.6		22.0		$	5,799

(1)	Assumes the value of First Savings Financial Group common stock is $10.00 per share for purposes of determining the total estimated value of the grants.

(2)	Assumes the value of a stock option is $3.83, which was determined using the Black-Scholes option-pricing formula. See “Pro Forma Data.”

Employment and Change in Control Agreements. First Savings Financial Group and First Savings Bank intend to enter into three-year employment agreements with Larry W. Myers, our President and Chief Executive Officer and John P. Lawson, Jr., our Chief Operations Officer, and change in control agreements with Donald R. Allen, our Chief Lending Officer, and Anthony A. Schoen, our Assistant Controller. Based solely on current cash compensation and excluding any benefits that would be payable under any employee benefit plan, if a change in control of First Savings Financial Group occurred and we terminated all of the officers with employment and change in control agreements, the total payments due under the employment and change in control agreements would be approximately $1.1 million.

The Offering Will Not Be Taxable to Persons Receiving Subscription Rights (page )

As a general matter, the offering will not be a taxable transaction for purposes of federal income taxes to persons who receive or exercise subscription rights. Further, for federal income tax purposes:

•

it is more likely than not that the members of First Savings Bank will not realize any income upon the issuance or exercise of the subscription rights;

•

it is more likely than not that the tax basis to the purchasers in the offering will be the amount paid for our common stock, and that the holding period for shares of common stock will begin on the date of completion of the offering; and

•

the holding period for shares of common stock purchased in the community offering or syndicated community offering will begin on the day after the date of completion of the purchase.

Persons Who Can Order Stock in the Offering (page )

Note: Subscription rights are not transferable, and persons with subscription rights may not subscribe for shares for the benefit of any other person. If you violate this prohibition, you may lose your rights to purchase shares and may face criminal prosecution and/or other sanctions.

We have granted rights to subscribe for shares of First Savings Financial Group common stock in a “subscription offering” to the following persons in the following order of priority:

Persons with $50 or more on deposit at First Savings Bank as of the close of business on March 31, 2007.

Our employee stock ownership plan, which will provide retirement benefits to our employees.

Persons with $50 or more on deposit at First Savings Bank as of the close of business on June 30, 2008.

First Savings Bank’s depositors as of the close of business on , 2008 who were not able to subscribe for shares under categories 1 or 3.

If we receive subscriptions for more shares than are to be sold in this offering, we may be unable to fill or may only partially fill your order. Shares will be allocated in order of the priorities described above under a formula outlined in the plan of conversion. Generally, shares first will be allocated so as to permit each eligible subscriber, if possible, to purchase a number of shares sufficient to make the subscriber’s total allocation equal to 100 shares or the number of shares actually subscribed for, whichever is less. After that, unallocated shares will be allocated among the remaining eligible subscribers whose subscriptions remain unfilled in proportion to the amounts that their respective qualifying deposits bear to the total qualifying deposits of all remaining eligible subscribers whose subscriptions remain unfilled. If we increase the number of shares to be sold above 3,553,500, the employee stock ownership plan will have the first priority right to purchase any shares exceeding that amount to the extent that its subscription has not previously been filled. Any shares remaining will be allocated in the order of priorities described above. See “The Conversion and Stock Offering — Subscription Offering and Subscription Rights” for a description of the allocation procedure.

We may offer shares not sold in the subscription offering, if any, to the general public in a community offering. People and trusts for the benefit of people who are residents of Clark, Floyd, Harrison, Jefferson, Scott and Washington Counties in Indiana and Bullitt, Henry, Jefferson, Meade, Nelson, Oldham, Shelby, Spencer and Trimble Counties in Kentucky will be given a preference to purchase shares in the community offering. We may, in our sole discretion, reject orders received in the community offering either in whole or in part. For example, we would reject an order submitted by a person whom we believe is making false representations or whom we believe is attempting to violate, evade or circumvent the terms and conditions of the plan of conversion. If your order is rejected in part, you cannot cancel the remainder of your order. The community offering may commence concurrently with the subscription offering or at any time thereafter and may terminate at any time without notice until , 2008, unless the Office of Thrift Supervision approves a later date, which will not be beyond .

Shares not sold in the subscription or community offering may be offered for sale in a syndicated community offering, which would be an offering to the general public on a best efforts basis managed by Keefe, Bruyette & Woods, Inc. Any syndicated community offering may terminate at any time without notice but not later than , 2008, unless the Office of Thrift Supervision approves a later date, which will not be beyond . As in the case of the community offering, we may, in our sole discretion, reject orders received in the syndicated community offering either in whole or in part.

Deadline for Ordering Stock (page )

The subscription offering will end at , Eastern time, on , 2008. We expect that the community offering will terminate at the same time, although it may continue for up to 45 days after the end of the subscription offering, or longer if the Office of Thrift Supervision approves a later date. No single extension may be for more than 90 days. If we extend the offering beyond , 2008, or if we intend to sell fewer than 2,626,500 shares or more than 4,086,525 shares, all subscribers will be notified and given the opportunity to confirm, change or cancel their orders. If you do not respond to this notice, we will return your funds promptly with interest at our passbook rate.

Purchase Limitations (page )

Our plan of conversion establishes limitations on the purchase of stock in the offering. These limitations include the following:

•

The minimum purchase is 25 shares.

•

No individual (or individuals on a single deposit account) may purchase more than $200,000 common stock (which equals 20,000 shares) in the subscription offering.

•

No individual may purchase more than $200,000 of common stock (which equals 20,000 shares) in the community offering.

•

No individual, no individual together with any associates, and no group of persons acting in concert may purchase more than $350,000 of common stock (which equals 35,000 shares) in all offering categories.

Subject to the Office of Thrift Supervision’s approval, we may increase or decrease the purchase limitations at any time.

How to Purchase Common Stock (page )

If you want to place an order for shares in the offering, you must complete an original stock order and certification form and send it to us together with full payment, or deliver it in person to the stock information center located at First Savings Bank’s headquarters in Clarksville, Indiana. You must sign the certification that is on the reverse side of the stock order and certification form. We must receive your stock order and certification form before the end of the subscription offering or the end of the community offering, as appropriate. Once we receive your order, you cannot cancel or change it without our consent.

To ensure that we properly identify your subscription rights, you must list all of your deposit accounts as of the applicable eligibility date on the stock order form. If you fail to do so, your subscription may be reduced or rejected if the offering is oversubscribed. To preserve your purchase priority, you must register the shares only in the name(s) of person(s) listed on your deposit account at the applicable date of eligibility. You may not add the names of others who were not eligible to purchase common stock in the offering on the applicable date of eligibility.

You may pay for shares in the subscription offering or the community offering in any of the following ways:

•

By check or money order made payable to First Savings Financial Group.

•

By authorizing withdrawal from an account at First Savings Bank. To use funds in an Individual Retirement Account at First Savings Bank, you must transfer your account to an unaffiliated institution or broker and open a self-directed Individual Retirement Account. Individual Retirement Accounts at First Savings Bank are not self-directed and common stock may only be purchased using a self-directed Individual Retirement Account. Please contact your broker or financial institution as quickly as possible to determine if you may transfer your Individual Retirement Account from First Savings Bank because the transfer may take several days.

We will pay interest on your subscription funds at the rate we pay on passbook accounts, which is currently 0.25% per annum, from the date we receive your funds until the offering is completed or terminated. All funds authorized for withdrawal from deposit accounts with us will earn interest at the applicable account rate until the offering is completed or terminated. If, as a result of a withdrawal from a certificate of deposit, the balance falls below the minimum balance requirement, the remaining funds will earn interest at our passbook rate. There will be no early withdrawal penalty for withdrawals from certificates of deposit used to pay for stock.

How We Will Use the Proceeds of this Offering (page )

The following table summarizes how we will use the proceeds of this offering, based on the sale of shares at the minimum and maximum of the offering range.


(In thousands)	Minimum 2,626,500 Shares at $10.00 Per Share		Maximum 3,553,500 Shares at $10.00 Per Share
Offering proceeds	$	26,265	$	35,535
Net offering proceeds		25,017		34,202
Less:
Proceeds contributed to First Savings Bank		12,509		17,101
Proceeds used for loan to employee stock ownership plan		2,189		2,931
Proceeds contributed to charitable foundation		100		100

Proceeds remaining for First Savings Financial Group	$	10,219	$	14,070

First Savings Financial Group may use the portion of the proceeds that it retains to, among other things, invest in securities, pay cash dividends or repurchase shares of common stock, subject to regulatory restrictions. First Savings Bank may use the portion of the proceeds that it receives to fund new loans, open new branches, invest in securities and expand its business activities. First Savings Financial Group and First Savings Bank may also use

the proceeds of the offering to diversify their businesses and acquire other companies, although we have no specific plans to do so at this time. Except as described above, neither First Savings Financial Group nor First Savings Bank has any specific plans for the investment of the proceeds of this offering and has not allocated a specific portion of the proceeds to any particular use. For a discussion of our business reasons for undertaking this offering, see “The Conversion and Stock Offering — Reasons for the Conversion.”

Purchases by Directors and Executive Officers (page )

We expect that our directors and executive officers, together with their associates, will subscribe for 192,000 shares, which equals 5.4% of the shares that would be sold at the maximum of the offering range. Our directors and executive officers will pay the same $10.00 per share price as everyone else who purchases shares in the offering. Like all of our depositors, our directors and executive officers have subscription rights based on their deposits and, if there is an oversubscription, their orders will be subject to the allocation provisions set forth in our plan of conversion, unless waived by the Office of Thrift Supervision. Purchases by our directors and executive officers will count towards the minimum number of shares we must sell to close the offering.

Market for First Savings Financial Group, Inc.’s Common Stock (page )

We have applied to list the common stock of First Savings Financial Group for trading on the Nasdaq Capital Market under the symbol “FSFG.” Keefe, Bruyette & Woods, Inc. currently intends to become a market maker in the common stock, but it is under no obligation to do so. In addition, if needed, Keefe, Bruyette & Woods, Inc. will assist us in obtaining additional market makers. We cannot assure you that other market makers will be obtained or that an active and liquid trading market for our common stock will develop or, if developed, will be maintained. After shares of the common stock begin trading, you may contact a stock broker to buy or sell shares.

First Savings Financial Group, Inc.’s Dividend Policy (page )

We have not determined whether we will pay a dividend on the common stock. After the offering, we will consider a policy of paying regular cash dividends. Our ability to pay dividends will depend on a number of factors, including capital requirements, regulatory limitations and our operating results and financial condition.

Subscription Rights

You are not allowed to transfer your subscription rights, and we will act to ensure that you do not do so. You will be required to certify that you are purchasing shares solely for your own account and that you have no agreement or understanding with another person involving the transfer of the shares that you purchase. We will not accept any stock orders that we believe involve the transfer of subscription rights.

Delivery of Prospectus

To ensure that each person receives a prospectus at least 48 hours before the offering deadline, we may not mail prospectuses any later than five days before such date or hand-deliver prospectuses later than two days before that date. Stock order forms may only be delivered if accompanied or preceded by a prospectus. We are not obligated to deliver a prospectus or order form by means other than U.S. mail.

We will make reasonable attempts to provide a prospectus and offering materials to holders of subscription rights. The subscription offering and all subscription rights will expire at , Eastern time, on , 2008 whether or not we have been able to locate each person entitled to subscription rights.

Delivery of Stock Certificates (page )

Certificates representing shares of common stock issued in the offering will be mailed to purchasers at the address provided by them on the order form as soon as practicable following completion of the offering and receipt of all necessary regulatory approvals. Until certificates for common stock are available and delivered to subscribers, subscribers may not be able to sell their shares, even though trading of the common stock will have commenced.

Stock Information Center

If you have any questions regarding the offering, please call the stock information center at ( ) - to speak to a registered representative of Keefe, Bruyette & Woods, Inc. The stock information center is open Monday through Friday from .m. to .m., Eastern Time. The stock information center is closed on bank holidays.

Risk Factors

You should consider carefully the following risk factors before purchasing First Savings Financial Group common stock.

Risks Related to Our Business

Our concentration in non-owner occupied real estate loans may expose us to increased credit risk.

At March 31, 2008, $30.8 million, or 28.0% of our residential mortgage loan portfolio and 17.7% of our total loan portfolio, consisted of loans secured by non-owner occupied residential properties. Loans secured by non-owner occupied properties generally expose a lender to greater risk of non-payment and loss than loans secured by owner occupied properties because repayment of such loans depend primarily on the tenant’s continuing ability to pay rent to the property owner, who is our borrower, or, if the property owner is unable to find a tenant, the property owner’s ability to repay the loan without the benefit of a rental income stream. In addition, the physical condition of non-owner occupied properties is often below that of owner occupied properties due to lax property maintenance standards, which has a negative impact on the value of the collateral properties. Furthermore, some of our non-owner occupied residential loan borrowers have more than one loan outstanding with us. Consequently, an adverse development with respect to one credit relationship may expose us to a greater risk of loss compared to an adverse development with respect to an owner occupied residential mortgage loan. Our non-performing residential mortgage loans increased from $99,000 at September 30, 2007 to $2.5 million at March 31, 2008, primarily due to an increase in non-performing non-owner occupied residential mortgage loans. At March 31, 2008, non-performing non-owner occupied residential mortgage loans totaled $2.1 million, or 6.8% of our non-owner occupied residential loan portfolio, of which $2.0 million was attributable to a single borrower. This increase in non-performing non-owner occupied residential mortgage loans was a primary factor in our need to increase our allowance for loan losses through an increased provision for loan losses, which contributed to our net loss of $348,000 for the six months ended March 31, 2008. At March 31, 2008, non-owner occupied residential properties held as real estate owned amounted to $717,000. For more information about the credit risk we face, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Management.”

Our recent emphasis on commercial real estate lending and commercial business lending may expose us to increased lending risks.

At March 31, 2008, $25.7 million, or 14.7%, of our loan portfolio consisted of commercial real estate loans and commercial business loans. Subject to market conditions, we intend to increase our origination of these loans after the offering. Commercial real estate loans generally expose a lender to greater risk of non-payment and loss than one- to four-family residential mortgage loans because repayment of the loans often depends on the successful operation of the property and the income stream of the borrowers. Commercial real estate loans also typically involve larger loan balances to single borrowers or groups of related borrowers both at origination and at maturity because many of our commercial real estate loans are not fully-amortizing, but result in “balloon” balances at maturity. Commercial business loans expose us to additional risks since they typically are made on the basis of the borrower’s ability to make repayments from the cash flow of the borrower’s business and are secured by non-real estate collateral that may depreciate over time. In addition, some of our commercial borrowers have more than one loan outstanding with us. Consequently, an adverse development with respect to one loan or one credit relationship may expose us to a greater risk of loss compared to an adverse development with respect to a one- to four-family residential mortgage loan. At March 31, 2008, non-performing commercial real estate loans totaled $458,000 and non-performing commercial business loans totaled $495,000. For more information about the credit risk we face, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Management.”

Our unseasoned commercial real estate loan and commercial business loan portfolios may expose us to increased lending risks.

A significant amount of our commercial real estate loans and commercial business loans are unseasoned, meaning that they were originated recently. Our limited experience with these loans does not provide us with a significant payment history pattern with which to judge future collectibility. Furthermore, these loans have not been subjected to unfavorable economic conditions. As a result, it may be difficult to predict the future performance of this part of our loan portfolio. These loans may have delinquency or charge-off levels above our expectations, which could adversely affect our future performance.

Our construction loan and land and land development loan portfolios may expose us to increased credit risk.

At March 31, 2008, $16.8 million, or 9.6% of our loan portfolio consisted of construction loans and land and land development loans, and $7.0 million, or 57.7% of the construction loan portfolio, consisted of speculative construction loans at that date. While recently the demand for construction loans has decreased significantly due to the decline in the housing market, historically, construction loans, including speculative construction loans, have been a material part of our loan portfolio. Speculative construction loans are loans made to builders who have not identified a buyer for the completed property at the time of loan origination. Subject to market conditions, we intend to continue to emphasize the origination of construction loans and land and land development loans. These loan types generally expose a lender to greater risk of nonpayment and loss than residential mortgage loans because the repayment of such loans often depends on the successful operation or sale of the property and the income stream of the borrowers and such loans typically involve larger balances to a single borrower or groups of related borrowers. In addition, many borrowers of these types of loans have more than one loan outstanding with us so an adverse development with respect to one loan or credit relationship can expose us to significantly greater risk of non-payment and loss. Furthermore, we may need to increase our allowance for loan losses through future charges to income as the portfolio of these types of loans grows, which would hurt our earnings. For more information about the credit risk we face, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Risk Management.”

Changing interest rates may hurt our earnings and asset value.

Our net interest income is the interest we earn on loans and investments less the interest we pay on our deposits and borrowings. Our net interest margin is the difference between the yield we earn on our assets and the interest rate we pay for deposits and our other sources of funding. Changes in interest rates—up or down—could adversely affect our net interest margin and, as a result, our net interest income. Although the yield we earn on our assets and our funding costs tend to move in the same direction in response to changes in interest rates, one can rise or fall faster than the other, causing our net interest margin to expand or contract. Our liabilities tend to be shorter in duration than our assets, so they may adjust faster in response to changes in interest rates. As a result, when interest rates rise, our funding costs may rise faster than the yield we earn on our assets, causing our net interest margin to contract until the yield catches up. Changes in the slope of the “yield curve”—or the spread between short-term and long-term interest rates—could also reduce our net interest margin. Normally, the yield curve is upward sloping, meaning short-term rates are lower than long-term rates. Because our liabilities tend to be shorter in duration than our assets, when the yield curve flattens or even inverts, we could experience pressure on our net interest margin as our cost of funds increases relative to the yield we can earn on our assets. In addition, over the last year and accelerating in the first calendar quarter of 2008, the U.S. Federal Reserve has decreased its target rate for federal funds from 5.25% to 2.00%. Interest rate decreases can lead to increased prepayments of loans and mortgage-backed securities as borrowers refinance their loans to reduce borrowing costs. Under these circumstances, we are subject to reinvestment risk as we may have to redeploy such repayment proceeds into lower yielding investments, which would likely hurt our income.

Changes in interest rates also affect the value of our interest-earning assets, and in particular our securities portfolio. Generally, the value of fixed-rate securities fluctuates inversely with changes in interest rates. Unrealized gains and losses on securities available for sale are reported as a separate component of equity, net of tax. Decreases in the fair value of securities available for sale resulting from increases in interest rates could have an adverse effect on stockholders’ equity. For further discussion of how changes in interest rates could impact us, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations —Risk Management — Interest Rate Risk Management.”

A downturn in the local economy or a decline in real estate values could hurt our profits.

Substantially all of our loans are secured by real estate in Clark and Floyd Counties, Indiana, and the surrounding areas. As a result of this concentration, a downturn in the local economy could significantly increase nonperforming loans, which would hurt our profits. A decline in real estate values could lead to some of our mortgage loans becoming inadequately collateralized, which would expose us to greater risk of loss. Additionally, a decline in real estate values could hurt our portfolio of construction loans, nonresidential real estate loans, and land and land development loans and could reduce our ability to originate such loans. For a discussion of our primary market area, see “Our Business — Market Area.”

Strong competition within our primary market area could hurt our profits and slow growth.

We face intense competition both in making loans and attracting deposits. This competition has made it more difficult for us to make new loans and attract deposits. Price competition for loans and deposits might result in us earning less on our loans and paying more on our deposits, which would reduce net interest income. Competition also makes it more difficult to grow loans and deposits. At June 30, 2007, which is the most recent date for which data is available from the Federal Deposit Insurance Corporation, we held approximately 14.54% of the deposits in Clark County, Indiana and 1.18% of the deposits in Floyd County, Indiana. Some of the institutions with which we compete have substantially greater resources and lending limits than we have and may offer services that we do not provide. We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Our profitability depends upon our continued ability to compete successfully in our primary market area. See “Our Business — Market Area” and “Our Business — Competition” for more information about our primary market area and the competition we face.

We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations.

We are subject to extensive regulation, supervision and examination by the Office of Thrift Supervision, our chartering authority, and by the Federal Deposit Insurance Corporation, as insurer of our deposits. First Savings Financial Group also will be subject to regulation and supervision by the Office of Thrift Supervision. Such regulation and supervision governs the activities in which an institution and its holding company may engage, and are intended primarily for the protection of the insurance fund and the depositors and borrowers of First Savings Bank rather than for holders of First Savings Financial Group common stock. Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on our operations, the classification of our assets and determination of the level of our allowance for loan losses. If our regulators require us to charge-off loans or increase our allowance for loan losses, our earnings would suffer. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation or supervisory action, may have a material impact on our operations. For a further discussion, see “Regulation and Supervision.”

Risks Related to this Offering

Our stock price may decline when trading commences.

If you purchase shares in the offering, you may not be able to sell them at or above the $10.00 purchase price. After the shares of our common stock begin trading, the trading price of the common stock will be determined by the marketplace, and will be influenced by many factors outside of our control, including prevailing interest rates, investor perceptions, securities analyst research reports and general industry, geopolitical and economic conditions. Publicly traded stocks, including stocks of financial institutions, often experience substantial market price volatility. These market fluctuations might not be related to the operating performance of particular companies whose shares are traded. Additionally, the stock prices of many recently converted thrift institutions have declined below, and remain below, their initial offering prices.

There may be a limited market for our common stock, which may adversely affect our stock price.

Although we have applied to list our shares of common stock for trading on the Nasdaq Capital Market, there is no guarantee that the shares will be actively traded. If an active trading market for our common stock does not develop, you may not be able to sell all of your shares of common stock on short notice and the sale of a large number of shares at one time could temporarily depress the market price. There also may be a wide spread between the bid and asked price for our common stock. When there is a wide spread between the bid and asked price, the price at which you may be able to sell our common stock may be significantly lower than the price at which you could buy it at that time.

Additional expenses following the offering from operating as a public company and from new equity benefit plans will adversely affect our profitability.

Following the offering, our noninterest expenses are likely to increase as a result of the financial accounting, legal and various other additional expenses usually associated with operating as a public company and complying with public company disclosure obligations, particularly those obligations imposed by the Sarbanes-Oxley Act of 2002. Compliance with the Sarbanes-Oxley Act of 2002 will require us to upgrade our accounting systems, which will increase our operating expenses. We also will recognize additional annual employee compensation and benefit expenses stemming from options and shares granted to employees, directors and executives under new benefit plans. These additional expenses will adversely affect our profitability. We cannot determine the actual amount of these new stock-related compensation and benefit expenses at this time because applicable accounting practices generally require that they be based on the fair market value of the options or shares of common stock at the date of the grant; however, we expect them to be material. We will recognize expenses for our employee stock ownership plan when shares are committed to be released to participants’ accounts and will recognize expenses for restricted stock awards and stock options generally over the vesting period of awards made to recipients. These benefit expenses in the first year following the offering have been estimated to be approximately $548,000 at the maximum of the offering range as set forth in the pro forma financial information under “Pro Forma Data” assuming the $10.00 per share purchase price as fair market value. Actual expenses, however, may be higher or lower, depending on the price of our common stock. For further discussion of these plans, see “Our Management — Benefit Plans.”

Our low return on equity may negatively impact the value of our common stock.

Return on equity, which equals net income divided by average equity, is a ratio used by many investors to compare the performance of a particular company with other companies.

For the twelve months ended March 31, 2008, our return on equity was 0.48%. Our pro forma return on equity for the same period is estimated to be (0.22)% and our pro forma stockholders’ equity to assets ratio at March 31, 2008 is estimated to be 24.54%, assuming the sale of shares at the maximum of the offering range. Our publicly traded thrift peers used in the valuation as of May 16, 2008 had an average return on equity of 3.84% for the twelve months ended March 31, 2008, or December 31, 2007 (based on the most recent date which was publicly available). Over time, we intend to use the net proceeds from this offering to increase earnings per share and book value per share, without assuming undue risk, with the goal of achieving a return on equity that is competitive with other publicly held companies. This goal could take a number of years to achieve, and it may not be attained, and the expected increase in our noninterest expenses following the offering due to operating as a public company and from new equity benefit plans will likely further deter our ability to achieve a competitive return on equity. Consequently, you should not expect a competitive return on equity in the near future. Failure to achieve a competitive return on equity might make an investment in our common stock unattractive to some investors and might cause our common stock to trade at lower prices than comparable companies with higher returns on equity. See “Pro Forma Data” for an illustration of the financial impact of this offering.

We have broad discretion in allocating the proceeds of the offering. Our failure to effectively utilize such proceeds would reduce our profitability.

We intend to contribute approximately 50% of the net proceeds of the offering to First Savings Bank. First Savings Financial Group may use the portion of the proceeds that it retains to, among other things, invest in securities, pay cash dividends or repurchase shares of common stock, subject to regulatory restrictions. First Savings Bank may use the portion of the proceeds that it receives to fund new loans, open new branches, invest in securities and expand its business activities. First Savings Financial Group and First Savings Bank may also use the proceeds of the offering to diversify their businesses and acquire other companies, although we have no specific plans to do so at this time. We have not allocated specific amounts of proceeds for any of these purposes, and we will have significant flexibility in determining how much of the net proceeds we apply to different uses and the timing of such applications. Our failure to utilize these funds effectively would reduce our profitability.

Issuance of shares for benefit programs may dilute your ownership interest.

We intend to adopt an equity incentive plan following the offering. If stockholders approve the new equity incentive plan, we intend to issue shares to our officers, employees and directors through this plan. If the restricted stock awards under the equity incentive plan are funded from authorized but unissued stock, your ownership interest in the shares could be diluted by up to approximately 3.85%, assuming awards of common stock equal to 4% of the shares sold in the offering and contributed to First Savings Charitable Foundation are awarded under the plan. If the shares issued upon the exercise of stock options under the equity incentive plan are issued from authorized but unissued stock, your ownership interest in the shares could be diluted by up to approximately 9.1%, assuming stock option grants equal to 10% of the shares sold in the offering and contributed to First Savings Charitable Foundation are granted under the plan. See “Pro Forma Data” and “Our Management — Benefit Plans.”

The articles of incorporation and bylaws of First Savings Financial Group and certain regulations may prevent or make more difficult certain transactions, including a sale or merger of First Savings Financial Group.

Provisions of the articles of incorporation and bylaws of First Savings Financial Group and federal banking regulations may make it more difficult for companies or persons to acquire control of First Savings Financial Group. Consequently, our shareholders may not have the opportunity to participate in such a transaction and the trading price of our common stock may not rise to the level of other institutions that are more vulnerable to hostile takeovers. The factors that may discourage takeover attempts or make them more difficult include:

•

Articles of incorporation and bylaws . Provisions of the articles of incorporation and bylaws of First Savings Financial Group may make it more difficult and expensive to pursue a takeover attempt that the board of directors opposes. These provisions also make more difficult the removal of current directors or management, or the election of new directors. These provisions include:

•

supermajority voting requirements for certain business combinations and changes to some provisions of the articles of incorporation and bylaws;

•

limitation on the right to vote shares;

•

the election of directors to staggered terms of three years;

•

provisions regarding the timing and content of shareholder proposals and nominations;

•

provisions restricting the calling of special meetings of shareholders;

•

the absence of cumulative voting by shareholders in the election of directors; and

•

the removal of directors only for cause.

•

Office of Thrift Supervision regulations . Office of Thrift Supervision regulations prohibit, for three years following the completion of a mutual-to-stock conversion, the offer to acquire or the acquisition of more than 10% of any class of equity security of a converted institution without the prior approval of the Office of Thrift Supervision.

For further information, see “ Restrictions on Acquisition of First Savings Financial Group, Inc. and First Savings Bank, F.S.B. ”

Risks Related to the Formation of the Charitable Foundation

The contribution to First Savings Charitable Foundation will decrease the ownership interest and voting interest in the shares sold to the public by up to 4.0% after the contribution.

Purchasers of shares will have their ownership and voting interests diluted at the close of the conversion when First Savings Financial Group issues and contributes 110,000 shares to the First Savings Charitable Foundation. This dilution will range from approximately 4.0% at the minimum of the offering range to approximately 3.0% at the maximum of the offering range. For a further discussion regarding the effect of the contribution to the charitable foundation, see “Pro Forma Data” and “Comparison of Independent Valuation and Pro Forma Financial Information With and Without the Foundation.”

Our contribution to First Savings Charitable Foundation may not be tax deductible, which could hurt our profits.

We believe that our contribution to First Savings Charitable Foundation, valued at $1.2 million, pre-tax, will be deductible for federal income tax purposes. However, we do not have any assurance that the Internal Revenue Service will grant tax-exempt status to the foundation. If the contribution is not deductible, we would not receive any tax benefit from the contribution. In addition, even if the contribution is tax deductible, we may not have sufficient profits to be able to use the deduction fully. In the event it is more likely than not that we will be unable to use the entire deduction, we will be required to establish a valuation allowance related to any deferred tax asset that has been recorded for this contribution.

Establishment of First Savings Charitable Foundation will hurt our profits for fiscal year 2008.

First Savings Financial Group intends to contribute 110,000 shares of First Savings Financial Group common stock and $100,000 cash to First Savings Charitable Foundation. This contribution will be an additional operating expense and will reduce net income during the fiscal year in which the foundation is established, which is expected to be the year ending September 30, 2008. The contribution to First Savings Charitable Foundation would reduce net earnings by approximately $725,000, after tax, in fiscal year 2008. See “Pro Forma Data.”

A Warning About Forward-Looking Statements

This prospectus contains forward-looking statements, which can be identified by the use of words such as “believes,” “expects,” “anticipates,” “estimates” or similar expressions. Forward-looking statements include:

•

statements of our goals, intentions and expectations;

•

statements regarding our business plans, prospects, growth and operating strategies;

•

statements regarding the quality of our loan and investment portfolios; and

•

estimates of our risks and future costs and benefits.

These forward-looking statements are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by the forward-looking statements due to, among others, the following factors:

•

general economic conditions, either nationally or in our primary market area, that are worse than expected;

•

changes in the interest rate environment that reduce our interest margins or reduce the fair value of financial instruments;

•

increased competitive pressures among financial services companies;

•

changes in consumer spending, borrowing and savings habits;

•

legislative, regulatory or supervisory changes that adversely affect our business;

•

adverse changes in the securities markets; and

•

changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board or the Public Company Accounting Oversight Board.

Any of the forward-looking statements that we make in this prospectus and in other public statements we make may later prove incorrect because of inaccurate assumptions, the factors illustrated above or other factors that we cannot foresee. Consequently, no forward-looking statement can be guaranteed.

Selected Consolidated Financial and Other Data

The summary consolidated financial information presented below is derived in part from our consolidated financial statements. The following is only a summary and you should read it in conjunction with the consolidated financial statements and notes beginning on page F-1. The information at September 30, 2007 and 2006 and for the years then ended is derived in part from the audited financial statements of First Savings Bank that appear elsewhere in this prospectus.

The selected data at March 31, 2008 and for the six months ended March 31, 2008 and 2007 was not audited, but in the opinion of management, represents all adjustments necessary for a fair presentation. All of these adjustments are normal and recurring. The results of operations for the six months ended March 31, 2008 are not necessarily indicative of the results of operations that may be expected for the entire year.


	At March 31,		At September 30,
(Dollars in thousands)	2008		2007		2006		2005		2004		2003
Financial Condition Data:
Total assets	$	212,624	$	203,321	$	206,399	$	205,796	$	216,529	$	223,940
Cash and cash equivalents		9,233		10,395		15,223		14,651		21,904		56,084
Securities available-for-sale		10,424		8,260		5,897		7,039		7,534		—
Securities held-to-maturity		9,100		7,422		8,219		11,602		14,650		3,091
Loans net		171,018		167,371		166,695		163,676		163,305		155,644
Deposits		174,085		168,782		175,891		175,451		187,516		195,979
Advances from Federal Home Loan Bank		8,000		3,000		—		—		—		—
Total equity		29,399		29,662		28,850		28,487		27,245		26,353


	For the Six Months Ended March 31,					For the Year Ended September 30,
(Dollars in thousands)	2008			2007		2007		2006		2005		2004		2003
Operating Data:
Interest income	$	6,301		$	6,561	$	13,078	$	12,223	$	10,874	$	10,552	$	11,931
Interest expense		3,096			3,091		6,183		5,250		4,255		4,496		6,166

Net interest income		3,205			3,470		6,895		6,973		6,619		6,056		5,765
Provision for loan losses		1,203			420		758		813		336		226		131

Net interest income after provision for loan losses		2,002			3,050		6,137		6,160		6,283		5,830		5,634
Noninterest income		499			387		841		889		1,306		679		837
Noninterest expense		3,148			2,949		5,737		6,453		5,601		5,047		4,644

Income (loss) before income taxes		(647	)		488		1,241		596		1,988		1,462		1,827
Income tax expense (benefit)		(299	)		162		427		241		784		577		725

Net income (loss)	$	(348	)	$	326	$	814	$	355	$	1,204	$	885	$	1,102


	At or For the Six Months Ended March 31,				At or For the Year Ended September 30,
	2008		2007		2007		2006		2005		2004		2003
Performance Ratios (1):
Return on average assets	(0.34	)%	0.31	%	0.40	%	0.17	%	0.57	%	0.40	%	0.49	%
Return on average equity	(2.36	)	2.25		2.78		1.24		4.32		3.45		4.37
Interest rate spread (2)	2.94		3.15		3.48		3.49		3.34		2.89		2.53
Net interest margin (3)	3.37		3.58		3.77		3.74		3.50		3.01		2.72
Other expenses to average assets	3.04		2.85		2.79		3.13		2.66		2.29		2.05
Efficiency ratio (4)	85.00		76.46		74.16		82.08		70.68		74.94		70.34
Average interest-earning assets to average interest-bearing liabilities	113.32		113.66		108.61		109.23		107.59		105.05		106.46
Average equity to average assets	14.25		14.02		14.24		13.91		13.24		11.66		11.13
Capital Ratios:
Tangible capital	13.77	%	13.98	%	14.56	%	13.96	%	13.82	%	12.58	%	11.76	%
Core capital	13.77		13.98		14.56		13.96		13.82		12.58		11.76
Risk-based capital	23.81		23.82		24.70		23.36		23.84		22.87		22.68
Asset Quality Ratios:
Allowance for loan losses as a percent of total loans	1.43	%	0.73	%	0.75	%	0.51	%	0.52	%	0.47	%	0.42	%
Allowance for loan losses as a percent of non-performing loans	61.83		77.11		117.16		50.61		55.79		49.24		71.31
Net charge-offs to average outstanding loans during the period	—		0.07		0.21		0.51		0.16		0.07		0.05
Non-performing loans as a percent of total loans	2.32		0.95		0.64		1.01		0.93		0.96		0.59
Non-performing assets as a percent of total assets	2.50		1.41		1.27		1.79		1.14		1.36		1.15
Other Data:
Number of offices	7		7		7		7		7		7		7
Number of deposit accounts	17,434		17,897		17,525		17,962		17,930		18,895		20,045
Number of loans	2,235		2,214		2,216		2,325		2,516		2,647		2,827

(1)	Performance ratios for the six months ended March 31, 2008 and 2007 are annualized.

(2)	Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost on average interest-bearing liabilities. Tax exempt income is reported on a tax equivalent basis using a federal marginal tax rate of 34%.

(3)	Represents net interest income as a percent of average interest-earning assets. Tax exempt income is reported on a tax equivalent basis using a federal marginal tax rate of 34%.

(4)	Represents other expenses divided by the sum of net interest income and other income.

Use of Proceeds

The following table shows how we intend to use the net proceeds of the offering. The actual net proceeds will depend on the number of shares of common stock sold in the offering and the expenses incurred in connection with the offering. Payments for shares made through withdrawals from deposit accounts at First Savings Bank will reduce deposits and will not result in the receipt of new funds for investment. See “Pro Forma Data” for the assumptions used to arrive at these amounts.


	Minimum of Offering Range				Midpoint of Offering Range				Maximum of Offering Range				15% Above Maximum of Offering Range
(Dollars in thousands)	2,626,500 Shares at $10.00 Per Share		Percent of Net Proceeds		3,090,000 Shares at $10.00 Per Share		Percent of Net Proceeds		3,553,500 Shares at $10.00 Per Share		Percent of Net Proceeds		4,086,525 Shares at $10.00 Per Share		Percent of Net Proceeds
Offering proceeds	$	26,265	105.0	%	$	30,900	104.4	%	$	35,535	103.9	%	$	40,865	103.5	%
Less: offering expenses		1,248	5.0			1,290	4.4			1,333	3.9			1,382	3.5

Net offering proceeds		25,017	100.0			29,610	100.0			34,202	100.0			39,483	100.0
Less:
Proceeds contributed to First Savings Bank, F.S.B.		12,509	50.0			14,805	50.0			17,101	50.0			19,742	50.0
Proceeds used for loan to employee stock ownership plan		2,189	8.8			2,560	8.6			2,931	8.6			3,357	8.5
Proceeds contributed to charitable foundation		100	0.4			100	0.3			100	0.3			100	0.3

Proceeds remaining for First Savings Financial Group, Inc. (1)	$	10,219	40.8	%	$	12,145	41.0	%	$	14,070	41.1	%	$	16,284	41.2	%

(1)

Following the completion of the stock offering and in accordance with applicable regulations, First Savings Financial Group may purchase shares of its common stock in the open market in order to grant awards of restricted stock under its proposed equity incentive plan. Assuming a market price of $10.00 per share at the time of purchase, the cost of acquiring the shares would be approximately $1.1 million (109,500 shares) at the minimum of the offering range, $1.3 million (128,000 shares) at the midpoint of the offering range, $1.5 million (146,500 shares) at the maximum of the offering range and $1.7 million (167,900 shares) at 15% above the maximum of the offering range. See “ Pro Forma Data” and “Our Management — Benefit Plans — Nonqualified Deferred Compensation — Future Equity Incentive Plan.’

First Savings Financial Group intends to invest the proceeds it retains from the offering initially in short-term, liquid investments. Over time, First Savings Financial Group may use the proceeds it retains from the offering:

•

to invest in securities;

•

to pay dividends to stockholders;

•

to repurchase shares of its common stock, subject to regulatory restrictions;

•

to finance the possible acquisition of financial institutions or other businesses that are related to banking, although we currently have no definitive plans or commitments regarding potential acquisition opportunities; and

•

for general corporate purposes.

Under current Office of Thrift Supervision regulations, First Savings Financial Group may not repurchase shares of its common stock during the first year following the offering, except to fund shareholder-approved equity benefit plans or, with prior regulatory approval, when extraordinary circumstances exist.

First Savings Bank may use the proceeds that it receives from the offering, which is shown in the table above as the amount contributed to First Savings Bank:

•

to fund new loans;

•

to invest in securities;

•

to finance the possible expansion of its business activities through the establishment of new branch offices and/or the acquisition of other financial institutions or financial services companies, although we currently have no definitive plans or commitments regarding potential expansion or acquisition opportunities;

•

for general corporate purposes; and

•

We plan to open a new leased branch office in 2009. We are in the initial stages of investigating potential suitable locations, but have no definitive plans or commitments with respect to a particular location.

We may need regulatory approvals to engage in some of the activities listed above.

Except as described above, neither First Savings Financial Group nor First Savings Bank has any specific plans for the investment of the proceeds of this offering and has not allocated a specific portion of the proceeds to any particular use. For a discussion of our business reasons for undertaking the offering, see “The Conversion and Stock Offering — Reasons for the Conversion.”

Our Dividend Policy

We have not yet determined whether we will pay a dividend on our common stock. Following the offering, our board of directors will consider adopting a policy of paying regular cash dividends. We cannot guarantee that we will pay dividends or that, if paid, we will not reduce or eliminate dividends in the future.

The board of directors may declare and pay periodic special cash dividends in addition to, or in lieu of, regular cash dividends. In determining whether to declare or pay any dividends, whether regular or special, the board of directors will take into account our financial condition and results of operations, tax considerations, capital requirements, industry standards, and economic conditions. We will also consider the regulatory restrictions that affect the payment of dividends by First Savings Bank to us, discussed below.

First Savings Financial Group is subject to Indiana law, which generally prohibits First Savings Financial Group from paying dividends on its common stock if, after giving effect to the distribution, it would be able to pay its debts as they become due in the usual course of business or if its total assets would be less than the sum of its liabilities and the amount that would be needed, if First Savings Financial Group were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of any holders of capital stock who have a preference upon dissolution.

First Savings Financial Group will not be subject to Office of Thrift Supervision regulatory restrictions on the payment of dividends. However, our ability to pay dividends may depend, in part, upon dividends we receive from First Savings Bank because we initially will have no source of income other than dividends from First Savings Bank and earnings from the investment of the net proceeds from the offering that we retain. Office of Thrift Supervision regulations limit dividends and other distributions from First Savings Bank to us. First Savings Bank may not declare or pay a cash dividend on its capital stock if its effect would be to reduce the regulatory capital of First Savings Bank below the amount required for the liquidation account to be established as required by First Savings Bank’s plan of conversion. In addition, First Savings Financial Group may not make a distribution that would constitute a return of capital during the three-year term of the business plan submitted in connection with the offering. No insured depository institution may make a capital distribution if, after making the distribution, the institution would be undercapitalized. See “Regulation and Supervision — Regulation of Federal Savings Associations — Limitation on Capital Distributions” and “ The Conversion and Stock Offering —Effects of Conversion to Stock Form — Liquidation Account.”

Any payment of dividends by First Savings Bank to us that would be deemed to be drawn out of First Savings Bank’s bad debt reserves would require First Savings Bank to pay federal income taxes at the then current income tax rate on the amount deemed distributed. See “Federal and State Taxation —Federal Income Taxation” and Note 11 of the notes to consolidated financial statements included in this prospectus. First Savings Financial Group does not contemplate any distribution by First Savings Bank that would result in this type of tax liability.

Market for the Common Stock

We have not previously issued common stock and there is currently no established market for the common stock. We have applied to list our common stock for trading on the Nasdaq Capital Market under the symbol “FSFG” upon completion of the offering. Keefe, Bruyette & Woods, Inc. intends to become a market maker in our common stock following the offering, but it is under no obligation to do so. Keefe, Bruyette & Woods, Inc. also will assist us, if needed, in obtaining other market makers after the offering. We will try to obtain at least three market makers for our stock, but we cannot assure you that other market makers will be obtained or that an active and liquid trading market for the common stock will develop or, if developed, will be maintained.

The development of a public market having the desirable characteristics of depth, liquidity and orderliness depends on the existence of willing buyers and sellers, the presence of which is not within our control or that of any market maker. The number of active buyers and sellers of our common stock at any particular time may be limited, which may have an adverse effect on the price at which our common stock can be sold. There can be no assurance that persons purchasing the common stock will be able to sell their shares at or above the $10.00 price per share in the offering. Purchasers of our common stock should recognize that there may be a limited trading market in the common stock.

Capitalization

The following table presents the historical capitalization of First Savings Bank at March 31, 2008 and the capitalization of First Savings Financial Group reflecting the offering (referred to as “pro forma” information). The pro forma capitalization gives effect to the assumptions listed under “Pro Forma Data,” based on the sale of the number of shares of common stock indicated in the table. This table does not reflect the issuance of additional shares as a result of the exercise of options granted under the proposed equity incentive plan. A change in the number of shares to be issued in the offering may materially affect pro forma capitalization. We are offering our common stock on a best efforts basis. We must sell a minimum of 2,626,500 shares to complete the offering.


				Pro Forma Capitalization Based Upon the Sale of
(Dollars in thousands, except per share amounts)	Capitalization as of March 31, 2008			2,626,500 Shares at $10.00 Per Share			3,090,000 Shares at $10.00 Per Share			3,553,500 Shares at $10.00 Per Share			4,086,525 Shares at $10.00 Per Share
Deposits (1)	$	174,085		$	174,085		$	174,085		$	174,085		$	174,085
Borrowings		8,000			8,000			8,000			8,000			8,000

Total deposits and borrowed funds	$	182,085		$	182,085		$	182,085		$	182,085		$	182,085

Stockholder’s equity:
Preferred stock:
1,000,000 shares, $0.01 par value per share, authorized; none issued or outstanding	$	—		$	—		$	—		$	—		$	—
Common stock:
20,000,000 shares, $0.01 par value per share, authorized; specified number of shares assumed to be issued and outstanding (2)		—			27			32			37			42
Additional paid-in capital		—			26,090			30,678			35,265			40,541
Retained earnings (3)		29,262			29,262			29,262			29,262			29,262
Accumulated other comprehensive income		137			137			137			137			137
Plus:
Tax benefit of contribution to charitable foundation (4)		—			475			475			475			475
Less :
Charitable foundation contribution expense (5)		—			1,200			1,200			1,200			1,200
Common stock acquired by employee stock ownership plan (6)		—			2,189			2,560			2,931			3,357
Common stock to be acquired by equity incentive plan (7)		—			1,095			1,280			1,465			1,679

Total stockholders’ equity	$	29,399		$	51,507		$	55,544		$	59,580		$	64,222

Stockholders’ equity to assets (1)		13.83	%		21.94	%		23.26	%		24.54	%		25.95	%

(1)	Does not reflect withdrawals from deposit accounts for the purchase of common stock in the offering. Withdrawals to purchase common stock will reduce pro forma deposits and assets by the amounts of the withdrawals.

(2)	Reflects total issued and outstanding shares of 2,736,500, 3,200,000, 3,663,500 and 4,196,525 at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively.

(3)	Retained earnings are restricted by applicable regulatory capital requirements.

(4)

Represents the tax benefit of the contribution of common stock to First Savings Charitable Foundation based on an estimated tax rate of 39.6%. The actual rate experienced by First Savings Financial Group may vary. The realization of the tax benefit is limited annually to 10.0% of our annual taxable income. However, for federal and state tax purposes, we can carry forward any unused portion of the deduction for five years following the year in which the contribution is made.

(5)	Represents the pre-tax expense of the contribution of common stock to the First Savings Charitable Foundation.

(6)

Assumes that 8% of the common stock sold in the offering and contributed to the charitable foundation will be acquired by the employee stock ownership plan in the offering with funds borrowed from First Savings Financial Group. Under generally accepted accounting principles, the amount of common stock to be purchased by the employee stock ownership plan represents unearned compensation and is, accordingly, reflected as a reduction of capital and a liability to the employee stock ownership plan. As shares are released to plan participants’ accounts, a compensation expense will be charged, along with related tax benefit, and a reduction in the charge against capital will occur in the amount of the compensation expense recognized. Since the funds are borrowed from First Savings Financial Group, the borrowing will be eliminated in consolidation and no liability or interest expense will be reflected in the financial statements of First Savings Bank. The loan will be repaid principally through First Savings Bank’s contributions to the employee stock ownership plan and dividends payable on common stock held by the plan over the anticipated 15 year term of the loan. See “Our Management — Benefit Plans — Employee Stock Ownership Plan.”

(7)

Assumes the purchase in the open market at $10.00 per share, for restricted stock awards under the proposed equity incentive plan, of a number of shares equal to 4% of the shares of common stock sold in the offering and contributed to the charitable foundation. The shares are reflected as a reduction of stockholders’ equity. The equity incentive plan will be submitted to stockholders for approval at a meeting following the offering. See “Risk Factors — Issuance of shares for benefit programs may dilute your ownership interest,” “Pro Forma Data” and “Our Management — Benefit Plans — Future Equity Incentive Plan.”

Regulatory Capital Compliance

At March 31, 2008, First Savings Bank exceeded all regulatory capital requirements. The following table presents First Savings Bank’s capital position relative to its regulatory capital requirements at March 31, 2008, on a historical and a pro forma basis. The table reflects receipt by First Savings Bank of 50% of the net proceeds of the offering. For purposes of the table, the amount expected to be borrowed by the employee stock ownership plan and the cost of the shares expected to be awarded under the equity incentive plan as restricted stock (8% and 4% of the shares of common stock sold and contributed to the charitable foundation, respectively) are deducted from pro forma regulatory capital. For a discussion of the assumptions underlying the pro forma capital calculations presented below, see “Use of Proceeds,” “Capitalization” and “Pro Forma Data.” The definitions of the terms used in the table are those provided in the capital regulations issued by the Office of Thrift Supervision. For a discussion of the capital standards applicable to First Savings Bank, see “Regulation and Supervision — Regulation of Federal Savings Associations — Capital Requirements.”


					Pro Forma at March 31, 2008
					Minimum of Offering Range					Midpoint of Offering Range					Maximum of Offering Range					15% Above Maximum of Offering Range
	Historical at March 31, 2008				2,626,500 Shares At $10.00 Per Share					3,090,000 Shares At $10.00 Per Share					3,553,500 Shares At $10.00 Per Share					4,086,525 Shares At $10.00 Per Share
(Dollars in thousands)	Amount		Percent of Assets (1)		Amount			Percent of Assets		Amount			Percent of Assets		Amount			Percent of Assets		Amount			Percent of Assets
Total capital under generally accepted accounting principles	$	29,399	13.83	%	$	39,718		17.64	%	$	41,644		18.31	%	$	43,569		18.97	%	$	45,783		19.70	%
Tangible Capital:
Capital level (2)	$	29,262	13.78		$	39,581		17.60	%	$	41,507		18.27	%	$	43,432		18.93	%	$	45,646		19.67	%
Requirement		3,186	1.50			3,373		1.50			3,408		1.50			3,442		1.50			3,482		1.50

Excess	$	26,076	12.28	%	$	36,208		16.10	%	$	38,099		16.77	%	$	39,990		17.43	%	$	42,164		18.17	%

Core Capital:
Capital level (2)	$	29,262	13.78	%	$	39,581		17.60	%	$	41,507		18.27	%	$	43,432		18.93	%	$	45,646		19.67	%
Requirement		8,495	4.00			8,995		4.00			9,087		4.00			9,179		4.00			9,285		4.00

Excess	$	20,767	9.78	%	$	30,586		13.60	%	$	32,420		14.27	%	$	34,253		14.93	%	$	36,361		15.67	%

Tier 1 Risk-Based Capital:
Capital level	$	29,262	22.79	%	$	39,581		30.24	%	$	41,507		31.60	%	$	43,432		32.95	%	$	45,646		34.50	%
Requirement		5,135	4.00			5,235		4.00			5,253		4.00			5,272		4.00			5,293		4.00

Excess	$	24,127	18.79	%	$	34,346		26.24	%	$	36,254		27.60	%	$	38,160		28.95	%	$	40,353		30.50	%

Total Risk-Based Capital:
Total risk-based capital (3)	$	30,566	23.81	%	$	40,885		31.24	%	$	42,811		32.60	%	$	44,736		33.94	%	$	46,950		35.48	%
Requirement		10,270	8.00			10,470		8.00			10,507		8.00			10,544		8.00			10,586		8.00

Excess	$	20,296	15.81	%	$	30,415		23.24	%	$	32,304		24.60	%	$	34,192		25.94	%	$	36,364		27.48	%

Reconciliation of capital infusion to First Savings Bank, F.S.B.:
Proceeds to First Savings Bank					$	12,509				$	14,805				$	17,101				$	19,742
Less stock acquired by ESOP						(2,189	)				(2,560	)				(2,931	)				(3,357	)

Pro forma increase in GAAP and regulatory capital					$	10,319				$	12,245				$	14,170				$	16,384

(1)	Tangible capital and core capital levels are shown as a percentage of adjusted total assets of $212.4 million. Risk-based capital levels are shown as a percentage of risk-weighted assets of $128.4 million.

(2)	A portion of the net unrealized losses on available-for-sale securities accounts for the difference between capital calculated under generally accepted accounting principles and each of tangible capital and core capital. See Note 15 of the notes to consolidated financial statements.

(3)	Pro forma amounts and percentages assume net proceeds are invested in assets that carry a 20% risk-weighting.

Pro Forma Data

The following tables show information about our net income and stockholders’ equity reflecting the sale of common stock in the offering. The information provided illustrates our pro forma net income and stockholders’ equity based on the sale of common stock at the minimum of the offering range, the midpoint of the offering range, the maximum of the offering range and 15% above the maximum of the offering range. The actual net proceeds from the sale of the common stock cannot be determined until the offering is completed. Net proceeds indicated in the following tables are based upon the following assumptions:

•

All shares of stock will be sold in the subscription and community offerings;

•

Our employee stock ownership plan will purchase a number of shares equal to 8% of the shares sold in the offering and contributed to the charitable foundation with a loan from First Savings Financial Group that will be repaid in equal installments over 15 years;

•

Keefe, Bruyette & Woods, Inc. will receive a fee equal to 1.0% of the aggregate purchase price of the shares sold in the offering, except that no fee will be paid with respect to (i) shares purchased by the employee stock ownership plan or by our officers, directors and employees and members of their immediate families and (ii) shares contributed to the charitable foundation; and

•

Total expenses of the offering, excluding fees paid to Keefe, Bruyette & Woods, Inc., will be approximately $1.0 million.

•

We will make a charitable contribution of 110,000 shares of First Savings Financial Group with an assumed value of $10.00 per share and $100,000 cash.

Actual expenses may vary from this estimate, and the amount of fees paid to Keefe, Bruyette & Woods, Inc. (and potentially other broker-dealers) will depend upon whether a syndicate of broker-dealers or other means is necessary to sell the shares, and other factors.

Pro forma net income for the six months ended March 31, 2008 and the year ended September 30, 2007 has been calculated as if the offering were completed at the beginning of the period, and the net proceeds had been invested at 1.55% for the six months ended March 31, 2008 and the year ended September 30, 2007, which represents the one-year treasury rate at March 31, 2008. We believe that the one-year treasury rate at March 31, 2008 represents a more realistic yield on the investment of the offering proceeds than the arithmetic average of the weighted average yield earned on our interest-earning assets and the weighted average rate paid on our deposits, which is the reinvestment rate required by Office of Thrift Supervision regulations.

A pro forma after-tax return of 0.94% is used for the six months ended March 31, 2008 and for the year ended September 30, 2007, after giving effect to a combined federal and state income tax rate of 39.6% for each period. Historical and pro forma per share amounts have been calculated by dividing historical and pro forma amounts by the number of shares of common stock indicated in the tables.

When reviewing the following tables you should consider the following:

•

The final column gives effect to a 15% increase in the offering range, which may occur without any further notice if RP Financial increases its appraisal to reflect the results of this offering, changes in our financial condition or results of operations or changes in market conditions after the offering begins. See “The Conversion and Stock Offering — How We Determined the Offering Range and the $10.00 Per Share Purchase Price.”

•

Since funds on deposit at First Savings Bank may be withdrawn to purchase shares of common stock, the amount of funds available for investment will be reduced by the amount of withdrawals for stock purchases. The pro forma tables do not reflect withdrawals from deposit accounts.

•

Historical per share amounts have been computed as if the shares of common stock expected to be issued in the offering had been outstanding at the beginning of the period covered by the table. However, neither historical nor pro forma stockholders’ equity has been adjusted to reflect the investment of the estimated net proceeds from the sale of the shares in the offering, the additional employee stock ownership plan expense or the proposed equity incentive plan.

•

Pro forma stockholders’ equity (“book value”) represents the difference between the stated amounts of our assets and liabilities. Pro forma tangible stockholders’ equity excludes intangible assets. Book value amounts do not represent fair market values or amounts available for distribution to stockholders in the unlikely event of liquidation. The amounts shown do not reflect the federal income tax consequences of the restoration to income of First Savings Bank’s special bad debt reserves for income tax purposes or give effect to the liquidation account in the event of liquidation, which would be required in the unlikely event of liquidation. See “Federal and State Taxation” and “The Conversion and Stock Offering — Effects of Conversion to Stock Form — Liquidation Account.”

•

The amounts shown as pro forma stockholders’ equity per share do not represent possible future price appreciation of our common stock.

The following pro forma data may not represent the actual financial effects of the offering or our operating results after the offering. The pro forma data relies exclusively on the assumptions outlined above and in the notes to the pro forma tables. The pro forma data does not represent the fair market value of our common stock, the current fair market value of our assets or liabilities, or the amount of money that would be available for distribution to stockholders if we are liquidated after the offering.

We are offering our common stock on a best efforts basis. We must sell a minimum of 2,626,500 shares to complete the offering.


	Six Months Ended March 31, 2008
	Minimum of Offering Range			Midpoint of Offering Range			Maximum of Offering Range			15% Above Maximum of Offering Range
(Dollars in thousands, except per share amounts)	2,626,500 Shares at $10.00 Per Share			3,090,000 Shares at $10.00 Per Share			3,553,500 Shares at $10.00 Per Share			4,086,525 Shares at $10.00 Per Share
Gross proceeds	$	26,265		$	30,900		$	35,535		$	40,865
Less: estimated expenses		1,248			1,290			1,333			1,382
Estimated net proceeds		25,017			29,610			34,202			39,483
Less: cash contribution to charitable foundation		(100	)		(100	)		(100	)		(100	)
Less: common stock acquired by employee stock ownership plan (1)		(2,189	)		(2,560	)		(2,931	)		(3,357	)
Less: common stock to be acquired by equity incentive plan (2)		(1,095	)		(1,280	)		(1,465	)		(1,679	)

Net investable proceeds		21,633			25,670			29,706			34,347

Pro Forma Net Income:
Pro forma net income (loss) (3):
Historical		(348	)		(348	)		(348	)		(348	)
Pro forma income on net investable proceeds		101			120			139			161
Less: pro forma employee stock ownership plan adjustments (1)		(44	)		(52	)		(59	)		(68	)
Less: pro forma restricted stock award expense (2)		(66	)		(77	)		(89	)		(101	)
Less: pro forma stock option expense (4)		(94	)		(110	)		(126	)		(145	)

Pro forma net income (loss)		(451	)		(467	)		(483	)		(501	)

Pro forma net income (loss) per share (3):
Historical		(0.14	)		(0.12	)		(0.10	)		(0.09	)
Pro forma income on net investable proceeds		0.05			0.05			0.05			0.05
Less: pro forma employee stock ownership plan adjustments (1)		(0.02	)		(0.02	)		(0.02	)		(0.02	)
Less: pro forma restricted stock award expense (2)		(0.03	)		(0.03	)		(0.03	)		(0.03	)
Less: pro forma stock option expense (4)		(0.04	)		(0.04	)		(0.04	)		(0.04	)

Pro forma net income (loss) per share		(0.18	)		(0.16	)		(0.14	)		(0.13	)

Offering price as a multiple of pro forma net income per share (annualized)		*			*			*			*
Number of shares used to calculate pro forma net income per share (5)		2,524,877			2,952,533			3,380,189			3,871,994
Pro Forma Stockholders’ Equity:
Pro forma stockholders’ equity (book value) (5):
Historical		29,399			29,399			29,399			29,399
Estimated net proceeds		25,017			29,610			34,202			39,483
Plus: common stock issued to charitable foundation		1,100			1,100			1,100			1,100
Less: expense net of tax of contribution to charitable foundation		(725	)		(725	)		(725	)		(725	)
Less: common stock acquired by employee stock ownership plan (1)		(2,189	)		(2,560	)		(2,931	)		(3,357	)
Less: common stock to be acquired by equity incentive plan (2)		(1,095	)		(1,280	)		(1,465	)		(1,679	)

Pro forma stockholders’ equity		51,507			55,544			59,580			6,422

Pro forma stockholders’ equity per share (5):
Historical		10.74			9.19			8.02			7.01
Estimated net proceeds		9.14			9.26			9.34			9.40
Plus: common stock issued to charitable foundation		0.40			0.34			0.30			0.26
Less: expense net of tax contribution to charitable foundation		(0.26	)		(0.23	)		(0.20	)		(0.17	)
Less: common stock acquired by employee stock ownership plan (1)		(0.80	)		(0.80	)		(0.80	)		(0.80	)
Less: common stock to be acquired by equity incentive plan (2)		(0.40	)		(0.40	)		(0.40	)		(0.40	)

Pro forma stockholders’ equity per share		18.82			17.36			16.26			15.30

Offering price as a percentage of pro forma stockholders’ equity per share		53.13	%		57.60	%		61.50	%		65.36	%
Number of shares used to calculate pro forma stockholders’ equity per share (5)		2,736,500			3,200,000			3,663,500			4,196,525

(footnotes on pages __)


	Year Ended September 30, 2007
	Minimum of Offering Range			Midpoint of Offering Range			Maximum of Offering Range			15% Above Maximum of Offering Range
(Dollars in thousands, except per share amounts)	2,626,500 Shares at $10.00 Per Share			3,090,000 Shares at $10.00 Per Share			3,553,500 Shares at $10.00 Per Share			4,086,525 Shares at $10.00 Per Share
Gross proceeds	$	26,265		$	30,900		$	35,535		$	40,865
Less: estimated expenses		1,248			1,290			1,333			1,382
Estimated net proceeds		25,017			29,610			34,202			39,483
Less: cash contribution to charitable foundation		(100	)		(100	)		(100	)		(100	)
Less: common stock acquired by employee stock ownership plan (1)		(2,189	)		(2,560	)		(2,931	)		(3,357	)
Less: common stock to be acquired by equity incentive plan (2)		(1,095	)		(1,280	)		(1,465	)		(1,679	)

Net investable proceeds		21,633			25,670			29,706			34,347

Pro Forma Income:
Pro forma net income (loss) (3):
Historical		814			814			814			814
Pro forma income on net investable proceeds		203			240			278			322
Less: pro forma employee stock ownership plan adjustments (1)		(88	)		(103	)		(118	)		(135	)
Less: pro forma restricted stock award expense (2)		(132	)		(155	)		(177	)		(203	)
Less: pro forma stock option expense (4)		(189	)		(221	)		(253	)		(290	)

Pro forma net income (loss)		608			575			544			508

Pro forma net income (loss) per share (3):
Historical		0.32			0.28			0.24			0.21
Pro forma income on net investable proceeds		0.07			0.06			0.07			0.07
Less: pro forma employee stock ownership plan adjustments (1)		(0.03	)		(0.03	)		(0.03	)		(0.03	)
Less: pro forma restricted stock award expense (2)		(0.05	)		(0.05	)		(0.05	)		(0.05	)
Less: pro forma stock option expense (4)		(0.07	)		(0.07	)		(0.07	)		(0.07	)

Pro forma net income (loss) per share		0.24			0.19			0.16			0.13

Offering price as a multiple of pro forma net income per share		41.67x			52.63x			62.50x			76.92x
Number of shares used to calculate pro forma net income per share (5)		2,532,175			2,961,067			3,389,959			3,883,184
Pro Forma Stockholders’ Equity:
Pro forma stockholders’ equity (book value) (5):
Historical		29,662			29,662			29,662			29,662
Estimated net proceeds		25,017			29,610			34,202			39,483
Plus: common stock issued to charitable foundation		1,100			1,100			1,100			1,100
Less expense net of tax of contribution to charitable foundation		(725	)		(725	)		(725	)		(725	)
Less: common stock acquired by employee stock ownership plan (1)		(2,189	)		(2,560	)		(2,931	)		(3,357	)
Less: common stock to be acquired by equity incentive plan (2)		(1,095	)		(1,280	)		(1,465	)		(1,679	)

Pro forma stockholders’ equity		51,770			55,807			59,843			64,485

Pro forma stockholders’ equity per share (5):
Historical		10.84			9.27			8.10			7.07
Estimated net proceeds		9.14			9.26			9.33			9.41
Plus: common stock issued to charitable foundation		0.40			0.34			0.30			0.26
Less: expense net of tax of contribution to charitable foundation		(0.26	)		(0.23	)		(0.20	)		(0.17	)
Less: common stock acquired by employee stock ownership plan (1)		(0.80	)		(0.80	)		(0.80	)		(0.80	)
Less: common stock to be acquired by equity incentive plan (2)		(0.40	)		(0.40	)		(0.40	)		(0.40	)

Pro forma stockholders’ equity per share		18.92			17.44			16.33			15.37

Offering price as a percentage of pro forma stockholders’ equity per share		52.85	%		57.34	%		61.24	%		65.06	%
Number of shares used to calculate pro forma stockholders’ equity per share (5)		2,736,500			3,200,000			3,663,500			4,196,525

(footnotes on pages __)

*	Not meaningful.

(1)

Assumes that the employee stock ownership plan will acquire a number of shares of stock equal to 8% of the shares sold in the offering and contributed to the charitable foundation (218,920, 256,000, 293,080 and 335,722 shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively). The employee stock ownership plan will borrow the funds to acquire these shares from the net offering proceeds retained by First Savings Financial Group. The amount of this borrowing has been reflected as a reduction from gross proceeds to determine estimated net investable proceeds. This borrowing will have an interest rate equal to the prime rate as published in The Wall Street Journal, which is currently %, and a term of 15 years. First Savings Bank intends to make contributions to the employee stock ownership plan in amounts at least equal to the principal and interest requirement of the debt. Interest income that First Savings Financial Group will earn on the loan will offset a portion of the compensation expense recorded by First Savings Bank as it contributes to the ESOP. As the debt is paid down, shares will be released for allocation to participants’ accounts and stockholders’ equity will be increased. The adjustment to pro forma net income for the employee stock ownership plan reflects the after-tax compensation expense associated with the plan. Applicable accounting principles require that compensation expense for the employee stock ownership plan be based upon the market value of shares committed to be released and that unallocated shares be excluded from earnings per share computations. An equal number of shares (1/15 of the total, based on a 15 - year loan) will be released each year over the term of the loan. The valuation of shares committed to be released would be based upon the average market value of the shares during the year, which, for purposes of this calculation, was assumed to be equal to the $10.00 per share purchase price. If the average market value per share is greater than $10.00 per share, total employee stock ownership plan expense would be greater. See “Our Management — Benefit Plans — Employee Stock Ownership Plan.”

(2)

Assumes that First Savings Financial Group will purchase in the open market a number of shares of stock equal to 4% of the shares sold in the offering and contributed to the charitable foundation (109,460, 128,000, 146,540 and 167,861 shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively), that will be reissued as restricted stock awards under an equity incentive plan to be adopted following the offering. Purchases will be funded with cash on hand at First Savings Financial Group or with dividends paid to First Savings Financial Group by First Savings Bank. The cost of these shares has been reflected as a reduction from gross proceeds to determine estimated net investable proceeds. In calculating the pro forma effect of the restricted stock awards, it is assumed that the required stockholder approval has been received, that the shares used to fund the awards were acquired at the beginning of the respective period and that the shares were acquired at the $10.00 per share purchase price. The issuance of authorized but unissued shares of the common stock instead of shares repurchased in the open market would dilute the ownership interests of existing stockholders by approximately 3.85%. The adjustment to pro forma net income for the restricted stock awards reflects the after-tax compensation expense associated with the awards. It is assumed that the fair market value of a share of First Savings Financial Group common stock was $10.00 at the time the awards were made, that shares of restricted stock issued under the equity incentive plan vest 20% per year, that compensation expense is recognized on a straight-line basis over each vesting period so that 20% of the value of the shares awarded was an amortized expense during each year, and that the combined federal and state income tax rate was 39.6%. If the fair market value per share is greater than $10.00 per share on the date shares are awarded under the equity incentive plan, total equity incentive plan expense would be greater.

(3)	Does not give effect to the non-recurring expense that will be recognized in fiscal 2008 as a result of the contribution of common stock to the charitable foundation.

The following table shows the estimated after-tax expense associated with the contribution to the foundation, as well as pro forma net loss and pro forma net loss per share assuming the contribution to the foundation was expensed during the periods presented.


(Dollars in thousands, except per share amounts)	Minimum of Offering Range			Midpoint of Offering Range			Maximum of Offering Range			15% Above Maximum of Offering Range
Before-tax expense of contribution to foundation:
Six months ended March 31, 2008	$	1,200		$	1,200		$	1,200		$	1,200
Year ended September 30, 2007	$	1,200		$	1,200		$	1,200		$	1,200
After-tax expense of contributions to foundation:
Six months ended March 31, 2008	$	725		$	725		$	725		$	725
Year ended September 30, 2007	$	725		$	725		$	725		$	725
Pro forma net loss:
Six months ended March 31, 2008	$	(1,176	)	$	(1,192	)	$	(1,208	)	$	(1,226	)
Year ended September 30, 2007	$	(117	)	$	(150	)	$	(181	)	$	(216	)
Pro forma net loss per share:
Six months ended March 31, 2008	$	(0.47	)	$	(0.40	)	$	(0.36	)	$	(0.32	)
Year ended September 30, 2007	$	(0.05	)	$	(0.05	)	$	(0.05	)	$	(0.06	)
Pro forma tax benefit:
Six months ended March 31, 2008	$	475		$	475		$	475		$	475
Year ended September 30, 2007	$	475		$	475		$	475		$	475

The before-tax expense of the contribution to the foundation is based upon 110,000 shares being contributed at a cost of $10.00 per share and a $100,000 cash contribution. The pro forma data assume that we will realize 100.0% of the income tax benefit as a result of the contribution to the foundation based on a 39.6% income tax rate. The realization of the tax benefit is limited annually to 10.0% of our annual taxable income. However, for federal and state tax purposes, we can carry forward any unused portion of the deduction for five years following the year in which the contribution is made. As reflected in the table above, the assumed tax benefit at a 39.6% tax rate reduces the before-tax expense of the charitable foundation for the year ended September 30, 2007 by $475,000 at each of the minimum, midpoint, maximum and 15% above the maximum of the offering range. See “Summary—We will Form the First Savings Charitable Foundation.”

(4)

The adjustment to pro forma net income for stock options reflects the after-tax compensation expense associated with the stock options that may be granted under the equity incentive plan to be adopted following the offering. If the equity incentive plan is approved by stockholders, a number of shares equal to 10% of the number of shares sold in the offering and contributed to the charitable foundation (273,650, 320,000, 366,350 and 419,653 shares at the minimum, midpoint, maximum and adjusted maximum of the offering range, respectively) will be reserved for future issuance upon the exercise of stock options that may be granted under the plan. Using the Black-Scholes option-pricing formula, the options are assumed to have a value of $3.83 for each option, based on the following assumptions: exercise price, $10.00; trading price on date of grant, $10.00; dividend yield, 0.00%; expected life, 10 years; expected volatility, 19.49%; and risk-free interest rate, 3.49%. Because there currently is no market for First Savings Financial Group common stock, the assumed expected volatility is based on the SNL Index for all publicly-traded thrifts. The dividend yield is assumed to be 0% because there is no history of dividend payments and the board of directors has not expressed an intention to commence dividend payments upon completion of the offering. It is assumed that stock options granted under the equity incentive plan vest 20% per year, that compensation expense is recognized on a straight-line basis over each vesting period so that 20% of the value of the options awarded was an amortized expense during each year, that 25% of the options awarded are non-qualified options and that the combined federal and state income tax rate was 39.6%. If the fair market value per share is different than $10.00 per share on the date options are awarded under the equity incentive plan, or if the assumptions used in the option-pricing formula are different from those used in preparing this pro forma data, the value of the stock options and the related expense would be different. Applicable accounting standards do not prescribe a specific valuation technique to be used to estimate the fair value of employee stock options. First Savings Financial Group may use a valuation technique other than the Black-Scholes option-pricing formula and that technique may produce a different value. The issuance of authorized but unissued shares of common stock to satisfy option exercises instead of shares repurchased in the open market would dilute the ownership interests of existing stockholders by approximately 9.1%.

(5)

The number of shares used to calculate pro forma net income per share is equal to the total number of shares to be outstanding upon completion of the offering, less the number of shares purchased by the employee stock ownership plan not committed to be released within six months or one year following the offering. The number of shares used to calculate pro forma stockholders’ equity per share equals the total number of shares to be outstanding upon completion of the offering.

Comparison of Independent Valuation and Pro Forma Financial

Information With and Without the Foundation

As set forth in the following table, if we do not establish and fund First Savings Charitable Foundation as part of the offering, RP Financial estimates that our pro forma valuation would be greater, which would have resulted in an increase in the amount of common stock offered for sale in the offering. If the foundation were not established, there is no assurance that the updated appraisal that RP Financial will prepare at the closing of the offering would conclude that our pro forma market value would be the same as the estimate set forth in the table below. The updated appraisal will be based on the facts and circumstances existing at that time, including, among other things, market and economic conditions.

The information presented in the following table is for comparative purposes only. It assumes that the offering was completed at March 31, 2008, based on the assumptions set forth under “Pro Forma Data.”


	At the Minimum of Estimated Valuation Range						At the Midpoint of Estimated Valuation Range						At the Maximum of Estimated Valuation Range						At the Maximum, as Adjusted, of Estimated Valuation Range
(Dollars in thousands, except per share amount)	With Foundation			No Foundation			With Foundation			No Foundation			With Foundation			No Foundation			With Foundation			No Foundation
Estimated offering amount (1)	$	26,265		$	27,880		$	30,900		$	32,800		$	35,535		$	37,720		$	40,865		$	43,378
Pro forma market capitalization		27,365			27,880			32,000			32,800			36,635			37,720			41,965			43,378
Estimated pro forma valuation		27,365			27,880			32,000			32,800			36,635			37,720			41,965			43,378
Pro forma total assets		234,732			235,895			238,769			240,179			242,805			244,464			247,447			249,391
Pro forma total liabilities		183,225			183,225			183,225			183,225			183,225			183,225			183,225			183,225
Pro forma stockholders’ equity		51,507			52,670			55,544			56,954			59,580			61,239			64,222			66,166
Pro forma net income		(451	)		(447	)		(467	)		(464	)		(483	)		(481	)		(501	)		(501	)
Pro forma stockholders’ equity per share		18.82			18.89			17.36			17.36			16.26			16.24			15.30			15.25
Pro forma net income per share		(0.18	)		(0.17	)		(0.16	)		(0.15	)		(0.14	)		(0.14	)		(0.13	)		(0.13	)
Pro Forma Pricing Ratios:
Offering prices as a percentage of pro forma stockholders’ equity		53.13	%		52.94	%		57.60	%		57.60	%		61.50	%		61.58	%		65.36	%		65.57	%
Offering price as a multiple of pro forma net income per share		*			*			*			*			*			*			*			*
Pro Forma Financial Ratios:
Return on assets		(0.38	)%		(0.38	)%		(0.39	)%		(0.39	)%		(0.40	)%		(0.39	)%		(0.40	)%		(0.40	)%
Return on stockholders’ equity		(1.75	)		(1.70	)		(1.68	)		(1.63	)		(1.62	)		(1.57	)		(1.56	)		(1.51	)
Stockholders’ equity to total assets		21.94			22.33			23.26			23.71			24.54			25.05			25.95			26.53

*	Not meaningful.

(1)	Based on independent valuation prepared by RP Financial as of May 16, 2008.

Our Business

General

First Savings Financial Group, an Indiana corporation, was incorporated in May 2008 to become the holding company for First Savings Bank upon completion of the conversion. Before the completion of the conversion, First Savings Financial Group has not engaged in any significant activities other than organizational activities. Following completion of the conversion, First Savings Financial Group’s business activity will be the ownership of the outstanding capital stock of First Savings Bank. First Savings Financial Group will not own or lease any property but instead use the premises, equipment and other property of First Savings Bank with the payment of appropriate rental fees, as required by applicable law and regulations, under the terms of an expense allocation agreement. In the future, First Savings Financial Group may acquire or organize other operating subsidiaries; however, there are no current plans, arrangements, agreements or understandings, written or oral, to do so.

Founded in 1937, First Savings Bank is a federally chartered savings bank headquartered in Clarksville, Indiana. We operate as a community-oriented financial institution offering traditional financial services to consumers and businesses in our primary market area. We attract deposits from the general public and use those funds to originate primarily residential mortgage loans and, to a lesser but growing extent, commercial mortgage loans and commercial business loans. We also originate residential and commercial construction loans, multi-family loans, land and land development loans, and consumer loans. We conduct our lending and deposit activities primarily with individuals and small businesses in our primary market area.

Our website address is www.fsbbank.net. Information on our website should not be considered a part of this prospectus.

Market Area

We are located in South Central Indiana along the axis of Interstate 65 and Interstate 64, directly across the Ohio River from Louisville, Kentucky. We consider Clark and Floyd counties, Indiana, and the surrounding areas to be our primary market area. According to published statistics, the current populations of Clark and Floyd counties are 105,035 and 73,064, respectively, and are expected to grow by 3% and 17.7%, respectively, through the year 2012. Median household income for Clark and Floyd counties is also projected to grow by 46.2% and 47.3%, respectively, through the year 2012. The top employment sectors in Clark and Floyd counties are currently the private retail, service and manufacturing industries, which are likely to continue to be supported by the projected growth in population and median household income. Clark and Floyd counties have their own unique identity and micro-economy, and are well-served by barge transportation, rail service, and commercial and general aviation services, including the United Parcel Service’s major hub, which are located in our primary market area.

Competition

We face significant competition for the attraction of deposits and origination of loans. Our most direct competition for deposits has historically come from the several financial institutions operating in our primary market area and from other financial service companies such as securities and mortgage brokerage firms, credit unions and insurance companies. We also face competition for investors’ funds from money market funds, mutual funds and other corporate and government securities. At June 30, 2007, which is the most recent date for which data is available from the Federal Deposit Insurance Corporation, we held approximately 14.54% and 1.18% of the FDIC-insured deposits in Clark and Floyd Counties, Indiana, respectively. This data does not reflect deposits held by credit unions with which we also compete. In addition, banks owned by large national and regional holding companies and other community-based banks also operate in our primary market area. Some of these institutions are larger than us and, therefore, may have greater resources.

Our competition for loans comes primarily from financial institutions, including credit unions, in our primary market area and from other financial service providers, such as mortgage companies and mortgage brokers. Competition for loans also comes from non-depository financial service companies entering the mortgage market, such as insurance companies, securities companies and specialty finance companies.

We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Technological advances, for example, have lowered barriers to entry, allowed banks to expand their geographic reach by providing services over the Internet, and made it possible for non-depository institutions to offer products and services that traditionally have been provided by banks. Changes in federal law now permit affiliation among banks, securities firms and insurance companies, which promotes a competitive environment in the financial services industry. Competition for deposits and the origination of loans could limit our growth in the future.

Lending Activities

General. The largest segment of our loan portfolio is real estate mortgage loans, primarily one-to four- family residential loans, including non-owner occupied residential loans that were predominately originated before 2005, and, to a lesser but growing extent, commercial real estate loans. We also originate commercial business loans, and we intend to seek to grow that portfolio. We also originate residential and commercial construction loans, multi-family loans, land and land development loans, and consumer loans. We generally originate loans for investment purposes, although, depending on the interest rate environment and our asset/liability management goals, we may sell into the secondary market the 25-year and 30-year fixed-rate residential mortgage loans that we originate.

We intend to continue to emphasize residential lending, primarily secured by owner-occupied properties, while concentrating on ways to expand our consumer/retail banking capabilities and our commercial banking services with a focus on serving small businesses and emphasizing relationship banking in our primary market area. We do not offer sub-prime or no-documentation loans.

One-to Four-Family Residential Loans. Our origination of residential mortgage loans enables borrowers to purchase or refinance existing homes located in Clark and Floyd Counties, Indiana, and the surrounding areas. Before 2005, a significant portion of the residential mortgage loans that we had originated are secured by non-owner occupied properties. Loans secured by non-owner occupied properties generally carry a greater risk of loss than loans secured by owner-occupied properties, and our non-performing loan balances have increased in recent periods primarily because of delinquencies in our non-owner occupied residential loan portfolio. See “Risk Factors – Risks Related to Our Business – Our concentration in non-owner occupied real estate loans may expose us to increased credit risk” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risk Management – Analysis of Nonperforming and Classified Assets.” Since 2005, when we hired a new President and Chief Executive Officer, we have de-emphasized non-owner occupied residential mortgage lending and have focused, and intend to continue to focus, our residential mortgage lending primarily on originating residential mortgage loans secured by owner-occupied properties.

Our residential lending policies and procedures conform to the secondary market guidelines. We generally offer a mix of adjustable rate mortgage loans and fixed-rate mortgage loans with terms of 10 to 30 years. Borrower demand for adjustable-rate loans compared to fixed-rate loans is a function of the level of interest rates, the expectations of changes in the level of interest rates, and the difference between the interest rates and loan fees offered for fixed-rate mortgage loans as compared to an initially discounted interest rate and loan fees for multi-year adjustable-rate mortgages. The relative amount of fixed-rate mortgage loans and adjustable-rate mortgage loans that can be originated at any time is largely determined by the demand for each in a competitive environment. The loan fees, interest rates and other provisions of mortgage loans are determined by us based on our own pricing criteria and competitive market conditions.

Interest rates and payments on our adjustable-rate mortgage loans generally adjust annually after an initial fixed period that typically ranges from one to five years. Interest rates and payments on our adjustable-rate loans generally are adjusted to a rate typically equal to a margin above the one year U.S. Treasury index. The maximum amount by which the interest rate may be increased or decreased is generally two percentage points per adjustment period and the lifetime interest rate cap is generally six percentage points over the initial interest rate of the loan.

While one-to four-family residential real estate loans are normally originated with up to 30-year terms, such loans typically remain outstanding for substantially shorter periods because borrowers often prepay their loans in full either upon sale of the property pledged as security or upon refinancing the original loan. Therefore, average loan maturity is a function of, among other factors, the level of purchase and sale activity in the real estate market, prevailing interest rates and the interest rates payable on outstanding loans on a regular basis. We do not offer loans with negative amortization and generally do not offer interest-only loans.

We generally do not make conventional loans with loan-to-value ratios exceeding 80%, except that for non-owner occupied residential real estate loans, the loan-to-value ratios generally may not exceed 75%, or 65% where the borrower has more than five non-owner occupied loans outstanding. Non-owner occupied loans originated before 2005, however, were generally originated with loan-to-value ratios up to 80%. Loans with loan-to-value ratios in excess of 80% generally require private mortgage insurance. We generally require all properties securing mortgage loans to be appraised by a board-approved independent appraiser. We also generally require title insurance on all first mortgage loans with principal balances of $250,000 or more. Borrowers must obtain hazard insurance, and flood insurance is required for all loans located flood hazard areas.

At March 31, 2008, our largest one-to four-family residential loan had an outstanding balance of $2.7 million. This loan, which was originated in November 2007 and is secured by 46 non-owner occupied properties with an appraised value of $3.5 million, was performing in accordance with its original terms at March 31, 2008.

Commercial Real Estate Loans. We offer fixed- and adjustable-rate mortgage loans secured by commercial real estate. Our commercial real estate loans are generally secured by small to moderately-sized office, retail and industrial properties located in our primary market area and are typically made to small business owners and professionals such as attorneys and accountants.

We originate fixed-rate commercial real estate loans, generally with terms up to five years and payments based on an amortization schedule of 15 to 20 years, resulting in “balloon” balances at maturity. We also offer adjustable-rate commercial real estate loans, generally with terms up to five years and with interest rates typically equal to a margin above the prime lending rate. Loans are secured by first mortgages, generally are originated with a maximum loan-to-value ratio of 80% and generally require specified debt service coverage ratios depending on the characteristics of the project. Rates and other terms on such loans generally depend on our assessment of credit risk after considering such factors as the borrower’s financial condition and credit history, loan-to-value ratio, debt service coverage ratio and other factors.

At March 31, 2008, our largest commercial real estate loan had an outstanding balance of $2.3 million. This loan, which was originated in February 2006 and is secured by a restaurant and undeveloped land was performing in accordance with its original terms at March 31, 2008.

Construction Loans. We originate construction loans for one-to four-family homes and, to a lesser extent, commercial properties such as small industrial buildings, warehouses, retail shops and office units. Construction loans are typically for a term of 12 months with monthly interest only payments. Except for speculative loans, discussed below, repayment of construction loans typically comes from the proceeds of a permanent mortgage loan for which a commitment is typically in place when the construction loan is originated. We originate construction loans to a limited group of well-established builders in our primary market area and we limit the number of projects with each builder. Interest rates on these loans are generally tied to the prime lending rate. Construction loans, other than land development loans, generally will not exceed the lesser of 80% of the appraised value or 90% of the direct costs, excluding items such as developer fees, operating deficits or other items that do not relate to the direct development of the project. Generally, commercial construction loans require the personal guarantee of the owners of the business. We also offer construction loans for the financing of pre-sold homes, which convert into permanent loans at the end of the construction period. Such loans generally have a six-month construction period with interest only payments due monthly, followed by an automatic conversion to a 15-year to 30-year permanent loan with monthly payments of principal and interest. Occasionally, a construction loan to a builder of a speculative home will be converted to a permanent loan if the builder has not secured a buyer within a limited period of time after the completion of the home. We generally disburse funds on a percentage-of-completion basis following an inspection by a third party inspector.

We also originate speculative construction loans to builders who have not identified a buyer for the completed property at the time of origination. At March 31, 2008, we had approved commitments for speculative construction loans of $8.9 million, of which $7.5 million was outstanding. We require a maximum loan-to-value ratio of 80% for speculative construction loans. At March 31, 2008, our largest construction loan relationship was for a commitment of $1.8 million, of which $1.7 million was outstanding. This relationship was performing according to its original terms at March 31, 2008.

Land and Land Development Loans. On a limited basis, we originate loans to developers for the purpose of developing vacant land in our primary market area, typically for residential subdivisions. Land development loans are generally interest-only loans for a term of 18 to 24 months. We require a maximum loan-to-value ratio of 80% of the appraisal market value upon completion of the project. We do not require any cash equity from the borrower if there is sufficient indicated equity in the collateral property. Development plats and cost verification documents are required from borrowers before approving and closing the loan. Our loan officers are required to personally visit the proposed development site and the sites of competing developments. We also originate loans to individuals secured by undeveloped land held for investment purposes. At March 31, 2008, our largest land loan development had an outstanding balance of $2.0 million. This loan was performing in accordance with its original terms at March 31, 2008.

Multi-Family Real Estate Loans. To a limited extent, we offer multi-family mortgage loans that are generally secured by properties in our primary market area. Multi-family loans are secured by first mortgages and generally are originated with a maximum loan-to-value ratio of 80% and generally require specified debt service coverage ratios depending on the characteristics of the project. Rates and other terms on such loans generally depend on our assessment of the credit risk after considering such factors as the borrower’s financial condition and credit history, loan-to-value ratio, debt service coverage ratio and other factors.

Consumer Loans. Although we offer a variety of consumer loans, our consumer loan portfolio consists primarily of home equity loans, both fixed-rate amortizing term loans with terms up to 15 years and adjustable rate lines of credit with interest rates equal to a margin above the prime lending rate. Consumer loans typically have shorter maturities and higher interest rates than traditional one-to four-family lending. We typically do not make home equity loans with loan-to-value ratios exceeding 90%, including any first mortgage loan balance. We also offer auto and truck loans, personal loans and boat loans. At March 31, 2008, $3.5 million, or 2.0% of our consumer loan portfolio was comprised of boat loans. We no longer are an active originator of boat loans. The procedures for underwriting consumer loans include an assessment of the applicant’s payment history on other debts and ability to meet existing obligations and payments on the proposed loan. Although the applicant’s creditworthiness is a primary consideration, the underwriting process also includes a comparison of the value of the collateral, if any, to the proposed loan amount.

Commercial Business Loans. We typically offer commercial business loans to small businesses located in our primary market area. Commercial business loans are generally secured by equipment and general business assets. Key loan terms vary depending on the collateral, the borrower’s financial condition, credit history and other relevant factors, and personal guarantees are typically required as part of the loan commitment.

Loan Underwriting Risks

Adjustable-Rate Loans. While we anticipate that adjustable-rate loans will better offset the adverse effects of an increase in interest rates as compared to fixed-rate mortgages, an increased monthly mortgage payment required of adjustable-rate loan borrowers in a rising interest rate environment could cause an increase in delinquencies and defaults. The marketability of the underlying property also may be adversely affected in a high interest rate environment. In addition, although adjustable-rate mortgage loans make our asset base more responsive to changes in interest rates, the extent of this interest sensitivity is limited by the annual and lifetime interest rate adjustment limits.

Non-Owner Occupied Residential Real Estate Loans. Loans secured by rental properties represent a unique credit risk to us and, as a result, we adhere to special underwriting guidelines. Of primary concern in non-owner occupied real estate lending is the consistency of rental income of the property. Payments on loans secured by rental properties often depend on the maintenance of the property and the payment of rent by its

tenants. Payments on loans secured by rental properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to adverse conditions in the real estate market or the economy. To monitor cash flows on rental properties, we require borrowers and loan guarantors, if any, to provide annual financial statements and we consider and review a rental income cash flow analysis of the borrower and consider the net operating income of the property, the borrower’s expertise, credit history and profitability, and the value of the underlying property. We generally require collateral on these loans to be a first mortgage along with an assignment of rents and leases. Until recently, if the borrower had multiple loans for rental properties with us, the loans were not cross-collateralized. If the borrower holds loans on more than four rental properties, a loan officer is require to inspect these properties annually to determine if they are being properly maintained and rented. Recently, we generally have limited these loan relationships to an aggregate total of $500,000.

Multi-Family and Commercial Real Estate Loans. Loans secured by multi-family and commercial real estate generally have larger balances and involve a greater degree of risk than one- to four-family residential mortgage loans. Of primary concern in multi-family and commercial real estate lending is the borrower’s creditworthiness and the feasibility and cash flow potential of the project. Payments on loans secured by income properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject to adverse conditions in the real estate market or the economy. To monitor cash flows on income properties, we require borrowers and loan guarantors, if any, to provide annual financial statements on multi-family and commercial real estate loans. In reaching a decision on whether to make a multi-family or commercial real estate loan, we consider and review a global cash flow analysis of the borrower and consider the net operating income of the property, the borrower’s expertise, credit history and profitability, and the value of the underlying property. An environmental survey or environmental risk insurance is obtained when the possibility exists that hazardous materials may have existed on the site, or the site may have been impacted by adjoining properties that handled hazardous materials.

Construction and Land and Land Development Loans. Construction financing is generally considered to involve a higher degree of risk of loss than long-term financing on improved, occupied real estate. Risk of loss on a construction loan depends largely upon the accuracy of the initial estimate of the property’s value at completion of construction and the estimated cost of construction. During the construction phase, a number of factors could result in delays and cost overruns. If the estimate of construction costs proves to be inaccurate, we may be required to advance funds beyond the amount originally committed to permit completion of the building. If the estimate of value proves to be inaccurate, we may be confronted, at or before the maturity of the loan, with a building having a value which is insufficient to assure full repayment if liquidation is required. If we are forced to foreclose on a building before or at completion due to a default, there can be no assurance that we will be able to recover all of the unpaid balance of, and accrued interest on, the loan as well as related foreclosure and holding costs. In addition, speculative construction loans, which are loans made to home builders who, at the time of loan origination, have not yet secured an end buyer for the home under construction, typically carry higher risks than those associated with traditional construction loans. These increased risks arise because of the risk that there will be inadequate demand to ensure the sale of the property within an acceptable time. As a result, in addition to the risks associated with traditional construction loans, speculative construction loans carry the added risk that the builder will have to pay the property taxes and other carrying costs of the property until an end buyer is found. Land and land development loans have substantially similar risks to speculative construction loans.

Consumer Loans. Consumer loans may entail greater risk than do residential mortgage loans, particularly in the case of consumer loans that are secured by assets that depreciate rapidly, such as motor vehicles. In such cases, repossessed collateral for a defaulted consumer loan may not provide an adequate source of repayment for the outstanding loan and a small remaining deficiency often does not warrant further substantial collection efforts against the borrower. In the case of home equity loans, real estate values may be reduced to a level that is insufficient to cover the outstanding loan balance after accounting for the first mortgage loan balance. Consumer loan collections depend on the borrower’s continuing financial stability, and therefore are likely to be adversely affected by various factors, including job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including federal and state bankruptcy and insolvency laws, may limit the amount that can be recovered on such loans.

Commercial Business Loans. Unlike residential mortgage loans, which generally are made on the basis of the borrower’s ability to make repayment from his or her employment income or other income, and which are secured by real property whose value tends to be more easily ascertainable, commercial business loans are of higher risk and typically are made on the basis of the borrower’s ability to make repayment from the cash flow of the borrower’s business. As a result, the availability of funds for the repayment of commercial business loans may depend substantially on the success of the business itself. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value.

Loan Originations, Sales and Purchases. Loan originations come from a number of sources. The primary sources of loan originations are existing customers, walk-in traffic, advertising and referrals from customers. We generally sell in the secondary market long-term fixed-rate residential mortgage loans that we originate. Our decision to sell loans is based on prevailing market interest rate conditions, interest rate management and liquidity needs. We have not historically purchased whole loans or participation interests to supplement our lending portfolio.

Loan Approval Procedures and Authority. Our lending activities follow written, non-discriminatory underwriting standards and loan origination procedures established by our board of directors and management. Certain of our employees have been granted individual lending limits, which vary depending on the individual, the type of loan and whether the loan is secured or unsecured. Generally, all loan requests exceeding the individual officer lending limits require Loan Committee recommendation and Board approval. The Loan Committee consists of the President, Chief Operations Officer and certain other officers designated by the Board. One-to four-family residential loans in excess of $500,000 generally require loan committee recommendation and Board approval. Consumer loan requests up to $50,000 secured ($100,000 on loans secured by single family, owner-occupied residential property) and $35,000 unsecured are submitted to the direct credit underwriter for review and approval; requests over $50,000 secured ($100,000 on loans secured by single family, owner-occupied residential property) and $35,000 unsecured, generally require loan committee approval, and consumer loan requests in excess of $500,000 require approval by the Board. Commercial loan and construction loan requests in excess of individual officer lending limits up to and including $1 million require Loan Committee approval and requests in excess of $1 million require approval by the Board.

Loans to One Borrower. The maximum amount that we may lend to one borrower and the borrower’s related entities is limited, by regulation, to generally 15% of our stated capital and reserves. At March 31, 2008, our regulatory limit on loans to one borrower was $4.4 million. At that date, our largest lending relationship was $4.2 million and was performing according to its original terms at that date. This loan relationship is secured by commercial real estate and undeveloped land.

Loan Commitments. We issue commitments for residential and commercial mortgage loans conditioned upon the occurrence of certain events. Commitments to originate mortgage loans are legally binding agreements to lend to our customers. Generally, our loan commitments expire after 30 days. See Note 12 to notes to consolidated financial statements appearing elsewhere in this prospectus.

Investment Activities

We have legal authority to invest in various types of liquid assets, including U.S. Treasury obligations, securities of various government-sponsored agencies and of state and municipal governments, mortgage-backed securities and certificates of deposit of federally insured institutions. Within certain regulatory limits, we also may invest a portion of our assets in other permissible securities. As a member of the Federal Home Loan Bank of Indianapolis, we also are required to maintain an investment in Federal Home Loan Bank of Indianapolis stock.

At March 31, 2008, our investment portfolio consisted primarily of U.S. government and agency securities, mortgage-backed securities and securities issued by government sponsored enterprises, and municipal securities. We do not currently invest in trading account securities.

Our investment objectives are to provide and maintain liquidity, to establish an acceptable level of interest rate and credit risk, and to provide an alternate source of low-risk investments at a favorable return when loan demand is weak. Our board of directors has the overall responsibility for the investment portfolio, including approval of the investment policy. Messrs. Myers and Lawson, our President and Chief Executive Officer and Chief Operations Officer, respectively, are responsible for implementation of the investment policy and monitoring our investment performance. Our board of directors reviews the status of our investment portfolio on a quarterly basis, or more frequently if warranted.

Deposit Activities and Other Sources of Funds

General. Deposits, borrowings and loan repayments are the major sources of our funds for lending and other investment purposes. Scheduled loan repayments are a relatively stable source of funds, while deposit inflows and outflows and loan prepayments are significantly influenced by general interest rates and money market conditions.

Deposit Accounts. Deposits are attracted from within our primary market area through the offering of a broad selection of deposit instruments, including non-interest-bearing demand deposits (such as checking accounts), interest-bearing demand accounts (such as NOW and money market accounts), regular savings accounts and certificates of deposit. Deposit account terms vary according to the minimum balance required, the time periods the funds must remain on deposit and the interest rate, among other factors. In determining the terms of our deposit accounts, we consider the rates offered by our competition, our liquidity needs, profitability to us, matching deposit and loan products and customer preferences and concerns. We generally review our deposit mix and pricing weekly. Our deposit pricing strategy has typically been to offer competitive rates on all types of deposit products, and to periodically offer special rates in order to attract deposits of a specific type or term.

Borrowings. We use advances from the Federal Home Loan Bank of Indianapolis to supplement our investable funds. The Federal Home Loan Bank functions as a central reserve bank providing credit for member financial institutions. As a member, we are required to own capital stock in the Federal Home Loan Bank and are authorized to apply for advances on the security of such stock and certain of our mortgage loans and other assets (principally securities which are obligations of, or guaranteed by, the United States), provided certain standards related to creditworthiness have been met. Advances are made under several different programs, each having its own interest rate and range of maturities. Depending on the program, limitations on the amount of advances are based either on a fixed percentage of an institution’s net worth or on the Federal Home Loan Bank’s assessment of the institution’s creditworthiness.

Properties

We conduct our business through our main office and branch offices. The following table sets forth certain information relating to these facilities as of March 31, 2008.


Location	Year Opened	Owned/ Leased	Net Book Value at March 31, 2008
			(Dollars in thousands)
Main Office:
Clarksville Main Office 501 East Lewis & Clark Parkway Clarksville, Indiana	1968	Owned	$632
Branch Offices:
Jeffersonville - Allison Lane Office 2213 Allison Lane Jeffersonville, Indiana	1975	Owned	762
Charlestown Office 1100 Market Street Charlestown, Indiana	1993	Owned	236
Floyd Knobs Office 3711 Paoli Pike Floyd Knobs, Indiana	1999	Owned	476
Georgetown Office 1000 Copperfield Drive Georgetown, Indiana	2003	Owned	585
Jeffersonville - Court Avenue Office 202 East Court Avenue Jeffersonville, Indiana	1986	Owned	461
Sellersburg Office 125 Hunter Station Way Sellersburg, Indiana	1995	Owned	447

Personnel

As of March 31, 2008, we had 67 full-time employees and 17 part-time employees, none of whom is represented by a collective bargaining unit. We believe our relationship with our employees is good.

Legal Proceedings

Periodically, there have been various claims and lawsuits against us, such as claims to enforce liens, condemnation proceedings on properties in which we hold security interests, claims involving the making and servicing of real property loans and other issues incident to our business. We are not a party to any pending legal proceedings that we believe would have a material adverse effect on our financial condition, results of operations or cash flows.

Subsidiaries

We have two subsidiaries, Southern Indiana Financial Corporation and FFCC, Inc, both of which are organized as Indiana corporations. Southern Indiana Financial Corporation is an independent insurance agency, offering various types of annuities and life insurance policies. FFCC, Inc. was organized for the purposes of purchasing, holding and disposing of real estate owned.

We have plans to form one or more additional wholly-owned subsidiaries to hold investment securities in order to take advantage of certain favorable income tax treatment afforded under Indiana law.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

The objective of this section is to help potential investors understand our views on our results of operations and financial condition. You should read this discussion in conjunction with the consolidated financial statements and the notes to consolidated financial statements that appear at the end of this prospectus.

Overview

Income. Our primary source of pre-tax income is net interest income. Net interest income is the difference between interest income, which is the income that we earn on our loans and investments, and interest expense, which is the interest that we pay on our deposits and borrowings. Other significant sources of pre-tax income are service charges (mostly from service charges on deposit accounts and loan servicing fees), fees from sale of mortgage loans originated for sale in the secondary market, and commissions on sales of securities and insurance products. We also recognize income from the sale of securities.

Allowance for Loan Losses. The allowance for loan losses is a valuation allowance for probable losses inherent in the loan portfolio. We evaluate the need to establish allowances against losses on loans on a quarterly basis. When additional allowances are necessary, a provision for loan losses is charged to earnings.

Expenses. The noninterest expenses we incur in operating our business consist of salaries and employee benefits expenses, occupancy expenses, federal deposit insurance premiums, data processing expenses and other miscellaneous expenses. Following the offering, our noninterest expenses are likely to increase as a result of operating as a public company. These additional expenses will consist primarily of legal and accounting fees, expenses of shareholder communications and meetings, stock exchange listing fees, and expenses related to the addition of personnel in our accounting department.

Salaries and employee benefits consist primarily of: salaries and wages paid to our employees; payroll taxes; and expenses for health insurance, retirement plans and other employee benefits. Following the offering, we will recognize additional annual employee compensation expenses stemming from the adoption of new equity benefit plans. We cannot determine the actual amount of these new stock-related compensation and benefit expenses at this time because applicable accounting practices require that they be based on the fair market value of the shares of common stock at specific points in the future. For an illustration of these expenses, see “Pro Forma Data.”

Occupancy expenses, which are the fixed and variable costs of buildings and equipment, consist primarily of depreciation charges, furniture and equipment expenses, maintenance, real estate taxes and costs of utilities. Depreciation of premises and equipment is computed using the straight-line method based on the useful lives of the related assets, which range from three to 40 years.

Data processing expenses are the fees we pay to third parties for processing customer information, deposits and loans.

Federal deposit insurance premiums are payments we make to the Federal Deposit Insurance Corporation for insurance of our deposit accounts.

Our contribution to the charitable foundation will be an additional operating expense that will reduce net income during the quarter in which the contribution to the foundation is made and, as a result, we expect to record a loss in the fourth quarter of 2008. The contribution to the foundation will result in a $725,000 after-tax expense. Had such an expense been incurred in 2007, we would have had net income of approximately $89,000 for the year ended September 30, 2007. Any loss resulting from the contribution to the foundation will not be a recurring loss. See “Pro Forma Data” for a detailed analysis of the cost of the contribution to the foundation.

Other expenses include expenses for professional services, advertising, office supplies, postage, telephone, insurance, regulatory assessments and other miscellaneous operating expenses.

Critical Accounting Policies

We consider accounting policies involving significant judgments and assumptions by management that have, or could have, a material impact on the carrying value of certain assets or on income to be critical accounting policies. We consider the allowance for loan losses to be our only critical accounting policy.

Allowance for Loan Losses. The allowance for loan losses is the amount estimated by management as necessary to cover losses inherent in the loan portfolio at the balance sheet date. The allowance is established through the provision for loan losses, which is charged to income. Determining the amount of the allowance for loan losses necessarily involves a high degree of judgment. Among the material estimates required to establish the allowance are: loss exposure at default; the amount and timing of future cash flows on impacted loans; value of collateral; and determination of loss factors to be applied to the various elements of the portfolio. All of these estimates are susceptible to significant change. Management reviews the level of the allowance at least quarterly and establishes the provision for loan losses based upon an evaluation of the portfolio, past loss experience, current economic conditions and other factors related to the collectibility of the loan portfolio. Although we believe that we use the best information available to establish the allowance for loan losses, future adjustments to the allowance may be necessary if economic or other conditions differ substantially from the assumptions used in making the evaluation. In addition, the Office of Thrift Supervision, as an integral part of its examination process, periodically reviews our allowance for loan losses and may require us to recognize adjustments to the allowance based on its judgments about information available to it at the time of its examination. A large loss could deplete the allowance and require increased provisions to replenish the allowance, which would adversely affect earnings. See Note 2 of the notes to consolidated financial statements included in this prospectus.

Operating Strategy

Our mission is to operate and grow a profitable community-oriented financial institution. We plan to achieve this by executing our strategy of:

•

continuing our historical focus on residential mortgage lending but de-emphasizing residential mortgage lending secured by non-owner occupied properties;

•

pursuing opportunities to increase commercial real estate lending and commercial business lending;

•

providing exceptional customer service to attract and retain customers; and

•

Continuing our historical focus on residential mortgage lending but de-emphasizing residential mortgage lending secured by non-owner occupied properties.

Our predominant lending activity has been residential mortgage lending in our primary market area. Before 2005, a significant portion of the residential mortgage loans that we had originated are secured by non-owner occupied properties. Loans secured by non-owner occupied properties generally carry a greater risk of loss than loans secured by owner-occupied properties, and our non-performing loan balances have increased in recent periods primarily because of delinquencies in our non-owner occupied residential loan portfolio. Since 2005, when we hired a new President and Chief Executive Officer, we have de-emphasized non-owner occupied residential mortgage lending and have focused, and intend to continue to focus, our residential mortgage lending primarily on originating residential mortgage loans secured by owner-occupied properties. At March 31, 2008, 63.0% of our total loans were residential mortgage loans and 28% of our residential mortgage loans were secured by non-owner occupied properties. We intend to expand our emphasis on residential mortgage lending because this type of lending generally carries lower credit risk and has contributed to our historically favorable asset quality.

Pursuing opportunities to increase commercial real estate lending and commercial business lending.

In recent periods, we have begun to focus on commercial real estate and commercial business lending and intend to continue this focus after the completion of the proposed conversion. Commercial real estate loans and commercial business loans give us the opportunity to earn more income because these loans have higher interest rates than residential mortgage loans in order to compensate for the increased credit risk. At March 31, 2008, commercial real estate loans and commercial business loans represented 8.8% and 6.0%, respectively, of our total loans, compared to 7.0% and 3.1%, respectively, at September 30, 2003. We intend to continue pursue these lending opportunities in our primary market area.

Providing exceptional customer service to attract and retain customers.

As a community-oriented financial institution, we emphasize providing exceptional customer service as a means to attract and retain customers. We deliver personalized service and respond with flexibility to customer needs. We believe that our community orientation is attractive to our customers and distinguishes us from the larger banks that operate in our area.

Expanding our market share and market area.

We intend to pursue opportunities to expand our market share and market area by seeking to open additional branch offices and pursuing opportunities to acquire other financial institutions in our primary market area and surrounding areas. We plan to open a new leased branch office in 2009 in our primary market area. We are in the initial stages of investigating potential suitable locations, but have no definitive plans or commitments with respect to a particular location.

Balance Sheet Analysis

Cash and Cash Equivalents. At March 31, 2008, September 30, 2007 and September 30, 2006, cash and cash equivalents totaled $9.2 million, $10.4 million and $15.2 million, respectively. We have focused on investing excess liquidity in higher yielding loans and investment securities in an effort to offset the negative impact that the increase in the cost of deposits have had on net interest income.

Loans. Our primary lending activity is the origination of loans secured by real estate. We originate one-to four-family mortgage loans, multifamily loans, commercial real estate loans and construction loans. To a lesser extent, we originate commercial business loans and various consumer loans including home equity lines of credit and credit cards.

Residential mortgage loans comprise the largest segment of our loan portfolio. At March 31, 2008, these loans totaled $109.9 million, or 63.0% of total loans. At September 30, 2007, these loans totaled $100.2 million, or 58.0% of total loans, compared to $96.1 million, or 56.3% of total loans, at September 30, 2006. Total residential mortgage loan balances increased in 2007 and 2008 due to our ability to originate in-house adjustable rate mortgages. We generally originate loans for investment purposes, although, depending on the interest rate environment loans, we typically sell 25-year and 30-year fixed-rate residential mortgage loans that we originate into the secondary market in order to limit exposure to interest rate risk and maximize noninterest fee income. Management intends to continue offering adjustable rate mortgage loans and sell long-term fixed rate mortgage loans in the secondary market with servicing released.

Commercial real estate loans totaled $15.3 million, or 8.8% of total loans at March 31, 2008. At September 30, 2007, these loans totaled $18.4 million, or 10.6% of total loans, compared to $19.1 million, or 11.2% of total loans, at September 30, 2006. The total balance of commercial real estate loans has fluctuated slightly over the past three years due to increased competition in the marketplace for these loans and changes in our commercial lending personnel. Management has sought to increase the number of commercial lending personnel in order to further pursue nonresidential loan opportunities to further diversify the loan portfolio.

Multi-family real estate loans totaled $5.2 million, or 3.0% of total loans at March 31, 2008. At September 30, 2007, these loans totaled $5.4 million, or 3.1% of total loans, compared to $6.9 million, or 4.0% of total loans, at September 30, 2006. The total balance of multi-family real estate loans has decreased slightly over the past three years due to pay-downs, payoffs and limited opportunities to originate this type of loan in our primary market area.

Our construction loan portfolio consists primarily of residential and commercial construction loans, including speculative residential construction loans. Construction loans totaled $12.2 million, or 7.0% of total loans, at March 31, 2008, of which $7.0 million were speculative construction loans. At September 30, 2007, these loans totaled $14.8 million, or 8.6% of total loans, compared to $20.6 million, or 12.1% of total loans, at September 30, 2006. Construction loan balances decreased over the past three years due to increased competition in the marketplace for these loans and the general slowdown in the housing market in the target market area.

Land and land development loans totaled $4.6 million, or 2.7% of total loans at March 31, 2008. At September 30, 2007, these loans totaled $5.0 million, or 2.9% of total loans, compared to $2.5 million, or 1.5% of total loans, at September 30, 2006. These loans are primarily secured by vacant land to be improved for residential and nonresidential development.

Commercial business loans totaled $10.4 million, or 6.0% of total loans at March 31, 2008. At September 30, 2007, these loans totaled $12.6 million, or 7.3% of total loans, compared to $10.2 million, or 6.0% of total loans, at September 30, 2006. Commercial business loan balances decreased during the six-month period ended March 31, 2008 due primarily to the payoff of a $2.0 million commercial line of credit, but we do intend to continue to emphasize these types of loans going forward.

Consumer loans totaled $16.7 million, or 9.6% of total loans at March 31, 2008. At September 30, 2007, these loans totaled $16.4 million, or 9.5% of total loans, compared to $15.2 million, or 8.9% of total loans, at September 30, 2006. The total balance of consumer loans has increased over the past three years due to management’s emphasis on the generation of home equity lines of credit which have increased $845,000, $2.3 million and $844,000 during the six months ended March 31, 2008 and the years ended September 30, 2006 and 2007, respectively. Other consumer loans including unsecured loans and boat loans have declined over the past three years due to pay-downs, payoffs, charge-offs, repossessions of collateral and management’s focus on other lending opportunities.

The following table sets forth the composition of our loan portfolio at the dates indicated.


	At March 31, 2008					At September 30,
	At March 31, 2008					2007					2006					2005					2004					2003
(Dollars in thousands)	Amount			Percent		Amount			Percent		Amount			Percent		Amount			Percent		Amount			Percent		Amount			Percent
Real estate mortgage:
Residential	$	109,922		63.04	%	$	100,202		57.96	%	$	96,067		56.32	%	$	100,255		58.75	%	$	103,401		60.96	%	$	96,047		59.07	%
Commercial		15,286		8.77			18,364		10.62			19,090		11.19			11,738		6.88			11,372		6.70			11,348		6.98
Multi-family		5,227		3.00			5,369		3.11			6,877		4.03			6,534		3.83			7,135		4.21			7,830		4.82
Residential construction		8,902		5.11			11,583		6.70			20,562		12.06			22,111		12.96			18,152		10.70			22,433		13.80
Commercial construction		3,265		1.87			3,265		1.89			29		0.02			2,800		1.64			2,038		1.20			672		0.41
Land and land development		4,644		2.66			5,022		2.91			2,524		1.48			2,917		1.71			1,648		0.97			1,302		0.80

Total		147,246		84.45			143,805		83.19			145,149		85.10			146,355		85.77			143,746		84.74			139,632		85.88

Commercial business		10,412		5.97			12,645		7.31			10,232		6.00			8,462		4.96			8,809		5.19			5,028		3.09
Consumer:
Home equity loans and lines of credit		10,526		6.04			9,681		5.60			7,408		4.34			6,564		3.85			6,020		3.55			5,187		3.19
Auto loans		2,013		1.15			1,946		1.13			1,675		0.98			1,934		1.13			1,959		1.15			2,477		1.52
Boat loans		3,488		2.00			3,975		2.30			5,158		3.02			6,237		3.66			7,509		4.43			8,989		5.53
Other		693		0.39			820		0.47			940		0.56			1,084		0.63			1,583		0.94			1,291		0.79

Total		16,720		9.58			16,422		9.50			15,181		8.90			15,819		9.27			17,071		10.07			17,944		11.03

Total loans		174,378		100.00	%		172,872		100.00	%		170,562		100.00	%		170,636		100.00	%		169,626		100.00	%		162,604		100.00	%

Reserve for uncollected interest		—					—					1					—					1					1
Deferred loan origination fees and costs, net		(740	)				(618	)				(335	)				(204	)				(95	)				(12	)
Undisbursed portion of loans in process		1,602					4,822					3,333					6,282					5,610					6,290
Allowance for loan losses		2,498					1,297					868					882					805					681

Loans, net	$	171,018				$	167,371				$	166,695				$	163,676				$	163,305				$	155,644

Loan Maturity

The following table sets forth certain information at March 31, 2008 and September 30, 2007 regarding the dollar amount of loan principal repayments becoming due during the periods indicated. The table does not include any estimate of prepayments which significantly shorten the average life of all loans and may cause our actual repayment experience to differ from that shown below. Demand loans having no stated schedule of repayments and no stated maturity, are reported as due in one year or less.


	At March 31, 2008
(Dollars in thousands)	Residential Real Estate (1)		Commercial Real Estate (2)		Construction		Commercial Business		Consumer		Total Loans
Amounts due in:
One year or less	$	5,935	$	2,091	$	12,167	$	7,759	$	1,615	$	29,567
More than one year to two years		5,299		2,351		—		851		1,121		9,622
More than two years to three years		4,874		2,248		—		589		1,050		8,761
More than three years to five years		8,073		3,055		—		558		4,859		16,545
More than five years to ten years		20,948		3,971		—		181		2,732		27,832
More than ten years to fifteen years		20,887		3,323		—		213		5,343		29,766
More than fifteen years		49,133		2,891		—		261		–		52,285

Total	$	115,149	$	19,930	$	12,167	$	10,412	$	16,720	$	174,378

(1)	Includes multi-family loans.

(2)	Includes land and land development loans.


	At September 30, 2007
(Dollars in thousands)	Residential Real Estate (1)		Commercial Real Estate (2)		Construction		Commercial Business		Consumer		Total Loans
Amounts due in:
One year or less	$	4,242	$	3,047	$	14,848	$	9,527	$	1,740	$	33,404
More than one year to two years		3,902		2,459		—		1,160		1,087		8,608
More than two years to three years		3,835		2,083		—		599		1,010		7,527
More than three years to five years		7,463		3,158		—		673		4,711		16,005
More than five years to ten years		19,675		4,561		—		193		2,838		27,267
More than ten years to fifteen years		18,923		3,739		—		213		5,036		27,911
More than fifteen years		47,531		4,339		—		280		–		52,150

Total	$	105,571	$	23,386	$	14,848	$	12,645	$	16,422	$	172,872

(1)	Includes multi-family loans.

(2)	Includes land and land development loans.

Fixed vs. Adjustable Rate Loans

The following table sets forth the dollar amount of all loans at March 31, 2008 that are due after March 31, 2009, and have either fixed interest rates or adjustable interest rates. The amounts shown below exclude unearned loan origination fees.


(In thousands)	Fixed Rates		Adjustable Rates		Total
Residential real estate (1)	$	54,363	$	54,851	$	109,214
Commercial real estate (2)		9,568		8,271		17,839
Construction		—		—		—
Commercial business		1,654		999		2,653
Consumer		9,390		5,715		15,105

Total	$	74,975	$	69,836	$	144,811

(1)	Includes multi-family loans.

(2)	Includes land and land development loans.

The following table sets forth the dollar amount of all loans at September 30, 2007 that are due after September 30, 2008, and have either fixed interest rates or adjustable interest rates. The amounts shown below exclude unearned loan origination fees.


(In thousands)	Fixed Rates		Adjustable Rates		Total
Residential real estate (1)	$	48,107	$	53,222	$	101,329
Commercial real estate (2)		9,593		10,746		20,339
Construction		—		—		—
Commercial business		2,015		1,103		3,118
Consumer		9,291		5,391		14,682

Total	$	69,006	$	70,462	$	139,468

(1)	Includes multi-family loans.

(2)	Includes land and land development loans.

Loan Activity

The following table shows loans originated, purchased and sold during the periods indicated.


	Six Months Ended March 31,						Year Ended September 30,
(In thousands)	2008			2007			2007			2006			2005
Total loans at beginning of period	$	172,872		$	170,562		$	170,562		$	170,636		$	169,626
Loans originated:
Residential real estate (1)		24,353			9,280			25,203			24,954			29,761
Commercial real estate (2)		2,916			2,517			7,956			9,528			6,299
Construction		5,315			11,065			23,597			28,884			32,930
Commercial business		2,703			6,465			12,798			10,704			9,072
Consumer		8,451			6,460			13,916			11,345			13,673

Total loans originated		43,738			35,787			83,470			85,415			91,735

Loans purchased		—			—			—			—			—
Deduct:
Loan principal repayments		(41,103	)		(38,682	)		(80,707	)		(84,667	)		(86,490	)
Loan sales		(1,129	)		—			(453	)		(822	)		(4,235	)

Net loan activity		1,506			(2,895	)		2,310			(74	)		1,010

Total loans at end of period	$	174,378		$	167,667		$	172,872		$	170,562		$	170,636

(1)	Includes multi-family loans.

(2)	Includes land and land development loans.

Securities Available for Sale. Our available for sale securities portfolio consists primarily of U.S. government agency debt securities, including mortgage-backed securities and collateralized mortgage obligations, with relatively smaller investments in municipal bonds. Available for sale securities increased by $2.2 million, or 26.2%, in the six-month period ended March 31, 2008 due primarily to purchases of $4.0 million, offset by maturities of $2.0 million. The increase in available for sale securities during the six-month period ended March 31, 2008 was primarily funded by increases in deposits, management’s intentional reduction of interest-earning deposits with banks and Federal Home Loan Bank advances. In the year ended September 30, 2007, available for sale securities increased by $2.4 million and available for sale securities decreased by $1.1 million in the year ended September 30, 2006. The increase during 2007 was primarily due to net purchases of $2.0 million in money market preferred stock. The decrease in available for sale securities during 2006 was due primarily to the maturity of U.S. government agency debt securities which exceeded purchases for the year.

Securities Held to Maturity. Our held to maturity securities portfolio consists primarily of U.S. government agency notes and mortgage-backed securities, as well as municipal bonds. Held to maturity securities increased by $1.7 million, or 22.6%, in the six-month period ended March 31, 2008 due primarily to purchases of mortgage-backed securities totaling $6.0 million, offset by maturities of $4.0 million and principal paydowns of $359,000. Held to maturity securities decreased $797,000 and $3.4 million for the years ended September 30, 2007 and 2006, respectively. The decrease during 2007 was due to principal repayments on mortgage-backed securities and the decrease in 2006 was due to maturities of $2.5 million and principal repayments of $860,000.

The following table sets forth the amortized costs and fair values of our investment securities at the dates indicated.


	At March 31, 2008				At September 30,
	At March 31, 2008				2007				2006				2005
(In thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Securities available for sale:
U.S. government agency	$	7,026	$	7,158	$	5,000	$	5,006	$	5,000	$	4,969	$	6,965	$	6,940
Municipal		1,119		1,148		1,119		1,115		807		815		—		—
Money market preferred stock		—		—		2,000		2,000		—		—		—		—
Mortgage-backed securities		1,998		1,998		—		—		—		—		—		—
Other equity securities		—		120		—		139		—		113		—		99

Total	$	10,143	$	10,424	$	8,119	$	8,260	$	5,807	$	5,897	$	6,965	$	7,039

Securities held to maturity:
U.S. government agency		—		—		4,000		4,000		4,000		3,980		6,513		6,508
Municipal		308		314		309		304		310		309		312		311
Mortgage-backed securities		8,792		8,877		3,113		3,091		3,909		3,846		4,777		4,790

Total	$	9,100	$	9,191	$	7,422	$	7,395	$	8,219	$	8,135	$	11,602	$	11,609

The following table sets forth the activity in our investment securities portfolio during the periods indicated.


	At or For the Six Months Ended March 31,						At or For the Year Ended September 30,
(In thousands)	2008			2007			2007			2006			2005
Mortgage-backed securities:
Mortgage-backed securities, beginning of period (1)	$	3,091		$	3,846		$	3,846		$	4,790		$	2,141

Purchases		8,038			—			—			—			3,450
Sales		—			—			—			—			—
Maturities		—			—			—			—			—
Repayments and prepayments		(362	)		(384	)		(795	)		(869	)		(789	)
Increase (decrease) in net unrealized gain		108			40			40			(75	)		(12	)
Net decrease in mortgage-backed securities		7,784			(344	)		(755	)		(944	)		2,649

Mortgage-backed securities, end of period (1)	$	10,875		$	3,502		$	3,091		$	3,846		$	4,790

Investment securities:
Investment securities, beginning of period (1)	$	12,564		$	10,186		$	10,186		$	13,858		$	20,062

Purchases		2,029			312			5,311			807			20,895
Sales		—			—			—			—			—
Maturities		(6,000	)		—			(3,000	)		(4,435	)		(26,950	)
Repayments and prepayments		(3	)		—			(1	)		(44	)		(211	)
Increase (decrease) in net unrealized gain		150			44			68			—			62
Net decrease in investment securities		(3,824	)		356			2,378			(3,672	)		(6,204	)

Investment securities, end of period (1)	$	8,740		$	10,542		$	12,564		$	10,186		$	13,858

(1)	At fair value.

The following tables set forth the stated maturities and weighted average yields of debt securities at March 31, 2008 and September 30, 2007. Weighted average yields on tax-exempt securities are presented on a tax equivalent basis using a federal marginal tax rate of 34%. Certain mortgage-backed securities have adjustable interest rates and will reprice annually within the various maturity ranges. These repricing schedules are not reflected in the table below. Weighted average yield calculations on investments available for sale do not give effect to changes in fair value that are reflected as a component of equity.


	One Year or Less				More than One Year to Five Years				More than Five Years to Ten Years				More than Ten Years				Total
(Dollars in thousands)	Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield
March 31, 2008
Securities available for sale:
U.S. government agency	$	3,004	4.60	%	$	2,102	4.75	%	$	2,052	3.76	%	$	—	—	%	$	7,158	4.40	%
Municipal		—	—			—	—			465	5.83			683	6.20			1,148	6.05
Mortgage-backed securities		—	—			—	—			—	—			1,998	5.02			1,998	5.02

Total	$	3,004	4.60	%	$	2,102	4.75	%	$	2,517	4.14	%	$	2,681	5.32	%	$	10,304	4.70	%

Securities held to maturity:
Municipal	$	—	—	%	$	—	—	%	$	308	5.83	%	$	—	—	%	$	308	5.83	%
Mortgage-backed securities		1	8.00			1,664	4.60			464	4.80			6,663	5.40			8,792	5.22

Total	$	1	8.00	%	$	1,664	4.60	%	$	772	5.21	%	$	6,663	5.40	%	$	9,100	5.24	%


	One Year or Less				More than One Year to Five Years				More than Five Years to Ten Years				More than Ten Years				Total
(Dollars in thousands)	Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield		Carrying Value		Weighted Average Yield
September 30, 2007
Securities available for sale:
U.S.government agency	$	2,997	4.60	%	$	2,009	4.75	%	$	—	—	%	$	—	—	%	$	5,006	4.66	%
Municipal		—	—			—	—			308	5.57			807	6.23			1,115	6.05

Total	$	2,997	4.60	%	$	2,009	4.75	%	$	308	5.57	%	$	807	6.23	%	$	6,121	4.91	%

Securities held to maturity:
U.S. government agency	$	1,998	4.50	%	$	—	—	%	$	2,002	6.00	%	$	—	—	%	$	4,000	5.25	%
Municipal		—	—			—	—			—	—			309	5.83			309	5.83
Mortgage-backed securities		4	8.00			1,881	4.59			518	4.80			710	5.86			3,113	4.92

Total	$	2,002	4.51	%	$	1,881	4.59	%	$	2,520	4.77	%	$	1,019	5.85	%	$	7,422	5.14	%

Deposits. Deposit accounts, generally obtained from individuals and businesses throughout our primary market area, are our primary source of funds for lending and investments. Our deposit accounts are comprised of noninterest-bearing accounts, interest-bearing savings, checking and money market accounts and certificates of deposits. Deposits increased $5.3 million, or 3.1%, during the six-month period ended March 31, 2008, primarily due to increases in certificates of deposit primarily as a result of competitive pricing on 7-month, 12-month and 18-month certificates of deposit. During the year ended September 30, 2007, our deposits decreased by $7.1 million, or 4.0%, primarily as the result of decreases in passbook savings and money market accounts primarily due to the transfer of $4.1 million of our pension plan assets to a third party. Deposits increased $440,000, or 0.3%, for the year ended September 30, 2006.

The following table sets forth the balances of our deposit accounts at the dates indicated.


	At March 31,		At September 30,
(In thousands)	2008		2007		2006		2005
Non-interest-bearing demand deposits	$	4,291	$	5,011	$	4,393	$	4,801
NOW accounts		21,497		19,340		19,488		20,731
Money market accounts		6,521		6,617		8,363		11,332
Passbook accounts		17,521		18,499		23,631		25,659
Certificates of deposit		124,255		119,315		120,016		112,928

Total	$	174,085	$	168,782	$	175,891	$	175,451

The following table indicates the amount of jumbo certificates of deposit by time remaining until maturity as of March 31, 2008 and September 30, 2007, none of which are brokered deposits. Jumbo certificates of deposit require minimum deposits of $100,000.


Maturity Period	Amount
	(In thousands)
At March 31, 2008:
Three months or less	$	2,438
Over three through six months		5,110
Over six through twelve months		13,287
Over twelve months		11,065

Total	$	31,900

At September 30, 2007:
Three months or less	$	4,282
Over three through six months		8,754
Over six through twelve months		4,838
Over twelve months		11,271

Total	$	29,145

The following table sets forth time deposits classified by rates at the dates indicated.


	At March 31,		At September 30,
(In thousands)	2008		2007		2006		2005
1.01 - 2.00%	$	—	$	—	$	170	$	4,685
2.01 - 3.00%		9,883		332		15,552		50,844
3.01 - 4.00%		25,944		25,288		24,224		32,747
4.01 - 5.00%		69,418		73,674		62,197		11,131
5.01 - 6.00%		6,792		7,784		5,618		947
6.01 - 7.00%		1,135		1,429		2,051		2,451
7.01 - 8.00%		5,019		5,116		5,142		10,123	(2)
8.01 - 9.00% (1)		6,064		5,692		5,062		—

Total	$	124,255	$	119,315	$	120,016	$	112,928

(1)	Represents the investment of our pension plan assets in certificates of deposit.

(2)	Amount includes a $4.5 investment of our pension plan assets in certificates of deposit.

The following table sets forth the amount and maturities of time deposits at March 31, 2008.


	Amount Due
(Dollars in thousands)	Less Than One Year		More Than One Year to Two Years		More Than Two Years to Three Years		More Than Three Years		Total		Percent of Total Time Deposit Accounts
1.01 - 2.00%	$	—	$	—	$	—	$	—	$	—	—	%
2.01 - 3.00%		7,384		2,083		188		228		9,883	7.95
3.01 - 4.00%		17,357		5,585		1,434		1,568		25,944	20.88
4.01 - 5.00%		50,543		7,569		7,522		3,784		69,418	55.87
5.01 - 6.00%		2,285		481		121		3,905		6,792	5.47
6.01 - 7.00%		—		314		821		—		1,135	0.91
7.01 - 8.00%		262		40		4,717		—		5,019	4.04
8.01 - 9.00% (1)		6,064		—		—		—		6,064	4.88

Total	$	83,895	$	16,072	$	14,803	$	9,485	$	124,255	100.00	%

(1)	Represents the investment of our pension plan assets in certificates of deposit.

The following table sets forth the amount and maturities of time deposits at September 30, 2007.


	Amount Due
(Dollars in thousands)	Less Than One Year		More Than One Year to Two Years		More Than Two Years to Three Years		More Than Three Years		Total		Percent of Total Time Deposit Accounts
1.01 - 2.00%	$	—	$	—	$	—	$	—	$	—	—	%
2.01 - 3.00%		324		5		—		3		332	0.28
3.01 - 4.00%		12,244		8,984		2,803		1,257		25,288	21.19
4.01 - 5.00%		53,124		7,441		5,605		7,504		73,674	61.75
5.01 - 6.00%		3,110		334		342		3,998		7,784	6.52
6.01 - 7.00%		256		—		613		560		1,429	1.20
7.01 - 8.00%		257		138		3,510		1,211		5,116	4.29
8.01 - 9.00% (1)		5,692		—		—		—		5,692	4.77

Total	$	75,007	$	16,902	$	12,873	$	14,533	$	119,315	100.00	%

(1)	Represents the investment of our pension plan assets in certificates of deposit.

The following table sets forth deposit activity for the periods indicated.


	Six Months Ended March 31,				Year Ended September 30,
(In thousands)	2008		2007		2007			2006			2005
Beginning balance	$	168,782	$	175,891	$	175,891		$	175,451		$	187,516

Increase (decrease) before interest credited		3,966		10		(8,470	)		(817	)		(13,033	)
Interest credited		1,337		1,381		1,361			1,257			968

Net increase (decrease) in deposits		5,303		1,391		(7,109	)		440			(12,065	)

Ending balance	$	174,085	$	177,282	$	168,782		$	175,891		$	175,451

Borrowings. We use borrowings from the Federal Home Loan Bank of Indianapolis to supplement our supply of funds for loans and investments.


	Six Months Ended March 31,						Year Ended September 30,
(In thousands)	2008			2007			2007			2006			2005
Maximum amount of FHLB advances outstanding at any month-end during period	$	8,000		$	—		$	3,000		$	—		$	—
Average FHLB advances outstanding during period		4,817			—			153			1,371			—
Weighted average interest rate during period		3.90	%		—	%		5.23	%		4.81	%		—	%
Balance outstanding at end of period	$	8,000		$	—		$	3,000		$	—		$	—
Weighted average interest rate at end of period		3.36	%		—	%		4.88	%		—	%		—	%

During the quarter ended March 31, 2008, we borrowed an $8.0 million five-year, fixed rate advance from the Federal Home Loan Bank of Indianapolis at 3.36% when rates on borrowed funds declined sharply in January 2008. The proceeds from the fixed rate advance, maturing in January 2013, were used to pay off outstanding short-term variable rate advances and fund current and anticipated loan demand, with the residual deployed in available for sale securities. We had additional borrowing capacity with the Federal Home Loan Bank of Indianapolis of $52.0 million at March 31, 2008.

Results of Operations for the Six Months Ended March 31, 2008 and 2007

Overview. We had a net loss of $348,000 for the six-month period ended March 31, 2008, compared to net income of $326,000 for the six-month period ended March 31, 2007. The primary factor that contributed to the net loss for 2008 was a $783,000 increase in the provision for loan losses. Other factors contributing to the net loss for the six months ended March 31, 2008 include a decrease in net interest income of $265,000 and an increase in noninterest expense of $199,000, offset by an increase in noninterest income of $112,000 and a decrease in tax expense of $461,000.

Net Interest Income. Net interest income decreased $265,000, or 7.6%, from $3.5 million for the six months ended March 31, 2007 to $3.2 million for the six months ended March 31, 2008 primarily as the result of a decrease in the interest rate spread from 3.15% in 2007 to 2.94% in 2008.

Total interest income decreased $260,000, or 4.0%, from $6.6 million for 2007 to $6.3 million for 2008 as a result of decreased average balances of interest-earning assets and declining yields. The average balance of total interest-earning assets decreased $2.3 million, or 1.2%, from $194.4 million in 2007 to $192.1 million in 2008. The average tax-equivalent yield on total interest-earning assets decreased from 6.76% in 2007 to 6.59% in 2008. The average yield on interest-earning assets decreased primarily as a result of the downward repricing of adjustable rate loans due to lower market interest rates.

Interest income on loans decreased $12,000, or 0.2%, from $5.9 million for 2007 to $5.8 million for 2008 due to a decrease in the average tax-equivalent yield from 7.05% in 2007 to 6.86% in 2008 as a result of lower market interest rates. Average loans outstanding increased $4.7 million, or 2.8%, from $166.2 million in 2007 to $170.9 million in 2008. During 2008, management continued to emphasize commercial real estate lending in order to increase the balance of the loan portfolio with higher-yielding assets.

Interest income on investment securities decreased $36,000, or 10.7%, as a result of a decrease in the average outstanding balance of investment securities and a slight decrease in the average tax-equivalent yield from 4.97% in 2007 to 4.93% in 2008. Interest income on interest-bearing deposits with banks decreased $210,000, or 63.1%, as a result of a $5.6 million decrease in the average balance of these assets for 2008 compared to 2007 and a decrease in the average yield from 5.21% in 2007 to 3.42% in 2008 due to a decline in market interest rates. During 2008, management focused on reducing excess liquidity in interest-bearing deposits with banks by investing these funds in higher yielding loans and investment securities in an effort to offset the adverse impact that the increase in the cost of interest-bearing liabilities had on net interest income.

Total interest expense increased $5,000, or 0.2%, as a result of an increase in the average cost of funds from 3.61% in 2007 to 3.65% in 2008. The average balance of interest-bearing deposits was $164.7 million in 2008 compared to $171.0 million in 2007 and the average cost of funds for deposits was 3.64% in 2008 compared to 3.61% in 2007. The average balance of Federal Home Loan Bank advances was $4.8 million in 2008 compared to no advances outstanding during the six-month period ended March 31, 2007. The average cost of funds for the 2008 advances was 3.90%. The average cost of interest-bearing liabilities increased for 2008 primarily as a result of the increase in Federal Home Loan Bank advances in 2008 and an increase in interest expense on time deposits in 2008. Interest expense on time deposits was greater in 2008 as compared to 2007 primarily because we received fewer fees for early withdrawal penalties on time deposits in 2008.

Provision for Loan Losses. The provision for loan losses was $1.2 million for the six months ended March 31, 2008 compared to $420,000 for the same period in 2007. The primary factor that contributed to the significant provision for loan losses for 2008 was the diminished repayment ability of a large borrower and a deterioration of the value of the collateral securing the loans due to sub-standard maintenance and disrepair, which is 35 single family non-owner occupied rental properties originated before 2005. The provision made for this particular borrower in the quarter ended March 31, 2008 amounted to $881,000. It is management’s assessment that the allowance for loan losses at March 31, 2008 was adequate at that date.

During 2008, net charge-offs were $2,000 compared to $114,000 for 2007 and the net loan portfolio growth was $3.6 million for 2008 compared to a net decrease of $2.3 million for 2007. The loan portfolio growth for 2008 was primarily in the owner-occupied residential mortgage portfolio, which generally has a lower level of inherent credit risk than the commercial real estate, commercial business and consumer loan portfolios. The consistent application of management’s allowance for loan losses methodology resulted in an increase in the level of the allowance for loan losses consistent with the increase in nonperforming loans. See “Analysis of Nonperforming and Classified Assets.”

Noninterest Income. Noninterest income increased $112,000, or 28.9%, to $499,000 for the six-month period ended March 31, 2008 compared to $387,000 for the same period in 2007. The principal source of noninterest income was deposit account service charges. Deposit account service charges increased $5,000 from $246,000 for 2007 to $251,000 for 2008. Net gain on sales of mortgage loans was $15,000 for 2008 whereas no

gains on sales of mortgage loans were recognized during 2007. Other noninterest income increased $92,000 for 2008 compared to 2007 primarily as a result of the investment in bank owned life insurance (BOLI) during 2008 which generated income of $49,000, a one time gain on redemption of Visa, Inc. stock of $31,000 and an increase in ATM transaction fees of $10,000 due to higher usage.

Noninterest Expense. Total noninterest expense increased $199,000, or 6.8%, to $3.1 million for 2008 compared to $2.9 million for the same period in 2007. The primary factors contributing to the increase in noninterest expense were increases in professional fees of $43,000, net loss on foreclosed real estate of $52,000, and other operating expenses of $112,000. Decreases in compensation and benefits and advertising expenses were offset by increases in data processing and occupancy and equipment expenses. Professional fees increased as a result of increases in audit fees, employee benefit plan service fees, and legal fees related to the increase in problem loans and nonperforming assets. Net loss on foreclosed real estate increased primarily due to net provisions for loss on sale of foreclosed real estate in excess of decreased foreclosed real estate expenses for 2008 compared to 2007. Other operating expenses increased primarily due to increases in officer and employee training expenditures and related travel expense, losses on sales and valuation provisions for repossessed assets and other miscellaneous operating expenses which were partially offset by decreases in general office and supplies expense.

Income Tax Expense. We had an income tax benefit of $299,000 for 2008 compared to income tax expense of $162,000 for the same period in 2007 due primarily to significant decreases in current and deferred income tax liabilities as a result of the provision to loan losses and increased tax-exempt income during 2008. The effective tax rate for 2007 increased was 33.2%. See Note 11 in the accompanying Notes to Consolidated Financial Statements.

Results of Operations for the Years Ended September 30, 2007 and 2006

Overview. Net income increased $459,000, or 129.3%, from $355,000 for the year ended September 30, 2006 to $814,000 for the year ended September 30, 2007. The primary reason for the increase in net income in 2007 was the absence of severance expenses, a component of noninterest expenses, in 2007. In 2006, we paid $324,000 in severance payments to our former President and to a former lending officer.

Net Interest Income. Net interest income decreased $78,000, or 1.1%, from $7.0 million for the year ended September 30, 2006 to $6.9 million for the year ended September 30, 2007 primarily as the result of a decrease in total average interest-earning assets in excess of a decrease in total interest-bearing liabilities of $1.2 million from 2007 to 2008. The interest rate spread decreased slightly from 3.49% in 2006 and 3.48% in 2007.

Total interest income increased $855,000, or 7.0%, from $12.2 million for 2006 to $13.1 million for 2007. The increase was the result of increased average yields on interest-earning assets despite the decrease in total average balances of interest-earning assets. The average balance of total interest-earning assets decreased $2.7 million, or 1.4%, from $186.6 million in 2006 to $183.9 million in 2007 primarily as a result of loan repayments exceeding loan originations. The average tax-equivalent yield on total interest-earning assets increased from 6.56% in 2006 to 7.13% in 2007 primarily as a result of higher market interest rates.

Interest income on loans increased $642,000, or 5.8%, from $11.1 million for 2006 to $11.7 million for 2007 due to an increase in the average tax-equivalent yield from 6.84% in 2006 to 7.48% in 2007 as a result of higher market interest rates and despite a decrease in the average balance of loans outstanding. Average loans outstanding decreased $5.0 million, or 3.1%, from $161.7 million in 2006 to $156.7 million in 2007 primarily due to a decrease in the average balance of residential construction loans resulting from the slowing housing market.

Interest income on investment securities decreased $13,000, or 1.8%, as a result of a $2.0 million decrease in the average outstanding balance of investment securities and despite an increase in the average tax-equivalent yield from 4.60% in 2006 to 5.29% in 2007 due to maturities of lower yielding securities and their replacement with higher yielding securities purchased during 2007. The decrease in the average outstanding balance of investment securities was due to maturities of investment securities in excess of purchases during 2007. Interest income on interest-bearing deposits with banks increased $230,000, or 61.8%, as a result of a $4.4 million increase in the average balance of these assets for 2007 compared to 2006 and a slight increase in the average yield from 4.87% in 2006 to 5.02% in 2007.

Total interest expense increased $933,000, or 17.8%, as a result of an increase in the average cost of funds from 3.07% in 2006 to 3.65% in 2007 and despite a $1.5 million decrease in the average balance of interest-bearing liabilities from $170.8 in 2006 to $169.3 million in 2007. The average balance of interest-bearing deposits was $169.2 million in 2007 compared to $169.5 million in 2006 and the average cost of funds for deposits was 3.65% in 2007 compared to 3.06% in 2006. The average balance of Federal Home Loan Bank advances was $153,000 in 2007 compared to $1.4 million in 2006 and the average cost of funds for advances was 5.23% in 2007 compared to 4.81% in 2006. The average cost of interest-bearing liabilities increased for 2007 primarily as a result of the repricing of low-cost time deposits at higher market rates during 2007 and the increase in the average cost of funds for advances which have a variable interest rate.

Average Balances and Yields

The following tables present information regarding average balances of assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting annualized average yields and costs. The yields and costs for the periods indicated are derived by dividing income or expense by the average balances of assets or liabilities, respectively, for the periods presented. Average balances have been calculated using monthly balances. We believe the use of monthly balances, rather than daily balances are representative of our operations. Nonaccrual loans are included in average balances only. Loan fees are included in interest income on loans and are not material. Tax exempt income on loans and on investment and mortgage-backed securities has been calculated on a tax equivalent basis using a federal marginal tax rate of 34%.


	At March 31, 2008		Six Months Ended March 31,
	At March 31, 2008		2008						2007
(Dollars in thousands)	Weighted Average Yield/ Cost		Average Balance		Interest and Dividends		Yield/ Cost		Average Balance		Interest and Dividends		Yield/ Cost
Assets:
Interest-bearing deposits with banks	1.70	%	$	7,189	$	123	3.42	%	$	12,790	$	333	5.21	%
Loans	6.71			170,894		5,865	6.86			166,236		5,858	7.05
Investment securities	4.82			8,758		231	5.28			10,323		260	5.04
Mortgage-backed securities	5.22			3,950		82	4.15			3,676		88	4.79
Federal Home Loan Bank stock	N/A			1,336		33	4.94			1,352		35	5.18

Total interest-earning assets	6.37			192,127		6,334	6.59			194,377		6,574	6.76

Non-interest-earning assets				15,128						12,675

Total assets			$	207,255					$	207,052

Liabilities and equity:
NOW accounts	0.60		$	19,979	$	79	0.79		$	19,512	$	71	0.73
Money market deposit accounts	1.77			6,300		59	1.87			7,968		72	1.81
Passbook accounts	0.52			17,599		48	0.55			22,514		169	1.50
Certificates of deposit	4.51			120,852		2,816	4.66			121,019		2,779	4.59

Total interest-bearing deposits	3.43			164,730		3,002	3.64			171,013		3,091	3.61
Federal Home Loan Bank advances	3.36			4,817		94	3.90			—		—	—

Total interest-bearing liabilities	3.42			169,547		3,096	3.65			171,013		3,091	3.61

Non-interest-bearing deposits				4,879						4,568
Other non-interest-bearing liabilities				3,299						2,447

Total liabilities				177,725						178,028

Total equity				29,530						29,024

Total liabilities and equity			$	207,255					$	207,052

Net interest income					$	3,238					$	3,483

Interest rate spread							2.94	%					3.15	%

Net interest margin							3.37	%					3.58	%

Average interest-earning assets to average interest-bearing liabilities							113.32	%					113.66	%


	Year Ended September 30,
	2007						2006						2005
(Dollars in thousands)	Average Balance		Interest and Dividends		Yield/ Cost		Average Balance		Interest and Dividends		Yield/ Cost		Average Balance		Interest and Dividends		Yield/ Cost
Assets:
Interest-bearing deposits with banks	$	11,994	$	602	5.02	%	$	7,637	$	372	4.87	%	$	10,128	$	343	3.39	%
Loans		156,733		11,720	7.48			161,696		11,065	6.84			158,319		9,902	6.25
Investment securities		10,374		566	5.46			11,518		534	4.64			16,391		472	2.88
Mortgage-backed securities		3,466		166	4.79			4,295		194	4.52			2,651		95	3.58
Federal Home Loan Bank stock		1,344		65	4.84			1,447		69	4.77			1,449		63	4.35

Total interest-earning assets		183,911		13,119	7.13			186,593		12,234	6.56			188,938		10,875	5.76

Non- interest- earning assets		21,526						19,481						21,461

Total assets	$	205,437					$	206,074					$	210,399

Liabilities and equity:
NOW accounts	$	19,618	$	148	0.75			19,667	$	140	0.71			20,988	$	147	0.70
Money market deposit accounts		7,657		137	1.79			9,767		174	1.78			12,790		152	1.19
Passbook accounts		21,477		296	1.38			24,521		381	1.55			27,547		328	1.19
Certificates of deposit		120,430		5,594	4.65			115,503		4,489	3.89			114,278		3,628	3.17

Total interest-bearing deposits		169,182		6,175	3.65			169,458		5,184	3.06			175,603		4,255	2.42
Federal Home Loan Bank advances		153		8	5.23			1,371		66	4.81			–—		–—	–—

Total interest-bearing liabilities		169,335		6,183	3.65			170,829		5,250	3.07			175,603		4,255	2.42

Non-interest-bearing deposits		4,649						4,353						4,853
Other non-interest-bearing liabilities		2,197						2,223						2,077

Total liabilities		176,181						177,405						182,533
Total equity		29,256						28,669						27,866

Total liabilities and equity	$	205,437					$	206,074					$	210,399

Net interest income			$	6,936					$	6,984					$	6,620

Interest rate spread					3.48	%					3.49	%					3.34	%

Net interest margin					3.77	%					3.74	%					3.50	%

Average interest-earning assets to average interest-bearing liabilities					108.61	%					109.23	%					107.59	%

Rate/Volume Analysis. The following table sets forth the effects of changing rates and volumes on our net interest income. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The net column represents the sum of the prior columns. Changes attributable to changes in both rate and volume have been allocated proportionally based on the absolute dollar amounts of change in each.


	Six Months Ended March 31, 2008 Compared to Six Months Ended March 31, 2007									Year Ended September 30, 2007 Compared to Year Ended September 30, 2006								Year Ended September 30, 2006 Compared to Year Ended September 30, 2005
	Increase (Decrease) Due to									Increase (Decrease) Due to								Increase (Decrease) Due to
(In thousands)	Volume			Rate			Net			Volume		Rate			Net			Volume		Rate			Net
Interest income:
Interest-bearing deposits with banks	$	(92	)	$	(118	)	$	(210	)	$	11	$	219		$	230		$	66	$	(37	)	$	29
Loans receivable		(316	)		323			7			974		(319	)		655			949		214			1,163
Investment securities		13			(42	)		(29	)		85		(53	)		32			121		(59	)		62
Mortgage-backed securities		(24	)		18			(6	)		12		(40	)		(28	)		29		70			99
Other interest-earning assets		(1	)		(1	)		(2	)		1		(5	)		(4	)		6		—			6

Total interest-earning assets		(420	)		180			(240	)		1,083		(198	)		885			1,171		188			1,359

Interest expense:
Deposits		(26	)		(115	)		(89	)		999		(8	)		991			970		(41	)		929
Federal Home Loan Bank advances		—			94			94			6		(64	)		(58	)		—		66			66

Total interest-bearing liabilities		(26	)		(21	)		5			1,005		(72	)		933			970		(25	)		995

Net increase (decrease) in interest income	$	(440	)	$	201		$	(245	)	$	78	$	(126	)	$	(48	)	$	201	$	163		$	364

Provision for Loan Losses. The provision for loan losses was $758,000 for the year ended September 30, 2007 compared to $813,000 for the year ended September 30, 2006. The decrease in provision for loan losses primarily reflected the decrease in nonperforming loans from $1.7 million at September 30, 2006 to $1.1 million at September 30, 2007. Management was successful in reducing the impaired loans through pay-offs by customers, refinancing with other financial institutions and foreclosing on loans and liquidating the collateral assets with minimal realized losses. During 2007, we had net charge-offs of $329,000 compared to $827,000 for 2006.

An analysis of the changes in the allowance for loan losses is presented under “Risk Management — Analysis and Determination of the Allowance for Loan Losses.”

Noninterest Income. Noninterest income decreased $48,000, or 5.4%, to $841,000 for 2007 compared to $889,000 for 2006. The Bank’s principal source of noninterest income is deposit account service charges which decreased $62,000 from $564,000 for 2006 to $502,000 for 2007. Net gain on sales of mortgage loans decreased $5,000 for 2007 from $11,000 for 2006 to $6,000 for 2007. Other noninterest income increased $19,000 for 2007 compared to 2006 primarily as a result of an increase in ATM transaction fees of $25,000 due to increased usage.

Noninterest Expense. Total noninterest expense decreased $716,000, or 11.1%, to $5.7 million for 2007 compared to $6.5 million for 2006. The primary factors contributing to the decrease in noninterest expense were decreases in compensation and benefits expense of $660,000, occupancy and equipment expense of $32,000, advertising expense of $42,000 and other operating expenses of $31,000; offset by increases in professional fees and net loss on foreclosed real estate of $20,000 and $27,000, respectively. The decrease in compensation and benefits expense is primarily the result of severance compensation and benefits to our former president of the Bank and a former lending officer of approximately $324,000 expensed for the year ended September 30, 2006. There was no such severance expense in 2007.

Income Tax Expense. Income tax expense was $427,000 for the year ended September 30, 2007 compared to $241,000 for the year ended September 30, 2006. The effective tax rate decreased from 40.4% for 2006 to 34.4% for 2007 primarily as a result of an increase in tax exempt interest income and tax-advantageous dividend income. See Note 11 of the notes to consolidated financial statements included elsewhere in this prospectus.

Risk Management

Overview. Managing risk is an essential part of successfully managing a financial institution. Our most prominent risk exposures are credit risk, interest rate risk and market risk. Credit risk is the risk of not collecting the interest and/or the principal balance of a loan or investment when it is due. Interest rate risk is the potential reduction of interest income as a result of changes in interest rates. Market risk arises from fluctuations in interest rates that may result in changes in the values of financial instruments, such as available-for-sale securities that are accounted for on a mark-to-market basis. Other risks that we face are operational risks, liquidity risks and reputation risk. Operational risks include risks related to fraud, regulatory compliance, processing errors, technology and disaster recovery. Liquidity risk is the possible inability to fund obligations to depositors, lenders or borrowers. Reputation risk is the risk that negative publicity or press, whether true or not, could cause a decline in our customer base or revenue.

Credit Risk Management. Our strategy for credit risk management focuses on having well-defined credit policies and uniform underwriting criteria and providing prompt attention to potential problem loans.

When a borrower fails to make a required loan payment, we take a number of steps to have the borrower cure the delinquency and restore the loan to current status. When the loan becomes 15 days past due, a late notice is sent to the borrower and a late fee is assessed. When the loan becomes 30 days past due, a more formal letter is sent. Between 15 and 30 days past due, telephone calls are also made to the borrower. After 30 days, we regard the borrower as in default. The borrower may be sent a letter from our attorney and we may commence collection proceedings. If a foreclosure action is instituted and the loan is not brought current, paid in full, or refinanced before the foreclosure sale, the real property securing the loan generally is sold at foreclosure. Generally, when a consumer loan becomes 60 days past due, we institute collection proceedings and attempt to repossess any personal property that secures the loan. Generally, we institute foreclosure proceedings when a loan is 60 days past due. Management informs the board of directors monthly of the amount of loans delinquent more than 30 days, all loans in foreclosure and repossessed property that we own.

Analysis of Nonperforming and Classified Assets. We consider repossessed assets and loans that are 90 days or more past due to be nonperforming assets. Loans are generally placed on nonaccrual status when they become 90 days delinquent at which time the accrual of interest ceases and the allowance for any uncollectible accrued interest is established and charged against operations. Typically, payments received on a nonaccrual loan are first applied to the outstanding principal balance.

Real estate that we acquire 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 its cost, which is the unpaid balance of the loan plus foreclosure costs, or fair market value at the date of foreclosure. Holding costs and declines in fair value after acquisition of the property result in charges against income.

The following table provides information with respect to our nonperforming assets at the dates indicated. We had no troubled debt restructurings at any of the dates indicated.


	At March 31,			At September 30,
(Dollars in thousands)	2008			2007			2006			2005			2004			2003
Non-accrual loans:
Residential real estate	$	2,473		$	99		$	568		$	221		$	191		$	136
Commercial real estate		458			22			211			15			15			15
Multi-family		—			—			—			—			—			—
Land and land development		33			33			—			—			18			18
Construction		—			—			418			—			—			—
Commercial business		495			—			9			—			187			—
Consumer		163			277			368			591			501			476

Total		3,622			431			1,574			827			912			645

Accruing loans past due 90 days or more:
Residential real estate		276			572			—			563			572			281
Commercial real estate		—			104			—			—			—			29
Construction		—			—			—			—			—			—
Multi-family		—			—			—			—			—			—
Land and land development		—			—			—			—			—			—
Commercial business		—			—			—			—			—			—
Consumer		142			—			141			191			151			—

Total		418			676			141			754			723			310

Total of non-accrual and 90 days or more past due loans		4,040			1,107			1,715			1,581			1,635			955
Real estate owned		1,125			1,278			1,941			555			1,092			1,415
Other non-performing assets		144			198			45			219			215			207

Total non-performing assets	$	5,309		$	2,583		$	3,701		$	2,355		$	2,942		$	2,577

Total non-performing loans to total loans		2.32	%		0.64	%		1.01	%		0.93	%		0.96	%		0.59	%

Total non-performing loans to total assets		1.90	%		0.54	%		0.83	%		0.77	%		0.76	%		0.43	%

Total non-performing assets and troubled debt restructurings to total assets		2.50	%		1.27	%		1.79	%		1.14	%		1.36	%		1.15	%

Non-accrual residential real estate loans at March 31, 2008 include 35 loans, all secured by non-owner occupied residential properties, outstanding to a single borrower and related entities with aggregate outstanding balances of $2.0 million. Based on recent independent appraisals on 30 of the properties and management’s internal valuation of the other 5 properties, the properties have an aggregate appraised value of $1.2 million. An internal appraisal was performed on five of the properties because their deteriorated condition made obtaining an independent appraisal unfeasible given the absence of comparable properties for valuation purposes.

Non-accrual commercial real estate loans at March 31, 2008 consist of one loan secured by a restaurant property with an appraised value of $590,000. Non-accrual commercial business loans at March 31, 2008 consists of one loan secured by general business assets and real estate with an aggregate appraised value of $869,000.

Interest income that would have been recorded for the six months ended March 31, 2008 and the year ended September 30, 2007, had nonaccruing loans been current according to their original terms, amounted to $71,000 and $27,000, respectively. Interest income of $13,000 and $27,000 related to non-performing loans was included in interest income for the six months ended March 31, 2008 and the year ended September 30, 2007, respectively.

Federal regulations require us to review and classify our assets on a regular basis. In addition, the Office of Thrift Supervision has the 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 we 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 “loss” is considered uncollectible and of such little value that continuance as an asset of the institution is not warranted. The regulations also provide for a “special mention” category, described as assets which do not currently expose us to a sufficient degree of risk to warrant classification but do possess credit deficiencies or potential weaknesses deserving our close attention. When we classify an asset as substandard or doubtful we may establish a specific allowance for loan losses. If we classify an asset as loss, we charge off an amount equal to 100% of the portion of the asset classified loss.

The following table shows the aggregate amounts of our classified assets at the dates indicated.


	At March 31,		At September 30,
(In thousands)	2008		2007		2006		2005
Special mention assets	$	2,633	$	1,605	$	680	$	2,844
Substandard assets		2,222		4,481		2,468		1,915
Doubtful assets		2,572		409		408		544
Loss assets		—		—		—		—

Total classified assets	$	7,427	$	6,495	$	3,556	$	5,303

Classified assets includes loans that are classified due to factors other than payment delinquencies, such as lack of current financial statements and other required documentation, insufficient cash flows or other deficiencies, and, therefore, are not included as non-performing assets. Other than as disclosed in the above tables, there are no other loans where management has serious doubts about the ability of the borrowers to comply with the present loan repayment terms.

Delinquencies. The following table provides information about delinquencies in our loan portfolio at the dates indicated.


	At March 31, 2008							At September 30, 2007
	30-89 Days				90 Days or More			30-89 Days			90 Days or More
(In thousands)	Number of Loans	Principal Balance of Loans			Number of Loans	Principal Balance of Loans		Number of Loans	Principal Balance of Loans		Number of Loans	Principal Balance of Loans
Residential real estate	48	$	3,009	⁽¹⁾	10	$	720	9	$	629	9	$	589
Commercial real estate	—		—		1		458	—		—	2		116
Multi-family	—		—		—		—	—		—	—		—
Construction	2		341		—		—	—		—	—		—
Commercial business	3		210		1		495	2		295	—		—
Land and land development	—		—		1		33	1		400	1		33
Consumer	8		318		5		162	5		171	10		194

Total	61	$	3,878		18	$	1,868	17	$	1,495	22	$	932

(1)	Includes $2.0 million of non-accrual, non-owner occupied residential real estate loans.


	At September 30,
	2006						2005
	30-89 Days			90 Days or More			30-89 Days			90 Days or More
(In thousands)	Number of Loans	Principal Balance of Loans		Number of Loans	Principal Balance of Loans		Number of Loans	Principal Balance of Loans		Number of Loans	Principal Balance Of Loans
Residential real estate	4	$	565	8	$	515	6	$	611	11	$	696
Commercial real estate	2		103	1		211	—		—	1		15
Multi-family	—		—	—		—	—		—	—		—
Construction	—		—	3		418	—		—	—		—
Commercial business	2		316	1		9	1		9	—		—
Land and land development	—		—	—		—	—		—	—		—
Consumer	17		223	17		368	15		194	34		590

Total	25	$	1,207	30	$	1,521	22	$	814	46	$	1,301

Analysis and Determination of the Allowance for Loan Losses.

The allowance for loan losses is a valuation allowance for probable losses inherent in the loan portfolio. We evaluate the need to establish allowances against losses on loans on a quarterly basis. When additional allowances are necessary, a provision for loan losses is charged to earnings.

Our methodology for assessing the appropriateness of the allowance for loan losses consists of: (1) a specific allowance required for identified problem loans; and (2) a general valuation allowance on the remainder of the loan portfolio; and (3) an unallocated allowance to cover uncertainties that could affect management’s estimate of probable losses. Although we determine the amount of each element of the allowance separately, the entire allowance for loan losses is available to absorb losses in the loan portfolio.

Specific Allowance Required for Identified Problem Loans. We establish a specific allowance for loans that are classified as doubtful, substandard or special mention. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of the loan.

General Valuation Allowance on the Remainder of the Loan Portfolio. We establish a general allowance for loans that are not currently classified in order to recognize the inherent losses associated with lending activities. The general allowance covers non-classified loans and is based on historical loss experience adjusted for qualitative factors such as changes in economic conditions, changes in the volume of past due and non-accrual loans and classified assets, changes in the nature and volume of the portfolio, changes in the value of underlying collateral for collateral dependent loans, concentrations of credit, and other factors.

Unallocated Valuation Allowance. We establish an unallocated allowance to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimate specific and general losses in the loan portfolio.

The following table sets forth the breakdown of the allowance for loan losses by loan category at the dates indicated.


	At March 31, 2008						At September 30,
	At March 31, 2008						2007						2006
(Dollars in thousands)	Amount		% of Allowance to Total Allowance		% of Loans in Category to Total Loans		Amount		% of Allowance to Total Allowance		% of Loans in Category to Total Loans		Amount		% of Allowance to Total Allowance		% of Loans in Category to Total Loans
Residential real estate	$	1,580	63.25	%	63.04	%	$	267	20.59	%	57.96	%	$	88	10.14	%	56.32	%
Commercial real estate		78	3.12		8.77			137	10.56		10.62			118	13.59		11.19
Multi-family		—	—		3.00			—	—		3.11			—	—		4.03
Construction		—	—		6.98			—	—		8.59			—	—		12.08
Land and land development		6	0.24		2.66			—	—		2.91			—	—		1.48
Commercial business		93	3.72		5.97			268	20.66		7.31			157	18.09		6.00
Consumer		741	29.67		9.58			625	48.19		9.50			505	58.18		8.90
Unallocated		—	—		—				—		—			—	—		—

Total allowance for loan Losses	$	2,498	100.00	%	100.00	%	$	1,297	100.00	%	100.00	%	$	868	100.00	%	100.00	%


	At September 30,
	2005						2004						2003
(Dollars in thousands)	Amount		% of Allowance to Total Allowance		% of Loans in Category to Total Loans		Amount		% of Allowance to Total Allowance		% of Loans in Category to Total Loans		Amount		% of Allowance to Total Allowance		% of Loans in Category To Total Loans
Residential real estate	$	114	12.93	%	58.75	%	$	51	6.34	%	60.96	%	$	61	8.96	%	59.07	%
Commercial real estate		51	5.78		6.88			48	5.96		6.70			52	7.64		6.98
Multi-family		—	—		3.83			—	—		4.21			—	—		4.82
Construction		—	—		14.60			—	—		11.90			—	—		14.21
Land and land development		—	—		1.71			—	—		0.97			—	—		0.80
Commercial business		169	19.16		4.96			204	25.34		5.19			94	13.80		3.09
Consumer		548	62.13		9.27			502	62.36		10.07			474	69.60		11.03
Unallocated		—	—		—				—		—				—		—

Total allowance for loan Losses	$	882	100.00	%	100.00	%	$	805	100.00	%	100.00	%	$	681	100.00	%	100.00	%

Although we believe that we use the best information available to establish the allowance for loan losses, future adjustments to the allowance for loan losses may be necessary and our results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations. Furthermore, while we believe we have established our allowance for loan losses in conformity with generally accepted accounting principles, there can be no assurance that the Office of Thrift Supervision, in reviewing our loan portfolio, will not require us to increase our allowance for loan losses. The Office of Thrift Supervision may require us to increase our allowance for loan losses based on judgments different from ours. In addition, because future events affecting borrowers and collateral cannot be predicted with certainty, there can be no assurance that the existing allowance for loan losses is adequate or that increases will not be necessary should the quality of any loans deteriorate as a result of the factors discussed above. Any material increase in the allowance for loan losses may adversely affect our financial condition and results of operations.

Analysis of Loan Loss Experience.

The following table sets forth an analysis of the allowance for loan losses for the periods indicated.


	Six Months Ended March 31,						Year Ended September 30,
(Dollars in thousands)	2008			2007			2007			2006			2005			2004			2003
Allowance for loan losses at beginning of period	$	1,297		$	868		$	868		$	882		$	805		$	681		$	637

Provision for loan losses		1,203			420			758			813			336			226			131

Charge offs:
Residential real estate		—			—			—			528			30			—			—
Commercial real estate		—			—			216			—			—			—			—
Multi-family		15			—			—			—			—			—			—
Land and land development		—			—			—			—			—			—			—
Construction		—			—			—			—			—			—			—
Commercial business		—			9			9			—			98			—			—
Consumer		100			107			198			314			142			115			101

Total charge-offs		115			116			424			842			270			115			101

Recoveries:
Residential real estate		—			—			—			—			—			—			—
Non-residential real estate		110			—			—			—			—			—			—
Multi-family		—			—			—			—			—			—			—
Land and land development		—			—			—			—			—			—			—
Construction		—			—			—			—			—			—			—
Commercial business		—			—			2			—			—			—			—
Consumer		3			58			93			15			11			13			14

Total recoveries		113			58			95			15			11			13			14

Net charge-offs (recoveries)		(2	)		(58	)		(329	)		(827	)		(259	)		(102	)		(87	)

Allowance for loan losses at end of period	$	2,498		$	1,230		$	1,297		$	868		$	882		$	805		$	681

Allowance for loan losses to non-performing loans		61.83	%		77.11	%		117.16	%		50.61	%		55.79	%		49.24	%		71.31	%
Allowance for loan losses to total loans outstanding at the end of the period		1.43	%		0.73	%		0.75	%		0.51	%		0.52	%		0.47	%		0.42	%
Net charge-offs (recoveries) to average loans outstanding during the period		—	%		0.03	%		0.21	%		0.51	%		0.16	%		0.07	%		0.05	%

Interest Rate Risk Management. We manage the interest rate sensitivity of our interest-bearing liabilities and interest-earning assets in an effort to minimize the adverse effects of changes in the interest rate environment. Deposit accounts typically react more quickly to changes in market interest rates than mortgage loans because of the shorter maturities of deposits. As a result, sharp increases in interest rates may adversely affect our earnings while decreases in interest rates may beneficially affect our earnings. To reduce the potential volatility of our earnings, we have sought to improve the match between asset and liability maturities and rates, while maintaining an acceptable interest rate spread. Our strategy for managing interest rate risk emphasizes: adjusting the maturities of borrowings; adjusting the investment portfolio mix and duration and generally selling in the secondary market substantially all newly originated one-to four-family residential real estate loans. We currently do not participate in hedging programs, interest rate swaps or other activities involving the use of derivative financial instruments.

We have an Asset/Liability Management Committee, which includes members of management approved by the Board of Directors, to communicate, coordinate and control all aspects involving asset/liability management. The committee establishes and monitors the volume, maturities, pricing and mix of assets and funding sources with the objective of managing assets and funding sources to provide results that are consistent with liquidity, growth, risk limits and profitability goals.

Our goal is to manage asset and liability positions to moderate the effects of interest rate fluctuations on net interest income and net income.

Net Portfolio Value Analysis. We use a net portfolio value analysis prepared by the Office of Thrift Supervision to review our level of interest rate risk. This analysis measures interest rate risk by capturing changes in net portfolio value of our cash flows from assets, liabilities and off-balance sheet items, based on a range of assumed changes in market interest rates. Net portfolio value represents the market value of portfolio equity and is equal to the market value of assets minus the market value of liabilities, with adjustments made for off-balance sheet items. These analyses assess the risk of loss in market risk-sensitive instruments in the event of a sudden and sustained 100 to 300 basis point increase or 100 and 200 basis point decrease in market interest rates with no effect given to any steps that we might take to counter the effect of that interest rate movement.

The following table, which is based on information that we provide to the Office of Thrift Supervision, presents the change in our net portfolio value at March 31, 2008 that would occur in the event of an immediate change in interest rates based on Office of Thrift Supervision assumptions, with no effect given to any steps that we might take to counteract that change.


	Net Portfolio Value					Net Portfolio Value as % of Portfolio Value of Assets
Basis Point (“bp”) Change in Rates	$ Amount	$ Change		% Change		NPV Ratio		Change
	(Dollars in thousands)
300	25,620	(3,444	)	(12	)%	12.31	%	(110	)bp
200	27,479	(1,585	)	(5	)	12.99		(42	)bp
100	28,687	(377	)	(1	)	13.37		(4	)bp
0	29,064	—		—		13.41		—
(100)	28,785	(279	)	(1	)	13.18		(23	)bp

The Office of Thrift Supervision uses various assumptions in assessing interest rate risk. These assumptions relate to interest rates, loan prepayment rates, deposit decay rates and the market values of certain assets under differing interest rate scenarios, among others. As with any method of measuring interest rate risk, certain shortcomings are inherent in the methods of analyses presented in the foregoing tables. For example, although certain assets and liabilities may have similar maturities or periods to repricing, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind changes in market rates. Additionally, certain assets, such as adjustable-rate mortgage loans, have features that restrict changes in interest rates on a short-term basis and over the life of the asset. Further, if there is a change in interest rates, expected rates of prepayments on loans and early withdrawals from certificates could deviate significantly from those assumed in calculating the table. Prepayment rates can have a significant impact on interest income. Because of the large percentage of loans and mortgage-backed securities we hold, rising or falling interest rates have a significant impact on the prepayment speeds of our earning assets that in turn affect the rate sensitivity position. When interest rates rise, prepayments tend to slow. When interest rates fall, prepayments tend to rise. Our asset sensitivity would be reduced if prepayments slow and vice versa. While we believe these assumptions to be reasonable, there can be no assurance that assumed prepayment rates will approximate actual future mortgage-backed security and loan repayment activity.

Liquidity Management. Liquidity is the ability to meet current and future financial obligations of a short-term nature. Our primary sources of funds consist of deposit inflows, loan repayments, maturities and sales of investment securities and borrowings from the Federal Home Loan Bank of Indianapolis. While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and mortgage prepayments are greatly influenced by general interest rates, economic conditions and competition.

We regularly adjust our investments in liquid assets based upon our assessment of (1) expected loan demand, (2) expected deposit flows, (3) yields available on interest-earning deposits and securities and (4) the objectives of our asset/liability management policy.

Our most liquid assets are cash and cash equivalents and interest-bearing deposits. The levels of these assets depend on our operating, financing, lending and investing activities during any given period. At March 31, 2008, cash and cash equivalents totaled $9.2 million. Securities classified as available-for-sale, amounting to $10.4 million at March 31, 2008, provide additional sources of liquidity. In addition, at March 31, 2008, we had the ability to borrow a total of approximately $60.0 million from the Federal Home Loan Bank of Indianapolis. At March 31, 2008, we had $8.0 million Federal Home Loan Bank advances outstanding.

At March 31, 2008, we had $38.6 million in commitments to extend credit outstanding. Certificates of deposit due within one year of March 31, 2008 totaled $83.9 million, or 67.5% of certificates of deposit. We believe the large percentage of certificates of deposit that mature within one year reflects customers’ hesitancy to invest their funds for long periods due to the recent low interest rate environment and local competitive pressure. If these maturing deposits do not remain with us, we will be required to seek other sources of funds, including other certificates of deposit and borrowings. Depending on market conditions, we may be required to pay higher rates on such deposits or other borrowings than we currently pay on the certificates of deposit due on or before March 31, 2009. We believe, however, based on past experience, that a significant portion of our certificates of deposit will remain with us. We have the ability to attract and retain deposits by adjusting the interest rates offered.

The following tables present certain of our contractual obligations as of March 31, 2008 and September 30, 2007.


			Payments due by period
(In thousands)	Total		Less than One Year		One to Three Years		Three to Five Years		More Than Five Years
At March 31, 2008:
Deferred director fee agreements	$	264	$	6	$	11	$	11	$	236
Deferred compensation agreements (1)		277		29		62		70		116
Operating lease obligations		18		10		8		—		—
FHLB advance		8,000		—		—		8,000		—

Total	$	8,559	$	45	$	81	$	8,081	$	352

At September 30, 2007:
Deferred director fee agreements	$	243	$	6	$	11	$	11	$	215
Deferred compensation agreements (1)		287		28		61		68		130
Operating lease obligations		23		10		13		—		—
FHLB advance		3,000		3,000		—		—		—

Total	$	3,553	$	3,044	$	85	$	79	$	345

(1)	Includes deferred compensation agreement with a former officer that calls for annual payments of $9,000 until his death.

Our primary investing activities are the origination of loans and the purchase of securities. Our primary financing activities consist of activity in deposit accounts and Federal Home Loan Bank advances. Deposit flows are affected by the overall level of interest rates, the interest rates and products offered by us and our local competitors and other factors. We generally manage the pricing of our deposits to be competitive. Occasionally, we offer promotional rates on certain deposit products to attract deposits.

Financing and Investing Activities

The following table presents our primary investing and financing activities during the periods indicated.


	Six Months Ended March 31,						Year Ended September 30,
(In thousands)	2008			2007			2007			2006			2005
Investing activities:
Loan purchases	$	—		$	—		$	—		$	—		$	—
Loan originations		43,738			35,787			83,470			85,415			91,735
Loan principal repayments		41,103			38,682			80,707			84,667			86,490
Loan sales		1,129			—			453			822			4,235
Proceeds from maturities and principal repayments of investment securities		6,000			—			3,000			4,435			26,950
Proceeds from maturities and principal repayments of mortgage-backed securities		359			380			789			860			785
Proceeds from sales of investment securities available- for-sale		—			—			—			—			—
Proceeds from sales of mortgage-backed securities available-for-sale		—			—			—			—			—
Purchases of investment securities		(2,029	)		(312	)		(5,311	)		(807	)		(20,895	)
Purchases of mortgage-backed securities		(8,038	)		—			—			—			(3,450	)
Financing activities:
Increase (decrease) in deposits		5,302			1,390			(7,109	)		440			(12,065	)
Increase (decrease) in Federal Home Loan Bank Advances		5,000			—			3,000			—			—

Capital Management. We are subject to various regulatory capital requirements administered by the Office of Thrift Supervision, including a risk-based capital measure. The risk-based capital guidelines include both a definition of capital and a framework for calculating risk-weighted assets by assigning balance sheet assets and off-balance sheet items to broad risk categories. At March 31, 2008, we exceeded all of our regulatory capital requirements. We are considered “well capitalized” under regulatory guidelines. See “Regulation and Supervision — Regulation of Federal Savings Associations — Capital Requirements,” “Regulatory Capital Compliance” and Note 15 of the notes to consolidated financial statements.

This offering is expected to increase our consolidated equity by $30.2 million, to $59.6 million at the maximum of the offering range. See “Capitalization.” Following completion of this offering, we also will manage our capital for maximum stockholder benefit. The capital from the offering will significantly increase our liquidity and capital resources. Over time, the initial level of liquidity will be reduced as net proceeds from the stock offering are used for general corporate purposes, including the funding of lending activities. Our financial condition and results of operations will be enhanced by the capital from the offering, resulting in increased net interest-earning assets and net income. However, the large increase in equity resulting from the capital raised in the offering will, initially, have an adverse impact on our return on equity. Following the offering, we may use capital management tools such as cash dividends and common share repurchases. However, under Office of Thrift Supervision regulations, we will not be allowed to repurchase any shares during the first year following the offering, except to fund the restricted stock awards under the equity benefit plan after its approval by shareholders, unless extraordinary circumstances exist and we receive regulatory approval.

Off-Balance Sheet Arrangements. In the normal course of operations, we engage in a variety of financial transactions that, in accordance with generally accepted accounting principles, are not recorded in our financial statements. These transactions involve, to varying degrees, elements of credit, interest rate and liquidity risk. Such transactions are used primarily to manage customers’ requests for funding and take the form of loan commitments and lines of credit. For information about our loan commitments and unused lines of credit, see Notes 12 and 13 of the notes to consolidated financial statements.

For the six months ended March 31, 2008 and the year ended September 30, 2007, we did not engage in any off-balance sheet transactions reasonably likely to have a material effect on our financial condition, results of operations or cash flows.

Impact of Recent Accounting Pronouncements

For a discussion of the impact of recent accounting pronouncements, see Note 2 of the notes to consolidated financial statements included in this prospectus.

Effect of Inflation and Changing Prices

The consolidated financial statements and related financial data presented in this prospectus have been prepared according to generally accepted accounting principles in the United States, which require the measurement of financial position and operating results in terms of historical dollars without considering the change in the relative purchasing power of money over time due to inflation. The primary impact of inflation on our operations is reflected in increased operating costs. Unlike most industrial companies, virtually all the assets and liabilities of a financial institution are monetary in nature. As a result, interest rates generally have a more significant impact on a financial institution’s performance than do general levels of inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services.

Our Management

Board of Directors

The Board of Directors of First Savings Financial Group and First Savings Bank are each comprised of eight persons who are elected for terms of three (3) years, approximately one-third of whom are elected annually. At the first annual meeting of stockholders, Cecile A. Blau and Douglas A. York will each be up for election as a director to serve a one-year term ending in 2010, at which time each will be up for election as a director to serve a three-year term. The same individuals comprise the boards of directors of First Savings Financial Group and First Savings Bank.

All of our directors are independent under the current listing standards of the Nasdaq Stock Market, except for Larry W. Myers, who serves as President and Chief Executive Officer of First Savings Financial Group and First Savings Bank, and John P. Lawson, Jr., who serves as the Chief Operations Officer of First Savings Financial Group and First Savings Bank. In determining the independence of directors, the board of directors considered the various deposit, loan and other relationships that each director has with First Savings Bank, including loans and lines of credit to Charles E. Becht, Jr., Gerald Wayne Clapp, Jr., John P. Lawson, Jr. and Robert E. Libs, in addition to the transactions disclosed under “— Transactions with First Savings Bank,” but determined in each case that these relationships did not interfere with their exercise of independent judgment in carrying out their responsibilities as a director.

Information regarding the directors is provided below. Unless otherwise stated, each person has held his or her current occupation for the last five (5) years. Ages presented are as of March 31, 2008. The starting year of service as director relates to service on the board of directors of First Savings Bank.

The following directors have terms ending in 2009:

Charles E. Becht, Jr. is owner and President of Ward Forging Co., Inc., a steel fabrication company. Age 59. Director since 1995.

Gerald Wayne Clapp, Jr. is President of CLAPP Auto Group, an auto sales and service company. Age 58. Director since 1995.

Cecile A. Blau serves as a county judge in the State of Indiana. Ms. Blau’s current term as judge will expire in December 2008. Age 63. Director since 2008.

Douglas A. York is President of Melhiser Endres Tucker, an accounting firm. Age 46. Director since 2008.

The following directors have terms ending in 2010:

John P. Lawson, Jr. is the Chief Operations Officer of First Savings Bank and First Savings Financial Group. Mr. Lawson joined First Savings Bank in 1988. Previously, Mr. Lawson served as Assistant Vice President, Vice President, Senior Vice President and Executive Vice President of First Savings Bank. Age 51. Director since 2006.

The following directors have terms ending in 2011:

Robert E. Libs is owner and Chief Executive Officer of AML, Inc., a contractor. Age 66. Director since 1992.

Michael F. Ludden serves as Chairman of the Board and is President and Chief Executive Officer of L. Thorn Company, Inc., a construction materials distribution company. Age 58. Director since 1992.

Larry W. Myers is the President and Chief Executive Officer of First Savings Bank and First Savings Financial Group. Mr. Myers joined First Savings Bank in 2005. Previously, Mr. Myers served as Chief Operations Officer of First Savings Bank. Prior to joining First Savings Bank, Mr. Myers served as an area President of National City Bank in southern Indiana. Age 49. Director since 2005.

Executive Officers

The executive officers of First Savings Financial Group and First Savings Bank are elected annually by the board of directors and serve at the board’s discretion. The executive officers of First Savings Financial Group and First Savings Bank are:


Name		Position
Larry W. Myers		President and Chief Executive Officer
John P. Lawson, Jr.		Chief Operations Officer
M. Sue Johnson		Treasurer and Corporate Secretary

Since the formation of First Savings Financial Group, none of the company’s executive officers, directors or other personnel have received remuneration from First Savings Financial Group.

Below is information regarding our executive officers who are not also directors. Each executive officer has held his current position for at least the last five years, unless otherwise stated. Ages presented are as of March 31, 2008.

M. Sue Johnson is Treasurer and Corporate Secretary of First Savings Bank and First Savings Financial Group. Ms. Johnson joined First Savings Bank in July 1981. Age 61.

Meetings and Committees of the Board of Directors

We conduct business through meetings of our board of directors and its committees. During the year ended September 30, 2007, the board of directors of First Savings Bank met 13 times. Given that First Savings Financial Group was incorporated in May 2008, the board of directors of First Savings Financial Group did not meet during the year ended September 30, 2007.

In connection with the formation of First Savings Financial Group, the board of directors established Audit, Compensation and Nominating and Corporate Governance Committees.

The Audit Committee consists of Douglas A. York (Chair), Gerald W. Clapp, Jr. and Michael F. Ludden. The Audit Committee is responsible for providing oversight relating to our financial statements and financial reporting process, systems of internal accounting and financial controls, internal audit function, annual independent audit and the compliance and ethics programs established by management and the board. Each member of the Audit Committee is independent in accordance with the listing standards of the Nasdaq Stock Market. The board of directors of First Savings Financial Group has designated Douglas A. York as an audit committee financial expert under the rules of the Securities and Exchange Commission. The Audit Committee of First Savings Financial Group did not meet during the year ended September 30, 2007.

The Compensation Committee consists of Robert E. Libs (Chair), Gerald W. Clapp, Jr. and Michael F. Ludden. The Compensation Committee is responsible for human resources policies, salaries and benefits, incentive compensation, executive development and management succession planning. Each member of the Compensation Committee is independent in accordance with the listing standards of the Nasdaq Stock Market. The Compensation Committee of First Savings Financial Group did not meet during the year ended September 30, 2007.

The Nominating and Corporate Governance Committee consists of Charles E. Becht, Jr. (Chair), Cecile A. Blau and Michael F. Ludden. The Nominating and Corporate Governance Committee is responsible for identifying individuals qualified to become board members and recommending a group of nominees for election as directors at each annual meeting of stockholders, ensuring that the board and its committees have the benefit of qualified and experienced independent directors, and developing a set of corporate governance polices and procedures. Each

member of the Nominating and Corporate Governance Committee is independent in accordance with the listing standards of the Nasdaq Stock Market. The Nominating and Corporate Governance Committee of First Savings Financial Group did not meet during the year ended September 30, 2007.

Each of First Savings Financial Group’s committees listed above operates under a written charter, which governs its composition, responsibilities and operations.

In addition, the board of directors of First Savings Bank has the following standing committees: Salary Review and Nominating.

Corporate Governance Policies and Procedures

In addition to having established committees of the board of directors, First Savings Financial Group has also adopted several policies to govern the activities of both First Savings Financial Group and First Savings Bank, including a corporate governance policy and a code of business conduct and ethics. The corporate governance policy sets forth:

•

the duties and responsibilities of each director;

•

the composition, responsibilities and operation of the board of directors;

•

the establishment and operation of board committees;

•

succession planning;

•

procedures for convening executive sessions of independent directors;

•

the board of directors’ interaction with management and third parties; and

•

the evaluation of the performance of the board of directors and chief executive officer.

The code of business conduct and ethics, which applies to all employees and directors, addresses conflicts of interest, the treatment of confidential information, general employee conduct and compliance with applicable laws, rules and regulations. In addition, the code of business conduct and ethics is designed to deter wrongdoing and to promote honest and ethical conduct, the avoidance of conflicts of interest, full and accurate disclosure and compliance with all applicable laws, rules and regulations.

Executive Compensation

Summary Compensation Table

The following information is furnished for all individuals serving as the principal executive officer of First Savings Financial Group, or its subsidiaries for the fiscal year ended September 30, 2007, and all other executive officers of First Savings Financial Group, or its subsidiaries whose total compensation for the fiscal year ended September 30, 2007, exceeded $100,000.


Name and Principal Position	Year	Salary ($)	Bonus ($)	All Other Compensation ($)(1)	Total ($)
Larry W. Myers President & Chief Executive Officer	2007	173,200	6,088	6,594	185,882
John P. Lawson, Jr. Chief Operations Officer	2007	101,800	3,599	4,139	109,538

(1)	Details of the amounts requested in the “All Other Compensation” column are provided in the table below:


	Mr. Myers			Mr. Lawson			Ms. Johnson
Employer contributions to 401(k) Plan	$	6,594		$	4,139		$	1,715
Perquisites		–	(a)		–	(a)		–	(a)
Total all other compensation	$	6,594		$	4,139		$	1,715

(a)	Did not exceed $10,000

Current Employment Agreements. First Savings Bank does not currently maintain employment agreements with any of its employees.

Proposed Employment Agreements. Upon completion of the conversion, First Savings Bank and First Savings Financial Group will enter into employment agreements with each of Messrs. Myers and Lawson. Our continued success depends to a significant degree on the skills and competence of these officers, and the employment agreements are intended to ensure that we maintain a stable management base following the offering.

The employment agreements will each provide for three-year terms, subject to annual renewal by the board of directors for an additional year beyond the then-current expiration date. The initial base salaries under the employment agreements will be $173,200 and $123,800 for Messrs. Myers and Lawson, respectively. The agreements also will provide for participation in employee benefit plans and programs maintained for the benefit of employees and senior management personnel, including incentive compensation, health and welfare benefits, retirement benefits and certain fringe benefits as described in the agreements.

Upon termination of either executive’s employment for “cause”, as defined in the agreement, the executive will receive no further compensation or benefits under the agreement. If we terminate the executive for reasons other than cause, or if the executive resigns after the occurrence of specified circumstances that constitute constructive termination, the executive will continue to receive his base salary for the remaining unexpired term of the agreement.

Under each of the employment agreements, if, in connection with or following a change in control (as described in the agreements), we terminate the executive without cause or if the executive terminates employment voluntarily under certain circumstances specified in the agreement, he will receive a severance payment equal to three times his average annual taxable compensation for the five preceding taxable years. In addition, the executive will receive continued coverage under our medical, dental and life insurance programs for 36 months.

Section 280G of the Internal Revenue Code provides that severance payments that equal or exceed three times the individual’s base amount are deemed to be “excess parachute payments” if they are contingent upon a change in control. Individuals receiving excess parachute payments are subject to a 20% excise tax on the amount of the payment in excess of the base amount, and we would not be entitled to deduct such amount. The agreements will provide for the reduction, at the election of the executives, of change in control payments to the executives to the extent necessary to ensure that they will not receive “excess parachute payments”, which otherwise would result in the imposition of an excise tax.

Upon termination of employment (other than termination in connection with a change in control), each executive will be required to adhere to a one-year non-competition provision.

We will agree to pay all reasonable costs and legal fees of the executives in relation to the enforcement of the employment agreements, provided the executives succeed on the merits in a legal judgment, arbitration proceeding or settlement. The employment agreements also provide for indemnification of the executives to the fullest extent legally permissible.

Proposed Change in Control Agreements. Upon completion of the offering, First Savings Bank will enter into change in control agreements with Donald R. Allen, our Chief Lending Officer, and Anthony A. Schoen, our Assistant Controller, in order to help ensure that we maintain a stable management base after the offering. The continued success of First Savings Bank depends to a significant degree on the skills and competence of the executives.

Each change in control agreement will have a three-year term, subject to annual renewal by the board of directors of First Savings Bank to extend the term for an additional year. If the executives’ employment involuntarily terminates or if First Savings Bank constructively terminates the executives (under circumstances outlined in the agreement) in connection with or following a change in control, the executives will receive a severance payment equal to three times the executives’ base salary on the termination date. In addition, First Savings Bank will continue to provide the executives with medical, dental and life insurance coverage for no longer than 36 months following termination of employment.

Employee Severance Compensation Plan. In connection with the offering, we expect to adopt the First Savings Bank Employee Severance Compensation Plan. The plan will provide severance benefits to eligible employees who terminate employment in connection with a change in control. Employees will be eligible for severance benefits under the plan if they complete a minimum of one year of service and do not enter into a separate employment or change in control agreement with First Savings Bank or an affiliate, including First Savings Financial Group. Under the severance plan, if, within twelve months after a change in control, an employee’s employment involuntarily terminates, or if the employee voluntarily terminates employment under circumstances specified in the plan, the terminated employee will receive a severance payment equal to two weeks of base compensation for each year of service, up to a maximum of six months of base compensation. Based solely on compensation levels and years of service at March 31, 2008, and assuming that a change in control occurred on March 31, 2008, and all eligible employees became entitled to severance payments, the aggregate payments due under the severance plan would equal approximately $635,000.

Pension Benefits

Employees’ Pension Plan. We maintain the First Savings Bank Employees’ Pension Plan to provide retirement benefits for eligible employees. Employees are eligible to participate in the retirement plan on the May 1 ^st or November 1 ^st that coincides with or next follows their attainment of age 21 and completion of one year of eligibility service. An active participant may retire on or after the date the participant attains age 65 and receive a monthly pension in the form of a straight life annuity equal to 1.85% of his monthly compensation multiplied by his years of benefit service at normal retirement (up to a maximum of 25 years). After attainment of age 55 and the completion of ten years of service, an active participant may elect early retirement. Upon early retirement, a participant is entitled to receive his accrued pension commencing on his normal retirement date or, if the participant desires, he may elect to receive a reduced pension which will commence following the participant’s early retirement date. If the employment of an active participant is terminated because of total and permanent disability, the participant will be entitled to receive a disability pension equal to the participant’s accrued pension, without actuarial reduction, commencing on his normal retirement date, or, if the participant desires, he may elect to receive a reduced pension payable following termination of service due to the disability.

Participants generally have no vested interest in retirement plan benefits before the completion of five years of service. Following the completion of five years of vesting service, or in the event of a participant’s attainment of age 65, death or termination of employment due to disability, a participant will become 100% vested in the accrued benefit under the retirement plan. Participants may generally elect to receive benefits in the form of a life annuity, a joint and survivor annuity, or a life annuity with a minimum guaranteed payment.

We have taken steps to freeze the Employees’ Pension Plan as of June 30, 2008. As a result, each active participant’s pension benefit will be determined based on the participant’s compensation and duration of employment as of June 30, 2008, and compensation and employment after that date will not be taken into account in determining pension benefits under the pension plan.

Benefit Plans

Profit Sharing/401(k) Plan. We maintain the First Savings Bank Profit Sharing/401(k) Plan, a tax-qualified defined contribution plan, for all employees of First Savings Bank who satisfy the plan’s eligibility requirements. Participants become eligible to participate in the plan on the January 1st or July 1st that coincides with or next follows their attainment of age 21 and completion of six months of service. Eligible employees may contribute up to 100% of their compensation to the plan on a pre-tax basis, subject to limitations imposed by the Internal Revenue Code. For 2008, the salary deferral contribution limit is $15,500; provided, however, participants over age 50 may contribute an additional $5,000 to the plan. Participants are always 100% vested in their salary deferral contributions. In addition to salary deferral contributions, the plan provides that we can make discretionary matching contributions and profit sharing contributions to the accounts of plan participants. During the 2007 plan year, we made matching contributions to the plan on behalf of each participant in an amount equal to 100% of the first 3% of the salary deferral contributions made by each participant to the plan. Participants are 100% vested in their employer matching contributions. For the 2008 plan year, First Savings Bank will make a safe harbor matching contribution for each participant equal to 100% of each participant’s elective deferrals up to 5% of compensation. Participants have individual accounts under the plan and may direct the investment of their accounts among a variety of investment funds. In connection with the offering, the plan has added another investment alternative, the First Savings Financial Group Stock Fund (the “Stock Fund”), which will permit participants to invest their 401(k) Plan funds in First Savings Financial Group common stock. A participant who elects to purchase common stock in the offering through the plan will receive the same subscription priority, and be subject to the same individual purchase limitations, as if the participant had elected to purchase the common stock using funds outside the plan. See “The Conversion and Stock Offering — Subscription Offering and Subscription Rights” and “— Limitations on Purchases of Shares.” The Stock Fund trustee will purchase common stock in the offering on behalf of plan participants, to the extent that shares are available. Participants will direct the trustee regarding the voting of shares purchased for their plan accounts through the Stock Fund. Bank of New York will serve as custodian of the shares held in the Stock Fund.

Employee Stock Ownership Plan. In connection with the conversion, First Savings Bank has adopted an employee stock ownership plan for eligible employees. Eligible employees will participate in the employee stock ownership plan as of the first plan entry date (January 1st or July 1st) following or coincident with attainment of age 21 and completion of 1,000 hours of service during a consecutive 12-month period. However, eligible employees who are over 21 years of age on the closing of the First Savings Bank conversion will enter into the employee stock ownership plan on the later of January 1, 2008 or the eligible employee’s date of hire.

We have engaged a third party trustee to purchase, on behalf of the employee stock ownership plan, 8% of the total number of shares of First Savings Financial Group common stock sold in the conversion and contributed to the charitable foundation (218,920, 256,000, and 293,080 shares at the minimum, midpoint and maximum of the offering range, respectively). The employee stock ownership plan intends to fund its stock purchase through a loan from First Savings Financial Group equal to 100% of the aggregate purchase price of the common stock. The loan will be repaid principally through First Savings Bank’s contributions to the employee stock ownership plan and dividends payable on common stock held by the plan over the anticipated 15-year term of the loan. The fixed interest rate for the employee stock ownership plan loan will be the prime rate, as published in The Wall Street Journal, on the closing date of the offering. See “Pro Forma Data.”

The trustee will hold the shares purchased by the employee stock ownership plan in a loan suspense account, and will release the shares from the suspense account on a pro rata basis as First Savings Bank repays the loan. The trustee will allocate the shares released among active participants on the basis of each active participant’s proportional share of compensation. Participants will vest fully in their employee stock ownership plan allocations after earning three years of service. Participants also will become fully vested automatically upon normal retirement, death or disability, a change in control, or termination of the plan. Generally, participants will receive distributions from the employee stock ownership plan upon separation from service. The plan reallocates any unvested shares of common stock forfeited upon termination of employment among the remaining participants in the plan.

The employee stock ownership plan permits participants to direct the plan trustee how to vote the shares of common stock credited to their accounts. The plan trustee will vote unallocated shares and allocated shares for which participants do not provide instructions on any matter in the same ratio as it votes those shares for which participants provide instructions, subject to fulfillment of its fiduciary responsibilities as trustee for the plan.

Under applicable accounting requirements, First Savings Bank will record a compensation expense for a leveraged employee stock ownership plan at the fair market value of the shares when they are committed to be released from the suspense account to participants’ accounts under the plan.

Nonqualified Deferred Compensation

Supplemental Executive Retirement Plan. Following the conversion, we intend to implement a supplemental executive retirement plan to provide for supplemental retirement benefits with respect to the employee stock ownership plan. The plan will provide participating executives with benefits otherwise limited by other provisions of the Internal Revenue Code or the terms of the employee stock ownership plan loan. Specifically, the plan will provide benefits to eligible individuals (those designated by our Board of Directors) that cannot be provided under the employee stock ownership plan as a result of the limitations imposed by the Internal Revenue Code, but that would have been provided under the employee stock ownership plan but for such limitations. In addition to providing for benefits lost under tax qualified plans as a result of limitations imposed by the Internal Revenue Code, the new plan will also provide supplemental benefits to designated individuals upon a change of control before the complete scheduled repayment of the employee stock ownership plan loan. Generally, upon such an event, the supplemental executive retirement plan will provide the individual with a benefit equal to what the individual would have received under the employee stock ownership plan had he or she remained employed throughout the term of the employee stock ownership plan loan less the benefits actually provided under the employee stock ownership on behalf of such individual. An individual’s benefit under the supplemental executive retirement plan will generally become payable upon the change in control of First Savings Bank or First Savings Financial Group. First Savings Bank expects Messrs. Myers and Lawson to participate in the plan. The Board of Directors may also designate other officers as participants in future years.

Future Equity Incentive Plan. Following the conversion and initial stock offering, First Savings Financial Group plans to adopt an equity incentive plan that will provide for grants of stock options and restricted stock. In accordance with applicable regulations, First Savings Financial Group anticipates that the plan, if adopted within the first year of the offering, will authorize a number of stock options equal to 10% of the total shares sold in the conversion stock offering and contributed to the charitable foundation, and a number of shares of restricted stock equal to 4% of the total shares sold in the offering and contributed to the charitable foundation. Therefore, the number of shares reserved under the plan, if adopted within that one-year period, will range from 383,110 shares, assuming 2,736,500 shares are sold in the offering and contributed to the charitable foundation, to 512,890 shares, assuming 3,663,500 shares are sold in the offering and contributed to the charitable foundation. These limits will not apply if we adopt the plan more than one year after the offering.

Director Compensation

The following table provides the compensation received by individuals who served as non-employee directors of First Savings Bank during the 2007 fiscal year.


	Fees Earned or Paid in Cash ($)	All Other Compensation ($)	Total ($)
Charles E. Becht, Jr.	11,575	—	11,575
Cecile A. Blau (1)	—	—	—
Gerald Wayne Clapp, Jr.	11,575	—	11,575
Robert E. Libs	11,575	—	11,575
Michael F. Ludden	15,175	—	15,175
Douglas A. York (1)	—	—	—

(1)	Appointed to the board of directors in March 2008.

Cash Retainer and Meeting Fees For Non-Employee Directors. The following table sets forth the applicable retainers and fees that will be paid to our non-employee directors for their service on the boards of directors of First Savings Financial Group and First Savings Bank for their service during 2009.


Board of Directors of First Savings Bank
Fee per Board Meeting – Director	$	950
Fee per Board Meeting – Chairman	$	1,350
Board of Directors of First Savings Financial Group
Annual Retainer	$	5,000
Fee per committee meeting	$	200	($300 for Chairman of the Committee)

Directors’ Deferred Compensation Agreements. First Savings Bank has entered into deferred compensation agreements with each of our non-employee directors. Under the agreements, each director may defer the receipt of meeting and other board fees to a future date; generally until a director’s normal retirement date of age 70. Under the agreements, First Savings Bank credits the deferred compensation amounts quarterly with interest at a rate equal to the prime rate for the immediately preceding calendar quarter plus 2%, but in no event at a rate in excess of 8%. Subject to certain elections available to each director, deferred compensation amounts are distributable over a period of 180 months typically commencing at normal retirement age or termination of service. Benefits also become distributable over a 180 month period following a director becoming disabled. If a director dies prior to the commencement of benefit payments or prior to the completion of all benefit payments, the benefit or remaining benefit, as the case may be, are distributed to the director’s beneficiary in a single lump sum.

Transactions with First Savings Bank, F.S.B.

Loans and Extensions of Credit. The Sarbanes-Oxley Act of 2002 generally prohibits loans by First Savings Financial Group to its executive officers and directors. However, the Sarbanes-Oxley Act contains a specific exemption from such prohibition for loans by First Savings Bank to its executive officers and directors in compliance with federal banking regulations. Federal regulations require that all loans or extensions of credit to executive officers and directors of insured institutions must 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 must not involve more than the normal risk of repayment or present other unfavorable features. First Savings Bank is therefore prohibited from making any new loans or extensions of credit to executive officers and directors at different rates or terms than those offered to the general public. Notwithstanding this rule, federal regulations permit First Savings Bank to make loans to executive officers and directors at reduced interest rates if the loan is made under a benefit program generally available to all other employees and does not give preference to any executive officer or director over any other employee. First Savings Bank does not sponsor such a program.

In addition, loans made to a director or executive officer in an amount that, when aggregated with the amount of all other loans to the person and his or her related interests, are in excess of the greater of $25,000 or 5% of First Savings Bank’s capital and surplus, up to a maximum of $500,000, must be approved in advance by a majority of the disinterested members of the board of directors. See “Regulation and Supervision — Regulation of Federal Savings Associations — Transactions with Related Parties.”

The aggregate outstanding balance of loans extended by First Savings Bank to its executive officers and directors and related parties was $3.7 million at March 31, 2008, or approximately 6.2% of pro forma stockholders’ equity assuming that 3,663,500 shares are sold in the offering and contributed to the charitable foundation. These loans were performing according to their original terms at March 31, 2008. In addition, these loans were made in the ordinary course of business, on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to First Savings Bank, and did not involve more than the normal risk of collectibility or present other unfavorable features when made.

Other Transactions. Since October 1, 2006, there have been no transactions and there are no currently proposed transactions in which we were or are to be a participant and the amount involved exceeds $120,000, and in which any of our executive officers and directors had or will have a direct or indirect material interest.

Indemnification for Directors and Officers

First Savings Financial Group’s Articles of Incorporation provides that First Savings Financial Group shall indemnify all officers, directors and employees of First Savings Financial Group to the fullest extent permitted under Indiana law against all expenses and liabilities reasonably incurred by them in connection with or arising out of any action, suit or proceeding in which they may be involved by reason of their having been a director or officer of First Savings Financial Group. Such indemnification may include the advancement of funds to pay for or reimburse reasonable expenses incurred by an indemnified party to the fullest extent permitted under Indiana law. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of First Savings Financial Group pursuant to its Articles of Incorporation or otherwise, First Savings Financial Group has been advised by counsel that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.

Subscriptions By Executive Officers And Directors

The following table presents certain information as to the approximate purchases of common stock by our directors and executive officers, including their associates, if any, as defined by applicable regulations. No individual has entered into a binding agreement to purchase these shares and, therefore, actual purchases could be more or less than indicated. Directors and executive officers and their associates may not purchase more than 31% of the shares sold in the offering. Like all of our depositors, our directors and officers have subscription rights based on their deposits. For purposes of the following table, sufficient shares are assumed to be available to satisfy subscriptions in all categories. All directors and officers as a group would own 7.0% of our outstanding shares at the minimum of the offering range and 5.2% of our outstanding shares at the maximum of the offering range. These percentages reflect the shares to be issued to the charitable foundation.


	Proposed Purchases of Stock in the Offering
Name	Number of Shares	Dollar Amount
Directors:
Charles E. Becht, Jr.	20,000	$	200,000
Cecile A. Blau	5,000		50,000
Gerald Wayne Clapp, Jr.	25,000		250,000
Robert E. Libs	25,000		250,000
John P. Lawson, Jr.	10,000		100,000
Michael F. Ludden	25,000		250,000
Larry W. Myers	35,000		350,000
Douglas A. York	30,000		300,000
Executive Officers Who Are Not Directors:
Donald R. Allen	10,000		100,000
M. Sue Johnson	1,000		10,000
Gregory A. McMurry	5,000		50,000
Anthony A. Schoen	1,000		10,000

All directors and executive officers as a group (12 persons)	192,000	$	1,920,000

Regulation and Supervision

General

First Savings Bank is subject to extensive regulation, examination and supervision by the Office of Thrift Supervision, as its primary federal regulator, and the Federal Deposit Insurance Corporation, as its deposits insurer. First Savings Bank is a member of the Federal Home Loan Bank System and its deposit accounts are insured up to applicable limits by the Deposit Insurance Fund managed by the Federal Deposit Insurance Corporation. First Savings Bank must file reports with the Office of Thrift Supervision and the Federal Deposit Insurance Corporation concerning its activities and financial condition in addition to obtaining regulatory approvals before entering into certain transactions such as mergers with, or acquisitions of, other financial institutions. There are periodic examinations by the Office of Thrift Supervision and, under certain circumstances, the Federal Deposit Insurance Corporation to evaluate First Savings Bank’s safety and soundness and compliance with various regulatory requirements. This regulatory structure is intended primarily for the protection of the insurance fund and depositors. The regulatory structure also gives the regulatory authorities extensive discretion in connection with their supervisory and enforcement activities and examination policies, including policies with respect to the classification of assets and the establishment of adequate loan loss reserves for regulatory purposes. Any change in such policies, whether by the Office of Thrift Supervision, the Federal Deposit Insurance Corporation or Congress, could have a material adverse impact on First Savings Financial Group and First Savings Bank and their operations. First Savings Financial Group, as a savings and loan holding company, is required to file certain reports with, are subject to examination by, and otherwise must comply with the rules and regulations of the Office of Thrift Supervision. First Savings Financial Group will also be subject to the rules and regulations of the Securities and Exchange Commission under the federal securities laws.

Certain of the regulatory requirements that are or will be applicable to First Savings Bank and First Savings Financial Group are described below. This description of statutes and regulations is not intended to be a complete explanation of such statutes and regulations and their effects on First Savings Bank and First Savings Financial Group and is qualified in its entirety by reference to the actual statutes and regulations.

Regulation of Federal Savings Associations

Business Activities. Federal law and regulations, primarily the Home Owners’ Loan Act and the regulations of the Office of Thrift Supervision, govern the activities of federal savings banks, such as First Savings Bank. These laws and regulations delineate the nature and extent of the activities in which federal savings banks may engage. In particular, certain lending authority for federal savings banks, e.g., commercial, non-residential real property loans and consumer loans, is limited to a specified percentage of the institution’s capital or assets.

Branching. Federal savings banks are authorized to establish branch offices in any state or states of the United States and its territories, subject to the approval of the Office of Thrift Supervision.

Capital Requirements. The Office of Thrift Supervision’s capital regulations require federal savings institutions to meet three minimum capital standards: a 1.5% tangible capital to total assets ratio, a 4% leverage ratio (3% for institutions receiving the highest rating on the CAMELS examination rating system) and an 8% risk-based capital ratio. In addition, the prompt corrective action standards discussed below establish, in effect, a minimum 2% tangible capital standard, a 4% leverage ratio (3% for institutions receiving the highest rating on the CAMELS system) and, together with the risk-based capital standard itself, a 4% Tier 1 risk-based capital standard. The Office of Thrift Supervision regulations also require that, in meeting the tangible, leverage and risk-based capital standards, institutions must generally deduct investments in and loans to subsidiaries engaged in activities as principal that are not permissible for national banks.

The risk-based capital standard requires federal savings institutions to maintain Tier 1 (core) and total capital (which is defined as core capital and supplementary capital) to risk-weighted assets of at least 4% and 8%, respectively. In determining the amount of risk-weighted assets, all assets, including certain off-balance sheet assets, recourse obligations, residual interests and direct credit substitutes, are multiplied by a risk-weight factor of 0% to 100%, assigned by the Office of Thrift Supervision capital regulation based on the risks believed inherent in

the type of asset. Core (Tier 1) capital is defined as common stockholders’ equity (including retained earnings), certain noncumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries, less intangibles other than certain mortgage servicing rights and credit card relationships. The components of supplementary capital currently include cumulative preferred stock, long-term perpetual preferred stock, mandatory convertible securities, subordinated debt and intermediate preferred stock, the allowance for loan and lease losses limited to a maximum of 1.25% of risk-weighted assets and up to 45% of unrealized gains on available-for-sale equity securities with readily determinable fair market values. Overall, the amount of supplementary capital included as part of total capital cannot exceed 100% of core capital.

The Office of Thrift Supervision also has authority to establish individual minimum capital requirements in appropriate cases upon a determination that an institution’s capital level is or may become inadequate in light of the particular circumstances. At March 31, 2008 and September 30, 2007, First Savings Bank met each of these capital requirements. See Note 15 of the notes to consolidated financial statements included in this prospectus.

Prompt Corrective Regulatory Action. The Office of Thrift Supervision is required to take certain supervisory actions against undercapitalized institutions, the severity of which depends upon the institution’s degree of undercapitalization. Generally, a savings institution that has a ratio of total capital to risk weighted assets of less than 8%, a ratio of Tier 1 (core) capital to risk-weighted assets of less than 4% or a ratio of core capital to total assets of less than 4% (3% or less for institutions with the highest examination rating) is considered to be “undercapitalized.” A savings institution that has a total risk-based capital ratio of less than 6%, a Tier 1 capital ratio of less than 3% or a leverage ratio that is less than 3% is considered to be “significantly undercapitalized” and a savings institution that has a tangible capital to assets ratio equal to or less than 2% is deemed to be “critically undercapitalized.” Subject to a narrow exception, the Office of Thrift Supervision is required to appoint a receiver or conservator within specified time frames for an institution that is “critically undercapitalized.” An institution must file a capital restoration plan with the Office of Thrift Supervision within 45 days of the date it receives notice that it is “undercapitalized,” “significantly undercapitalized” or “critically undercapitalized.” Compliance with the plan must be guaranteed by any parent holding company in the amount of the lesser of 5% of the association’s total assets when it became undercapitalized or the amount necessary to achieve full compliance at the time the association first failed to comply. In addition, numerous mandatory supervisory actions become immediately applicable to an undercapitalized institution, including, but not limited to, increased monitoring by regulators and restrictions on growth, capital distributions and expansion. “Significantly undercapitalized” and “critically undercapitalized” institutions are subject to more extensive mandatory regulatory actions. The Office of Thrift Supervision could also take any one of a number of discretionary supervisory actions, including the issuance of a capital directive and the replacement of senior executive officers and directors.

Loans to One Borrower. Federal law provides that savings institutions are generally subject to the limits on loans to one borrower applicable to national banks. Subject to certain exceptions, a savings institution may not make a loan or extend credit to a single or related group of borrowers in excess of 15% of its unimpaired capital and surplus. An additional amount may be lent, equal to 10% of unimpaired capital and surplus, if secured by specified readily-marketable collateral. See “Our Business — Lending Activities — Loans to One Borrower.”

Standards for Safety and Soundness. As required by statute, the federal banking agencies have adopted Interagency Guidelines Establishing Standards for Safety and Soundness. The guidelines set forth the safety and soundness standards that the federal banking agencies use to identify and address problems at insured depository institutions before capital becomes impaired. If the Office of Thrift Supervision determines that a savings institution fails to meet any standard prescribed by the guidelines, the Office of Thrift Supervision may require the institution to submit an acceptable plan to achieve compliance with the standard.

Limitation on Capital Distributions. Office of Thrift Supervision regulations impose limitations upon all capital distributions by a savings institution, including cash dividends, payments to repurchase its shares and payments to stockholders of another institution in a cash-out merger. Under the regulations, an application to and the prior approval of the Office of Thrift Supervision is required before any capital distribution if the institution does not meet the criteria for “expedited treatment” of applications under Office of Thrift Supervision regulations (i.e., generally, examination and Community Reinvestment Act ratings in the two top categories), the total capital distributions for the calendar year exceed net income for that year plus the amount of retained net income for the preceding two years, the institution would be undercapitalized following the distribution or the distribution would

otherwise be contrary to a statute, regulation or agreement with the Office of Thrift Supervision. If an application is not required, the institution must still provide prior notice to the Office of Thrift Supervision of the capital distribution if, like First Savings Bank, it is a subsidiary of a holding company. If First Savings Bank’s capital were ever to fall below its regulatory requirements or the Office of Thrift Supervision notified it that it was in need of increased supervision, its ability to make capital distributions could be restricted. In addition, the Office of Thrift Supervision could prohibit a proposed capital distribution that would otherwise be permitted by the regulation, if the agency determines that such distribution would constitute an unsafe or unsound practice.

Qualified Thrift Lender Test. Federal law requires savings institutions to meet a qualified thrift lender test. Under the test, a savings association is required to either qualify as a “domestic building and loan association” under the Internal Revenue Code or maintain at least 65% of its “portfolio assets” (total assets less: (i) specified liquid assets up to 20% of total assets; (ii) intangibles, including goodwill; and (iii) the value of property used to conduct business) in certain “qualified thrift investments” (primarily residential mortgages and related investments, including certain mortgage-backed securities) in at least 9 months out of each 12-month period.

A savings institution that fails the qualified thrift lender test is subject to certain operating restrictions and may be required to convert to a bank charter. Recent legislation has expanded the extent to which education loans, credit card loans and small business loans may be considered “qualified thrift investments.” As of March 31, 2008, First Savings Bank maintained 76.2% of its portfolio assets in qualified thrift investments and, therefore, met the qualified thrift lender test.

Transactions with Related Parties. First Savings Bank’s authority to engage in transactions with “affiliates” is limited by Office of Thrift Supervision regulations and Sections 23A and 23B of the Federal Reserve Act as implemented by the Federal Reserve Board’s Regulation W. The term “affiliates” for these purposes generally means any company that controls or is under common control with an institution. First Savings Financial Group and any non-savings institution subsidiaries would be affiliates of First Savings Bank. In general, transactions with affiliates must be on terms that are as favorable to the institution as comparable transactions with non-affiliates. In addition, certain types of transactions are restricted to 10% of an institution’s capital and surplus with any one affiliate and 20% of capital and surplus with all affiliates. Collateral in specified amounts must usually be provided by affiliates in order to receive loans from an institution. In addition, savings institutions are prohibited from lending to any affiliate that is engaged in activities that are not permissible for bank holding companies and no savings institution may purchase the securities of any affiliate other than a subsidiary.

The Sarbanes-Oxley Act of 2002 generally prohibits a company from making loans to its executive officers and directors. However, that act contains a specific exception for loans by a depository institution to its executive officers and directors in compliance with federal banking laws. Under such laws, First Savings Bank’s authority to extend credit to executive officers, directors and 10% stockholders (“insiders”), as well as entities such persons control, is limited. The law restricts both the individual and aggregate amount of loans First Savings Bank may make to insiders based, in part, on First Savings Bank’s capital position and requires certain board approval procedures to be followed. Such loans must be made on terms substantially the same as those offered to unaffiliated individuals and not involve more than the normal risk of repayment. There is an exception for loans made pursuant to a benefit or compensation program that is widely available to all employees of the institution and does not give preference to insiders over other employees. There are additional restrictions applicable to loans to executive officers. For information about transactions with our directors and officers, see “Our Management —Transactions with First Savings Bank.”

Enforcement. The Office of Thrift Supervision has primary enforcement responsibility over federal savings institutions and has the authority to bring actions against the institution and all institution-affiliated parties, including stockholders, and any attorneys, appraisers and accountants who knowingly or recklessly participate in wrongful action likely to have an adverse effect on an insured institution. Formal enforcement action may range from the issuance of a capital directive or cease and desist order to removal of officers and/or directors to institution of receivership, or conservatorship. Civil penalties cover a wide range of violations and can amount to $25,000 per day, or even $1 million per day in especially egregious cases. The Federal Deposit Insurance Corporation has authority to recommend to the Director of the Office of Thrift Supervision that enforcement action be taken with respect to a particular savings institution. If action is not taken by the Director, the Federal Deposit Insurance Corporation has authority to take such action under certain circumstances. Federal law also establishes criminal penalties for certain violations.

Assessments. Federal savings banks are required to pay assessments to the Office of Thrift Supervision to fund its operations. The general assessments, paid on a semi-annual basis, are based upon the savings institution’s total assets, including consolidated subsidiaries, as reported in the institution’s latest quarterly thrift financial report, the institution’s financial condition and the complexity of its asset portfolio.

Insurance of Deposit Accounts. First Savings Bank’s deposits are insured up to applicable limits by the Deposit Insurance Fund of the Federal Deposit Insurance Corporation. The Deposit Insurance Fund is the successor to the Bank Insurance Fund and the Savings Association Insurance Fund, which were merged in 2006. The Federal Deposit Insurance Corporation has amended its risk-based assessment system for 2007 to implement authority granted by the Federal Deposit Insurance Reform Act of 2005 (the “Reform Act”). Under the revised system, insured institutions are assigned to one of four risk categories based on supervisory evaluations, regulatory capital levels and certain other factors by which institutions are assigned to one of three categories based on their capitalization and one of three subcategories based on examination ratings and other supervisory information. An institution’s assessment rate depends upon the category to which it is assigned. Risk Category I, which contains the least risky depository institutions, is expected to include more than 90% of all institutions. Unlike the other categories, Risk Category I contains further risk differentiation based on the Federal Deposit Insurance Corporation’s analysis of financial ratios, examination component ratings and other information. Assessment rates are determined semi-annually by the Federal Deposit Insurance Corporation and currently range from five to seven basis points for the healthiest institutions (Risk Category I) to 43 basis points of assessable deposits for the riskiest (Risk Category IV). The Federal Deposit Insurance Corporation may adjust rates uniformly from one quarter to the next, except that no single adjustment can exceed three basis points.

The Reform Act also provides for a one-time credit for eligible institutions based on their assessment base as of December 31, 1996. Subject to certain limitations with respect to institutions that are exhibiting weaknesses, credits can be used to offset assessments until exhausted. The Reform Act also provides for the possibility that the Federal Deposit Insurance Corporation may pay dividends to insured institutions once the Deposit Insurance Fund reserve ratio equals or exceeds 1.35% of estimated insured deposits.

In addition to the assessment for deposit insurance, institutions are required to make payments on bonds issued in the late 1980s by the Financing Corporation to recapitalize a predecessor deposit insurance fund. This payment is established quarterly and during the calendar year ending December 31, 2007 averaged 1.18 basis points of assessable deposits. First Savings Bank’s total assessment (including the Financing Corporation assessment) paid for fiscal 2007 was $21,000.

The Reform Act provides the Federal Deposit Insurance Corporation with authority to adjust the Deposit Insurance Fund ratio to insured deposits within a range of 1.15% and 1.50%, in contrast to the prior statutorily fixed ratio of 1.25%. The ratio, which is viewed by the Federal Deposit Insurance Corporation as the level that the fund should achieve, was established by the agency at 1.25% for 2007.

The Federal Deposit Insurance Corporation has authority to increase insurance assessments. A significant increase in insurance premiums would likely have an adverse effect on the operating expenses and results of operations of First Savings Bank. Management cannot predict what insurance assessment rates will be in the future.

Insurance of deposits may be terminated by the Federal Deposit Insurance Corporation upon a finding that the institution has engaged in unsafe or unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the Federal Deposit Insurance Corporation or the Office of Thrift Supervision. The management of First Savings Bank does not know of any practice, condition or violation that might lead to termination of deposit insurance.

Federal Home Loan Bank System. First Savings Bank is a member of the Federal Home Loan Bank System, which consists of (12) regional Federal Home Loan Banks. The Federal Home Loan Bank provides a central credit facility primarily for member institutions. First Savings Bank, as a member of the Federal Home Loan Bank of Indianapolis, is required to acquire and hold shares of capital stock in that Federal Home Loan Bank in an

amount at least equal to 1.0% of the aggregate principal amount of its unpaid residential mortgage loans and similar obligations at the beginning of each year, or 1/20th of its advances (borrowings) from the Federal Home Loan Bank, whichever is greater. At March 31, 2008, First Savings Bank complied with this requirement with an investment in Federal Home Loan Bank stock of $1.3 million.

The Federal Home Loan Banks are required to provide funds for the resolution of insolvent thrifts in the late 1980s and to contribute funds for affordable housing programs. These requirements could reduce the amount of dividends that the Federal Home Loan Banks pay to their members and could also result in the Federal Home Loan Banks imposing a higher rate of interest on advances to their members. If dividends were reduced, or interest on future Federal Home Loan Bank advances increased, our net interest income would likely also be reduced.

Community Reinvestment Act. Under the Community Reinvestment Act, as implemented by Office of Thrift Supervision regulations, a savings association has a continuing and affirmative obligation consistent with its safe and sound operation to help meet the credit needs of its entire community, including low and moderate income neighborhoods. The Community Reinvestment Act does not establish specific lending requirements or programs for financial institutions nor does it limit an institution’s discretion to develop the types of products and services that it believes are best suited to its particular community, consistent with the Community Reinvestment Act. The Community Reinvestment Act requires the Office of Thrift Supervision, in connection with its examination of a savings association, to assess the institution’s record of meeting the credit needs of its community and to take such record into account in its evaluation of certain applications by such institution.

The Community Reinvestment Act requires public disclosure of an institution’s rating and requires the Office of Thrift Supervision to provide a written evaluation of an association’s Community Reinvestment Act performance utilizing a four-tiered descriptive rating system.

First Savings Bank received a “satisfactory” rating as a result of its most recent Community Reinvestment Act assessment.

Other Regulations

Interest and other charges collected or contracted for by First Savings Bank are subject to state usury laws and federal laws concerning interest rates. First Savings Bank’s operations are also subject to federal laws applicable to credit transactions, such as the:

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Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers;

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Home Mortgage Disclosure Act of 1975, requiring financial institutions to provide information to enable the public and public officials to determine whether a financial institution is fulfilling its obligation to help meet the housing needs of the community it serves;

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Equal Credit Opportunity Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in extending credit;

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Fair Credit Reporting Act of 1978, governing the use and provision of information to credit reporting agencies;

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Fair Debt Collection Act, governing the manner in which consumer debts may be collected by collection agencies; and

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Rules and regulations of the various federal agencies charged with the responsibility of implementing such federal laws.

The operations of First Savings Bank also are subject to the:

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Right to Financial Privacy Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes procedures for complying with administrative subpoenas of financial records;

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Electronic Funds Transfer Act and Regulation E promulgated thereunder, which governs automatic deposits to and withdrawals from deposit accounts and customers’ rights and liabilities arising from the use of automated teller machines and other electronic banking services;

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Check Clearing for the 21st Century Act (also known as “Check 21”), which gives “substitute checks,” such as digital check images and copies made from that image, the same legal standing as the original paper check;

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Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (referred to as the “USA PATRIOT Act”), which significantly expands the responsibilities of financial institutions, including savings and loan associations, in preventing the use of the U.S. financial system to fund terrorist activities. Among other provisions, it requires financial institutions operating in the United States to develop new anti-money laundering compliance programs, due diligence policies and controls to ensure the detection and reporting of money laundering. Such required compliance programs are intended to supplement existing compliance requirements, also applicable to financial institutions, under the Bank Secrecy Act and the Office of Foreign Assets Control Regulations; and

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The Gramm-Leach-Bliley Act places limitations on the sharing of consumer financial information with unaffiliated third parties. Specifically, the Gramm-Leach-Bliley Act requires all financial institutions offering financial products or services to retail customers to provide such customers with the financial institution’s privacy policy and provide such customers the opportunity to “opt out” of the sharing of personal financial information with unaffiliated third parties.

Federal Reserve System

The Federal Reserve Board regulations require savings institutions to maintain non-interest earning reserves against their transaction accounts (primarily Negotiable Order of Withdrawal (“NOW”) and regular checking accounts). The regulations generally provide that reserves be maintained against aggregate transaction accounts as follows: a 3% reserve ratio is assessed on net transaction accounts up to and including $48.3 million; a 10% reserve ratio is applied above $48.3 million. The first $7.8 million of otherwise reservable balances (subject to adjustments by the Federal Reserve Board) are exempted from the reserve requirements. The amounts are adjusted annually. First Savings Bank complies with the foregoing requirements.

Holding Company Regulation

General. First Savings Financial Group will be a nondiversified unitary savings and loan holding company within the meaning of federal law. The Gramm-Leach-Bliley Act of 1999 provides that no company may acquire control of a savings institution after May 4, 1999 unless it engages only in the financial activities permitted for financial holding companies under the law or for multiple savings and loan holding companies as described below. Further, the Gramm-Leach-Bliley Act specifies that existing savings and loan holding companies may only engage in such activities. Upon any non-supervisory acquisition by First Savings Financial Group of another savings institution or savings bank that meets the qualified thrift lender test and is deemed to be a savings institution by the Office of Thrift Supervision, First Savings Financial Group would become a multiple savings and loan holding company (if the acquired institution is held as a separate subsidiary) and would generally be limited to activities permissible for bank holding companies under Section 4(c)(8) of the Bank Holding Company Act, subject to the prior approval of the Office of Thrift Supervision, and certain activities authorized by Office of Thrift Supervision regulation. However, the Office of Thrift Supervision has issued an interpretation concluding that multiple savings and loan holding companies may also engage in activities permitted for financial holding companies.

A savings and loan holding company is prohibited from, directly or indirectly, acquiring more than 5% of the voting stock of another savings institution or savings and loan holding company, without prior written approval of the Office of Thrift Supervision, and from acquiring or retaining control of a depository institution that is not insured by the Federal Deposit Insurance Corporation. In evaluating applications by holding companies to acquire savings institutions, the Office of Thrift Supervision considers the financial and managerial resources and future prospects of the company and institution involved, the effect of the acquisition on the risk to the deposit insurance funds, the convenience and needs of the community and competitive factors.

The Office of Thrift Supervision may not approve any acquisition that would result in a multiple savings and loan holding company controlling savings institutions in more than one state, subject to two exceptions: (i) the approval of interstate supervisory acquisitions by savings and loan holding companies; and (ii) the acquisition of a savings institution in another state if the laws of the state target savings institution specifically permit such acquisitions. The states vary in the extent to which they permit interstate savings and loan holding company acquisitions.

Although savings and loan holding companies are not currently subject to specific capital requirements or specific restrictions on the payment of dividends or other capital distributions, federal regulations do prescribe such restrictions on subsidiary savings institutions as described below. First Savings Bank must notify the Office of Thrift Supervision 30 days before declaring any dividend to First Savings Financial Group. In addition, the financial impact of a holding company on its subsidiary institution is a matter that is evaluated by the Office of Thrift Supervision and the agency has authority to order cessation of activities or divestiture of subsidiaries deemed to pose a threat to the safety and soundness of the institution.

Acquisition of Control. Under the federal Change in Bank Control Act, a notice must be submitted to the Office of Thrift Supervision if any person (including a company), or group acting in concert, seeks to acquire “control” of a savings and loan holding company or savings association. An acquisition of “control” can occur upon the acquisition of 10% or more of the voting stock of a savings and loan holding company or savings institution or as otherwise defined by the Office of Thrift Supervision. Under the Change in Bank Control Act, the Office of Thrift Supervision has 60 days from the filing of a complete notice to act, taking into consideration certain factors, including the financial and managerial resources of the acquirer and the anti-trust effects of the acquisition. Any company that so acquires control would then be subject to regulation as a savings and loan holding company.

Federal Securities Laws

First Savings Financial Group has filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933 for the registration of the common stock to be issued in the offering. Upon completion of the offering, First Savings Financial Group’s common stock will be registered with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. First Savings Financial Group will be subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Securities Exchange Act of 1934, as amended.

The registration, under the Securities Act of 1933, as amended, of the shares of common stock to be issued in the offering does not cover the resale of those shares. Shares of common stock purchased by persons who are not affiliates of First Savings Financial Group may be resold without registration. Shares purchased by an affiliate of First Savings Financial Group will be subject to the resale restrictions of Rule 144 under the Securities Act of 1933, as amended. If First Savings Financial Group meets the current public information requirements of Rule 144, each affiliate of First Savings Financial Group that complies with the other conditions of Rule 144, including those that require the affiliate’s sale to be aggregated with those of other persons, would be able to sell in the public market, without registration, a number of shares not to exceed, in any three-month period, the greater of 1% of the outstanding shares of First Savings Financial Group or the average weekly volume of trading in the shares during the preceding four calendar weeks. In the future, First Savings Financial Group may permit affiliates to have their shares registered for sale under the Securities Act of 1933, as amended.

Sarbanes-Oxley Act of 2002

The Sarbanes-Oxley Act of 2002 addresses, among other issues, corporate governance, auditing and accounting, executive compensation, and enhanced and timely disclosure of corporate information. As directed by the Sarbanes-Oxley Act of 2002, First Savings Financial Group’s Chief Executive Officer and Chief Financial Officer each will be required to certify that First Savings Financial Group’s quarterly and annual reports do not contain any untrue statement of a material fact. The rules adopted by the Securities and Exchange Commission under the Sarbanes-Oxley Act of 2002 have several requirements, including having these officers certify that: they are responsible for establishing, maintaining and regularly evaluating the effectiveness of our internal controls; they have made certain disclosures to our auditors and the audit committee of the board of directors about our internal controls; and they have included information in our quarterly and annual reports about their evaluation and whether there have been significant changes in our internal controls or in other factors that could significantly affect internal controls. First Savings Financial Group will be subject to further reporting and audit requirements beginning with the year ending September 30, 2008 under the requirements of the Sarbanes-Oxley Act. First Savings Financial Group will prepare policies, procedures and systems designed to comply with these regulations to ensure compliance with these regulations.

Federal and State Taxation

Federal Income Taxation

General. We report our income on a fiscal year basis using the accrual method of accounting. The federal income tax laws apply to us in the same manner as to other corporations with some exceptions, including particularly our 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 us. Our federal income tax returns have not been audited during the last five years. For its 2007 fiscal year, First Savings Bank’s maximum federal income tax rate was 34%.

First Savings Financial Group and First Savings Bank will enter into a tax allocation agreement. Because First Savings Financial Group owns 100% of the issued and outstanding capital stock of First Savings Bank, First Savings Financial Group and First Savings Bank are members of an affiliated group within the meaning of Section 1504(a) of the Internal Revenue Code, of which group First Savings Financial Group is the common parent corporation. As a result of this affiliation, First Savings Bank may be included in the filing of a consolidated federal income tax return with First Savings Financial Group and, if a decision to file a consolidated tax return is made, the parties agree to compensate each other for their individual share of the consolidated tax liability and/or any tax benefits provided by them in the filing of the consolidated federal income tax return.

Bad Debt Reserves. For fiscal years beginning before June 30, 1996, thrift institutions that qualified under certain definitional tests and other conditions of the Internal Revenue 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 the percentage of taxable income method or the experience method. The reserve for nonqualifying loans was computed using the experience method. Federal legislation enacted in 1996 repealed the reserve method of accounting for bad debts and the percentage of taxable income method for tax years beginning after 1995 and require savings institutions to recapture or take into income certain portions of their accumulated bad debt reserves. Approximately $4.6 million of our accumulated bad debt reserves would not be recaptured into taxable income unless First Savings Bank makes a “non-dividend distribution” to First Savings Financial Group as described below.

Distributions. If First Savings Bank makes “non-dividend distributions” to First Savings Financial Group, the distributions will be considered to have been made from First Savings Bank’s unrecaptured tax bad debt reserves, including the balance of its reserves as of December 31, 1987, to the extent of the “non-dividend distributions,” and then from First Savings Bank’s supplemental reserve for losses on loans, to the extent of those reserves, and an amount based on the amount distributed, but not more than the amount of those reserves, will be included in First Savings Bank’s taxable income. Non-dividend distributions include distributions in excess of First Savings 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 First Savings Bank’s current or accumulated earnings and profits will not be so included in First Savings Bank’s taxable 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. Therefore, if First Savings Bank makes a non-dividend distribution to First Savings Financial Group, approximately one and one-half times the amount of the distribution not in excess of the amount of the reserves would be includable in income for federal income tax purposes, assuming a 34% federal corporate income tax rate. First Savings Bank does not intend to pay dividends that would result in a recapture of any portion of its bad debt reserves.

State Taxation

Indiana. Indiana imposes an 8.5% franchise tax based on a financial institution’s adjusted gross income as defined by statute. In computing adjusted gross income, deductions for municipal interest, U.S. Government interest, the bad debt deduction computed using the reserve method and pre-1990 net operating losses are disallowed. The Bank’s state income tax returns have not been audited during the last five years.

The Conversion and Stock Offering

First Savings Bank’s board of directors has approved the plan of conversion. The Office of Thrift Supervision also has conditionally approved the plan of conversion, but its approval does not constitute a recommendation or endorsement of the plan of conversion by the agency.

General

On April 30, 2008, the board of directors of First Savings Bank unanimously adopted the plan of conversion according to which First Savings Bank will convert from a federally chartered mutual savings bank to a federally chartered stock savings bank and become a wholly owned subsidiary of First Savings Financial Group, a newly formed Indiana corporation. First Savings Financial Group will offer 100% of its common stock to qualifying depositors of First Savings Bank in a subscription offering and, if necessary, to members of the general public through a community offering and/or a syndicate of registered broker-dealers. The completion of the offering depends on market conditions and other factors beyond our control. We can give no assurance as to the length of time that will be required to complete the sale of the common stock. If we experience delays, significant changes may occur in the appraisal of First Savings Bank, which would require a change in the offering range. A change in the offering range would result in a change in the net proceeds realized by First Savings Financial Group from the sale of the common stock. If the offering is terminated, First Savings Bank would be required to charge all offering expenses against current income. The Office of Thrift Supervision approved our plan of conversion, subject to the fulfillment of certain conditions.

The plan of conversion and stock offering also provides for the establishment of First Savings Charitable Foundation and our funding of the foundation with 110,000 shares of our common stock sold in connection with the conversion and $100,000 cash. The establishment of First Savings Charitable Foundation is subject to a separate vote of First Savings Bank’s members. The special meeting of First Savings Bank’s members has been called for this purpose on , 2008.

The following is a brief summary of the pertinent aspects of the offering. A copy of the plan of conversion is available from First Savings Bank upon request and is available for inspection at the offices of First Savings Bank and at the Office of Thrift Supervision. The plan of conversion is also filed as an exhibit to the registration statement that we have filed with the Securities and Exchange Commission. See “Where You Can Find More Information.”

Reasons for the Conversion

The primary reasons for the conversion and related stock offering are to:

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increase the capital of First Savings Bank to support future lending and operational growth;

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enhance profitability and earnings through reinvesting and leveraging the proceeds, primarily through traditional funding and lending activities;

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support future branching activities and/or the acquisition of financial services companies;

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implement equity compensation plans to retain and attract qualified directors, officers and staff to enhance the current incentive-based compensation program; and

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increase our philanthropic endeavors to the communities we serve through the formation and funding of First Savings Charitable Foundation.

As a stock holding company, First Savings Financial Group will have greater flexibility than First Savings Bank now has in structuring mergers and acquisitions, including the consideration paid in a transaction. Our current mutual savings bank structure, by its nature, limits our ability to offer any common stock as consideration in a merger or acquisition. Our new stock holding company structure will enhance our ability to compete with other bidders when acquisition opportunities arise by better enabling us to offer stock or cash consideration, or a combination of the two. We currently do not have any agreement or understanding as to any specific acquisition.

Effects of Conversion to Stock Form

General. Each depositor in a mutual savings bank has both a deposit account in the institution and a pro rata ownership interest in the net worth of the institution based upon the balance in his or her account. However, this ownership interest is tied to the depositor’s account and has no value separate from such deposit account. Furthermore, this ownership interest may only be realized in the unlikely event that the institution is liquidated. In such event, the depositors of record at that time, as owners, would be able to share in any residual surplus and reserves after payment of other claims, including claims of depositors to the amounts of their deposits. Any depositor who opens a deposit account obtains a pro rata ownership interest in the net worth of the institution without any additional payment beyond the amount of the deposit. A depositor who reduces or closes his or her account receives a portion or all of the balance in the account but nothing for his or her ownership interest in the net worth of the institution, which is lost to the extent that the balance in the account is reduced.

When a mutual savings bank converts to stock form, depositors lose all rights to the net worth of the mutual savings bank, except the right to claim a pro rata share of funds representing the liquidation account established in connection with the conversion. Additionally, permanent nonwithdrawable capital stock is created and offered to depositors which represents the ownership of the institution’s net worth. The common stock of First Savings Financial Group is separate and apart from deposit accounts and cannot be and is not insured by the Federal Deposit Insurance Corporation or any other governmental agency. Certificates are issued to evidence ownership of the permanent stock. The stock certificates are transferable, and therefore the stock may be sold or traded if a purchaser is available with no effect on any deposit account the seller may hold in the institution.

No assets of First Savings Financial Group will be distributed in connection with the conversion other than the payment of those expenses incurred in connection with the conversion.

Continuity. While the conversion is being accomplished, the normal business of First Savings Bank will continue without interruption, including being regulated by the Office of Thrift Supervision and the Federal Deposit Insurance Corporation. After the conversion, First Savings Bank will continue to provide services for depositors and borrowers under current policies by its present management and staff.

The directors of First Savings Bank at the time of the conversion will serve as directors of First Savings Bank after the conversion. The directors of First Savings Financial Group will be composed of individuals who serve on the board of directors of First Savings Bank. All officers of First Savings Bank at the time of conversion will retain their positions after the conversion.

Deposit Accounts and Loans. First Savings Bank’s deposit accounts, account balances and existing Federal Deposit Insurance Corporation insurance coverage of deposit accounts will not be affected by the conversion. Furthermore, the conversion will not affect the loan accounts, loan balances or obligations of borrowers under their individual contractual arrangements with First Savings Bank.

Effect on Voting Rights. Voting rights in First Savings Bank, as a mutual savings bank, belong to its depositor members. After the conversion, depositors will no longer have voting rights in First Savings Bank and, therefore, will no longer be able to elect directors of First Savings Bank or control its affairs. Instead, First Savings Financial Group, as the sole stockholder of First Savings Bank, will possess all voting rights in First Savings Bank. The holders of the common stock of First Savings Financial Group will possess all voting rights in First Savings Financial Group. Depositors of First Savings Bank will not have voting rights after the conversion except to the extent that they become stockholders of First Savings Financial Group by purchasing common stock.

Liquidation Account. In the unlikely event of a complete liquidation of First Savings Bank before the conversion, each depositor in First Savings Bank would receive a pro rata share of any assets of First Savings Bank remaining after payment of claims of all creditors, including the claims of all depositors up to the withdrawal value of their accounts. Each depositor would receive a pro rata share of the remaining assets in the same proportion as the value of his or her deposit account to the total value of all deposit accounts in First Savings Bank at the time of liquidation.

After the conversion, holders of withdrawable deposits in First Savings Bank, including certificates of deposit, will not be entitled to share in any residual assets upon liquidation of First Savings Bank. However, under applicable regulations, First Savings Bank will, at the time of the conversion, establish a liquidation account in an amount equal to its total equity as of the date of the latest statement of financial condition contained in the final prospectus relating to the conversion.

First Savings Bank will maintain the liquidation account after the conversion for the benefit of eligible account holders and supplemental eligible account holders who retain their savings accounts in First Savings Bank. Each eligible account holder and supplemental account holder will, with respect to each deposit account held, have a related inchoate interest in a sub-account portion of the liquidation account balance.

The initial sub-account balance for a savings account held by an eligible account holder or a supplemental eligible account holder will be determined by multiplying the opening balance in the liquidation account by a fraction of which the numerator is the amount of the holder’s “qualifying deposit” in the deposit account and the denominator is the total amount of the “qualifying deposits” of all eligible or supplemental eligible account holders. The initial subaccount balance will not be increased, but it will be decreased as provided below.

If the deposit balance in any deposit account of an eligible account holder or supplemental eligible account holder at the close of business on any annual closing day of First Savings Bank (which is September 30) after March 31, 2007 or June 30, 2008, is less than the lesser of the deposit balance in a deposit account at the close of business on any other annual closing date after March 31, 2007 or June 30, 2008, or the amount of the “qualifying deposit” in a savings account on March 31, 2007 or June 30, 2008, then the subaccount balance for a savings account will be adjusted by reducing the subaccount balance in an amount proportionate to the reduction in the savings balance. Once reduced, the subaccount balance will not be subsequently increased, notwithstanding any increase in the savings balance of the related savings account. If any savings account is closed, the related subaccount balance will be reduced to zero.

Upon a complete liquidation of First Savings Bank, each eligible account holder and supplemental account holder will be entitled to receive a liquidation distribution from the liquidation account in the amount of the then current adjusted subaccount balance(s) for deposit account(s) held by the holder before any liquidation distribution may be made to stockholders. No merger, consolidation, bulk purchase of assets with assumptions of savings accounts and other liabilities or similar transactions with another federally insured institution in which First Savings Bank is not the surviving institution will be considered to be a complete liquidation. In any of these transactions, the liquidation account will be assumed by the surviving institution.

In the unlikely event First Savings Bank is liquidated after the conversion, depositors will be entitled to full payment of their deposit accounts before any payment is made to First Savings Financial Group as sole shareholder of First Savings Bank. There are no plans to liquidate either First Savings Bank or First Savings Financial Group in the future.

Material Income Tax Consequences

In connection with the conversion, we have received an opinion of counsel with respect to federal tax laws that no gain or loss will be recognized by account holders receiving subscription rights, except to the extent, if any, that subscription rights are deemed to have fair market value on the date such rights are issued. We believe that the tax opinion summarized below addresses all material federal income tax consequences that are generally applicable to persons receiving subscription rights.

Kilpatrick Stockton LLP has issued an opinion to us that, for federal income tax purposes:

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the conversion of First Savings Bank from the mutual to the stock form of organization will qualify as a reorganization within the meaning of Section 368(a)(1)(F) of the Internal Revenue Code, and no gain or loss will be recognized by account holders and no gain or loss will be recognized by First Savings Bank by reason of such conversion;

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no gain or loss will be recognized by First Savings Financial Group upon the sale of shares of common stock in the offering;

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it is more likely than not that the fair market value of the non-transferable subscription rights to purchase shares of common stock of First Savings Financial Group to be issued to eligible account holders, supplemental eligible account holders and other members is zero and, accordingly, that no income will be realized by eligible account holders, supplemental eligible account holders and other members upon the issuance to them of the subscription rights or upon the exercise of the subscription rights; and

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it is more likely than not that the tax basis to the holders of shares of common stock purchased in the stock offering pursuant to the exercise of the subscription rights will be the amount paid therefor, and that the holding period for such shares of common stock will begin on the date of completion of the stock offering.

The statements set forth in the first and second bullet points above are based on the position that the subscription rights do not have any market value at the time of distribution or at the time they are exercised. Whether subscription rights have a market value for federal income tax purposes is a question of fact, depending upon all relevant facts and circumstances. According to our counsel, the Internal Revenue Service will not issue rulings on whether subscription rights have a market value. Counsel has also advised us that they are unaware of any instance in which the Internal Revenue Service has taken the position that nontransferable subscription rights have a market value. Counsel also noted that the subscription rights will be granted at no cost to the recipients, will be nontransferable and of short duration, and will afford the recipients the right only to purchase our common stock at a price equal to its estimated fair market value, which will be the same price as the purchase price for the unsubscribed shares of common stock.

Unlike a private letter ruling issued by the Internal Revenue Service, an opinion of counsel is not binding on the Internal Revenue Service and the Internal Revenue Service could disagree with the conclusions reached in the opinion. If there is a disagreement, no assurance can be given that the conclusions reached in an opinion of counsel would be sustained by a court if contested by the Internal Revenue Service.

First Savings Bank has also received an opinion from Monroe Shine & Co., Inc., that, assuming the conversion does not result in any federal income tax liability to First Savings Bank, its account holders, or First Savings Financial Group, implementation of the plan of conversion will not result in any Indiana income tax liability to those entities or persons.

The opinions of Kilpatrick Stockton LLP and of Monroe Shine & Co., Inc. are filed as exhibits to the registration statement that we have filed with the Securities and Exchange Commission. See “Where You Can Find More Information.”

Subscription Offering and Subscription Rights

Under the plan of conversion, we have granted rights to subscribe for First Savings Financial Group common stock to the following persons in the following order of priority:

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Persons with deposits in First Savings Bank with balances aggregating $50 or more (“qualifying deposits”) as of the close of business on March 31, 2007 (“eligible account holders”). For this purpose, deposit accounts include all savings, time and demand accounts.

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Our employee stock ownership plan.

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Persons with qualifying deposits in First Savings Bank as of the close of business on June 30, 2008 (“supplemental eligible account holders”), other than our officers, directors and their associates except to the extent the Office of Thrift Supervision grants a waiver permitting such individuals to be treated as supplemental eligible account holders.

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Depositors of First Savings Bank as of the close of business on , 2008, who are neither eligible nor supplemental eligible account holders (“other members”).

The amount of common stock that any person may purchase will depend on the availability of the common stock after satisfaction of all subscriptions having priority rights in the subscription offering and to the maximum and minimum purchase limitations set forth in the plan of conversion. See “— Limitations on Purchases of Shares.” All persons on a joint account will be counted as a single depositor for purposes of determining the maximum amount that may be subscribed for by owners of a joint account.

We will strive to identify your ownership in all accounts, but cannot guarantee we will identify all accounts in which you have an ownership interest.

Category 1: Eligible Account Holders. Subject to the purchase limitations as described below under “— Limitations on Purchases of Shares,” each eligible account holder has the right to subscribe for up to the greater of:

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$200,000 of common stock (which equals 20,000 shares);

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one-tenth of 1% of the total offering of common stock; or

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15 times the product (rounded down to the next whole number) obtained by multiplying the total number of shares of common stock to be sold by a fraction of which the numerator is the amount of qualifying deposits of the eligible account holder and the denominator is the total amount of qualifying deposits of all eligible account holders.

If there are insufficient shares to satisfy all subscriptions by eligible account holders, shares first will be allocated so as to permit each subscribing eligible account holder, if possible, to purchase a number of shares sufficient to make the person’s total allocation equal 100 shares or the number of shares actually subscribed for, whichever is less. After that, unallocated shares will be allocated among the remaining subscribing eligible account holders whose subscriptions remain unfilled in the proportion that the amounts of their respective qualifying deposits bear to the total qualifying deposits of all remaining eligible account holders whose subscriptions remain unfilled. Unless waived by the Office of Thrift Supervision, subscription rights of eligible account holders who are also executive officers or directors of First Savings Bank or their associates will be subordinated to the subscription rights of other eligible account holders to the extent attributable to increased deposits in First Savings Bank in the one year period preceding March 31, 2007. See “Subscriptions by Executive Officers and Directors” regarding the grant of such waivers.

To ensure a proper allocation of stock, each eligible account holder must list on his or her stock order form all deposit accounts in which such eligible account holder had an ownership interest at March 31, 2007. Failure to list an account, or providing incorrect information, could result in the loss of all or part of a subscriber’s stock allocation.

Category 2: Tax-Qualified Employee Benefit Plans. Our tax-qualified employee benefit plans have the right to purchase up to 10% of the shares of common stock sold in the offering and contributed to the charitable foundation. As a tax-qualified employee benefit plan, our employee stock ownership plan intends to purchase 8% of the shares sold in the offering and contributed to the charitable foundation. Subscriptions by the employee stock ownership plan will not be aggregated with shares of common stock purchased by any other participants in the offering, including subscriptions by our officers and directors, for the purpose of applying the purchase limitations in the plan of conversion. If eligible account holders subscribe for all of the shares being sold, no shares will be available for our tax-qualified employee benefit plans. However, if we increase the number of shares offered above the maximum of the offering range, the employee stock ownership plan will have a first priority right to purchase

any shares exceeding that amount up to 10% of the common stock issued in the offering and contributed to the charitable foundation. If the plan’s subscription is not filled in its entirety, the employee stock ownership plan may purchase shares in the open market or may purchase shares directly from us with the approval of the Office of Thrift Supervision.

Category 3: Supplemental Eligible Account Holders. Subject to the purchase limitations as described below under “— Limitations on Purchases of Shares,” each supplemental eligible account holder has the right to subscribe for up to the greater of:

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$200,000 of common stock (which equals 20,000 shares);

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one-tenth of 1% of the total offering of common stock; or

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15 times the product (rounded down to the next whole number) obtained by multiplying the total number of shares of common stock to be sold by a fraction of which the numerator is the amount of qualifying deposits of the supplemental eligible account holder and the denominator is the total amount of qualifying deposits of all supplemental eligible account holders.

If eligible account holders and the employee stock ownership plan subscribe for all of the shares being sold, no shares will be available for supplemental eligible account holders. If shares are available for supplemental eligible account holders but there are insufficient shares to satisfy all subscriptions by supplemental eligible account holders, shares first will be allocated so as to permit each subscribing supplemental eligible account holder, if possible, to purchase a number of shares sufficient to make the person’s total allocation equal 100 shares or the number of shares actually subscribed for, whichever is less. After that, unallocated shares will be allocated among the remaining subscribing supplemental eligible account holders whose subscriptions remain unfilled in the proportion that the amounts of their respective qualifying deposits bear to the total qualifying deposits of all remaining supplemental eligible account holders whose subscriptions remain unfilled.

To ensure a proper allocation of stock, each supplemental eligible account holder must list on his or her stock order form all deposit accounts in which such supplemental eligible account holder had an ownership interest at June 30, 2008. Failure to list an account, or providing incorrect information, could result in the loss of all or part of a subscriber’s stock allocation.

The Office of Thrift Supervision has granted us a waiver permitting certain of our officers and directors and, in certain cases, their associates, to be treated as supplemental eligible account holders.

Category 4: Other Members. Subject to the purchase limitations as described below under “ — Limitations on Purchases of Shares,” each other member has the right to purchase up to the greater of $200,000 of common stock (which equals 20,000 shares) or one-tenth of 1% of the total offering of common stock. If eligible account holders, the employee stock ownership plan and supplemental eligible account holders subscribe for all of the shares being sold, no shares will be available for other members. If shares are available for other members but there are not sufficient shares to satisfy all subscriptions by other members, shares first will be allocated so as to permit each subscribing other member, if possible, to purchase a number of shares sufficient to make the person’s total allocation equal 100 shares or the number of shares actually subscribed for, whichever is less. After that, unallocated shares will be allocated among the remaining subscribing other members in the proportion that each other member’s subscription bears to the total subscriptions of all such subscribing other members whose subscriptions remain unfilled.

To ensure a proper allocation of stock, each other member must list on his or her stock order form all deposit accounts in which such other member had an ownership interest at , 2008. Failure to list an account or providing incorrect information could result in the loss of all or part of a subscriber’s stock allocation.

Expiration Date for the Subscription Offering. The subscription offering, and all subscription rights under the plan of conversion, will terminate at , Eastern time, on . We will not accept orders for common stock in the subscription offering received after that time. We will make reasonable attempts to provide a prospectus and related offering materials to holders of subscription rights; however, all subscription rights will expire on the expiration date whether or not we have been able to locate each person entitled to subscription rights.

Office of Thrift Supervision regulations require that we complete the sale of common stock within 45 days after the close of the subscription offering. If the sale of the common stock is not completed within that period, all funds received will be returned promptly with interest at our passbook rate and all withdrawal authorizations will be canceled unless we receive approval of the Office of Thrift Supervision to extend the time for completing the offering. If regulatory approval of an extension of the time period has been granted, we will notify all subscribers of the extension and of the duration of any extension that has been granted, and subscribers will have the right to modify or rescind their purchase orders. If we do not receive an affirmative response from a subscriber to any resolicitation, the subscriber’s order will be rescinded and all funds received will be returned promptly with interest, or withdrawal authorizations will be canceled. No single extension can exceed 90 days.

Persons in Non-Qualified States. We will make reasonable efforts to comply with the securities laws of all states in the United States in which persons entitled to subscribe for stock under the plan of conversion reside. However, we are not required to offer stock in the subscription offering to any person who resides in a foreign country or who resides in a state of the United States in which (1) only a small number of persons otherwise eligible to subscribe for shares of common stock reside; (2) the granting of subscription rights or the offer or sale of shares to such person would require that we or our officers or directors register as a broker, dealer, salesman or selling agent under the securities laws of the state, or register or otherwise qualify the subscription rights or common stock for sale or qualify as a foreign corporation or file a consent to service of process; or (3) we determine that compliance with that state’s securities laws would be impracticable for reasons of cost or otherwise.

Restrictions on Transfer of Subscription Rights and Shares. Subscription rights are nontransferable. You may not transfer, or enter into any agreement or understanding to transfer, the legal or beneficial ownership of your subscription rights issued under the plan of conversion or the shares of common stock to be issued upon exercise of your subscription rights. Your subscription rights may be exercised only by you and only for your own account. If you exercise your subscription rights, you will be required to certify that you are purchasing shares solely for your own account and that you have no agreement or understanding regarding the sale or transfer of such shares. Federal regulations also prohibit any person from offering, or making an announcement of an offer or intent to make an offer, to purchase such subscription rights or shares of common stock before the completion of the offering.

If you sell or otherwise transfer your rights to subscribe for common stock in the subscription offering or subscribe for common stock on behalf of another person, you may forfeit those rights and face possible further sanctions and penalties imposed by the Office of Thrift Supervision or another agency of the U.S. Government. We will pursue any and all legal and equitable remedies if we become aware of the transfer of subscription rights and will not honor orders known by us to involve the transfer of such rights.

Community Offering

To the extent that shares remain available for purchase after satisfaction of all subscriptions received in the subscription offering, we may offer shares in a community offering to the following persons in the following order of priority:

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Natural persons and trusts of natural persons who are residents of Clark, Floyd, Harrison, Jefferson, Scott and Washington Counties in Indiana and Bullitt, Henry, Jefferson, Meade, Nelson, Oldham, Shelby, Spencer and Trimble Counties in Kentucky; and

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Other persons to whom we deliver a prospectus.

We will consider persons to be residents of the above listed counties if they occupy a dwelling in the county and have established an ongoing physical presence in the county that is not merely transitory in nature. We may utilize depositor or loan records or other evidence provided to us to make a determination as to whether a person is a resident of such counties. In all cases, the determination of residence status will be made by us in our sole discretion.

Purchasers in the community offering are eligible to purchase up to $200,000 of common stock (which equals 20,000 shares). If shares are available for preferred subscribers in the community offering but there are insufficient shares to satisfy all orders, the available shares will be allocated first to each preferred subscriber whose order we accept in an amount equal to the lesser of 100 shares or the number of shares ordered by each such subscriber, if possible. After that, unallocated shares will be allocated among the remaining preferred subscribers whose orders remain unsatisfied in the same proportion that the unfilled order of each such subscriber bears to the total unfilled orders of all such subscribers. If, after filling the orders of preferred subscribers in the community offering, shares are available for other subscribers in the community offering but there are insufficient shares to satisfy all orders, shares will be allocated in the same manner as for preferred subscribers.

The community offering, if held, may commence concurrently with, during or after the subscription offering and will terminate no later than 45 days after the close of the subscription offering unless extended by us, with approval of the Office of Thrift Supervision. If we receive regulatory approval for an extension, all subscribers will be notified of the extension and of the duration of any extension that has been granted, and will have the right to confirm, increase, decrease or rescind their orders. If we do not receive an affirmative response from a subscriber to any resolicitation, the subscriber’s order will be rescinded and all funds received will be promptly returned with interest.

The opportunity to subscribe for shares of common stock in the community offering is subject to our right to reject orders, in whole or part, either at the time of receipt of an order or as soon as practicable following the expiration date of the offering. If your order is rejected in part, you will not have the right to cancel the remainder of your order.

Syndicated Community Offering or Underwritten Public Offering

The plan of conversion provides that, if necessary, all shares of common stock not purchased in the subscription offering and community offering may be offered for sale to the general public in a syndicated community offering to be managed by Keefe, Bruyette & Woods, Inc., acting as our agent. In such capacity, Keefe, Bruyette & Woods, Inc. may form a syndicate of other brokers-dealers who are member firms of the Financial Industry Regulatory Authority (formerly known as the National Association of Securities Dealers, Inc.) (“FINRA”). Alternatively, we may sell any remaining shares in an underwritten public offering. Neither Keefe, Bruyette & Woods, Inc. nor any registered broker-dealer will have any obligation to take or purchase any shares of the common stock in the syndicated community offering; however, Keefe, Bruyette & Woods, Inc. has agreed to use its best efforts in the sale of shares in any syndicated community offering. We have not selected any particular broker-dealers to participate in a syndicated community offering and will not do so until before the commencement of the syndicated community offering. The syndicated community offering would terminate no later than 45 days after the expiration of the subscription offering, unless extended by us, with approval of the Office of Thrift Supervision. See “— Community Offering” above for a discussion of rights of subscribers if an extension is granted.

The opportunity to subscribe for shares of common stock in the syndicated community offering or underwritten public offering is subject to our right in our sole discretion to accept or reject orders, in whole or part, either at the time of receipt of an order or as soon as practicable following the expiration date of the offering. If your order is rejected in part, you will not have the right to cancel the remainder of your order.

Common stock sold in the syndicated community offering also will be sold at the $10.00 per share purchase price. Purchasers in the syndicated community offering are eligible to purchase up to $200,000 of common stock (which equals 20,000 shares). Orders for common stock in the syndicated community offering will be filled first to a maximum of 2% of the total number of shares sold in the offering and thereafter any remaining shares will be allocated on an equal number of shares basis per order until all orders have been filled. However, no fractional shares will be issued. We may begin the syndicated community offering or underwritten public offering at any time following the commencement of the subscription offering.

Selected dealers, if any, will send confirmations of the orders to customers on the next business day after the order date. Selected dealers will debit the accounts of their customers on the settlement date, which date will be three business days from the order date. Customers who authorize selected dealers to debit their brokerage accounts are required to have the funds for payment in their account on but not before the settlement date. On the settlement

date, selected dealers will deposit funds to the account established at First Savings Bank for each selected dealer. Each customer’s funds forwarded to one of these accounts, along with all other accounts held in the same title, will be insured by the Federal Deposit Insurance Corporation in accordance with applicable regulations. After payment has been received by us from selected dealers, funds will earn interest at First Savings Bank’s regular savings rate until the completion or termination of the offering. Funds will be promptly returned, with interest, if the syndicated community offering is not completed.

If we are unable to find purchasers from the general public for all unsubscribed shares, we will make other purchase arrangements, if feasible. Other purchase arrangements must be approved by the Office of Thrift Supervision and may provide for purchases for investment purposes by directors, officers, their associates and other persons in excess of the limitations provided in the plan of conversion and in excess of the proposed director and executive officer purchases discussed earlier, although no such purchases are currently intended. If other purchase arrangements cannot be made, we may: terminate the stock offering and promptly return all funds; promptly return all funds, set a new offering range and give all subscribers the opportunity to place a new order for shares of First Savings Financial Group common stock; or take such other actions as may be permitted by the Office of Thrift Supervision and the Securities and Exchange Commission.

Limitations on Purchases of Shares

In addition to the purchase limitations described above under “Subscription Offering and Subscription Rights,” “— Community Offering” and “Syndicated Community Offering or Underwritten Public Offering,” the plan of conversion provides for the following purchase limitations:

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Except for our tax-qualified employee benefit plans, no individual may purchase in the aggregate more than $200,000 of the common stock, or 20,000 shares sold in the offerings, subject to increase as described below. In addition, no person, either alone or together with associates of or persons acting in concert with such person, may purchase more than $350,000 of the common stock, or 35,000 shares sold in the offerings.

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Our tax-qualified employee benefit plans are entitled to purchase up to 10.0% of the shares sold in the conversion and contributed to the charitable foundation. As a tax- qualified employee benefit plan, our employee stock ownership plan intends to purchase 8.0% of the shares sold in the conversion and contributed to the charitable foundation.

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Each subscriber must subscribe for a minimum of 25 shares.

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Our directors and executive officers, together with their associates, may purchase in the aggregate up to 31% of the common stock sold in the offering.

We may, in our sole discretion, increase the individual or aggregate purchase limitation to up to 5% of the shares of common stock sold in the offering. We do not intend to increase the maximum purchase limitation unless market conditions warrant. If we decide to increase the purchase limitations, persons who subscribed for the maximum number of shares of common stock will be given the opportunity to increase their subscriptions accordingly, subject to the rights and preferences of any person who has priority subscription rights. We, in our discretion, also may give other large subscribers the right to increase their subscriptions.

If we increase the maximum purchase limitation to 5% of the shares of common stock sold in the offering, we may further increase the maximum purchase limitation to 9.99%, provided that orders for common stock exceeding 5% of the shares of common stock sold in the offering may not exceed in the aggregate 10% of the total shares of common stock sold in the offering.

The plan of conversion defines “acting in concert” to mean knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not by an express agreement or understanding; or a combination or pooling of voting or other interests in the securities of an issuer for a common purpose under any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise. In general, a person who acts in concert with another party will also be deemed to be acting in concert

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with any person who is also acting in concert with that other party. We may presume that certain persons are acting in concert based upon, among other things, joint account relationships or the fact that persons share a common address (whether or not related by blood or marriage) or may have filed joint Schedules 13D or 13G with the Securities and Exchange Commission with respect to other companies. For purposes of the plan of conversion, our directors are not deemed to be acting in concert solely by reason of their Board membership.

The plan of conversion defines “associate,” with respect to a particular person, to mean:

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a corporation or organization other than First Savings Financial Group or First Savings Bank or a majority-owned subsidiary of First Savings Financial Group or First Savings Bank of which a person is a senior officer or partner or is, directly or indirectly, the beneficial owner of 10% or more of any class of equity securities of such corporation or organization;

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a trust or other estate in which a person has a substantial beneficial interest or as to which a person serves as a trustee or a fiduciary; and

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any person who is related by blood or marriage to such person and who lives in the same home as such person or who is a director or senior officer of First Savings Financial Group or First Savings Bank or any of their subsidiaries.

For example, a corporation of which a person serves as an officer would be an associate of that person and, therefore, all shares purchased by the corporation would be included with the number of shares that the person could purchase individually under the aggregate purchase limitation described above. We have the right in our sole discretion to reject any order submitted by a person whose representations we believe to be false or who we otherwise believe, either alone or acting in concert with others, is violating or circumventing, or intends to violate or circumvent, the terms and conditions of the plan of conversion. Directors and officers are not treated as associates of each other solely by virtue of holding such positions. We have the sole discretion to determine whether prospective purchasers are “associates” or “acting in concert.”

Marketing Arrangements

We have retained Keefe, Bruyette & Woods, Inc. to consult with and advise and assist us, on a best efforts basis, in the distribution of shares in the offering. Keefe, Bruyette & Woods, Inc. is a broker-dealer registered with the Securities and Exchange Commission and a member of the FINRA. Keefe, Bruyette & Woods, Inc. will assist us in the reorganization by acting as marketing advisor with respect to the subscription offering and will represent us as placement agent on a best efforts basis in the sale of the common stock in the community offering, if held. The services that Keefe, Bruyette & Woods, Inc. will provide include, but are not limited to:

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training our employees who will perform ministerial functions in the subscription offering and community offering regarding the mechanics and regulatory requirements of the stock offering process;

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managing the stock information center by assisting interested stock subscribers and by keeping records of all stock orders;

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preparing marketing materials; and

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assisting in the solicitation of proxies from First Savings Bank’s members for use at the special meeting.

We have also engaged Keefe, Bruyette & Woods, Inc. to act as our conversion agent in connection with the stock offering. In its role as conversion agent, Keefe, Bruyette & Woods, Inc. will assist us in the stock offering as follows:

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develop a master file and consolidation of accounts;

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generate address lists for the mailing of proxy solicitation and stock offering materials;

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provide software for the operation of the stock information center; and

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subscription order processing and stock allocation services.

For all these services, Keefe, Bruyette & Woods, Inc. will receive a fee of 1.0% of the aggregate dollar amount of the common stock sold in the subscription and community offerings to persons other than the employee stock ownership plan and directors, officers and employees of First Savings Bank or their immediate families and shares issued to the charitable foundation. This 1% fee is estimated at $308,000 at the maximum of the offering range assuming all of the common stock is sold in the subscription and community offerings. We have paid Keefe, Bruyette & Woods, Inc. a management fee of $40,000 that will be applied against the 1.0% fee. We will reimburse Keefe, Bruyette & Woods, Inc. for its expenses, including the fees and expenses of its counsel, associated with its marketing effort, up to a maximum of $70,000. If there is a syndicated community offering, the total fees paid to Keefe, Bruyette & Woods, Inc. and other FINRA member firms in the syndicated community offering will not exceed 5.5% of the aggregate dollar amount of the common stock sold in the syndicated community offering.

Keefe, Bruyette & Woods, Inc. has not prepared any report or opinion constituting a recommendation or advice to us or to persons who subscribe for stock, nor has it prepared an opinion as to the fairness to us of the purchase price or the terms of the stock to be sold. Keefe, Bruyette & Woods, Inc. expresses no opinion as to the prices at which common stock to be issued may trade. Keefe, Bruyette & Woods, Inc. and selected dealers participating in the syndicated community offering may receive a commission in the syndicated community offering in a maximum amount to be agreed upon by us to reflect market requirements at the time of the allocation of shares in the syndicated community offering.

We have also agreed to indemnify Keefe, Bruyette & Woods, Inc. against liabilities and expenses, including legal fees, incurred in connection with certain claims or litigation arising out of or based upon untrue statements or omissions contained in the offering materials for the common stock, including liabilities under the Securities Act of 1933 and the performance of Keefe, Bruyette & Woods, Inc. of its services in connection with the reorganization.

Description of Sales Activities

First Savings Financial Group will offer the common stock in the subscription offering and community offering principally by the distribution of this prospectus and through activities conducted at the stock information center. The stock information center is expected to operate during normal business hours throughout the subscription offering and community offering. It is expected that at any particular time one or more Keefe, Bruyette & Woods, Inc. employees will be working at the stock information center. Employees of Keefe, Bruyette & Woods, Inc. will be responsible for responding to questions regarding the reorganization and the offering and processing stock orders.

Sales of common stock will be made by registered representatives affiliated with Keefe, Bruyette & Woods, Inc. or by the selected dealers managed by Keefe, Bruyette & Woods, Inc. First Savings Bank’s officers and employees may participate in the offering in clerical capacities, providing administrative support in effecting sales transactions or, when permitted by state securities laws, answering questions of a mechanical nature relating to the proper execution of the order form. First Savings Bank’s officers may answer questions regarding our business when permitted by state securities laws. Other questions of prospective purchasers, including questions as to the advisability or nature of the investment, will be directed to registered representatives. First Savings Bank’s officers and employees have been instructed not to solicit offers to purchase common stock or provide advice regarding the purchase of common stock.

No officer, director or employee of First Savings Bank will be compensated, directly or indirectly, for any activities in connection with the offer or sale of common stock in the offering.

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None of First Savings Bank’s personnel participating in the offering is registered or licensed as a broker or dealer or an agent of a broker or dealer. First Savings Bank’s personnel will assist in the above-described sales activities under an exemption from registration as a broker or dealer provided by Rule 3a4-l promulgated under the Securities Exchange Act of 1934. Rule 3a4-l generally provides that an “associated person of an issuer” of securities will not be deemed a broker solely by reason of participation in the sale of securities of the issuer if the associated person meets certain conditions. These conditions include, but are not limited to, that the associated person participating in the sale of an issuer’s securities not be compensated in connection with the offering at the time of participation, that the person not be associated with a broker or dealer and that the person observe certain limitations on his or her participation in the sale of securities. For purposes of this exemption, “associated person of an issuer” is defined to include any person who is a director, officer or employee of the issuer or a company that controls, is controlled by or is under common control with the issuer.

Procedure for Purchasing Shares in the Subscription and Community Offerings

Use of Order Forms. To purchase shares in the subscription offering, a properly completed and executed order form must be received (not postmarked) by us in our stock information center by , Eastern time, on . Your order form must be accompanied by full payment for all of the shares subscribed for or include appropriate authorization in the space provided on the order form for withdrawal of full payment from a deposit account with First Savings Bank. To purchase shares in the community offering, you must deliver a properly completed and executed order form to us, accompanied by the required payment for each share subscribed for, before the community offering terminates, which may be on, or at any time after, the end of the subscription offering. Our interpretation of the terms and conditions of the plan of conversion and of the acceptability of the order forms will be final.

To ensure that your stock purchase eligibility and priority are properly identified, you must list all accounts on the order form, giving all names in each account and the account number. We will strive to identify your ownership in all accounts, but cannot guarantee we will identify all accounts in which you have an ownership interest. Failure to list all of your accounts may result in fewer shares being allocated to you than if all of your accounts were listed.

We need not accept order forms that are received after the expiration of the subscription offering or community offering, as the case may be, or that are executed defectively or that are received without full payment or without appropriate withdrawal instructions. In addition, we are not obligated to accept orders submitted on photocopied or facsimilied stock order forms. We have the right to waive or permit the correction of incomplete or improperly executed order forms, but do not represent that we will do so. Under the plan of conversion, our interpretation of the terms and conditions of the plan of conversion and of the order form will be final. Once received, an executed order form may not be modified, amended or rescinded without our consent unless the offering has not been completed within 45 days after the end of the subscription offering, unless extended.

The reverse side of the order form contains a regulatorily mandated certification form. We will not accept order forms where the certification form is not executed. By executing and returning the certification form, you will be certifying that you received this prospectus and acknowledging that the common stock is not a deposit account and is not insured or guaranteed by the federal government. You also will be acknowledging that you received disclosure concerning the risks involved in this offering. The certification form could be used as support to show that you understand the nature of this investment.

To ensure that each purchaser in the subscription and community offering receives a prospectus at least 48 hours before the end of the subscription and community offering, as required by Rule 15c2-8 under the Securities Exchange Act of 1934, as amended, no prospectus will be mailed any later than five days before that date or hand delivered any later than two days before that date. Execution of the order form will confirm receipt or delivery under Rule 15c2-8. Order forms will be distributed only when preceded or accompanied by a prospectus.

Payment for Shares. Payment for subscriptions may be made by check, bank draft or money order, or by authorization of withdrawal from deposit accounts maintained with First Savings Bank. Funds received before the completion of the offering will be maintained in a segregated account at First Savings Bank or, at our discretion, at another federally insured depository institution. However, we will not maintain more than one escrow account.

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All subscriptions received will bear interest at First Savings Bank’s passbook savings rate, which is currently 0.25% per annum. Subscriber’s funds will be transmitted to the segregated account no later than noon of the next business day where they will be invested in investments that are permissible under Securities and Exchange Commission Rule 15c2-4. Appropriate means by which withdrawals may be authorized are provided on the order form. No wire transfers or third party checks will be accepted. Interest will be paid on payments made by check, bank draft or money order at our passbook rate from the date payment is received at the conversion center until the completion or termination of the offering. Payment in cash will not be accepted unless the cash is converted into a bank check or money order. If payment is made by authorization of withdrawal from deposit accounts, the funds authorized to be withdrawn from a deposit account will continue to accrue interest at the contractual rates until completion or termination of the offering, but a hold will be placed on the funds, making them unavailable to the depositor until completion or termination of the offering. When the offering is completed, the funds received in the offering will be used to purchase the shares of common stock ordered. The shares of common stock issued in the offering cannot and will not be insured by the Federal Deposit Insurance Corporation or any other government agency. If the offering is not consummated for any reason, all funds submitted will be promptly refunded with interest as described above.

If a subscriber authorizes us to withdraw the amount of the purchase price from his or her deposit account, we will do so as of the completion of the offering, though the account must contain the full amount necessary for payment at the time the subscription order is received. We will waive any applicable penalties for early withdrawal from certificate accounts. If the remaining balance in a certificate account is reduced below the applicable minimum balance requirement at the time funds are actually transferred under the authorization, the certificate will be canceled at the time of the withdrawal, without penalty, and the remaining balance will earn interest at our passbook rate.

The employee stock ownership plan will not be required to pay for the shares subscribed for at the time it subscribes, but rather may pay for shares of common stock subscribed for upon the completion of the offering; provided that there is in force from the time of its subscription until the completion of the offering a loan commitment from an unrelated financial institution or from us to lend to the employee stock ownership plan, at that time, the aggregate purchase price of the shares for which it subscribed.

We may, in our sole discretion, permit institutional investors to submit irrevocable orders together with the legally binding commitment for payment and to thereafter pay for such shares of common stock for which they subscribe in the community offering at any time before the 48 hours before the completion of the offering. This payment may be made by wire transfer.

Our individual retirement accounts (“IRAs”) do not permit investment in common stock. A depositor interested in using his or her IRA funds to purchase common stock must do so through a self-directed IRA. Since we do not offer those accounts, we will allow a depositor to make a trustee-to-trustee transfer of the IRA funds to a trustee offering a self-directed IRA program with the agreement that the funds will be used to purchase our common stock in the offering. There will be no early withdrawal or Internal Revenue Service interest penalties for such transfers. The new trustee would hold the common stock in a self-directed account in the same manner as we now hold the depositor’s IRA funds. An annual administrative fee may be payable to the new trustee. Depositors interested in using funds in an IRA with us to purchase common stock should contact the conversion center as soon as possible so that the necessary forms may be forwarded for execution and returned before the subscription offering ends. In addition, federal laws and regulations require that officers, directors and 10% stockholders who use self-directed IRA funds to purchase shares of common stock in the subscription offering, make purchases for the exclusive benefit of IRAs.

How We Determined the Offering Range and the $10.00 Per Share Purchase Price

Federal regulations require that the aggregate purchase price of the securities sold in connection with the offering be based upon our estimated pro forma value, as determined by an independent appraisal. We have retained RP Financial, which is experienced in the evaluation and appraisal of business entities, to prepare the independent appraisal. RP Financial will receive fees totaling $40,000 for its appraisal services, plus out-of-pocket expenses for its initial final appraisal, and $3,500 per appraisal update. We have agreed to indemnify RP Financial and its employees and affiliates for certain costs and expenses, including reasonable legal fees arising out of, related to, or based upon the offering and due to any misstatement or untrue statement or intentional omission by First Savings Bank.

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RP Financial prepared the appraisal taking into account the pro forma impact of the offering. For its analysis, RP Financial undertook substantial investigations to learn about our business and operations. We supplied financial information, including annual financial statements, information on the composition of assets and liabilities, and other financial schedules. In addition to this information, RP Financial reviewed our stock issuance application as filed with the Office of Thrift Supervision and our registration statement as filed with the Securities and Exchange Commission. Furthermore, RP Financial visited our facilities and had discussions with our management. RP Financial did not perform a detailed individual analysis of the separate components of our assets and liabilities. We did not impose any limitations on RP Financial in connection with its appraisal.

In connection with its appraisal, RP Financial reviewed the following factors, among others:

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our present and projected operating results and financial condition;

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the economic and demographic conditions of our primary market area;

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pertinent historical financial and other information relating to First Savings Bank;

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a comparative evaluation of our operating and financial statistics with those of other thrift institutions;

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the proposed price per share;

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the aggregate size of the offering of common stock;

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the impact of the conversion on our capital position and earnings potential; and

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the trading market for securities of comparable institutions and general conditions in the market for such securities.

Consistent with Office of Thrift Supervision appraisal guidelines, RP Financial’s analysis utilized three selected valuation procedures, the price/tangible book method, the price/core earnings method, and the price/assets method, all of which are described in its report. RP Financial’s appraisal report is filed as an exhibit to the registration statement that we have filed with the Securities and Exchange Commission. See “Where You Can Find More Information.” RP Financial placed the greatest emphasis on the price/core earnings and price/tangible book methods in estimating pro forma market value. RP Financial compared the pro forma price/tangible book and price/core earnings ratios for First Savings Financial Group to the same ratios for a peer group of comparable companies. The peer group included companies with:

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average assets of $328 million;

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average non-performing assets of 1.48% of total assets;

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average net loans of 75.3% of total assets;

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average equity of 11.1% of total assets; and

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average core income of 0.37% of average assets.

On the basis of the analysis in its report, RP Financial has advised us that, in its opinion, as of May 16, 2008, our estimated pro forma market value, including shares contributed to the First Savings Charitable Foundation, was within the valuation range of $27.4 million and $36.6 million with a midpoint of $32.0 million.

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The following table presents a summary of selected pricing ratios for First Savings Financial Group, for the peer group companies and for all publicly traded thrifts. Compared to the average pricing ratios of the peer group, First Savings Financial Group’s pro forma pricing ratios at the maximum of the offering range indicated discount of 28.0% on a price-to-tangible book value basis. First Savings Financial Group’s pro forma price to core earnings multiple is not meaningful given its pro forma loss for the twelve months ended March 31, 2008.


	Price to Core Earnings Multiple (1)		Price to Book Value Ratio (2)		Price to Tangible Book Value Ratio (2)
First Savings Financial Group (pro forma):
Minimum	*		53.13	%	53.13	%
Midpoint	*		57.60		57.60
Maximum	*		61.50		61.50
Maximum, as adjusted	*		65.36		65.36
Peer Group:
Average	21.43	x	83.22	%	85.43	%
Median	24.34		80.79		82.51
All publicly-traded thrift:
Average	20.65	x	108.34	%	120.80	%
Median	19.59		98.98		108.91

*	Not meaningful.

(1)	Ratios are based on earnings for the twelve months ended December 31, 2007 or March 31, 2008, and share prices as of May 16, 2008.

(2)	Ratios are based on book value as of December 31, 2007 or March 31, 2008, and share prices as of May 16, 2008.

The pro forma information presented under “Pro Forma Data” reflects an estimated expense for the equity incentive plan that may be adopted by First Savings Financial Group and the resulting effect on the pro forma price-to-earnings multiples for First Savings Financial Group.

Our board of directors reviewed RP Financial’s appraisal report, including the methodology and the assumptions used by RP Financial, and determined that the valuation range was reasonable and adequate. Assuming that the shares are sold at $10.00 per share in the conversion, the estimated number of shares would be between 2,626,500 at the minimum of the valuation range and 3,553,500 at the maximum of the valuation range, with a midpoint of 3,090,000, which amount includes shares contributed to the foundation. The purchase price of $10.00 per share was determined by us, taking into account, among other factors, the requirement under Office of Thrift Supervision regulations that the common stock be offered in a manner that will achieve the widest distribution of the stock and desired liquidity in the common stock after the offering.

Since the outcome of the offering relates in large measure to market conditions at the time of sale, it is not possible for us to determine the exact number of shares that we will issue at this time. The offering range may be amended, with the approval of the Office of Thrift Supervision, if necessitated by developments following the date of the appraisal in, among other things, market conditions, our financial condition or operating results, regulatory guidelines or national or local economic conditions.

If, upon completion of the subscription offering, at least the minimum number of shares are subscribed for, RP Financial, after taking into account factors similar to those involved in its prior appraisal, will determine its estimate of our pro forma market value as of the close of the subscription offering. If, as a result of regulatory considerations, demand for the shares or changes in market conditions, RP Financial determines that our pro forma market value has increased, we may sell up to 4,086,525 shares without any further notice to you.

No shares will be sold unless RP Financial confirms that, to the best of its knowledge and judgment, nothing of a material nature has occurred that would cause it to conclude that the actual total purchase price of the shares on an aggregate basis was materially incompatible with its appraisal. If, however, the facts do not justify that statement, we may either: terminate the stock offering and promptly return all funds; set a new offering range, notify all subscribers and give them the opportunity to place a new order for shares of First Savings Financial Group

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common stock; or take such other actions as may be permitted by the Office of Thrift Supervision. If the offering is terminated all subscriptions will be cancelled and subscription funds will be returned promptly with interest, and holds on funds authorized for withdrawal from deposit accounts will be released or reduced. If RP Financial establishes a new valuation range, it must be approved by the Office of Thrift Supervision.

In formulating its appraisal, RP Financial relied upon the truthfulness, accuracy and completeness of all documents we furnished to it. RP Financial also considered financial and other information from regulatory agencies, other financial institutions, and other public sources, as appropriate. While RP Financial believes this information to be reliable, RP Financial does not guarantee the accuracy or completeness of the information and did not independently verify the consolidated financial statements and other data provided by us nor independently value our assets or liabilities. The appraisal is not intended to be, and must not be interpreted as, a recommendation of any-kind as to the advisability of purchasing shares of common stock. Moreover, because the appraisal must be based on many factors that change periodically, there is no assurance that purchasers of shares in the offering will be able to sell shares after the offering at prices at or above the purchase price.

Copies of the appraisal report of RP Financial, including any amendments to the report, and the detailed memorandum of the appraiser setting forth the method and assumptions for such appraisal are available for inspection at our main office and the other locations specified under “Where You Can Find More Information.”

Delivery of Certificates

Certificates representing the common stock sold in the offering will be mailed by our transfer agent to the persons whose subscriptions or orders are filled at the addresses of such persons appearing on the stock order form as soon as practicable following completion of the offering. We will hold certificates returned as undeliverable until claimed by the persons legally entitled to the certificates or otherwise disposed of in accordance with applicable law. Until certificates for common stock are available and delivered to subscribers, subscribers may not be able to sell their shares, even though trading of the common stock may have commenced.

Restrictions on Repurchase of Stock

Under Office of Thrift Supervision regulations, we may not for a period of one year from the date of the completion of the offering repurchase any of our common stock from any person, except (1) in an offer made to all stockholders to repurchase the common stock on a pro rata basis, approved by the Office of Thrift Supervision, (2) the repurchase of qualifying shares of a director, or (3) repurchases to fund restricted stock plans or tax-qualified employee stock benefit plans. Where extraordinary circumstances exist, the Office of Thrift Supervision may approve the open market repurchase of up to 5% of our common stock during the first year following the offering. To receive such approval, we must establish compelling and valid business purposes for the repurchase to the satisfaction of the Office of Thrift Supervision. Furthermore, repurchases of any common stock are prohibited if they would cause First Savings Bank’s regulatory capital to be reduced below the amount required under the regulatory capital requirements imposed by the Office of Thrift Supervision.

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Restrictions on Transfer of Shares After the Conversion Applicable to Officers and Directors

Common stock purchased in the offering will be freely transferable, except for shares purchased by our directors and executive officers.

Shares of common stock purchased by our directors and executive officers may not be sold for a period of one year following the offering, except upon the death of the stockholder or unless approved by the Office of Thrift Supervision. Shares purchased by these persons in the open market after the offering will be free of this restriction. Shares of common stock issued to directors and executive officers will bear a legend giving appropriate notice of the restriction and, in addition, we will give appropriate instructions to our transfer agent with respect to the restriction on transfers. Any shares issued to directors and executive officers as a stock dividend, stock split or otherwise with respect to restricted common stock will be similarly restricted.

Persons affiliated with us, including our directors and executive officers, received subscription rights based only on their deposits with First Savings Bank as account holders. Any purchases made by persons affiliated with us for the explicit purpose of meeting the minimum of the offering must be made for investment purposes only, and not with a view towards redistribution. Furthermore, as set forth above, Office of Thrift Supervision regulations restrict sales of common stock purchased in the offering by directors and executive officers for a period of one year following the offering.

Purchases of outstanding shares of our common stock by directors, officers, or any person who becomes an executive officer or director after adoption of the plan of conversion, and their associates, during the three-year period following the offering may be made only through a broker or dealer registered with the Securities and Exchange Commission, except with the prior written approval of the Office of Thrift Supervision. This restriction does not apply, however, to negotiated transactions involving more than 1% of our outstanding common stock or to the purchase of stock under stock benefit plans.

We have filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended, for the registration of the common stock to be issued in the offering and contributed to the charitable foundation. This registration does not cover the resale of the shares. Shares of common stock purchased by persons who are not affiliates of us may be resold without registration. Shares purchased by an affiliate of us will have resale restrictions under Rule 144 of the Securities Act. If we meet the current public information requirements of Rule 144, each affiliate of ours who complies with the other conditions of Rule 144, including those that require the affiliate’s sale to be aggregated with those of certain other persons, would be able to sell in the public market, without registration, a number of shares not to exceed, in any three-month period, the greater of 1% of our outstanding shares or the average weekly volume of trading in the shares during the preceding four calendar weeks. We may make future provision to permit affiliates to have their shares registered for sale under the Securities Act under certain circumstances.

Interpretation, Amendment and Termination

To the extent permitted by law, all interpretations by us of the plan of conversion will be final; however, such interpretations have no binding effect on the Office of Thrift Supervision. The plan of conversion provides that, if deemed necessary or desirable, we may substantively amend the plan of conversion as a result of comments from regulatory authorities or otherwise.

Completion of the offering requires the sale of all shares of the common stock within 90 days following approval of the plan of conversion by the Office of Thrift Supervision, unless an extension is granted by the Office of Thrift Supervision. If this condition is not satisfied, the plan of conversion will be terminated and we will continue our business as a federal mutual savings bank. We may terminate the plan of conversion at any time.

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First Savings Charitable Foundation

General

In furtherance of our commitment to our local community, the plan of conversion provides that we will establish a charitable foundation in connection with the conversion. We have established First Savings Charitable Foundation as a non-stock Delaware corporation to serve as the charitable foundation. The foundation will be funded with First Savings Financial Group common stock as described below. By further enhancing our visibility and reputation in our local community, we believe that the foundation will enhance the long-term value of our community banking franchise. We believe the conversion presents us with a unique opportunity to provide a substantial and continuing benefit to our community and to receive the associated tax benefits, without any cash outlay by us.

Purpose of the Charitable Foundation

We emphasize community lending and community activities. First Savings Charitable Foundation is being formed to complement, not to replace, our existing community activities. Although we intend to continue to emphasize community lending and community activities following the conversion, such activities are not our sole corporate purpose. First Savings Charitable Foundation will be dedicated completely to community activities and the promotion of charitable causes, and may be able to support such activities in manners that are not presently available to us. We believe that First Savings Charitable Foundation will enable us to assist the communities within our market areas in areas beyond community development and lending and will enhance our current activities under the Community Reinvestment Act.

We further believe that the funding of First Savings Charitable Foundation with our common stock will allow our community to share in our potential growth and success long after the conversion. First Savings Charitable Foundation will accomplish that goal by providing for continued ties between our community and us, thereby forming a partnership within the communities in which we operate.

We do not expect the contribution to First Savings Charitable Foundation to take the place of our traditional community lending and charitable activities. For the six months ended March 31, 2008 and the years ended September 30, 2007 and September 30, 2006, we contributed $20,000, $40,000 and $19,000, respectively, to community organizations. We expect to continue making charitable contributions and donations within our community. In connection with the closing of the offering, we intend to contribute to First Savings Charitable Foundation 110,000 shares of our common stock and $100,000 cash.

Structure and Regulatory Requirements of the Charitable Foundation

First Savings Charitable Foundation will be incorporated under Delaware law as a non-stock corporation. The Certificate of Incorporation of First Savings Charitable Foundation will provide that First Savings Charitable Foundation is organized exclusively for charitable purposes as set forth in Section 501(c)(3) of the Internal Revenue Code. The Certificate of Incorporation will further provide that no part of the net earnings of the foundation will inure to the benefit of, or be distributable to, its directors, officers or members. Pursuant to regulations of the Office of Thrift Supervision, First Savings Charitable Foundation’s charter and gift instrument must also provide that:

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The charitable organization’s primary purpose is to serve and make grants in First Savings’ local community.

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As long as First Savings Charitable Foundation controls shares of First Savings Financial Group, it must vote those shares in the same ratio as all other shares voted on each proposal considered by First Savings Financial Group’s shareholders.

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For at least five years after its organization, one seat on First Savings Charitable Foundation’s board of directors is reserved for an independent director from First Savings’ local community. This director may not be an employee, officer or director of First Savings or an affiliate of First Savings, and should have experience with local community charitable organizations and grant making.

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•

For at least five years after its organization, one seat on First Savings Charitable Foundation’s board of directors is reserved for a director from First Savings’ board of directors or the board of directors of an acquirer or resulting institution in the event of a merger or acquisition of First Savings.

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The Office of Thrift Supervision may examine the charitable organization at the charitable organization’s expense.

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The charitable organization must comply with all supervisory directives that the Office of Thrift Supervision imposes.

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The charitable organization must annually provide the Office of Thrift Supervision with a copy of the annual report that the charitable organization submitted to the Internal Revenue Service.

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The charitable organization must operate according to written policies adopted by its board of directors, including a conflict of interest policy.

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The charitable organization may not engage in self-dealing, and must comply with all laws necessary to maintain its tax-exempt status under the Internal Revenue Code.

In addition, within six months of completing the conversion, First Savings Charitable Foundation must submit to the Office of Thrift Supervision a three-year operating plan.

Three directors of First Savings Bank will serve on the initial board of directors of the foundation: Larry W. Myers, John P. Lawson, Jr. and Cecile A. Blau. We also will select one additional person to serve on the foundation’s board of directors who will not be one of our employees, officers or directors. As required by the Office of Thrift Supervision regulations, this other director will have experience with local charitable organizations and grant making. While there are no plans to change the size of the initial board of directors during the year following the composition of its board of directors, following the first anniversary of the conversion, the foundation may alter the size and composition of its Board of Directors. It is currently not anticipated that directors of the foundation will receive compensation for their service.

The board of directors of First Savings Charitable Foundation will be responsible for establishing its grant and donation policies, consistent with the purposes for which it was established. As directors of a nonprofit corporation, directors of First Savings Charitable Foundation will always be bound by their fiduciary duty to advance the foundation’s charitable goals, to protect its assets and to act in a manner consistent with the charitable purposes for which the foundation is established. The directors of First Savings Charitable Foundation also will be responsible for directing the activities of the foundation, including the management and voting of our common stock held by the foundation. However, as required by Office of Thrift Supervision regulations, all shares of common stock held by First Savings Charitable Foundation must be voted in the same ratio as all other shares of the common stock on all proposals considered by our stockholders.

First Savings Charitable Foundation’s place of business will be located at our administrative offices. The board of directors of First Savings Charitable Foundation will appoint such officers and employees as may be necessary to manage its operations, although no employees are expected to be hired. To the extent applicable, we will comply with the affiliates restrictions set forth in Sections 23A and 23B of the Federal Reserve Act and the Office of Thrift Supervision regulations governing transactions between us and the foundation.

First Savings Charitable Foundation will receive working capital from: (1) any dividends that may be paid on our common stock in the future; (2) within the limits of applicable federal and state laws, loans collateralized by the common stock; or (3) the proceeds of the sale of any of the common stock in the open market from time to time. As a private foundation under Section 501(c)(3) of the Internal Revenue Code, First Savings Charitable Foundation will be required to distribute annually in grants or donations a minimum of 5% of the average fair market value of its net investment assets.

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Tax Considerations

Our independent tax advisor has advised us that an organization created for the above purposes should qualify as a Section 501(c)(3) exempt organization under the Internal Revenue Code and would be classified as a private foundation. First Savings Charitable Foundation will submit a timely request to the Internal Revenue Service to be recognized as an exempt organization. As long as First Savings Charitable Foundation files its application for tax-exempt status within 27 months from the date of its organization, and provided the Internal Revenue Service approves the application, its effective date as a Section 501(c)(3) organization will be the date of its organization. Our independent tax advisor, however, has not rendered any advice on whether First Savings’ Charitable Foundation’s tax-exempt status will be affected by the regulatory requirement that all shares of our common tock held by First Savings’ Charitable Foundation must be voted in the same ratio as all other outstanding shares of common stock voted on all proposals considered by our stockholders.

We are authorized under federal law to make charitable contributions. We believe that the conversion presents a unique opportunity to establish and fund a charitable foundation given the substantial amount of additional capital being raised. In making such a determination, we considered the dilutive impact of the contribution of common stock to First Savings Charitable Foundation on the amount of common stock to be sold in the conversion. See “Capitalization,” “Regulatory Capital Compliance,” and “Comparison of Independent Valuation and Pro Forma Financial Information With and Without the Foundation.” The amount of the contribution will not adversely impact our financial condition. We therefore believe that the amount of the charitable foundation is reasonable given our pro forma capital position and does not raise safety and soundness concerns.

We have received an opinion from our independent tax advisor that our contribution of our stock to First Savings Charitable Foundation should not constitute an act of self-dealing and that we should be entitled to a deduction under federal law in the amount of the fair market value of the stock at the time of the contribution, less the nominal amount that First Savings Charitable Foundation is required to pay us for such stock. Under the Internal Revenue Code, we are permitted to deduct only an amount equal to 10% of our annual taxable income in any one year. We are permitted under the Internal Revenue Code to carry the excess contribution over the five-year period following the contribution to First Savings Charitable Foundation. We estimate that substantially all of the contribution should be deductible under federal law over the six-year period. However, we do not have any assurance that the Internal Revenue Service will grant tax-exempt status to the foundation. Furthermore, even if the contribution is deductible under federal law, we may not have sufficient earnings to be able to use the deduction in full. We do not expect to make any further contributions to First Savings Charitable Foundation within the first five years following the initial contribution, unless such contributions would be deductible under the Internal Revenue Code. Any such decisions would be based on an assessment of, among other factors, our financial condition at that time, the interests of our stockholders and depositors, and the financial condition and operations of the foundation.

Although we have received an opinion from our independent tax advisor that we should be entitled to a deduction under federal law for the charitable contribution, there can be no assurances that the Internal Revenue Service will recognize First Savings Charitable Foundation as a Section 501(c)(3) exempt organization or that the deduction will be permitted. In such event, our contribution to First Savings Charitable Foundation would be expensed without tax benefit, resulting in a reduction in earnings in the year in which the Internal Revenue Service makes such a determination. See “Risk Factors — Risks Related to the Formation of the Charitable Foundation — Our contribution to First Savings Charitable Foundation may not be tax deductible, which could hurt our profits.”

As a private foundation, earnings and gains, if any, from the sale of common stock or other assets are exempt from federal and sate income taxation. However, investment income, such as interest, dividends and capital gains, is generally taxed at a rate of 2.0%. First Savings Charitable Foundation will be required to file an annual return with the Internal Revenue Service within four and one-half months after the close of its fiscal year. First Savings Charitable Foundation will be required to make its annual return available for public inspection. The annual return for a private foundation includes, among other things, an itemized list of all grants made or approved, showing the amount of each grant, the recipient, any relationship between a grant recipient and the foundation’s managers and a concise statement of the purpose of each grant.

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Restrictions on the Acquisition of

First Savings Financial Group, Inc.

and First Savings Bank, F.S.B.

General

First Savings Bank’s plan of conversion provides for the conversion of First Savings Bank from the mutual to the stock form of organization and, as part of the conversion, the adoption of a new federal stock charter and bylaws by First Savings Bank’s members. The plan of conversion also provides for the concurrent formation of a holding company. As described below and elsewhere in this document, certain provisions in First Savings Financial Group’s articles of incorporation and bylaws may have anti-takeover effects. In addition, provisions in First Savings Bank’s federal stock charter and bylaws may also have anti-takeover effects. Finally, Indiana corporate law and regulatory restrictions may make it difficult for persons or companies to acquire control of either First Savings Financial Group or First Savings Bank.

Restrictions in First Savings Financial Group, Inc.’s Articles of Incorporation and Bylaws

First Savings Financial Group’s articles of incorporation and bylaws contain provisions that could make more difficult an acquisition of First Savings Financial Group by means of a tender offer, proxy contest or otherwise. Some provisions will also render the removal of the incumbent board of directors or management of First Savings Financial Group more difficult. These provisions may have the effect of deterring a future takeover attempt that is not approved by the directors of First Savings Financial Group, but which First Savings Financial Group stockholders may deem to be in their best interests or in which stockholders may receive a substantial premium for their shares over then current market prices. As a result, stockholders who might desire to participate in such a transaction may not have the opportunity to do so. The following description of these provisions is only a summary and does not provide all of the information contained in First Savings Financial Group’s articles of incorporation and bylaws. See “Where You Can Find More Information” for information on where to obtain a copy of these documents.

Limitation on Voting Rights. The Articles of Incorporation of First Savings Financial Group provide that in no event shall any record owner of any outstanding common stock which is beneficially owned, directly or indirectly, by a person who beneficially owns in excess of 10% of the then outstanding shares of common stock (the “Limit”) be entitled or permitted to any vote in respect of the shares held in excess of the Limit, unless permitted by a resolution, granted in advance and adopted by a majority of the board of directors. Beneficial ownership is determined under the federal securities laws and includes shares beneficially owned by such person or any of his or her affiliates (as defined in the Articles of Incorporation), shares which such person or his or her affiliates have the right to acquire upon the exercise of conversion rights or options and shares as to which such person and his or her affiliates have or share investment or voting power, but shall not include shares beneficially owned by the ESOP or directors, officers and employees of First Savings Bank or First Savings Financial Group or shares that are subject to a revocable proxy and that are not otherwise beneficially, or deemed by First Savings Financial Group to be beneficially, owned by such person and his or her affiliates.

Board of Directors. The Board of Directors of First Savings Financial Group is divided into three classes, each of which shall contain approximately one-third of the whole number of the members of the Board. The members of each class shall be elected for a term of three years, with the terms of office of all members of one class expiring each year so that approximately one-third of the total number of directors are elected each year. The Articles of Incorporation provide that any vacancy occurring in the Board, including a vacancy created by an increase in the number of directors, may be filled by a vote of a majority of the directors then in office and any director so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of the class to which the director has been chosen expires. The classified Board is intended to provide for continuity of the Board of Directors and to make it more difficult and time consuming for a stockholder group to fully use its voting

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power to gain control of the Board of Directors without the consent of the incumbent Board of Directors of First Savings Financial Group. The Articles of Incorporation of First Savings Financial Group provide that a director may be removed from the Board of Directors prior to the expiration of his or her term only for cause and only upon the vote of two-thirds of the outstanding shares of voting stock. In the absence of this provision, the vote of the holders of a majority of the shares could remove one or more directors with or without cause. The Bylaws provide that no person seventy (70) years of age or older shall be eligible for election, reelection, appointment or reappointment to the Board of Directors but a person that attains seventy (70) years of age while serving as a director may continue to serve until the expiration of his or her term. Following the expiration of the term during which a person serving as a director attains seventy (70) years of age, such person shall be eligible for election, reelection, appointment or reappointment as a director in the sole discretion of the nominating committee of the Board of Directors for no more than one (1) additional term but in no event shall such person serve as a director beyond the annual meeting of the Bank immediately following such person becoming seventy-five (75) years of age.

Cumulative Voting, Special Meetings and Action by Written Consent. The Articles of Incorporation do not provide for cumulative voting for any purpose. Moreover, the Articles of Incorporation provide that special meetings of stockholders of First Savings Financial Group may be called only by the chairman of the Board of Directors or by the Board of Directors of First Savings Financial Group pursuant to a resolution adopted by a majority of the total number of directors which the corporation would have if there were no vacancies on the Board of Directors. Under Indiana law, action may be taken by shareholders without a meeting only if evidenced by a written consent signed by all shareholders entitled to vote.

Authorized Shares. The Articles of Incorporation authorizes the issuance of 20 million (20,000,000) shares of common stock and 1 million (1,000,000) shares of preferred stock. The shares of common stock and preferred stock were authorized in an amount greater than that to be issued in the conversion to provide First Savings Financial Group’s Board of Directors with as much flexibility as possible to effect, among other transactions, financing, acquisitions, stock dividends, stock splits, restricted stock grants and the exercise of stock options. However, these additional authorized shares may also be used by the Board of Directors, consistent with fiduciary duties, to deter future attempts to gain control of First Savings Financial Group. The Board of Directors also has sole authority to determine the terms of any one or more series of preferred stock, including voting rights, conversion rates, and liquidation preferences. As a result of the ability to fix voting rights for a series of preferred stock, the Board has the power, to the extent consistent with its fiduciary duties, to issue a series of preferred stock to persons friendly to management in order to attempt to block a tender offer, merger or other transaction by which a third party seeks control of First Savings Financial Group, and thereby assist members of management to retain their positions.

Stockholder Vote Required To Approve Business Combinations With Principal Stockholders. The Articles of Incorporation require the approval of the holders of at least 80% of First Savings Financial Group’s outstanding shares of voting stock to approve certain “Business Combinations” involving a “Related Person” except in cases where the proposed transaction has been approved in advance by a two-thirds vote of those members of First Savings Financial Group’s Board of Directors who are unaffiliated with the Related Person and were directors prior to the time when the Related Person became a Related Person. The term “Related Person” is defined to include any individual, corporation, partnership or other person or entity, other than First Savings Financial Group or its subsidiary, which owns beneficially or controls, directly or indirectly, 10% or more of the outstanding shares of voting stock of First Savings Financial Group or an affiliate of such person or entity. This provision of the Articles of Incorporation applies to any “Business Combination,” which is defined to include:

(1) any merger or consolidation of First Savings Financial Group with or into any Related Person;

(2) any sale, lease, exchange, transfer, or other disposition, including without limitation, a mortgage, or any other security device, of 25% or more of the assets of First Savings Financial Group, Inc. or combined assets of First Savings Financial Group and its subsidiaries to a Related Person;

(3) any merger or consolidation of a Related Person with or into First Savings Financial Group or a subsidiary of First Savings Financial Group;

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(4) any sale, lease, exchange, transfer, or other disposition of 25% or more of the assets of a Related Person to First Savings Financial Group or a subsidiary of First Savings Financial Group;

(5) the issuance of any securities of First Savings Financial Group or a subsidiary of First Savings Financial Group to a Related Person;

(6) the acquisition by First Savings Financial Group or a subsidiary of First Savings Financial Group of any securities of a Related Person;

(7) any reclassification of common stock of First Savings Financial Group or any recapitalization involving the common stock of First Savings Financial Group; or

(8) any agreement or other arrangement providing for any of the foregoing.

Under Indiana law, absent this provision, business combinations, including mergers, share exchanges and sales of substantially all of the assets of a corporation must, subject to certain exceptions, be approved by the vote of the holders of a majority of the outstanding shares of common stock of First Savings Financial Group and any other affected class of stock. The increased stockholder vote required to approve a business combination may have the effect of foreclosing mergers and other business combinations which a majority of stockholders deem desirable and placing the power to prevent such a merger or combination in the hands of a minority of stockholders.

Amendment of Articles of Incorporation and Bylaws. Amendments to First Savings Financial Group’s Articles of Incorporation must be approved by a two-thirds vote of its Board of Directors, provided, however, that an affirmative vote of at least two-thirds of the outstanding voting stock entitled to vote (after giving effect to the provision limiting voting rights) is also required to amend or repeal certain provisions of the Articles of Incorporation, including the provision limiting voting rights, the provisions relating to approval of certain business combinations, calling special meetings, the number and classification of directors, removal of directors, director and officer indemnification by First Savings Financial Group and amendment of the Articles of Incorporation. First Savings Financial Group’s Bylaws may be amended only by a resolution adopted by a two-thirds vote of the Board of Directors.

Stockholder Nominations and Proposals. The Bylaws of First Savings Financial Group require a stockholder who intends to nominate a candidate for election to the Board of Directors, or to raise new business at a stockholder meeting, to deliver written notice to the Secretary of First Savings Financial Group not less than 60 days nor more than 90 days before the stockholder meeting; provided that if less than 71 days’ notice of the stockholder meeting is given to stockholders, such written notice must be delivered not later than the close of the tenth day following the day on which notice of the stockholder meeting was mailed to stockholders. The notice provision requires a stockholder who desires to raise new business to provide certain information to First Savings Financial Group concerning the nature of the new business, the stockholder and the stockholder’s interest in the business matter. Similarly, a stockholder wishing to nominate any person for election as a director must provide First Savings Financial Group with certain information concerning the nominee and the proposing stockholder.

Restrictions in Indiana Corporate Law

Indiana law contains certain provisions, described below, which may be applicable to First Savings Financial Group upon consummation of the conversion.

Control Share Acquisitions. Indiana law provides that if a person makes a “control share acquisition,” defined as an acquisition of voting stock having at least 20% of all voting power, those shares will be accorded the same voting rights as all other shares only if a resolution is approved at an annual or special stockholders meeting by the holders of a majority of all shares entitled to vote other than the control shares. The statute also provides that any person proposing to make or who has made a control share acquisition may, at the person’s election, deliver a statement to the corporation disclosing the information specified by the statute. Under Indiana law, First Savings Financial Group is permitted and has decided to specifically opt out of the application of the Control Share Acquisitions Chapter of the Indiana Business Corporations law.

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Business Combinations. Indiana law generally provides that for five (5) years from the date a stockholder becomes an “interested shareholder” ( i.e. , the owner of 10% or more of a corporation’s voting stock), the corporation may not engage in a business combination with the interested shareholder unless the board of directors approved in advance the business combination or the transaction causing the stockholder to become an interested shareholder. If such advance approval is not received, then the business combination must meet all requirements of the Articles of Incorporation and either must be approved by a majority vote of the voting stock not owned by the interested shareholder and its associates at a meeting called for that purpose no earlier than five (5) years after the interested shareholder’s share acquisition date or the proposed consideration to be paid in the business combination must satisfy certain fair price criteria. Under Indiana law, First Savings Financial Group is permitted and has decided to specifically opt out of the application of the Business Combinations Chapter of the Indiana Business Corporations law.

Restrictions in First Savings Bank, F.S.B.’s Federal Stock Charter and Bylaws

Although the board of directors of First Savings Bank is not aware of any effort that might be made to obtain control of First Savings Bank after its conversion to the stock form of ownership, the board of directors believes it is appropriate to adopt certain provisions permitted by federal regulations that may have the effect of deterring a future takeover attempt that is not approved by First Savings Bank’s board of directors. The following description of these provisions is only a summary and does not provide all of the information contained in First Savings Bank’s proposed federal stock charter and bylaws.

Beneficial Ownership Limitation. First Savings Bank’s charter provides that, for a period of five years from the date of the conversion, no person, other than First Savings Financial Group, may acquire directly or indirectly the beneficial ownership of more than 10% of any class of any equity security of First Savings Bank. In the event a person acquires shares in violation of this provision, all shares beneficially owned by such person in excess of 10% will be considered “excess shares” and will not be counted as shares entitled to vote or counted as voting shares in connection with any matters submitted to the stockholders for a vote.

Board of Directors.

Classified Board. First Savings Bank’s board of directors is divided into three classes as nearly as equal in number as possible. The stockholders elect one class of directors each year for a term of three years. The classified board makes it more difficult and time consuming for a stockholder group to fully use its voting power to gain control of the board of directors without the consent of the incumbent board of directors of First Savings Bank.

Filling of Vacancies; Removal. The bylaws provide that any vacancy occurring in the board of directors, including a vacancy created by an increase in the number of directors, may be filled by a vote of a majority of the remaining directors although less than a quorum of the board of directors then in office. A person elected to fill a vacancy on the board of directors will serve until the next election of directors by the stockholders. First Savings Bank’s bylaws provide that a director may be removed from the board of directors before the expiration of his or her term only for cause and only upon the vote of a majority of the outstanding shares of voting stock. These provisions make it more difficult for stockholders to remove directors and replace them with their own nominees.

Elimination of Cumulative Voting. The charter of First Savings Bank does not provide for cumulative voting with respect to the election of directors. The elimination of cumulative voting makes it more difficult for a stockholder group to elect a director nominee.

Authorized but Unissued Shares of Capital Stock. Following the conversion, First Savings Bank will have authorized but unissued shares of common and preferred stock. First Savings Bank’s charter authorizes the board of directors to establish one or more series of preferred stock and, for any series of preferred stock, to determine the terms and rights of the series, including voting rights, conversion rates, and liquidation preferences. Such shares of common and preferred stock could be issued by the board of directors to render more difficult or to discourage an attempt to obtain control of First Savings Bank by means of a merger, tender offer, proxy contest or otherwise.

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Regulatory Restrictions

Office of Thrift Supervision Regulations. Regulations of the Office of Thrift Supervision provide that, for a period of three years following the date of the completion of the conversion, no person, acting singly or together with associates in a group of persons acting in concert, will directly or indirectly offer to acquire or acquire the beneficial ownership of more than 10% of any class of any equity security of First Savings Financial Group without the prior written approval of the Office of Thrift Supervision. Where any person, directly or indirectly, acquires beneficial ownership of more than 10% of any class of any equity security of First Savings Financial Group without the prior written approval of the Office of Thrift Supervision, the securities beneficially owned by such person in excess of 10% will not be voted by any person or counted as voting shares in connection with any matter submitted to the stockholders for a vote, and will not be counted as outstanding for purposes of determining the affirmative vote necessary to approve any matter submitted to the stockholders for a vote.

Change in Bank Control Act. The acquisition of 10% or more of the common stock outstanding may trigger the provisions of the Change in Bank Control Act, a federal law. The Office of Thrift Supervision has also adopted a regulation under the Change in Bank Control Act which generally requires persons who at any time intend to acquire control of a federally chartered savings association, including a converted savings and loan association such as First Savings Bank, to provide 60 days prior written notice and certain financial and other information to the Office of Thrift Supervision.

The 60-day notice period does not commence until the information is deemed to be substantially complete. Control for the purpose of this Act exists in situations in which the acquiring party has voting control of at least 25% of any class of First Savings Financial Group’s voting stock or the power to direct the management or policies of First Savings Financial Group. However, under Office of Thrift Supervision regulations, “control” is presumed to exist where the acquiring party has voting control of at least 10% of any class of First Savings Financial Group’s voting securities if specified “control factors” are present. The statute and underlying regulations authorize the Office of Thrift Supervision to disapprove a proposed acquisition on certain specified grounds.

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Description of First Savings Financial Group, Inc. Capital Stock

The common stock of First Savings Financial Group will represent nonwithdrawable capital, will not be an account of any type, and will not be insured by the Federal Deposit Insurance Corporation or any other government agency.

General

First Savings Financial Group is authorized to issue twenty million (20,000,000) shares of common stock having a par value of $0.01 per share and one million (1,000,000) shares of preferred stock having a par value of $0.01 per share. Each share of First Savings Financial Group’s common stock will have the same relative rights as, and will be identical in all respects with, each other share of common stock. Upon payment of the purchase price for the common stock, as required by the plan of conversion, all stock will be duly authorized, fully paid and nonassessable. First Savings Financial Group will not issue any shares of preferred stock in the conversion.

Common Stock

Dividends. First Savings Financial Group cannot pay dividends on its common stock if, after giving effect to the distribution, it would be unable to pay its indebtedness as the indebtedness comes due in the usual course of business or its total assets exceed the sum of its liabilities and the amount needed, if First Savings Financial Group were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of any holders of capital stock who have a preference upon dissolution. The holders of common stock of First Savings Financial Group will be entitled to receive and share equally in dividends as may be declared by the board of directors of First Savings Financial Group out of funds legally available for dividends. If First Savings Financial Group issues preferred stock, the holders of the preferred stock may have a priority over the holders of the common stock with respect to dividends. See “ Our Dividend Policy” and “Regulation and Supervision.”

Voting Rights. After the conversion, the holders of common stock of First Savings Financial Group will possess exclusive voting rights in First Savings Financial Group. They will elect First Savings Financial Group’s board of directors and act on other matters as are required to be presented to them under Indiana law or as are otherwise presented to them by the board of directors. Except as discussed under “Restrictions on the Acquisition of First Savings Financial Group and First Savings Bank-Restrictions in First Savings Financial Group’s Articles of Incorporation and Bylaws — Limitations on Voting Rights,” each holder of common stock will be entitled to one vote per share and will not have any right to cumulate votes in the election of directors. If First Savings Financial Group issues preferred stock, holders of First Savings Financial Group preferred stock may also possess voting rights.

Liquidation. If there is any liquidation, dissolution or winding up of First Savings Bank, First Savings Financial Group, as the sole holder of First Savings Bank’s capital stock, would be entitled to receive all of First Savings Bank’s assets available for distribution after payment or provision for payment of all debts and liabilities of First Savings Bank, including all deposit accounts and accrued interest. Upon liquidation, dissolution or winding up of First Savings Financial Group, the holders of its common stock would be entitled to receive all of the assets of First Savings Financial Group available for distribution after payment or provision for payment of all its debts and liabilities. If First Savings Financial Group issues preferred stock, the preferred stock holders may have a priority over the holders of the common stock upon liquidation or dissolution.

Preemptive Rights; Redemption. Holders of the common stock of First Savings Financial Group will not be entitled to preemptive rights with respect to any shares that may be issued. The common stock cannot be redeemed.

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Preferred Stock

First Savings Financial Group will not issue any preferred stock in the conversion and it has no current plans to issue any preferred stock after the conversion. Preferred stock may be issued with designations, powers, preferences and rights as the board of directors may from time to time determine. The board of directors can, without stockholder approval, issue preferred stock with voting, dividend, liquidation and conversion rights that could dilute the voting strength of the holders of the common stock and may assist management in impeding an unfriendly takeover or attempted change in control.

Transfer Agent and Registrar

The transfer agent and registrar for our common stock will be .

Registration Requirements

We have registered our common stock with the Securities and Exchange Commission under Section 12(b) of the Securities Exchange Act of 1934, as amended, and will not deregister our common stock for a period of at least three years following the offering. As a result of registration, the proxy and tender offer rules, insider trading reporting and restrictions, annual and periodic reporting and other requirements of that statute will apply.

Legal and Tax Opinions

The legality of our common stock has been passed upon for us by Kilpatrick Stockton LLP, Washington, D.C. The federal tax consequences of the conversion have been opined upon by Kilpatrick Stockton LLP and the state tax consequences of the conversion have been opined upon by Monroe Shine & Co., Inc. Kilpatrick Stockton LLP and Monroe Shine & Co., Inc. have consented to the references to its opinions in this prospectus. Certain legal matters will be passed upon for Keefe, Bruyette & Woods, Inc. by Silver Freedman & Taff, L.L.P.

Experts

The consolidated financial statements of First Savings Bank as of September 30, 2007 and 2006, and for each of the years in the two year period ended September 30, 2007 included in this prospectus and in the registration statement have been audited by Monroe Shine & Co., Inc., an independent registered public accounting firm, as stated in its report appearing herein and elsewhere in the registration statement (which report expresses an unqualified opinion), and has been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

RP Financial has consented to the summary in this prospectus of its report to us setting forth its opinion as to our estimated pro forma market value and to the use of its name and statements with respect to it appearing in this prospectus.

Where You Can Find More Information

We have filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended, that registers the common stock offered in the stock offering, including shares issued to the charitable foundation. This prospectus forms a part of the registration statement. The registration statement, including the exhibits, contains additional relevant information about us and our common stock. The rules and regulations of the Securities and Exchange Commission allow us to omit certain information included in the registration statement from this prospectus. You may read and copy the registration statement at the Securities and Exchange Commission’s public reference room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for further information on the Securities and Exchange Commission’s public reference rooms. The registration statement also is available to the public from commercial document retrieval services and at the Internet World Wide Website maintained by the Securities and Exchange Commission at http://www.sec.gov.

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First Savings Financial Group has filed an application for approval of the plan of conversion with the Office of Thrift Supervision. This prospectus omits certain information contained in the application. The application may be inspected, without charge, at the offices of the Office of Thrift Supervision, 1700 G Street, NW, Washington, D.C. 20552 and at the offices of the Regional Director of the Office of Thrift Supervision at the Central Regional Office of the Office of Thrift Supervision, One South Wacker Drive, Suite 2000, Chicago, Illinois 60606.

A copy of the plan of conversion and First Savings Financial Group’s articles of incorporation and bylaws are available without charge from First Savings Bank.

The appraisal report of RP Financial has been filed as an exhibit to our registration statement and to our application to the Office of Thrift Supervision. Portions of the appraisal report were filed electronically with the Securities and Exchange Commission and are available on its website as described above. The entire appraisal report is available at the public reference room of the Securities and Exchange Commission and the offices of the Office of Thrift Supervision as described above.

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I ndex to Consolidated Financial Statements

of First Savings Bank, F.S.B.


Page

Report of Independent Registered Public Accounting Firm		F -l

Consolidated Balance Sheets as of March 31, 2008 (unaudited) and September 30, 2007 and 2006		F-2

Consolidated Statements of Income for the Six Month Periods Ended March 31, 2008 and 2007 (unaudited) and the Years Ended September 30, 2007 and 2006		F-3

Consolidated Statements of Changes in Equity for the Six Month Periods Ended March 31, 2008 (unaudited) and the Years Ended September 30, 2007 and 2006		F-4

Consolidated Statements of Cash Flows for the Six Month Periods Ended March 31, 2008 and 2007 (unaudited) and the Years Ended September 30, 2007 and 2006		F-5

Notes to Consolidated Financial Statements		F-6

****

All schedules are omitted as the required information either is not applicable or is included in the financial statements or related notes. Separate financial statements for First Savings Financial Group have not been included in this prospectus because First Savings Financial Group, which has engaged only in organizational activities to date, has no significant assets, contingent or other liabilities, revenues or expenses.

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LOGO

Report of Independent Registered Public Accounting Firm

The Board of Directors

First Savings Bank, F.S.B.

Clarksville, Indiana

We have audited the accompanying consolidated balance sheets of First Savings Bank, F.S.B. and Subsidiaries as of September 30, 2007 and 2006, and the related consolidated statements of income, equity and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Bank’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We have conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. 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 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 First Savings Bank, F.S.B. and Subsidiaries as of September 30, 2007 and 2006, and the results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

/s/ Monroe Shine & Co., Inc.

New Albany, Indiana

December 20, 2007

F-1

MONROE SHINE & CO., INC. CERTIFIED PUBLIC ACCOUNTANTS AND BUSINESS CONSULTANTS

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

MARCH 31, 2008 (UNAUDITED) AND SEPTEMBER 30, 2007 AND 2006

(Dollars in Thousands)


	March 31, 2008		September 30,
	March 31, 2008		2007		2006
	(Unaudited)
ASSETS
Cash and due from banks	$	3,739	$	6,391	$	6,856
Interest-bearing deposits with banks		5,494		4,004		8,367

Total cash and cash equivalents		9,233		10,395		15,223
Securities available for sale, at fair value		10,424		8,260		5,897
Securities held to maturity (fair value of $9,191 in 2008 $7,395 in 2007 and $8,135 in 2006)		9,100		7,422		8,219
Loans held for sale		157		—		—
Loans, net of allowance for loan losses of $2,498 in 2008, $1,297 in 2007 and $868 in 2006		171,018		167,371		166,695
Federal Home Loan Bank stock, at cost		1,336		1,336		1,379
Premises and equipment		4,334		4,369		4,407
Foreclosed real estate		1,125		1,278		1,941
Accrued interest receivable:
Loans		741		900		963
Securities		213		182		169
Other assets		4,943		1,808		1,506

Total Assets	$	212,624	$	203,321	$	206,399

LIABILITIES
Deposits:
Noninterest-bearing	$	4,291	$	5,011	$	4,393
Interest-bearing		169,794		163,771		171,498

Total deposits		174,085		168,782		175,891
Advances from Federal Home Loan Bank		8,000		3,000		—
Accrued interest payable on deposits		179		175		147
Advance payments by borrowers for taxes and insurance		190		332		279
Accrued expenses and other liabilities		771		1,370		1,232

Total Liabilities		183,225		173,659		177,549

EQUITY
Retained earnings - substantially restricted		29,262		29,610		28,796
Accumulated other comprehensive income		137		52		54

Total Equity		29,399		29,662		28,850

Total Liabilities and Equity	$	212,624	$	203,321	$	206,399

F-2

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

SIX-MONTH PERIODS ENDED MARCH 31, 2008 AND 2007 (UNAUDITED) AND

YEARS ENDED SEPTEMBER 30, 2007 AND 2006

(Dollars in Thousands)


	March 31,					September 30,
	2008			2007		2007		2006
	(Unaudited)			(Unaudited)
INTEREST INCOME
Loans, including fees	$	5,846		$	5,858	$	11,707	$	11,065
Securities:
Taxable		271			309		650		695
Tax-exempt		28			26		54		22
Federal Home Loan Bank dividends		33			35		65		69
Interest-bearing deposits with banks		123			333		602		372

Total interest income		6,301			6,561		13,078		12,223
INTEREST EXPENSE
Deposits		3,002			3,091		6,175		5,184
Borrowed funds		94			—		8		66

		3,096			3,091		6,183		5,250

Net interest income		3,205			3,470		6,895		6,973
Provision for loan losses		1,203			420		758		813

Net interest income after provision for loan losses		2,002			3,050		6,137		6,160
NONINTEREST INCOME
Service charges on deposit accounts		251			246		502		564
Net gain on sales of mortgage loans		15			—		6		11
Other income		233			141		333		314

Total noninterest income		499			387		841		889

NONINTEREST EXPENSE
Compensation and benefits		1,491			1,520		2,895		3,555
Occupancy and equipment		393			364		751		783
Data processing		280			267		548		546
Advertising		59			80		160		202
Professional fees		110			67		170		150
Net loss on foreclosed real estate		114			62		118		91
Other operating expenses		701			589		1,095		1,126

Total noninterest expense		3,148			2,949		5,737		6,453

Income (loss) before income taxes		(647	)		488		1,241		596
Income tax expense (benefit)		(299	)		162		427		241

Net Income (Loss)	$	(348	)	$	326	$	814	$	355

F-3

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

SIX-MONTH PERIOD ENDED MARCH 31, 2008 (UNAUDITED) AND

YEARS ENDED SEPTEMBER 30, 2007 AND 2006

(Dollars in Thousands)


				Accumulated Other Comprehensive Income (Loss)
	Retained Earnings			Net Unrealized Gain From Securities Available For Sale		Pension Adjustments			Total
Balances at October 1, 2005	$	28,441		$	45	$	—		$	28,486
COMPREHENSIVE INCOME
Net income		355			—		—			355
Other comprehensive income:
Change in unrealized gain on securities available for sale, net of deferred income tax expense of $6		—			9		—			9
Less: reclassification adjustment		—			—		—			—

Total comprehensive income										364

Balances at September 30, 2006		28,796			54		—			28,850
COMPREHENSIVE INCOME
Net income		814			—		—			814
Other comprehensive income:
Change in unrealized gain on securities available for sale, net of deferred income tax expense of $20		—			31		—			31
Less: reclassification adjustment		—			—		—			—
Adjustment to initially apply SFAS No. 158,net of deferred income tax benefit of $22		—			—		(33	)		(33	)

Total comprehensive income										812

Balances at September 30, 2007		29,610			85		(33	)		29,662
COMPREHENSIVE LOSS
Net loss		(348	)		—		—			(348	)
Other comprehensive loss:
Change in unrealized gain on securities available for sale, net of deferred income tax expense of $55		—			85		—			85
Less: reclassification adjustment		—			—		—			—

Total comprehensive loss										(263	)

Balances at March 31, 2008	$	29,262		$	170	$	(33	)	$	29,399

F-4

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

SIX-MONTH PERIODS ENDED MARCH 31, 2008 AND 2007 (UNAUDITED) AND

YEARS ENDED SEPTEMBER 30, 2007 AND 2006

(Dollars in Thousands)


	March 31,						September 30,
	2008			2007			2007			2006
	(Unaudited)			(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	(348	)	$	326		$	814		$	355
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Provision for loan losses		1,203			420			758			813
Depreciation		147			130			281			263
Amortization of premiums and accretion of discounts on securities, net		6			4			7			53
Mortgage loans originated for sale		(1,270	)		—			(447	)		(811	)
Proceeds on sale of mortgage loans		1,129			—			453			822
Gain on sale of mortgage loans		(15	)		—			(6	)		(11	)
Net realized and unrealized (gain) loss on foreclosed real estate		71			(6	)		18			26
Deferred income taxes		(306	)		13			(14	)		(120	)
(Increase) decrease in accrued interest receivable		128			14			50			(45	)
Increase in accrued interest payable		4			18			28			60
Change in other assets and liabilities, net		(483	)		(239	)		(203	)		72

Net Cash Provided By Operating Activities		266			680			1,739			1,477

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of securities available for sale		(4,027	)		(311	)		(5,311	)		(807	)
Proceeds from maturities of securities available for sale		2,000			—			3,000			1,935
Purchase of securities held to maturity		(6,040	)		—			—			—
Proceeds from maturities of securities held to maturity		4,000			—			—			2,500
Principal collected on mortgage-backed securities		359			380			789			860
Proceeds on redemption of Federal Home Loan Bank stock		—			43			43			85
Net (increase) decrease in loans		(5,037	)		1,938			(1,401	)		(5,281	)
Proceeds from sale of foreclosed real estate		268			554			612			37
Purchase of premises and equipment		(111	)		(121	)		(243	)		(581	)
Investment in cash surrender value of life insurance		(3,000	)		—			—			—

Net Cash Provided By (Used In) Investing Activities		(11,588	)		2,483			(2,511	)		(1,252	)

CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in deposits		5,302			1,390			(7,109	)		440
Proceeds from Federal Home Loan Bank advances		5,000			—			3,000			—
Net increase (decrease) in advance payments by borrowers for taxes and insurance		(142	)		(20	)		53			(93	)

Net Cash Provided By (Used In) Financing Activities		10,160			1,370			(4,056	)		347

Net Increase (Decrease) in Cash and Cash Equivalents		(1,162	)		4,533			(4,828	)		572
Cash and cash equivalents at beginning of period/year		10,395			15,223			15,223			14,651

Cash and Cash Equivalents at End of Period/Year	$	9,233		$	19,756		$	10,395		$	15,223

F-5

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(1)	PLAN OF CONVERSION AND CHANGE IN CORPORATE FORM

On April 30, 2008, the board of directors of First Savings Bank, F.S.B. (Bank) adopted a plan of conversion. The Plan is subject to the approval of the Office of Thrift Supervision (OTS) and must be approved by the affirmative vote of at least a majority of the total votes eligible to be cast by the voting members of the Bank at a special meeting. The Plan sets forth that the Bank proposes to convert into a stock savings bank structure with the establishment of a stock holding company, First Savings Financial Group, Inc. (Company), as parent of the Bank. The Bank will convert to the stock form of ownership, followed by the issuance of all of the Bank’s outstanding stock to First Savings Financial Group, Inc. Pursuant to the Plan, First Savings Financial Group, Inc. will determine the total offering value and number of shares of common stock based upon an independent appraiser’s valuation. The stock will be priced at $10.00 per share. In connection with the Plan, the Company intends to establish a charitable foundation which will be funded with 110,000 shares of common stock of the Company and $100,000 cash. In addition, the Bank’s board of directors has adopted an employee stock ownership plan (ESOP) which will subscribe 8% of the common stock sold in the offering and contributed to the charitable foundation. First Savings Financial Group, Inc. is being organized as a corporation incorporated under the laws of the State of Indiana and will own all of the outstanding common stock of the Bank upon completion of the conversion.

The costs of issuing the common stock will be deferred and deducted from the sales proceeds of the offering. If the conversion is unsuccessful, all deferred costs will be charged to operations. At March 31, 2008, the Bank had incurred $33,000 (unaudited) of deferred conversion costs in the form of retainers paid and included in other assets on the accompanying March 31, 2008 balance sheet. The Bank had incurred no deferred conversion costs as of December 31, 2007. The transaction is subject to approval by regulatory authorities and members of the Bank. At the completion of the conversion to stock form, the Bank will establish a liquidation account in the amount of retained earnings contained in the final prospectus. The liquidation account will be maintained for the benefits of eligible savings account holders who maintain deposit accounts in the Bank after conversion.

The conversion will be accounted for as a change in corporate form with the historic basis of the Bank’s assets, liabilities and equity unchanged as a result.

(2)	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

First Savings Bank, F.S.B. (the Bank) is a federal mutual savings bank which provides a variety of banking services to individuals and business customers through its seven offices in southern Indiana. The Bank’s primary source of revenue is single-family residential mortgage loans.

The Bank’s wholly-owned subsidiary, Southern Indiana Financial Corporation sells non-deposit investment products. The Bank’s other wholly-owned subsidiary, FFCC, Inc. is currently inactive.

Basis of Consolidation and Reclassifications

The consolidated financial statements include the accounts of the Bank and its wholly-owned subsidiaries, Southern Indiana Financial Corporation and FFCC, Inc. Inter-company balances and transactions have been eliminated. Certain prior year amounts have been reclassified to conform with current year presentation.

F-6

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

Statements of Cash Flows

For purposes of the statements of cash flows, the Bank has defined cash and cash equivalents as cash and amounts due from banks and interest-bearing deposits with other banks.

Use of Estimates

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 disclosure 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.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses and the valuation of real estate and other assets acquired in connection with foreclosures or in satisfaction of loans. In connection with the determination of the allowances for loan losses and foreclosed real estate, management obtains independent appraisals for significant properties.

A majority of the Bank’s loan portfolio consists of single-family residential and commercial real estate loans in the southern Indiana area. Accordingly, the ultimate collectibility of a substantial portion of the Bank’s loan portfolio and the recovery of the carrying amount of foreclosed real estate are susceptible to changes in local market conditions.

While management uses available information to recognize losses on loans and foreclosed real estate, further reductions in the carrying amounts of loans and foreclosed assets may be necessary based on changes in local economic conditions. In addition, as an integral part of their examination process, regulatory agencies periodically review the estimated losses on loans and foreclosed real estate. Such agencies may require the Bank to recognize additional losses based on their judgments about information available to them at the time of their examination. Because of these factors, it is reasonably possible the estimated losses on loans and foreclosed real estate may change materially in the near term. However, the amount of the change that is reasonably possible cannot be estimated.

F-7

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

Investment Securities

Securities Available for Sale : Securities available for sale consist primarily of U.S. government agency debt securities, collateralized mortgage obligations (CMO), municipal bonds and money market preferred stock and are stated at fair value. Amortization of premium and accretion of discount are recognized in interest income using methods approximating the interest method over the period to maturity. Unrealized gains and losses, net of tax, on securities available for sale are included in other comprehensive income and the accumulated unrealized holding gains and losses are reported as a separate component of equity until realized. Realized gains and losses on the sale of securities available for sale are determined using the specific identification method and are included in other noninterest income and, when applicable, are reported as a reclassification adjustment, net of tax, in other comprehensive income.

Securities Held to Maturity : U.S. government agency debt securities, including mortgage-backed securities, and municipal debt securities for which the Bank has the positive intent and ability to hold to maturity are reported at cost, adjusted for amortization of premium and accretion of discount that are recognized in interest income using methods approximating the interest method over the period to maturity, adjusted for anticipated prepayments. Mortgage-backed securities represent participating interests in pools of long-term first mortgage loans originated and serviced by issuers of the securities.

Declines in the fair value of individual available for sale and held to maturity securities below their amortized cost that are other than temporary result in write-downs of the individual securities to their fair value. The related write-downs are included in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers (1) the length of time and the extent to which the fair value has been less than amortized cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Bank to retain its investment for a period of time sufficient to allow for any anticipated recovery in fair value.

Mortgage Banking Activities

Mortgage loans originated and intended for sale in the secondary market are carried at the lower of aggregate cost or market value. Aggregate market value is determined based on the quoted prices under a “best efforts” sales agreement with a third party. Net unrealized losses are recognized through a valuation allowance by charges to income. Realized gains on sales of mortgage loans are included in non-interest income.

Commitments to originate mortgage loans held for sale are considered derivative financial instruments to be accounted for at fair value. The Bank’s mortgage loan commitments subject to derivative accounting are fixed rate mortgage loan commitments at market rates when initiated. Fair value is estimated based on fees that would be charged on commitments with similar terms. At March 31, 2008, the Bank had no commitments to originate fixed rate mortgage loans intended for sale in the secondary market.

F-8

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

Loans and Allowance for Loan Losses

The Bank grants real estate mortgage, commercial business and consumer loans. A substantial portion of the loan portfolio is represented by residential mortgage loans to customers in southern Indiana. The ability of the Bank’s customers to honor their contracts is dependent upon the real estate and general economic conditions in this area.

Loans are stated at unpaid principal balances, less net deferred loan fees and the allowance for loan losses.

Loan origination and commitment fees, as well as, certain direct costs of underwriting and closing loans are deferred and amortized as a yield adjustment to interest income over the lives of the related loans using the interest method. Amortization of deferred loan fees is discontinued when a loan is placed on nonaccrual status.

The recognition of income on a loan is discontinued and previously accrued interest is reversed, when interest or principal payments become ninety (90) days past due unless, in the opinion of management, the outstanding interest remains collectible. Past due status is determined based on contractual terms. Generally, by applying the cash receipts method, interest income is subsequently recognized only as received until the loan is returned to accrual status. The cash receipts method is used when the likelihood of further loss on the loan is remote. Otherwise, the Bank applies the cost recovery method and applies all payments as a reduction of the unpaid principal balance until the loan qualifies for return to accrual status. A loan is restored to accrual status when all principal and interest payments are brought current and the borrower has demonstrated the ability to make future payments of principal and interest as scheduled. The Bank’s practice is to charge off any loan or portion of a loan when the loan is determined by management to be uncollectible due to the borrower’s failure to meet repayment terms, the borrower’s deteriorating or deteriorated financial condition, the depreciation of the underlying collateral, the loans classification as a loss by regulatory examiners, or for other reasons.

The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to earnings. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectibility of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral, and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available.

The allowance consists of specific, general, and unallocated components. The specific component relates to loans that are classified as doubtful, substandard, or special mention. For such loans that are also classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non-classified loans and is based on historical loss experience adjusted for qualitative factors. An unallocated component is maintained to cover uncertainties that could affect management’s estimate of probable losses. The unallocated component of the allowance reflects the margin of imprecision inherent in the underlying assumptions used in the methodologies for estimating specific and general losses in the portfolio.

F-9

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

Loans and Allowance for Loan Losses (continued)

A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price, or the fair value of the collateral if the loan is collateral dependent.

Premises and Equipment

The Bank uses the straight line method of computing depreciation at rates adequate to amortize the cost of the applicable assets over their estimated useful lives. Items capitalized as part of premises and equipment are valued at cost. Maintenance and repairs are expensed as incurred. The cost and related accumulated depreciation of assets sold, or otherwise disposed of, are removed from the related accounts and any gain or loss is included in earnings.

Foreclosed Real Estate

Foreclosed real estate includes both formally foreclosed property and in-substance foreclosed property. In-substance foreclosed properties are those properties for which the Bank has taken physical possession, regardless of whether formal foreclosure proceedings have taken place.

At the time of foreclosure, foreclosed real estate is recorded at the lower of fair value less estimated costs to sell or cost, which becomes the property’s new basis. Any write-downs based on the property’s fair value at date of acquisition are charged to the allowance for loan losses. After foreclosure, valuations are periodically performed by management and property held for sale is carried at the lower of the new cost basis or fair value less cost to sell. Costs incurred in maintaining foreclosed real estate and subsequent impairment adjustments to the carrying amount of a property, if any, are included in other noninterest expense.

Mortgage Servicing Rights and Loan Servicing

Rights to service mortgage loans for others are recorded as separate assets, whether those rights are acquired through loan origination activities or through purchase activities. Additionally, mortgage servicing rights are periodically assessed for impairment based on the fair value of those rights. Mortgage servicing rights are amortized in proportion to, and over the period of, estimated net servicing income.

Loan servicing fees are credited to income as monthly principal and interest payments are collected on mortgages. Costs of loan servicing are charged to expense as incurred.

F-10

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

Income Taxes

Income taxes are provided for the tax effects of the transactions reported in the financial statements and consist of taxes currently due plus deferred taxes related primarily to differences between the basis of available-for-sale securities, allowance for loan losses, estimated losses on foreclosed real estate, accumulated depreciation, and accrued income and expenses for financial and income tax reporting. The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Deferred tax assets and liabilities are reflected at income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.

Benefit Plans

The Bank has a defined benefit pension plan covering substantially all employees. It is the policy of the Bank to fund the maximum amount that can be deducted for federal income tax purposes but in amounts not less than the minimum amounts required by law. The Bank uses a June 30 measurement date for its defined benefit pension plan. The Bank also provides a contributory defined contribution plan available to all eligible employees.

Advertising Costs

Advertising costs are charged to operations when incurred.

Recent Accounting Pronouncements

In June 2006, the Financial Accounting Standards Board (FASB) issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, which clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements under SFAS No. 109, Accounting for Income Taxes . The Interpretation prescribes a “more likely than not” threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This Interpretation also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition, as the cumulative effect of applying the provisions of the Interpretation are recognized as an adjustment to retained earnings. The provisions of the Interpretation were originally effective for fiscal years beginning after December 15, 2006 but, in February 2008, were deferred until fiscal years beginning after December 31, 2007. The Bank has no unrecognized tax benefits and does not anticipate any increase in unrecognized tax benefits during the next fiscal year relative to any tax positions taken after January 1, 2008. The Bank believes that its income tax filings would be sustained upon examination and does not anticipate any adjustments that would result in a material change to its financial position or results of operations. Consequently, no reserves for uncertain income tax positions are expected to be recorded nor is it expected that the Bank would record a cumulative effect adjustment related to the adoption of this Interpretation.

F-11

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(2 - continued)

In September 2006, FASB issued SFAS No. 157, Fair Value Measurements . The statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. The statement does not require any new fair value measurements under existing accounting pronouncements. The definition of fair value retains the exchange price notion found in earlier definitions of fair value and clarifies that the exchange price is the price in an orderly transaction between market participants to sell the asset or transfer the liability in the market in which the reporting entity would transact the sell or transfer. The statement further emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, the statement provides that fair value measurement should be determined based on the assumptions that market participants would use in pricing the assets or liability. The statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years with earlier implementation permitted. The application of this statement is not expected to have a material impact on the Bank’s financial condition or results of operations.

In September 2006, FASB issued SFAS No. 158, Employers’ Accounting for Defined Benefit Pension and Other Post-retirement Plans. This new standard requires employers to (1) recognize in their balance sheets an asset for a plan’s overfunded status or a liability for a plan’s underfunded status; (2) measure a plan’s assets and its obligations that determine its funded status as of the end of the employer’s fiscal year (eliminating the alternative of a measurement date that could be up to three months earlier under prior standards); and (3) recognize changes in the funded status of a plan through comprehensive income in the year in which the changes occur. SFAS No. 158 also amends the disclosure requirements in the notes to financial statements by requiring information about certain effects on net periodic benefit cost for the next fiscal year that arise from delayed recognition of the gains or losses, prior service costs or credits, and transition asset or obligation. The requirement to recognize the funded status of a benefit plan and the disclosure requirements are effective for fiscal year ended September 30, 2007. The requirement to measure plan assets and benefit obligations as of the date of the Bank’s fiscal year end balance sheet is effective for the fiscal year ending after December 15, 2008. The Bank plans to adopt the measurement provision of SFAS No. 158 on October 1, 2008.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities , which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. The statement also establishes presentation and disclosure requirements designed to facilitate comparisons between entities that choose different measurement attributes for similar types of assets and liabilities. This statement is effective as of the beginning of fiscal years beginning after November 15, 2007. Accordingly, the Bank will adopt SFAS No. 159 on October 1, 2008. At the effective date, an entity may elect the fair value option for eligible items that exist at that date. The entity shall report the effect of the first remeasurement to fair value as a cumulative effect adjustment to the opening balance of retained earnings. The Bank is currently evaluating the potential impact this statement may have on the Bank’s financial position and results of operations, but does not believe the impact of adoption will be material.

F-12

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(3)	INVESTMENT SECURITIES

Investment securities have been classified according to management’s intent. The amortized cost of securities and their approximate fair values are as follows:


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
March 31, 2008 (unaudited):
Securities available for sale:
U.S. government agency	$	7,026	$	132	$	—	$	7,158
CMO		1,998		—		—		1,998
Municipal		1,119		29		—		1,148

Subtotal – debt securities		10,143		161		—		10,304

Equity securities		—		120		—		120

Total securities available for sale	$	10,143	$	281	$	—	$	10,424

Securities held to maturity:
Mortgage-backed securities:
GNMA certificates	$	623	$	10	$	—	$	633
FNMA certificates		3,479		56		—		3,535
FHLMC certificates		4,690		19		—		4,709

		8,792		85		—		8,877

Other debt securities:
Municipal		308		6		—		314

Total securities held to maturity	$	9,100	$	91	$	—	$	9,191

F-13

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(3 - continued)


September 30, 2007:
Securities available for sale:
U.S. government agency	$	5,000	$	9	$	3	$	5,006
Municipal		1,119		1		5		1,115

Subtotal – debt securities		6,119		10		8		6,121

Money market preferred stock		2,000		—		—		2,000
Other equity securities		—		139		—		139

Total securities available for sale	$	8,119	$	149	$	8	$	8,260

Securities held to maturity:
Mortgage-backed securities:
GNMA certificates	$	714	$	5	$	—	$	718
FNMA certificates		518		—		3		515
FHLMC certificates		1,881		—		23		1,858

		3,113		5		26		3,091

Other debt securities:
U.S. government agency		4,000		3		3		4,000
Municipal		309		—		5		304

		4,309		3		8		4,304

Total securities held to maturity	$	7,422	$	8	$	34	$	7,395

September 30, 2006:
Securities available for sale:
U.S. government agency	$	5,000	$	—	$	31	$	4,969
Municipal		807		8				815

Subtotal – debt securities		5,807		8		31		5,784

Equity securities		—		113		—		113

Total securities available for sale	$	5,807	$	121	$	31	$	5,897

Securities held to maturity:
Mortgage-backed securities:
GNMA certificates	$	1,011	$	6	$	—	$	1,017
FNMA certificates		671		—		11		660
FHLMC certificates		2,227		—		58		2,169

		3,909		6		69		3,846

Other debt securities:
U.S. government agency		4,000		—		20		3,980
Municipal		310		—		1		309

		4,310		—		21		4,289

Total securities held to maturity	$	8,219	$	6	$	90	$	8,135

F-14

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(3 - continued)

The amortized cost and fair value of debt securities as of March 31, 2008 and September 30, 2007 by contractual maturity are shown below. Expected maturities of mortgage-backed securities may differ from contractual maturities because the mortgages underlying the obligations may be prepaid without penalty.


	March 31, 2008
	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due within one year	$	3,000	$	3,004	$	—	$	—
Due after one year through five years		2,000		2,102		—		—
Due after five years through ten years		2,484		2,517		308		314
Due after ten years		661		683		—		—

		8,145		8,306		308		314
CMO		1,998		1,998		—		—
Mortgage-backed securities		—		—		8,792		8,877

	$	10,143	$	10,304	$	9,100	$	9,191


	September 30. 2007
	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due within one year	$	3,000	$	2,997	$	2,000	$	1,998
Due after one year through five years		2,000		2,009		—		—
Due after five years through ten years		311		308		2,000		2,002
Due after ten years		808		807		309		304

		6,119		6,121		4,309		4,304
Mortgage-backed securities		—		—		3,113		3,091

	$	6,119	$	6,121	$	7,422	$	7,395

F-15

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(3 - continued)

The Bank had no securities in an unrealized loss position at March 31, 2008.

Information pertaining to securities with gross unrealized losses at September 30, 2007, aggregated by investment category and the length of time that individual securities have been in a continuous loss position, follows:


	Number of Investment Positions	Fair Value		Gross Unrealized Losses
Securities available for sale:
Continuous loss position less than twelve months:
Municipal bonds	4	$	966	$	5
Continuous loss position more than twelve months:
U.S. government agency obligations	1		2,997		3

Total securities available for sale	5	$	3,963	$	8

Securities held to maturity:
Continuous loss position more than twelve months:
Mortgage-backed securities	3		2,371		26
U. S. government agency obligations	1		1,998		3
Municipal obligations	1		304		5

Total securities held to maturity	5	$	4,673	$	34

Management evaluates securities for other-than temporary impairment at least on a quarterly basis, and more frequently when economic or market concerns warrant such evaluation. Consideration is given to (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Bank to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

The debt securities with loss positions at September 30, 2007 have depreciated 0.49% from the Bank’s amortized cost basis and are fixed rate securities with a weighted-average yield of 4.48% and a weighted-average coupon rate of 4.55%. All of these securities are either backed by the government issuers or secured by mortgage loans. These unrealized losses relate principally to current interest rates for similar types of securities. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government, its agencies, or other governments, whether downgrades by bond rating agencies have occurred, and the results of reviews of the issuer’s financial condition. As management has the ability to hold debt securities to maturity, or for the foreseeable future if classified as available for sale, no declines are deemed to be other-than-temporary.

F-16

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(4)

LOANS

Loans at March 31, 2008 and September 30, 2007 and 2006 consisted of the following:


	March 31,			September 30,
	2008			2007			2006
	(Unaudited)
Real estate mortgage:
Residential	$	109,922		$	100,202		$	96,067
Commercial		15,286			18,364			19,090
Multi-family		5,227			5,369			6,877
Residential construction		8,902			11,583			20,562
Commercial construction		3,265			3,265			29
Land and land development		4,644			5,022			2,524

Total real estate mortgage		147,246			143,805			145,149

Commercial business loans		10,412			12,645			10,232
Consumer:
Home equity loans and lines of credit		10,526			9,681			7,408
Auto loans		2,013			1,946			1,675
Loans secured by deposits		281			372			324
Other consumer loans		3,900			4,423			5,774

Total consumer		16,720			16422			15,181

Gross loans		174,378			172,872			170,562

Reserve for uncollected interest		—			—			(1	)
Deferred loan origination fees and costs, net		740			618			335
Undisbursed portion of loans in process		(1,602	)		(4,822	)		(3,333	)
Allowance for loan losses		(2,498	)		(1,297	)		(868	)

Loans, net	$	171,018		$	167,371		$	166,695

Mortgage loans serviced for the benefit of others amounted to $1,169 (unaudited), $1,341 and $1,805 at March 31, 2008 and September 30, 2007 and 2006, respectively. The balance of capitalized mortgage servicing rights, carried at estimated fair value, included in other assets at September 30, 2006, was $7,861. The estimated fair value of mortgage servicing rights was determined using a discount rate of 9.25 percent and prepayment speeds ranging from 13.21 percent to 28.86 percent, depending upon the stratification of the specific right. The remaining balance of mortgage service rights at September 30, 2006 was amortized to expense during the year ended September 30, 2007. No mortgage servicing rights have been capitalized since the year ended September 30, 1999.

F-17

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(4 – continued)

An analysis of the allowance for loan losses is as follows:


	March 31,						September 30,
	2008			2007			2007			2006
	(Unaudited)
Beginning balances	$	1,297		$	868		$	868		$	882
Recoveries		113			58			95			15
Loans charged-off		(115	)		(116	)		(424	)		(842	)
Provision for loan losses		1,203			420			758			813

Ending balances	$	2,498		$	1,230		$	1,297		$	868

At March 31, 2008 and September 30, 2007 and 2006, the total recorded investment in nonaccrual loans amounted to $3,622 (unaudited), $431 and $1,574, respectively. The total recorded investment in loans past due ninety days or more and still accruing interest amounted to approximately $418 (unaudited), $676 and $141 at March 31, 2008 and September 30, 2007 and 2006, respectively. Information about impaired loans and the related allowance for loan losses is presented below.


	March 31, 2008		September 30,
	March 31, 2008		2007		2006
	(Unaudited)
At end of period:
Impaired loans with related allowance	$	2,538	$	271	$	467
Impaired loans with no allowance		1,502		836		1,248

Total	$	4,040	$	1,107	$	1,715

Allowance related to impaired loans	$	1,189	$	128	$	180
Average balance of impaired loans		2,538		1,117		2,525
Interest income recognized in the statements of income during the periods of impairment		13		27		53
Interest income received during the periods of impairment – cash method		44		36		148

The Bank has entered into loan transactions with certain directors, officers and their affiliates (related parties). In the opinion of management, such indebtedness was incurred in the ordinary course of business on substantially the same terms as those prevailing at the time for comparable transactions with other persons and does not involve more than normal risk of collectibility or present other unfavorable features. The Bank had loans to related parties of $3,738 (unaudited), $3,270 and $2,248 at March 31, 2008 and September 30, 2007 and 2006, respectively.


	March 31, 2008			September 30, 2007
	(Unaudited)
Beginning balance	$	3,270		$	2,248
New loans and advances		1,332			1,598
Repayments		(859	)		(418	)
Reclassifications		(5	)		(158	)

Ending balance	$	3,738		$	3,270

F-18

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(5)	PREMISES AND EQUIPMENT

Premises and equipment consisted of the following:


	March 31, 2008		September 30,
	March 31, 2008		2007		2006
	(Unaudited)
Land and land improvements	$	1,343	$	1,343	$	1,336
Office buildings		4,195		4,203		4,203
Furniture, fixtures and equipment		2,434		2,398		2,256

		7,972		7,944		7,795
Less accumulated depreciation		3,638		3,575		3,388

Totals	$	4,334	$	4,369	$	4,407

(6)	FORECLOSED REAL ESTATE

At March 31, 2008 and September 30, 2007 and 2006, the Bank had foreclosed real estate held for sale of $1,125 (unaudited), $1,278 and $1,941, respectively. During the six-month period ended March 31, 2008 and the year ended September 30, 2006, foreclosure losses in the amount of $15 and $497, respectively, were charged-off to the allowance for loan losses. No foreclosure losses were charged-off to the allowance for loan losses for the six-month period ended March 31, 2007 or for the year ended September 30, 2007. Losses on subsequent writedowns of foreclosed real estate amounted to $89 (unaudited), $2 (unaudited), $25 and $10 for the six-month periods ended March 31, 2008 and 2007 and for the years ended September 30, 2007 and 2006, respectively, and are aggregated with realized gains and losses from the sale of foreclosed real estate and real estate taxes and other expenses of holding foreclosed real estate. Net realized gain (loss) from the sale of foreclosed real estate amounted to $17 (unaudited), $8 (unaudited), $7 and $(16) for the six-month periods ended March 31, 2008 and 2007 and for the years ended September 30, 2007 and 2006, respectively. Real estate taxes and other expenses of holding foreclosed real estate amounted to $42 (unaudited), $68 (unaudited), $100 and $65 for the six-month periods ended March 31, 2008 and 2007 and for the years ended September 30, 2007 and 2006, respectively. The net loss on foreclosed real estate is reported in noninterest expense.

F-19

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(7)	DEPOSITS

The aggregate amount of time deposit accounts (certificates of deposit) with balances of $100,000 or more was $31,900 (unaudited), $29,145 and $28,052 at March 31, 2008 and September 30, 2007 and 2006, respectively. Time deposit accounts with balances of more than $100,000 are not federally insured.

At March 31, scheduled maturities of certificates of deposit were as follows:


Period ending March 31 (unaudited):
2009	$	83,895
2010		16,072
2011		14,803
2012		5,906
2013 and thereafter		3,579

Total	$	124,255

At September 30, 2007, scheduled maturities of certificates of deposit were as follows:


Year ending September 30:
2008	$	75,007
2009		16,902
2010		12,873
2011		9,038
2012 and thereafter		5,495

Total	$	119,315

The Bank held deposits of $8,182 (unaudited), $6,277 and $3,625 for related parties at March 31, 2008 and September 30, 2007 and 2006, respectively.

(8)	DEFERRED COMPENSATION PLANS

The Bank has deferred compensation agreements with former officers who are receiving benefits. The agreements provide for the payment of specific benefits following retirement. Deferred compensation expense was $14 (unaudited), $13 (unaudited), $27 and $15 for the six-month periods ended March 31, 2008 and 2007 and the years ended September 30, 2007, respectively.

The Bank has a directors’ deferred compensation plan whereby a director, at his election, defers a portion of his monthly director fees into an account with the Bank. The Bank accrues interest on the deferred obligation monthly at the rate of 8% per annum for the deferral period which extends to the director’s normal retirement age of 70. The benefits under the plan are payable for a period of fifteen years following normal retirement, however, the agreements provide for payment of benefits in the event of disability, early retirement, termination of service or death. Deferred compensation expense for this plan was $24 (unaudited), $25 (unaudited), $49 and $45 for the six-month periods ended March 31, 2008 and 2007 and the years ended September 30, 2007, respectively.

F-20

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(9)	BENEFIT PLANS

Defined Benefit Plan:

The Bank sponsors a defined benefit pension plan covering substantially all employees. Contributions are intended to provide not only for benefits attributed to service to date but also for those expected to be earned in the future. The Bank’s funding policy is to contribute the larger of the amount required to fully fund the plan’s current liability or the amount necessary to meet the funding requirements as defined by the Internal Revenue Code. The Bank uses a June 30 measurement date for the plan.

The following table sets forth the reconciliations of the benefit obligation, the fair value of plan assets, and the funded status of the Bank’s plan as of and for the years ended September 30, 2007 and 2006:


	2007			2006
Change in projected benefit obligation:
Balance at beginning of year	$	4,899		$	4,878
Service cost		202			219
Interest cost		296			266
Actuarial gain		(338	)		(392	)
Benefits paid		(101	)		(72	)

Balance at end of year	$	4,958		$	4,899

Change in plan assets:
Fair value of plan assets at beginning of year	$	5,023		$	4,480
Actual return on plan assets		457			366
Employer contributions		271			263
Benefits paid		(116	)		(85	)

Fair value of plan assets at end of year	$	5,635		$	5,023

Funded status	$	677		$	124

Amounts recognized in the balance sheets consist of:
Excess pension asset recognized in other assets	$	677		$	124

F-21

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(9 - continued)

Components of net periodic benefit expense and other amounts recognized in other accumulated comprehensive income are as follows:


	March 31,						September 30,
	2008			2007			2007			2006
	(Unaudited)			(Unaudited)
Net periodic benefit expense:
Service cost	$	99		$	101		$	202		$	219
Interest cost on projected benefit obligation		151			148			296			266
Expected return on plan assets		(185	)		(168	)		(335	)		(301	)
Amortization of transition asset		(3	)		—			—			—
Amortization of prior service cost		3			—			—			—
Amortization of unrecognized loss		—			—			—			19

Net periodic benefit expense	$	65		$	81		$	163		$	203

Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Amortization of transition asset		3			—			—			—
Amortization of prior service cost		(3	)		—			—			—

Total recognized in other comprehensive income		—			—			—			—

Total recognized in net periodic pension benefit expense and other comprehensive income	$	65		$	81		$	163		$	203


Amounts included in accumulated other comprehensive income consist of the following:
Net loss at end of fiscal year							$	38			—
Prior service cost								38			—
Net transition asset existing at date of adoption of SFAS No. 87								(66	)		—

							$	55			—

The estimated prior service cost and net transition asset existing at the date of adoption of SFAS No. 87 that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $6 and $6, respectively.

The following are weighted average assumptions used to determine benefit obligations at June 30, 2007 and 2006 and net periodic benefit cost for the years then ended:


Discount rate	6.17	%	6.11	%
Rate of compensation increase	3.50	%	3.50	%
Expected long-term return on plan assets	6.50	%	6.50	%

The expected long-term return on plan assets assumption is based on a periodic review and modeling of the plan’s asset allocation and liability structure over a long-term horizon. Expectations of returns on each asset class are the most important of the assumptions used in the review and modeling and are based on reviews of historical data. The expected long-term rate of return on assets was selected from within the reasonable range of rates determined by (a) historical real returns, net of inflation, for the asset classes covered by the investment policy, and (b) projections of inflation over the long-term period during which benefits are payable to plan participants.

F-22

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(9 - continued)

The plan’s weighted-average asset allocations at June 30, 2007 and 2006 by asset category are as follows:


	2007		2006
Bank time deposits	99.3	%	99.3	%
Bank demand deposits	0.7		0.7

Total	100.0	%	100.0	%

The plan’s target asset allocation for 2008 is 100% investment in bank deposits. Bank deposits include time and demand deposit liabilities of the Bank.

The plan’s investment policy includes guidelines and procedures designed to ensure assets are invested in a manner necessary to meet expected future benefits earned by participants. The investment guidelines consider a broad range of economic conditions. The objective is to maintain investment portfolios that limit risk through prudent asset allocation parameters, achieve asset returns that meet or exceed the plan’s actuarial assumptions, and achieve asset returns that are competitive with like institutions employing similar investment strategies. The Bank periodically reviews the investment policy. The policy is established and administered in a manner so as to comply at all times with applicable government regulations.

The Bank contributed $177 (unaudited) to the Plan for the six months ended March 31, 2008 and does not anticipate any additional contributions for the fiscal year ending September 30, 2008.

The following estimated pension benefit payments, which reflect expected future service, as appropriate, are expected to be paid for years ending September 30:


2008	$	98
2009		97
2010		100
2011		109
2012		200
Years 2013-2017		1,817

The Bank adopted the recognition provisions of SFAS No. 158 for the year ended September 30, 2007. (See Note 1) The incremental effect of applying SFAS No. 158 on individual line items in the balance sheet at September 30, 2007 were as follows:


	Before Application of SFAS No. 158		Adjustments			After Application of SFAS No. 158
Other assets including pension asset	$	1,864	$	(55	)	$	1,809
Total assets		203,376		(55	)		203,321
Deferred income taxes		475		(22	)		453
Total liabilities		173,681		(22	)		173,659
Accumulated other comprehensive income		85		(33	)		52
Total equity		29,695		(33	)		29,662

Defined Contribution Plan:

The Bank has a qualified contributory defined contribution plan available to all eligible employees. The plan allows participating employees to make tax-deferred contributions under Internal Revenue Code Section 401(k). Contributions to the plan amounted to $52 (unaudited), $41 (unaudited), $81 and $80 for the six-month periods ended March 31, 2008 and 2007 and the years ended September 30, 2007, respectively.

F-23

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(10)	ADVANCES FROM FEDERAL HOME LOAN BANK

Advances from the Federal Home Loan Bank consisted of the following:


	March 31, 2008		September 30,
	March 31, 2008		2007		2006
	(Unaudited)
3.36% Fixed rate advance maturing January 25, 2013	$	8,000	$	—	$	—
Variable rate advance (currently 4.88%) maturing March 24, 2008		—		3,000		—

Totals	$	8,000	$	3,000	$	—

The Bank entered into an Advances and Security Agreement with the Federal Home Loan Bank of Indianapolis, (“FHLB”) whereas the Bank has the ability to initiate advances from the FHLB. The advances are secured under a blanket collateral agreement. At March 31, 2008 and September 30, 2007, the carrying value of residential and commercial mortgage loans pledged as security for the advances was $70,268 (unaudited) and $65,679, respectively. The Bank had no outstanding advances as of September 30, 2006.

(11)	INCOME TAXES

The Bank and its subsidiaries file consolidated income tax returns. The components of the consolidated income tax expense were as follows:


	March 31,					September 30,
	2008			2007		2007			2006
	(Unaudited)			(Unaudited)
Current	$	7		$	149	$	441		$	361
Deferred		(306	)		13		(14	)		(120	)

	$	(299	)	$	162	$	427		$	241

The reconciliation of income tax expense with the amount which would have been provided at the federal statutory rate of 34 percent follows:


	March 31,						September 30,
	2008			2007			2007			2006
	(Unaudited)			(Unaudited)
Provision at federal statutory rate	$	(220	)	$	166		$	422		$	203
State income tax-net of federal tax benefit		(32	)		27			59			24
Other		(47	)		(31	)		(54	)		14

Net provision for income taxes	$	(299	)	$	162		$	427		$	241

F-24

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(11 - continued)

Significant components of the Bank’s deferred tax assets and liabilities as follows:


	March 31, 2008		September 30,
	March 31, 2008		2007		2006
	(Unaudited)
Deferred tax liabilities:
Accumulated depreciation	$	354	$	370	$	365
Deferred loan fees and costs, net		469		453		385
Accrued pension expense		330		286		243
Federal Home Loan Bank stock dividends		52		53		53
Unrealized gain on securities available for sale		111		56		36
Mortgage servicing rights		—		—		3
Other		24		15		37

Total deferred tax liabilities		1,340		1,233		1,122

Deferred tax assets:
Deferred compensation plans		195		189		178
Accrued severance compensation		1		39		126
Allowance for loan losses		975		506		339
Valuation allowance on foreclosed real estate and repossessed assets		55		24		11
SFAS No. 158 other comprehensive income adjustment		22		22		—

Total deferred tax assets		1,248		780		654

Net deferred tax liability	$	92	$	453	$	468

Prior to October 1, 1996, the Bank was permitted by the Internal Revenue Code to deduct from taxable income an annual addition to a statutory bad debt reserve subject to certain limitations. Retained earnings at March 31, 2008 and September 30, 2007 and 2006 include $4,556 of cumulative deductions for which no deferred federal income tax liability has been recorded. Reduction of these reserves for purposes other than tax bad debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes subject to the then current corporate income tax rate. The unrecorded deferred liability on these amounts was $1,549 at March 31, 2008 and September 30, 2007 and 2006.

Federal legislation enacted in 1996 repealed the use of the qualified thrift reserve method of accounting for bad debts for tax years beginning after December 31, 1995. As a result, the Bank discontinued the calculation of the annual addition to the statutory bad debt reserve using the percentage-of-taxable-income method and adopted the experience reserve method for banks. Under this method, the Bank computes its federal tax bad debt deduction based on actual loss experience over a period of years.

The legislation also provided that the Bank will not be required to recapture its pre-1988 statutory bad debt reserves if it ceases to meet the qualifying thrift definitional tests and if the Bank continues to qualify as a “bank” under existing provisions of the Internal Revenue Code.

F-25

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(12)	COMMITMENTS AND CONTINGENT LIABILITIES

In the normal course of business, there are outstanding various commitments and contingent liabilities, such as commitments to extend credit and legal claims, which are not reflected in the accompanying consolidated financial statements.

Commitments under outstanding standby letters of credit totaled $47 (unaudited), $77 and $170 at March 31, 2008 and September 30, 2007 and 2006, respectively.

The following is a summary of the commitments to extend credit:


	2008 Weighted Average Rate		March 31, 2008 Amount		September 30,
	2008 Weighted Average Rate		March 31, 2008 Amount		2007 Amount		2006 Amount
	(Unaudited)		(Unaudited)
Fixed rate loans with terms as follows:
6 to 24 months	7.25	%	$	240	$	796	$	924
7 to 15 years	7.25	%		400		730		—
20 to 30 years	7.06	%		1,399		465		403

Total fixed rate loan commitments				2,039		1,991		1,327

Adjustable rate loans with 1 to 30 year terms				4,871		1,708		400
Unused lines of credit on credit cards				22,605		23,249		18,412
Undisbursed portion of commercial lines of credit				7,433		8,428		9,610
Undisbursed portion of loans in process				1,602		4,822		3,333

Total commitments to extend credit			$	38,550	$	40,198	$	33,082

F-26

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(13)	FINANCIAL INSTRUMENTS WITH OFF-BALANCE-SHEET RISK

The Bank is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheet.

The Bank’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments (see Note 12). The Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount and type of collateral obtained, if deemed necessary by the Bank upon extension of credit, varies and is based on management’s credit evaluation of the counterparty.

Standby letters of credit are conditional lending commitments issued by the Bank to guarantee the performance of a customer to a third party. Standby letters of credit generally have fixed expiration dates or other termination clauses and may require payment of a fee. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank’s policy for obtaining collateral, and the nature of such collateral, is essentially the same as that involved in making commitments to extend credit.

The Bank has not been obligated to perform on any financial guarantees and has incurred no losses on its commitments in 2008, 2007 or 2006.

F-27

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(14)	DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS

Statement of Financial Accounting Standards No. 107, Disclosures about Fair Value of Financial Instruments , requires disclosure of fair value information about financial instruments, whether or not recognized in the statement of financial condition. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instruments. Statement No. 107 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Bank. The estimated fair values of the Bank’s financial instruments at March 31, 2008 and September 30, 2007 and 2006 are as follows:


	March 31,				September 30,
	2008				2007			2006
	(Unaudited)
	Carrying Amount		Fair Value		Carrying Amount		Fair Value	Carrying Amount		Fair Value
Financial assets:
Cash and due from banks	$	3,739	$	3,739	$	6,391 $	6,391	$	6,856 $	6,856
Interest-bearing deposits in banks		5,494		5,494		4,004	4,004		8,367	8,367
Securities available for sale		10,424		10,424		8,260	8,260		5,897	5,897
Securities held to maturity		9,100		9,191		7,422	7,395		8,219	8,135
Loans held for sale		157		157		—	—		—	—
Loans, net		171,018		172,199		167,371	166,823		166,695	166,026
FHLB stock		1,336		1,336		1,336	1,336		1,379	1,379
Accrued interest receivable		954		954		1,082	1,082		1,132	1,132
Financial liabilities:
Deposits		174,085		178,680		168,782	169,921		175,891	176,315
FHLB advances		8,000		7,976		3,000	3,000		—	—
Accrued interest payable		179		179		175	175		147	147
Advance payments by borrowers for taxes and insurance		190		273		332	396		279	310
Off-balance-sheet financial instruments:
Asset related to commitments to extend credit		—		120		—	26		—	40

The carrying amounts in the preceding table are included in the consolidated balances sheets under the applicable captions. The contract or notional amounts of the Bank’s financial instruments with off-balance-sheet risk are disclosed in Note 12.

F-28

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(14 - continued)

Cash and Cash Equivalents

For cash and short-term instruments, including cash and due from banks and interest-bearing deposits with banks, the carrying amount is a reasonable estimate of fair value.

Debt and Equity Securities

For debt and equity securities with readily determinable market values, the fair values are based on quoted market prices, if available. If quoted market prices are not available, fair value is estimated based on quoted market prices for similar securities or third-party pricing models using observable market-based parameters. For Federal Home Loan Bank stock, a restricted equity security, the carrying amount is a reasonable estimate of fair value because the stock is not marketable.

Loans

The fair value of loans is estimated by discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and terms. The carrying amount of accrued interest receivable approximates its fair value.

Deposits

The fair value of demand and savings deposits and other transaction accounts is the amount payable on demand at the balance sheet date. The fair value of fixed-maturity time deposits is estimated by discounting the future cash flows using the rates currently offered for deposits with similar remaining maturities. The carrying amount of accrued interest payable approximates its fair value.

Federal Home Loan Bank Advances

The fair value of advances is estimated by discounting the future cash flows at current interest rates for advances with similar maturities.

Off-Balance-Sheet Financial Instruments

Commitments to extend credit were evaluated and fair value was estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present creditworthiness of the counterparties. For fixed-rate loan commitments, the fair value estimate considers the difference between current interest rates and the committed rates.

F-29

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(15)	REGULATORY MATTERS

The Bank is subject to various regulatory capital requirements administered by its primary federal regulator, the Office of Thrift Supervision (OTS). Failure to meet minimum capital requirements can initiate certain mandatory–and possibly 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 corrective 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 qualitative 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 tangible capital to adjusted total assets (as defined), Tier I (core) capital (as defined) to adjusted total assets, Tier I capital to risk-weighted assets (as defined), and of total risk-based capital (as defined) to risk-weighted assets. Management believes, as of March 31, 2008 and December 31, 2007, that the Bank meets all capital adequacy requirements to which it is subject.

As of March 31, 2008 and December 31, 2007, the most recent notification from the OTS categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum total risk-based, Tier I risk-based, and Tier I leverage ratios as set forth in the table below. There are no conditions or events since that notification that management believes have changed the institution’s category.

The Bank’s actual capital amounts and ratios are also presented in the table. No amount was deducted from capital for interest-rate risk in either year.

F-30

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(15 - continued)


	Actual					Minimum For Capital Adequacy Purposes:				Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount			Ratio		Amount		Ratio		Amount		Ratio
As of March 31, 2008 (Unaudited):
Total equity capital and ratio to total assets	$	29,399		13.8	%
Adjustments to equity capital		(137	)

Tangible capital and ratio to adjusted total assets	$	29,262		13.8	%	$	3,186	1.5	%	$	4,248	2.0	%

Tier I (core) capital and ratio to adjusted total assets	$	29,262		13.8	%	$	6,371	3.0	%	$	10,619	5.0	%

Tier I capital and ratio to risk-weighted assets	$	29,262		22.8	%	$	5,135	4.0	%	$	7,703	6.0	%

Allowance for loan losses		1,304

Total risk-based capital and ratio to risk-weighted assets	$	30,566		23.8	%	$	10,270	8.0	%	$	12,838	10.0	%

Total assets	$	212,624

Adjusted total assets	$	212,376

Risk-weighted assets	$	128,375

F-31

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(15 - continued)


	Actual					Minimum For Capital Adequacy Purposes:				Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount			Ratio		Amount		Ratio		Amount		Ratio
As of September 30, 2007:
Total equity capital and ratio to total assets	$	29,662		14.6	%
Adjustments to equity capital		(52	)

Tangible capital and ratio to adjusted total assets	$	29,610		14.6	%	$	3,048	1.5	%	$	4,064	2.0	%

Tier I (core) capital and ratio to adjusted total assets	$	29,610		14.6	%	$	6,095	3.0	%	$	10,159	5.0	%

Tier I capital and ratio to risk-weighted assets	$	29,610		23.9	%	$	4,959	4.0	%	$	7,438	6.0	%

Allowance for loan losses		1,010

Total risk-based capital and ratio to risk-weighted assets	$	30,620		24.7	%	$	9,918	8.0	%	$	12,397	10.0	%

Total assets	$	203,321

Adjusted total assets	$	203,180

Risk-weighted assets	$	123,974

F-32

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(15 - continued)


	Actual					Minimum For Capital Adequacy Purposes:				Minimum To Be Well Capitalized Under Prompt Corrective Action Provisions:
	Amount			Ratio		Amount		Ratio		Amount		Ratio
As of September 30, 2006:
Total equity capital and ratio to total assets	$	28,850		14.0	%
Adjustments to equity capital		(54	)

Tangible capital and ratio to adjusted total assets	$	28,796		14.0	%	$	3,095	1.5	%	$	4,126	2.0	%

Tier I (core) capital and ratio to adjusted total assets	$	28,796		14.0	%	$	6,189	3.0	%	$	10,315	5.0	%

Tier I capital and ratio to risk-weighted assets	$	28,796		22.8	%	$	5,049	4.0	%	$	7,574	6.0	%

Allowance for loan losses		685

Total risk-based capital and ratio to risk-weighted assets	$	29,481		23.4	%	$	10,098	8.0	%	$	12,623	10.0	%

Total assets	$	206,399

Adjusted total assets	$	206,309

Risk-weighted assets	$	126,225

F-33

FIRST SAVINGS BANK, F.S.B. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in Thousands)

(16)	CONCENTRATION OF CREDIT RISK

At March 31, 2008 and September 30, 2007 and 2006, the Bank had a concentration of credit risk with a correspondent bank as follows:


	March 31,		September 30,
	2008		2007		2006
	(Unaudited)
Due from correspondent bank balance in excess of federal deposit insurance limit	$	3,220	$	6,673	$	6,100

(17)	SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION


	March 31,				September 30,
	2008		2007		2007		2006
	(Unaudited) (Unaudited)
Cash payments for:
Interest	$	3,092	$	3,073	$	6,155	$	5,190
Taxes		168		—		134		691
Non-cash investing activities:
Transfers from loans to foreclosed real estate		185		185		294		1,392
Proceeds from sales of foreclosed real estate financed through loans		—		230		327		—

F-34

You should rely only on the information contained in this prospectus. Neither First Savings Financial Group nor First Savings Bank has authorized anyone to provide you with different information. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered by this prospectus to any person or in any jurisdiction in which an offer or solicitation is not authorized or in which the person making an offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make an offer or solicitation in those jurisdictions. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of common stock.

[LOGO]

(Holding Company for First Savings Bank F.S.B.)

3,553,500 Shares

(Anticipated Maximum, Subject to Increase)

COMMON STOCK

Prospectus

Keefe, Bruyette & Woods

_________, 2008

Until ___________, 2008, or 25 days after commencement of the syndicated community offering, if any, whichever is later, all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13.

Other Expenses of Issuance and Distribution.


SEC filing fee (1)	$	1,650
OTS filing fee		12,000
FINRA filing fee (1)		4,700
Nasdaq Stock Market listing fee		50,000
Blue Sky fees and expenses		7,500
EDGAR, printing, postage and mailing		175,000
Legal fees and expenses		495,000
Accounting fees and expenses		100,000
Appraiser’s fees and expenses		48,500
Business Plan fees and expenses		26,000
Underwriting Fees (1) (2) (3)		357,000
Marketing firm expenses (including marketing firm’s counsel fees)		70,000
Transfer agent and registrar fees and expenses		20,000
Certificate printing		7,500
Miscellaneous		8,000

Total	$	1,382,850

(1)	Estimated expenses based on the registration of 4,196,525 shares at $10.00 per share.

(2)	Assumes 8.0% ESOP purchase and purchases by insiders equal to 4.5% of the offering.

(3)

Keefe, Bruyette & Woods, Inc. will receive a fee equal to 1.0% of the aggregate purchase price of shares sold in the subscription offering and the community offering, excluding shares purchased by the employee stock ownership plan, and by officers, directors and employees of First Savings Bank, F.S.B. and members of their immediate families. Assumes purchases by insiders equal to 4.5% of the offering.

Item 14.

Indemnification of Directors and Officers.

Article VII of the Registrant’s Articles of Incorporation provides:

Section 7.01. General Provisions. This corporation shall, to the fullest extent to which it is empowered to do so by the Indiana Business Corporation Act or any other applicable laws, as from time to time in effect, indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, by reason of the fact that he or she is or was a director, officer or employee of this corporation, or who, while serving as such director, officer or employee of this corporation, is or was serving at the request of this corporation as a director, officer, partner, trustee, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, whether for profit or not, against expenses (including attorneys’ fees), judgments, settlements, penalties and fines (including excise taxes assessed with respect to employee benefit plans) actually or reasonably incurred by him in accordance with such action, suit or proceeding, if he or she acted in good faith and in a manner he or she reasonably believed, in the case of conduct in his or her official capacity, was in the best interest of this corporation, and in all other cases, was not opposed to the best interests of this corporation, and with respect to any criminal action or proceeding, he or she either had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not meet the prescribed standard of conduct.

Section 7.02. Indemnification Authorized. To the extent that a director, officer or employee of this corporation has been successful, on the merits or otherwise, in the defense of any action, suit or proceeding referred to in Section 7.01 of this Article VII, or in the defense of any claim, issue or matter therein, this corporation shall indemnify such person against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith. Any other indemnification under Section 7.01 of this Article VII (unless ordered by a court) shall be made by this corporation only as authorized in the specific case, upon a determination that indemnification of the director, officer or employee is permissible in the circumstances because he or she has met the applicable standard of conduct. Such determination shall be made (a) by the board of directors by a majority vote of a quorum consisting of directors who were not at the time parties to such action, suit or proceeding; or (b) if a quorum cannot be obtained under subdivision (a), by a majority vote of a committee duly designated by the board of directors (in which designation directors who are parties may participate), consisting solely of two or more directors not at the time parties to such action, suit or proceeding; or (c) by special legal counsel: (i) selected by the board of directors or its committee in the manner prescribed in subdivision (a) or (b), or (ii) if a quorum of the board of directors cannot be obtained under subdivision (a) and a committee cannot be designated under subdivision (b), selected by a majority vote of the full board of directors (in which selection directors who are parties may participate); or (d) by stockholders, but shares owned by or voted under the control of directors who are at the time parties to such action, suit or proceeding may not be voted on the determination.

Authorization of indemnification and evaluation as to reasonableness of expenses shall be made in the same manner as the determination that indemnification is permissible, except that if the determination is made by special legal counsel, authorization of indemnification and evaluation as to reasonableness of expenses shall be made by those entitled under subsection (c) to select counsel.

Section 7.03. Definition of Good Faith. For purposes of any determination under Section 7.01 of this Article VII, a person shall be deemed to have acted in good faith and to have otherwise met the applicable standard of conduct set forth in Section 7.01 of this Article VII if his or her action is based on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by (a) one or more officers or employees of this corporation or other enterprise whom he or she reasonably believes to be reliable and competent in the matters presented; (b) legal counsel, public accountants, appraisers or other persons as to matters he or she reasonably believes are within the person’s professional or expert competence; or (c) a committee of the board of directors of this corporation or another enterprise of which the person is not a member if he or she reasonably believes the committee merits confidence. The term “another enterprise” as used in this Section 7.03 shall mean any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise of which such person is or was serving at the request of this corporation as a director, officer, partner, trustee, employee or agent. The provisions of this Section 7.03 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standards of conduct set forth in Section 7.01 of this Article VII.

Section 7.04. Advancement of Expenses. Expenses incurred in connection with any civil or criminal action, suit or proceeding may be paid for or reimbursed by this corporation in advance of the final disposition of such action, suit or proceeding, as authorized in the specific case in the same manner described in Section 7.02 of this Article VII, upon receipt of a written affirmation of the director, officer or employee’s good faith belief that he or she has met the standard of conduct described in Section 7.01 of this Article VII and upon receipt of a written undertaking on behalf of the director, officer or employee to repay such amount if it shall ultimately be determined that he or she did not meet the standard of conduct set forth in this Article VII, and a determination is made that the facts then known to those making the determination would not preclude indemnification under this Article VII.

Section 7.05. Non-Exclusivity. The indemnification provided by this Article VII shall not be deemed exclusive of any other rights to which a person seeking indemnification may be entitled under these Articles of Incorporation, this corporation’s Bylaws, any resolution of the board of directors or stockholders, any other authorization, whenever adopted, after notice, by a majority vote of all voting stock then outstanding, or any contract, both as to action in his or her official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer or employee, and shall inure to the benefit of the heirs, executors and administrators of such a person.

Section 7.06. Vestment of Rights. The right of any individual to indemnification under this Article VII shall vest at the time of occurrence or performance of any event, act or omission giving rise to any action, suit or proceeding of the nature referred to in Section 7.01 of this Article VII and, once vested, shall not later be impaired as a result of any amendment, repeal, alteration or other modification of any or all of these provisions. Notwithstanding the foregoing, the indemnification afforded under this Article VII shall be applicable to all alleged prior acts or omissions of any individual seeking indemnification hereunder, regardless if such alleged acts or omissions may have occurred before the adoption of this Article VII. To the extent such prior acts or omissions cannot be deemed to be covered by this Article VII, the right of any individual to indemnification shall be governed by the indemnification provisions in effect at the time of such prior acts or omissions.

Section 7.07. Insurance. This corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of this corporation, or who is or was serving at the request of this corporation as a director, officer, partner, trustee, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against any liability asserted against or incurred by the individual in that capacity or arising from the individual’s status as a director, officer, employee or agent, whether or not this corporation would have power to indemnify the individual against the same liability under this Article VII.

Section 7.08. Other Definitions. For purposes of this Article VII, serving an employee benefit plan at the request of this corporation shall include any service as a director, officer or employee of this corporation which imposes duties on, or involves services by such director, officer or employee with respect to an employee benefit plan, its participants, or its beneficiaries. A person who acted in good faith and in a manner he or she reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interest of this corporation” referred to in this Article VII.

For purposes of this Article VII, “party” includes any individual who is or was a plaintiff, defendant or respondent in any action, suit or proceeding.

For purposes of this Article VII, “official capacity,” when used with respect to a director, shall mean the office of director of this corporation; and when used with respect to an individual other than a director, shall mean the office in this corporation held by the officer or the employment or agency relationship undertaking by the employee or agent on behalf of this corporation. “Official capacity” does not include service for any other foreign or domestic corporation or any partnership, joint venture, trust, employee benefit plan, or other enterprise, whether for profit or not, except as set forth in Section 1 of this Article VII.

Section 7.09. Business Expenses. Any payments made to any indemnified party under this Article VII under any other right of indemnification shall be deemed to be an ordinary and necessary business expense of this corporation, and payment thereof shall not subject any person responsible for the payment, or the board of directors, to any action for corporate waste or to any similar action.

Item 15.

Recent Sales of Unregistered Securities.

None.

Item 16.

Exhibits and Financial Statement Schedules.

The exhibits and financial statement schedules filed as a part of this registration statement are as follows:

(a)	List of Exhibits (filed herewith unless otherwise noted)


1.1		Engagement Letter between First Savings Bank, F.S.B. and Keefe, Bruyette & Woods, Inc.

1.2		Draft Agency Agreement*

2.1		Plan of Conversion

3.1		Articles of Incorporation of First Savings Financial Group, Inc.

3.2		Bylaws of First Savings Financial Group, Inc.

4.1		Specimen Stock Certificate of First Savings Financial Group, Inc.

5.1		Form of Opinion of Kilpatrick Stockton LLP re: Legality

8.1		Form of Opinion of Kilpatrick Stockton LLP re: Federal Tax Matters

8.2		Form of Opinion of Monroe Shine & Co., Inc. re: State Tax Matters

10.1		Form of First Savings Bank, F.S.B. Employee Stock Ownership Plan

10.2		Form of First Savings Bank, F.S.B. Employee Stock Ownership Plan Trust Agreement

10.3		Form of Employee Stock Ownership Plan Loan Agreement, Pledge Agreement and Promissory Note

10.4		First Savings Bank, F.S.B. Profit Sharing/401(k) Plan*

10.5		Form of Employment Agreement between First Savings Bank, F.S.B. and First Savings Financial Group, Inc. and Larry W. Myers and John P. Lawson, Jr.

10.6		Form of Change in Control Agreement between First Savings Bank, F.S.B. and Anthony A. Schoen and Donald R. Allen

10.7		Form of First Savings Bank, F.S.B. Employee Severance Compensation Plan

10.8		Form of First Savings Bank, F.S.B. Supplemental Executive Retirement Plan

10.9		First Savings Bank, F.S.B. Directors’ Deferred Compensation Agreements

23.1		Consent of Kilpatrick Stockton LLP (included in Exhibits 5.1 and 8.1 filed herewith)

23.2		Consent of Monroe Shine & Co., Inc.

23.3		Consent of RP Financial, LC.

24.1		Powers of Attorney

99.1		Appraisal Report of RP Financial, LC. (P)

99.2		Draft Marketing Materials

99.3		Form of Subscription Order Form and Instructions

99.4		Form of First Savings Charitable Foundation Gift Instrument

(P)	The supporting financial schedules are filed in paper under Form SE pursuant to Rule 202 of Regulation S-T.

*	To be filed by amendment.

(b)	Financial Statement Schedules

All schedules have been omitted as not applicable or not required under the rules of Regulation S-X.

Item 17.

Undertakings.

The undersigned registrant hereby undertakes:

(1)

To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i)

To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii)

To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

(iii)

To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2)

That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3)

To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4)

That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.

(5)

That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(6)

That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i)

Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(ii)

Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii)

The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv)

Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Clarksville, State of Indiana on June 13, 2008.


First Savings Financial Group, Inc.

By:		/s/ Larry W. Myers
		Larry W. Myers
		President, Chief Executive Officer and Director

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.


Name	Title	Date

/s/ Larry W. Myers	President, Chief Executive Officer	June 13, 2008
Larry W. Myers	and Director (principal executive officer)

/s/ M. Sue Johnson	Treasurer and Corporate Secretary	June 13, 2008
M. Sue Johnson	(principal accounting and financial officer)

/s/ John P. Lawson, Jr.	Chief Operations Officer and Director	June 13, 2008
John P. Lawson, Jr.

/s/ Charles E. Becht, Jr.	Director	June 13, 2008
Charles E. Becht, Jr.

/s/ Cecile A. Blau	Director	June 13, 2008
Cecile A. Blau

/s/ Gerald Wayne Clapp, Jr.	Director	June 13, 2008
Gerald Wayne Clapp, Jr.

/s/ Robert E. Libs	Director	June 13, 2008
Robert E. Libs

/s/ Michael F. Ludden	Director	June 13, 2008
Michael F. Ludden

/s/ Douglas A. York	Director	June 13, 2008
Douglas A. York

Exhibit 1.1

March 17, 2008

Mr. Larry W. Myers

President and Chief Executive Officer

First Savings Bank, FSB

501 East Lewis & Clark Parkway

Clarksville, IN 47129

Dear Mr. Myers:

This proposal is in connection with the proposal of First Savings Bank, FSB a federally-chartered mutual savings bank (the “Bank”) to convert from the mutual to stock form of organization pursuant to a Plan of Conversion (“Plan of Conversion”). In order to effect the Plan of Conversion, it is contemplated that a new stock holding company will be established by the Bank as part of the mutual to stock conversion (“Company”) and the Company will offer and sell shares of its common stock first to eligible persons in a Subscription and Community Offering as defined in the Plan of Conversion.

Keefe, Bruyette and Woods (“KBW”) will act as the Bank’s and the Company’s exclusive financial advisor and marketing agent in connection with the Conversion and stock issuance. This letter sets forth selected terms and conditions of our engagement.

1. Advisory/Conversion Services . As the Bank’s and Company’s financial advisor and marketing agent, KBW will provide the Bank and the Company with a comprehensive program of services designed to promote an orderly, efficient, cost-effective and long-term stock distribution. KBW will provide financial and logistical advice to the Bank and the Company concerning the Conversion and related issues. KBW will assist in providing Conversion enhancement services intended to maximize stock sales in the Subscription Offering and to residents of the Bank’s market area, if necessary, in the Community Offering.

KBW shall provide financial advisory services to the Bank and the Company which are typical in connection with an equity offering and include, but are not limited to, financial analysis of the Bank with a focus on identifying factors which impact the valuation of the common stock and provide the appropriate recommendations for the betterment of the equity valuation.

Mr. Larry W. Myers

March 17, 2008

Page 2 of 5

KBW will provide all Conversion Agent Services that would be required to successfully complete the conversion process as described in Exhibit A.

Additionally, post Conversion financial advisory services will include advice on shareholder relations, NASDAQ listing, after-market trading, dividend policy (for both regular and special dividends), stock repurchase strategy, communication with market makers and other matters described in Section 8 of this letter. (The nature of the services to be provided by KBW as the Bank’s and the Company’s financial advisor and marketing agent are further described in Exhibit A attached hereto.)

2. Preparation of Offering Documents . The Bank, the Company and their counsel will draft the Registration Statement, Application for Conversion, Prospectus and other documents to be used in connection with the Conversion. KBW and its counsel will attend meetings to review these documents and advise you on their form and content. KBW and its counsel will draft an appropriate agency agreement and related documents as well as marketing materials other than the Prospectus.

3. Due Diligence Review and Confidentiality . Prior to filing the Registration Statement, Application for Conversion or any offering or other documents naming KBW as the Bank’s and the Company’s financial advisor and marketing agent, KBW and its representatives will undertake substantial investigations to learn about the Bank’s business and operations (“due diligence review”) in order to confirm information provided to us and to evaluate information to be contained in the Company’s offering documents. The Bank agrees that it will make available to KBW all relevant information, whether or not publicly available, which KBW reasonably requests, and will permit KBW to discuss with management the operations and prospects of the Bank. The Bank acknowledges that KBW will rely upon the accuracy and completeness of all information received from the Bank, its officers, directors, employees, agents and representatives, accountants and counsel including this letter to serve as the Bank’s and the Company’s financial advisor and marketing agent.

In connection with the engagement of KBW, it is contemplated that KBW will receive from the Bank certain information the Bank considers confidential. KBW agrees that it will keep confidential such information provided by and relating to the Bank. KBW shall use this confidential information solely for the purpose of rendering services to the Bank pursuant to this letter and shall not disclose any of such confidential information to any party (other than certain officers and employees of KBW providing services pursuant to this engagement letter) except with the prior written consent of the Bank; provided, however, that the foregoing restriction shall not apply to any information that is publicly available when provided or thereafter becomes publicly available other than through disclosure by KBW or that is required to be disclosed by KBW by

Mr. Larry W. Myers

March 17, 2008

Page 3 of 5

judicial or administrative process in connection with any action, suit, proceeding or investigation. Information shall be deemed “publicly available” if it becomes a matter of public knowledge or is contained in materials available to the public or is obtained by KBW from any source other than the Bank or its representatives, provided that such source was not to the actual knowledge of KBW subject to a confidentiality agreement with the bank.

4. Regulatory Filings . The Bank and/or the Company will cause appropriate Conversion and offering documents to be filed with all regulatory agencies including, the Securities and Exchange Commission (“SEC”), the Financial Industry Regulatory Authority (“FINRA”), the Office of Thrift Supervision (“OTS”), and such state Banking and securities commissioners as may be determined by the Bank.

5. Agency Agreement . The specific terms of KBW’s services, including stock offering enhancement and syndicated offering services contemplated in this letter shall be set forth in a mutually agreed upon Agency Agreement between KBW and the Bank and the Company to be executed prior to commencement of the offering, and dated the date that the Company’s Prospectus is declared effective and/or authorized to be disseminated by the appropriate regulatory agencies, the SEC, the FINRA, the OTS, and such state securities commissioners and other regulatory agencies as required by applicable law.

6. Representations, Warranties and Covenants . The Agency Agreement will provide for the final agreed upon representations, warranties and covenants by the Bank and KBW, and for the Company to indemnify KBW and its controlling persons (and, if applicable, the member of the selling group and their controlling persons), and for KBW to indemnify the Bank and the Company against certain liabilities, including, without limitation, liabilities under the Securities Act of 1933.

7. Fees . For the services hereunder, the Bank or the Company, or the Bank and the Company together, shall pay the following fees to KBW at closing unless stated otherwise:

(a) Management Fee . A Management Fee of $40,000 payable in four consecutive monthly installments of $10,000 commencing with the adoption of the Plan of Conversion. Such fees shall be deemed to have been earned when due. Should the Conversion be terminated for any reason not attributable to the action or inaction of KBW, KBW shall have earned and be entitled to be paid fees accruing through the stage at which point the termination occurred. The Management Fee will be credited against the Success Fee in (b).

(b) Success Fee : A Success Fee of 1% shall be charged based on the aggregate purchase price of common stock sold in the Subscription Offering and Community Offering excluding shares purchased by the Bank’s officers, directors, or employees (or members of their immediate family)

Mr. Larry W. Myers

March 17, 2008

Page 4 of 5

plus any ESOP, tax-qualified or stock based compensation plans (except IRA’s for the benefit of persons other than officers, directors or employees of the bank or members of their immediate families) or similar plan created by the Bank for some or all of its directors or employees.

(c) Broker-Dealer Pass-Through . If any shares of the Company’s stock remain available after the Subscription Offering and Community Offering, at the request of the Bank, KBW will seek to form a syndicate of registered broker-dealers to assist in the sale of such common stock on a best efforts basis, subject to the terms and conditions set forth in the selected dealers agreement. KBW will endeavor to distribute the common stock among dealers in a fashion which best meets the distribution objectives of the Bank and the Plan of Conversion. KBW will be paid a fee not to exceed 5.5% of the aggregate Purchase Price of the shares of common stock sold by them. From this fee, KBW will pass onto selected broker-dealers, who assist in the syndicated community, an amount competitive with gross underwriting discounts charged at such time for comparable amounts of stock sold at a comparable price per share in a similar market environment. Fees with respect to purchases affected with the assistance of a broker/dealer other than KBW shall be transmitted by KBW to such broker/dealer. The decision to utilize selected broker-dealers will be made by the Bank upon consultation with KBW. In the event, with respect to any stock purchases, fees are paid pursuant to this subparagraph 7(c), such fees shall be in lieu of, and not in addition to, payment pursuant to subparagraph 7(b).

8. Additional Services . KBW further agrees to provide financial advisory assistance to the Company and the Bank for a period of three years following completion of the Conversion, including formation of a dividend policy and share repurchase program, assistance with shareholder reporting and shareholder relations matters, general advice on mergers and acquisitions, and other related financial matters (e.g., evaluation of business strategies regarding the use of net proceeds), without the payment by the Company and the Bank of any fees in addition to those set forth in Section 7 hereof. Nothing in this Agreement shall require the Company and the Bank to obtain such services from KBW.

9. Expenses . The Bank and the Company will bear those expenses of the proposed offering customarily borne by issuers, including, without limitation, regulatory filing fees, SEC, DTC, “Blue Sky,” and FINRA filing and registration fees; the fees of the Bank’s accountants, attorneys, appraiser, transfer agent and registrar, printing, mailing and marketing and syndicate expenses associated with the Conversion; the fees set forth in Section 7; and fees for “Blue Sky” legal work.

KBW shall be reimbursed for reasonable out-of-pocket expenses, including costs of travel, meals and lodging, photocopying, telephone, facsimile and couriers not to exceed $15,000. The selection of KBW’s counsel will be done by KBW, with the approval of the Bank. The Bank will reimburse KBW for the professional fees and expenses of its counsel which will not exceed $55,000.

Mr. Larry W. Myers

March 17, 2008

Page 5 of 5

10. Conditions . KBW’s willingness and obligation to proceed hereunder shall be subject to, among other things, satisfaction of the following conditions in KBW’s opinion, which opinion shall have been formed in good faith by KBW after reasonable determination and consideration of all relevant factors: (a) full and satisfactory disclosure of all relevant material, financial and other information in the disclosure documents and a determination by KBW, in its sole discretion, that the sale of stock on the terms proposed is reasonable given such disclosures; (b) no material adverse change in the condition or operations of the Bank subsequent to the execution of the agreement; and (c) no adverse market conditions at the time of offering which in KBW's opinion make the sale of the shares by the Company inadvisable.

11. Benefit . This Agreement shall inure to the benefit of the parties hereto and their respective successors and to the parties indemnified pursuant to the terms and conditions of the Agency Agreement and their successors, and the obligations and liabilities assumed hereunder by the parties hereto shall be binding upon their respective successors provided, however, that this Agreement shall not be assignable by KBW.

12. Definitive Agreement . This letter reflects KBW’s present intention of proceeding to work with the Bank on its proposed Conversion. It does not create a binding obligation on the part of the Bank, the Company or KBW except as to the agreement to maintain the confidentiality of non-public information set forth in Section 3, the payment of certain fees as set forth in Section 7(a) and the payment of certain expenses as set forth in Section 9, all of which shall constitute the binding obligations of the parties hereto and which shall survive the termination of this letter or the completion of the services furnished hereunder and shall remain operative and in full force and effect. You further acknowledge that any report or analysis rendered by KBW pursuant to this engagement is rendered for use solely by the Bank and the Company and its agents in connection with the Conversion. Accordingly, you agree that you will not provide any such information to any other person without our prior written consent.

KBW acknowledges that in offering the Company’s common stock no person will be authorized to give any information or to make any representation not contained in the offering prospectus and related offering materials filed as part of a registration statement to be declared effective in connection with the offering. Accordingly, KBW agrees that in connection with the offering it will not give any unauthorized information or make any unauthorized representation. We will be pleased to elaborate on any of the matters discussed in this letter at your convenience.

If the foregoing correctly sets forth our mutual understanding, please so indicate by signing and returning the original copy of this letter to the undersigned.


Sincerely,

KEEFE, BRUYETTE & WOODS

By:	/s/ Harold T. Hanley III
	Harold T. Hanley III
	Managing Director

FIRST SAVINGS BANK

By:	/s/ Larry W. Myers	Date: March 19, 2008
	Larry W. Myers
	President & CEO

EXHIBIT A

CONVERSION SERVICES

FOR

FIRST SAVINGS BANK, FSB

KBW provides thrift institutions converting from the mutual to stock form of ownership with a comprehensive program of proxy solicitation and stock issuance services designed to promote an orderly, efficient, cost-effective and long-term stock distribution. The following list is representative of the stock issuance services, if appropriate, we propose to perform on behalf of the Bank.

General Services

Assist management and legal counsel with the design of the transaction structure.

Analyze and make recommendations on bids from printing, transfer agent, and appraisal firms.

Assist in drafting and distribution of press releases as required or appropriate.

Provide Conversion Agent Services

Stock Offering Enhancement Services

Establish and manage Stock Information Center at the Bank. Stock Information Center personnel will track prospective investors; record stock orders; mail order confirmations; provide the Bank’s senior management with daily reports; solicit and process proxies; answer customer inquiries; and handle special situations as they arise.

Assign KBW’s registered personnel to be at the Bank through completion of the Subscription and Community Offerings to manage the Stock Information Center, meet with prospective shareholders at individual and community information meetings (if applicable), solicit local investor interest through a tele-marketing campaign, answer inquiries, and otherwise assist in the sale of stock in the Subscription and Community Offerings. This effort will be lead by a Principal of KBW who is a registered representative.

Create target investor list based upon review of the Bank’s depositor base.

Provide intensive financial and marketing input for drafting of the prospectus.

Prepare other marketing materials, including prospecting letters and brochures, and media advertisements.

Arrange logistics of community information meeting(s) as required.

Prepare audio-visual presentation by senior management for community information meeting(s).

Prepare management for question-and-answer period at community information meeting(s).

Attend and address community information meeting(s) and be available to answer questions.

Broker-Assisted Sales Services .

Arrange for broker information meeting(s) as required.

Prepare audio-visual presentation for broker information meeting(s).

Prepare script for presentation by senior management at broker information meeting(s).

Prepare management for question-and-answer period at broker information meeting(s).

Attend and address broker information meeting(s) and be available to answer questions.

Produce confidential broker memorandum to assist participating brokers in selling the Bank's common stock.

After-market Support Services .

KBW will use their best efforts to secure a trading commitment from at least three FINRA firms, one of which will be Keefe, Bruyette & Woods, Inc.

Conversion Agent Services

Extract data from Bank records to determine who has the right to purchase stock;

Consolidate records for household mailing;

Prepare information for and tabulate proxy vote;

Provide software to process the stock orders;

Assist with stock allocations in the event of an oversubscription;

Print interest and refund checks;

Prepare 1099’s for interest payments.

Exhibit 2.1

FIRST SAVINGS BANK, FSB

PLAN OF CONVERSION

ADOPTED ON APRIL 30, 2008

TABLE OF CONTENTS


		PAGE
1.	Introduction	1

2.	Definitions	1

3.	General Procedure for the Conversion	5

4.	Total Number of Shares and Purchase Price of Common Stock	7

5.	Subscription Rights of Eligible Account Holders (First Priority)	8

6.	Subscription Rights of Tax-Qualified Employee Stock Benefit Plans (Second Priority)	8

7.	Subscription Rights of Supplemental Eligible Account Holders (Third Priority)	9

8.	Subscription Rights of Other Members (Fourth Priority)	9

9.	Community Offering, Syndicated Community Offering, Public Offering and Other Offerings	10

10.	Limitations on Subscriptions and Purchases of Common Stock	11

11.	Timing of Subscription Offering; Manner of Exercising Subscription Rights and Order Forms	13

12.	Payment for Common Stock	14

13.	Account Holders in Nonqualified States or Foreign Countries	15

14.	Requirements Following the Conversion for Registration, Market Making and Stock Exchange Listing	15

15.	Liquidation Account	15

16.	Completion of the Conversion	17

17.	Requirements for Stock Purchases by Directors and Officers Following the Conversion	17

18.	Establishment and Funding of Charitable Foundation	17

19.	Restrictions on Transfer of Stock	18

20.	Stock Compensation Plans	18

21.	Dividend and repurchase Restrictions on Stock	19

22.	Amendment or Termination of the Plan	19

23.	Interpretation of the Plan	19

1.	INTRODUCTION.

For purposes of this section, all capitalized terms have the meanings ascribed to them in Section 2.

This Plan of Conversion provides for the conversion of First Savings Bank, FSB from a federally chartered mutual savings bank into a federally chartered stock savings bank. The Plan provides that the Bank will operate as a wholly-owned subsidiary of a stock holding company (the “Holding Company”).

The Board of Directors of the Bank has considered the alternatives available to the Bank with respect to its corporate structure, and has determined that a mutual to stock conversion, as described in this Plan, will be in the best interests of the Bank and its customers. The Conversion will raise capital which will enable the Bank to: (1) support future lending and operational growth, including branching activities and acquisitions of other financial institutions or financial services companies; (2) increase its ability to render services to the communities it serves; (3) compete more effectively with commercial banks and other financial institutions for new business opportunities; and (4) increase its equity capital base and access the capital markets when needed. The Conversion will also enable the Holding Company and the Bank to adopt stock benefit plans that will make the Bank more competitive in providing incentive compensation to management and employees.

In furtherance of the Bank’s commitment to its community, the Plan provides for the establishment of a charitable foundation as part of the Conversion. The charitable foundation is intended to complement the Bank’s existing community reinvestment activities in a manner that will allow the Bank’s local community to share in the growth and profitability of the Holding Company and the Bank over the long term. Consistent with the Bank’s goal, the Holding Company intends to donate to the charitable foundation immediately following the Conversion both cash and a number of shares of its authorized but unissued common stock in an amount up to 8% of the Holding Company Common Stock issued in the Conversion.

The Plan provides that non-transferable subscription rights to purchase the Common Stock of the Holding Company shall be granted to certain Members of the Bank pursuant to the Plan and in accordance with the rules and regulations of the OTS. The price of the Common Stock to be sold in the Conversion will be based upon an independent appraisal of the Bank and will reflect its estimated pro forma market value, as converted. No change will be made in the board of directors or management of the Bank as a result of the Conversion.

The Plan was adopted by the Bank’s Board of Directors on April 30, 2008. The Plan and the formation of the charitable foundation are each subject to the approval of the OTS and must be approved by the affirmative vote of at least a majority of the total votes eligible to be cast by the Voting Members at the Special Meeting.

After the Conversion, the Bank will continue to be regulated by the OTS, as its chartering authority, and by the FDIC, which insures the Bank’s deposits. In addition, the Bank will continue to be a member of the Federal Home Loan Bank System and all insured savings deposits will continue to be insured by the FDIC up to the maximum limit provided by law.

2.	DEFINITIONS.

As used in this Plan, the terms set forth below have the following meaning:

ACTING IN CONCERT means (i) knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant to an express agreement or understanding; or (ii) a combination or pooling of voting or other interests in the securities of an issuer for a

common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise. A Person or company which acts in concert with another Person or company (“other party”) shall also be deemed to be acting in concert with any Person or company who is also acting in concert with that other party, except that any Tax-Qualified Employee Stock Benefit Plan will not be deemed to be acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan will be aggregated and participants or beneficiaries of any such Tax-Qualified Employee Stock Benefit Plan will not be deemed to be acting in concert solely as a result of their common interests as participants or beneficiaries. When Persons act together for such purpose, their group is deemed to have acquired their stock. The determination of whether a group is Acting in Concert shall be made solely by the Boards of Directors of the Holding Company and the Bank or Officers delegated by such Boards and may be based on any evidence upon which the Board or such delegatee chooses to rely, including, without limitation, joint account relationships or the fact that such Persons share a common address (whether or not related by blood or marriage) or have filed joint Schedules 13D or Schedules 13G with the SEC with respect to other companies. Directors of the Holding Company and the Bank shall not be deemed to be Acting in Concert solely as a result of their membership on such board or boards.

ACTUAL PURCHASE PRICE means the price per share at which the Common Stock is ultimately sold by the Holding Company in the Offerings in accordance with the terms hereof.

AFFILIATE means a Person who, directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common control with the Person specified.

ASSOCIATE of a Person means (i) a corporation or organization (other than the Holding Company, the Bank or a majority-owned subsidiary of the Holding Company or the Bank), if the Person is a senior officer or partner or beneficially owns, directly or indirectly, 10% or more of any class of equity securities of the corporation or organization, (ii) a trust or other estate, if the Person has a substantial beneficial interest in the trust or estate or is a trustee or fiduciary of the trust or estate, provided, however, that such term shall not include any Tax-Qualified Employee Stock Benefit Plan of the Holding Company or the Bank in which such Person has a substantial beneficial interest or serves as a trustee or in a similar fiduciary capacity, and (iii) any person who is related by blood or marriage to such Person and who lives in the same home as the Person or who is a director or senior officer of the Holding Company or the Bank or any of their subsidiaries.

BANK means First Savings Bank, FSB.

BANK BENEFIT PLAN(S) includes, but is not limited to, Tax Qualified Employee Stock Benefit Plans and Non-Tax Qualified Employee Stock Benefit Plans.

CODE means the Internal Revenue Code of 1986, as amended.

COMMON STOCK means the shares of common stock to be issued and sold by the Holding Company in the Offerings and to be contributed to the Foundation, all pursuant to the Plan. The Common Stock will not be insured by the Federal Deposit Insurance Corporation.

COMMUNITY OFFERING means the offering for sale by the Holding Company of any shares of Common Stock not subscribed for in the Subscription Offering to such Persons as may be selected by the Holding Company and the Bank in their sole discretion and to whom a copy of the Prospectus is delivered by or on behalf of the Holding Company.

CONTROL (including the terms “controlling,” “controlled by,” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

CONVERSION means the conversion of the Bank to stock form pursuant to this Plan, and all steps incident thereto.

DEPOSIT ACCOUNT means any withdrawable account as defined in Section 561.42 of the Rules and Regulations of the OTS, including a demand account as defined in Section 561.16 of the Rules and Regulations of the OTS.

ELIGIBLE ACCOUNT HOLDER means any Person holding a Qualifying Deposit on the Eligibility Record Date for purposes of determining Subscription Rights.

ELIGIBILITY RECORD DATE means the date for determining Qualifying Deposits of Eligible Account Holders and is the close of business on March 31, 2007.

ESOP means a Tax Qualified Employee Stock Benefit Plan adopted by the Holding Company or the Bank in connection with the Conversion, the purpose of which shall be to acquire shares of Common Stock.

ESTIMATED PRICE RANGE means the range of the estimated aggregate pro forma market value of the total number of shares of Common Stock to be issued in the Offerings, as determined by the Independent Appraiser in accordance with Section 4 hereof.

FDIC means the Federal Deposit Insurance Corporation, or any successor thereto.

FOUNDATION means the charitable foundation that will qualify as an exempt organization under Section 501(c)(3) of the Code, the establishment and funding of which is contemplated by Section 18 herein.

HOLDING COMPANY means the stock corporation that will hold all of the outstanding capital stock of the Bank upon completion of the Conversion.

INDEPENDENT APPRAISER means the independent financial consulting firm retained by the Holding Company and the Bank to prepare an appraisal of the estimated pro forma market value of the Common Stock.

INITIAL PURCHASE PRICE means the price per share to be paid initially by Participants for shares of Common Stock subscribed for in the Subscription Offering and by Persons for shares of Common Stock ordered in the Community Offering and/or Syndicated Community Offering.

LOCAL COMMUNITY means Clark, Floyd, Harrison, Jefferson, Scott and Washington Counties in Indiana and Bullitt, Henry, Jefferson, Meade, Nelson, Oldham, Shelby, Spencer and Trimble Counties in Kentucky.

MANAGEMENT PERSON means any Officer or director of the Bank or the Holding Company or any Affiliate of the Bank or the Holding Company and any person Acting in Concert with such Officer or director.

MEMBER means any Person qualifying as a member of the Bank in accordance with its mutual charter and bylaws and the laws of the United States.

OFFERINGS mean the offering of Common Stock in the Subscription Offering, the Community Offering, the Syndicated Community Offering or the Public Offering.

OFFICER means the chairman of the board, president, chief executive officer, vice-president, secretary, treasurer or principal financial officer, comptroller or principal accounting officer and any other person performing similar functions with respect to any organization whether incorporated or unincorporated.

ORDER FORM means the form or forms to be provided by the Holding Company, containing all such terms and provisions as set forth in Section 11 hereof, to a Participant or other Person by which Common Stock may be ordered in the Offerings.

OTHER MEMBER means a Voting Member who is not an Eligible Account Holder or a Supplemental Eligible Account Holder.

OTS means the Office of Thrift Supervision, or any successor thereto.

PARTICIPANT means any Eligible Account Holder, Tax-Qualified Employee Stock Benefit Plan, Supplemental Eligible Account Holder or Other Member, but does not include the Foundation.

PERSON means an individual, a corporation, a partnership, an association, a joint-stock company, a limited liability company, a trust, an unincorporated organization or a government or any political subdivision of a government.

PLAN OF CONVERSION means this Plan of Conversion as adopted by the Board of Directors of the Bank and any amendment hereto approved as provided herein.

PREFERRED SUBSCRIBERS means natural persons and trusts of natural persons residing in the Local Community.

PROSPECTUS means the one or more documents to be used in offering the Common Stock in the Offerings.

PUBLIC OFFERING means an underwritten firm commitment offering to the public through one or more underwriters.

QUALIFYING DEPOSIT means the aggregate balance of all Deposit Accounts in the Bank of (i) an Eligible Account Holder at the close of business on the Eligibility Record Date, provided such aggregate balance is not less than $50.00, and (ii) a Supplemental Eligible Account Holder at the close of business on the Supplemental Eligibility Record Date, provided such aggregate balance is not less than $50.00.

SEC means the Securities and Exchange Commission, or any successor thereto.

SPECIAL MEETING means the special meeting of members of the Bank called for the purpose of submitting this Plan and the formation of the Foundation to the Members for their approval, including any adjournments or postponements of such meeting.

SUBSCRIPTION OFFERING means the offering of the Common Stock to Participants.

SUBSCRIPTION RIGHTS mean nontransferable rights to subscribe for Common Stock granted to Participants pursuant to the terms of this Plan.

SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDER means any Person, except directors and Officers of the Bank or the Holding Company and their Associates (unless the OTS grants a waiver to permit a director or Officer or Associate to be included), holding a Qualifying Deposit at the close of business on the Supplemental Eligibility Record Date.

SUPPLEMENTAL ELIGIBILITY RECORD DATE , if applicable, means the date for determining Supplemental Eligible Account Holders and shall be required if the Eligibility Record Date is more than 15 months before the date of the approval of the Conversion by the OTS. If applicable, the Supplemental Eligibility Record Date shall be the last day of the calendar quarter preceding OTS approval of the Conversion.

SYNDICATED COMMUNITY OFFERING means the offering for sale by a syndicate of broker-dealers to the general public of shares of Common Stock not purchased in the Subscription Offering and the Community Offering.

TAX-QUALIFIED EMPLOYEE STOCK BENEFIT PLAN means any defined benefit plan or defined contribution plan, such as an employee stock ownership plan, stock bonus plan, profit-sharing plan or other plan, which is established for the benefit of the employees of the Holding Company and/or the Bank and any Affiliate thereof and which, with its related trust, meets the requirements to be “qualified” under Section 401 of the Code as from time to time in effect. A “Non-Tax-Qualified Employee Stock Benefit Plan” is any defined benefit plan or defined contribution stock benefit plan that is not so qualified.

VOTING MEMBER means a Person who, at the close of business on the Voting Record Date, is entitled to vote as a Member of the Bank in accordance with its mutual charter and bylaws.

VOTING RECORD DATE means the date or dates for determining the eligibility of Members to vote at the Special Meeting.

3.	GENERAL PROCEDURE FOR THE CONVERSION.

(a)

Organization of the Holding Company and the Bank

The Bank will apply to the OTS to have the Holding Company retain up to 50% of the net proceeds of the Offerings, or such other amount as may be determined by the Board of Directors. The Bank may distribute additional capital to the Holding Company following the Conversion, subject to the OTS regulations governing capital distributions.

(b)

Effect on Deposit Accounts and Borrowings

Each deposit account in the Bank on the effective date of the Conversion, will remain a deposit account in the Bank after the Conversion in the same amount and upon the same terms and conditions, and will continue to be federally insured up to the legal maximum by the FDIC in the same manner as each deposit account existed in the Bank immediately before the Conversion. Holders of deposit accounts in the Bank shall not, as such holders, have any voting rights. Upon consummation of the Conversion, all loans and other borrowings from the Bank shall retain the same status with the Bank after the Conversion, as they had with the Bank immediately before the Conversion.

(c)

The Bank

Upon completion of the Conversion, the Bank will be authorized to exercise any and all powers, rights and privileges of, and will be subject to all limitations applicable to, capital stock savings associations under federal law. The Conversion will not result in any reduction of the amount of retained earnings and general loss reserves will be accounted for by the Holding Company and the Bank on a consolidated basis in accordance with generally accepted accounting principles. Copies of the proposed federal stock charter and bylaws of the Bank are attached hereto and made a part of this Plan. By their approval of this Plan, the Voting Members shall have approved and adopted the federal stock charter and bylaws of the Bank.

The initial members of the Board of Directors of the Bank upon the completion of the Conversion will be the members of the Board of Directors of the Bank at the time of the adoption of the Plan of Conversion who continue to be directors of the Bank at the time of the closing of the Conversion. Following the Conversion, the Bank will be wholly-owned by the Holding Company. The Holding Company will be wholly-owned by its stockholders who will initially consist of the persons who purchase Common Stock in the Offerings.

(d)

The Holding Company

The Holding Company will be authorized to exercise any and all powers, rights and privileges, and will be subject to all limitations applicable to savings and loan holding companies under federal law and regulations. The initial members of the Board of Directors of the Holding Company will be appointed by the Bank. Thereafter, the voting stockholders of the Holding Company will elect approximately one-third of the Holding Company’s directors annually. The total shares of Common Stock authorized under the Holding Company articles of incorporation will exceed the shares of Common Stock to be issued in the Conversion.

(e)

Applications and Regulatory and Member Approval

The Bank will take the necessary steps to prepare and file the Application for Conversion, including the Plan, together with all requisite material, with the OTS for approval. The Bank also will cause notice of the adoption of the Plan by the Board of Directors of the Bank to be given by publication in a newspaper having general circulation in each community in which an office of the Bank is located, and will cause copies of the Plan to be made available at each office of the Bank for inspection by Members. The Bank will post the notice of the adoption of the Plan in each of its offices. Once the Application for Conversion is filed, the Bank will again cause to be published, in accordance with the requirements of applicable regulations of the OTS, notice of the filing of the Application for Conversion with the OTS, and will post notice of the filing of the Application for Conversion in each office of the Bank.

As soon as practicable after the adoption of the Plan by the Board of Directors of the Bank, the proposed Board of Directors of the Holding Company shall adopt the Plan by at least a two-thirds vote. The proposed Board of Directors of the Holding Company shall cause to be filed with the OTS such applications as may be required for approval of the Holding Company’s acquisition of the Bank and filed with the SEC a Registration Statement to register the Common Stock under the Securities Act of 1933, as amended. The proposed Board of Directors of the Holding Company shall also register or qualify the Common Stock under any applicable state securities laws, subject to Section 13 hereof.

Promptly following receipt of requisite approval of the OTS, the Plan will be submitted to the Voting Members for their consideration and approval at the Special Meeting. The Bank may, at its option, mail to all Voting Members, at their last known address appearing on the records of the Bank, a proxy statement in either long form, or to the extent permitted by applicable laws and regulations, summary form

describing the Plan, which will be submitted to a vote of the Voting Members at the Special Meeting. If the Plan is approved by the affirmative vote of a majority of the total number of votes eligible to be cast by Voting Members at the Special Meeting, the Bank shall take all other necessary organizational steps pursuant to applicable laws and regulations to amend its charter and bylaws to authorize the issuance of its capital stock to the Holding Company at the time the Conversion is consummated.

(f)

Expenses

The Holding Company and the Bank may retain and pay for the services of financial and other advisors and investment bankers to assist in connection with any or all aspects of the Conversion, including in connection with the Offerings, the payment of fees to brokers for assisting Persons in completing and/or submitting Order Forms. The Bank shall use its best efforts to ensure that all fees, expenses, retainers and similar items shall be reasonable.

4.	TOTAL NUMBER OF SHARES AND PURCHASE PRICE OF COMMON STOCK.

(a) The aggregate price at which shares of Common Stock shall be sold in the Offerings shall be based on a pro forma valuation of the aggregate market value of the Common Stock prepared by the Independent Appraiser. The valuation shall be based on financial information relating to the Holding Company and the Bank, market, financial and economic conditions, a comparison of the Holding Company and the Bank with selected publicly-held financial institutions and holding companies and with comparable financial institutions and holding companies and such other factors as the Independent Appraiser may deem to be important, including, but not limited to, the projected operating results and financial condition of the Holding Company and Bank. The valuation shall be stated in terms of an Estimated Price Range, the maximum of which shall be no more than 15% above the average of the minimum and maximum of such price range and the minimum of which shall be no more than 15% below such average. The valuation shall be updated during the Conversion as market and financial conditions warrant and as may be required by the OTS.

(b) Based upon the independent valuation, the Boards of Directors of the Holding Company and the Bank shall fix the Initial Purchase Price and the number of shares of Common Stock to be offered in the Offerings. The purchase price per share for the Common Stock shall be a uniform price determined in accordance with applicable OTS rules and regulations. The Actual Purchase Price and the total number of shares of Common Stock to be issued in the Offerings shall be determined by the Boards of Directors of the Holding Company and the Bank upon conclusion of the Offerings in consultation with the Independent Appraiser and any financial advisor or investment banker retained by the Holding Company in connection with such offering.

(c) Subject to the approval of the OTS, the Estimated Price Range may be increased or decreased to reflect market, financial and economic conditions before completion of the Conversion or to fill the Order of the Tax-Qualified Employee Stock Benefit Plans, and under such circumstances the Holding Company and the Bank may increase or decrease the total number of shares of Common Stock to be issued in the Conversion to reflect any such change. Notwithstanding anything to the contrary contained in this Plan, no resolicitation of subscribers shall be required and subscribers shall not be permitted to modify or cancel their subscriptions unless the gross proceeds from the sale of the Common Stock in the Offerings are less than the minimum or more than 15% above the maximum of the Estimated Price Range set forth in the Prospectus. In the event of an increase in the total number of shares offered in the Offerings due to an increase in the Estimated Price Range, the priority of share allocation shall be as set forth in this Plan.

5.	SUBSCRIPTION RIGHTS OF ELIGIBLE ACCOUNT HOLDERS (FIRST PRIORITY).

(a) Each Eligible Account Holder shall receive, as first priority and without payment, Subscription Rights to purchase up to the greater of (i) $200,000 of Common Stock (or such maximum purchase limitation as may be established for the Community Offering and/or Syndicated Community Offering), (ii) one-tenth of 1% of the total offering of shares in the Subscription Offering, or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of shares of Common Stock offered in the Subscription Offering by a fraction, of which the numerator is the amount of the Qualifying Deposits of the Eligible Account Holder and the denominator is the total amount of all Qualifying Deposits of all Eligible Account Holders, in each case subject to Sections 10 and 13 hereof.

(b) In the event of an oversubscription for shares of Common Stock pursuant to Section 5(a), available shares shall be allocated among subscribing Eligible Account Holders so as to permit each such Eligible Account Holder, to the extent possible, to purchase a number of shares which will make his or her total allocation equal to the lesser of the number of shares subscribed for or 100 shares. Any available shares remaining after each subscribing Eligible Account Holder has been allocated the lesser of the number of shares subscribed for or 100 shares shall be allocated among the subscribing Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the Qualifying Deposit of each such subscribing Eligible Account Holder bears to the total Qualifying Deposits of all such subscribing Eligible Account Holders whose orders are unfilled, provided that no fractional shares shall be issued.

Subscription Rights of Eligible Account Holders who are also directors or Officers of the Holding Company or the Bank and their Associates shall be subordinated to those of other Eligible Account Holders to the extent that they are attributable to increased deposits during the one-year period preceding the Eligibility Record Date.

6.	SUBSCRIPTION RIGHTS OF TAX-QUALIFIED EMPLOYEE STOCK BENEFIT PLANS (SECOND PRIORITY).

Tax-Qualified Employee Stock Benefit Plans shall receive, without payment, Subscription Rights to purchase in the aggregate up to 10% of the Common Stock sold in the Offerings, including (i) any shares of Common Stock to be issued in the Conversion as a result of an increase in the Estimated Price Range after commencement of the Subscription Offering and before completion of the Offerings; and (ii) any shares of Common Stock contributed to the Foundation. The subscription rights granted to Tax-Qualified Employee Stock Benefit Plans shall be subject to the availability of shares of Common Stock after taking into account the shares of Common Stock purchased by Eligible Account Holders; provided, however, that if the total number of shares of Common Stock is increased to any amount greater than the number of shares representing the maximum of the Estimated Price Range as set forth in the Prospectus (“Maximum Shares”), the ESOP shall have a priority right to purchase any such shares exceeding the Maximum Shares up to an aggregate of 10% of Common Stock sold in the Offerings and contributed to the Foundation. Shares of Common Stock purchased by any individual participant (“Plan Participant”) in a Tax-Qualified Employee Stock Benefit Plan using funds therein pursuant to the exercise of subscription rights granted to such Participant in his individual capacity as an Eligible Account Holder and/or supplemental Eligible Account Holder and/or purchases by such Plan Participant in the Community Offering shall not be deemed to be purchases by a Tax-Qualified Employee Stock Benefit Plan for purposes of calculating the maximum amount of Common Stock that Tax-Qualified Employee Stock Benefit Plans may purchase pursuant to the first sentence of this Section 6 if the individual Plan Participant controls or directs the investment authority with respect to such account or subaccount. Consistent with applicable laws and regulations and policies and practices of the OTS, the Tax-Qualified Employee Stock Benefit Plans may use funds contributed by the Holding Company or the Bank and/or

borrowed from an independent financial institution to exercise such Subscription Rights, and the Holding Company and the Bank may make scheduled discretionary contributions thereto, provided that such contributions do not cause the Bank to fail to meet any applicable regulatory capital requirement. The Tax-Qualified Employee Stock Benefit Plans may fill their orders to purchase Common Stock, in whole or in part, through open market purchases after the closing of the Offerings, subject to approval of the OTS.

The Tax-Qualified Employee Stock Benefit Plans shall not be deemed to be an Associate or Affiliate of or Person Acting in Concert with any Management Person.

7.	SUBSCRIPTION RIGHTS OF SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDERS (THIRD PRIORITY).

(a) In the event that the Eligibility Record Date is more than 15 months before the date of OTS approval of the Plan, then, and only in that event, a Supplemental Eligibility Record Date shall be set and each Supplemental Eligible Account Holder shall receive, without payment, Subscription Rights to purchase up to the greater of (i) $200,000 of Common Stock (or such maximum purchase limitation as may be established for the Community Offering and/or Syndicated Community Offering), (ii) one-tenth of 1% of the total offering of shares in the Subscription Offering or (iii) 15 times the product (rounded down to the next whole number) obtained by multiplying the total number of shares of Common Stock offered in the Subscription Offering by a fraction, of which the numerator is the amount of the Qualifying Deposits of the Supplemental Eligible Account Holder and the denominator is the total amount of all Qualifying Deposits of all Supplemental Eligible Account Holders, in each case subject to Sections 10 and 13 hereof and the availability of shares of Common Stock for purchase after taking into account the shares of Common Stock purchased by Eligible Account Holders and Tax-Qualified Employee Stock Benefit Plans through the exercise of Subscription Rights under Sections 5 and 6 hereof.

(b) In the event of an oversubscription for shares of Common Stock pursuant to Section 7(a), available shares shall be allocated among subscribing Supplemental Eligible Account Holders so as to permit each such Supplemental Eligible Account Holder, to the extent possible, to purchase a number of shares sufficient to make his or her total allocation (including the number of shares, if any, allocated in accordance with Section 5(a)) equal to the lesser of the number of shares subscribed for or 100 shares. Any remaining available shares shall be allocated among subscribing Supplemental Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the amount of their respective Qualifying Deposits bears to the total amount of the Qualifying Deposits of all such subscribing Supplemental Eligible Account Holders whose orders are unfilled, provided that no fractional shares shall be issued.

8.	SUBSCRIPTION RIGHTS OF OTHER MEMBERS (FOURTH PRIORITY).

(a) Each Other Member shall receive, without payment, Subscription Rights to purchase up to the greater of (i) $200,000 of Common Stock (or such maximum purchase limitation as may be established for the Community Offering and/or Syndicated Community Offering) and (ii) one-tenth of 1% of the total offering of shares in the Subscription Offering, subject to Sections 10 and 13 hereof and the availability of shares of Common Stock for purchase after taking into account the shares of Common Stock purchased by Eligible Account Holders, Tax-Qualified Employee Stock Benefit Plans and Supplemental Eligible Account Holders, if any, through the exercise of Subscription Rights under Sections 5, 6 and 7 hereof.

(b) If, pursuant to this Section 8, Other Members subscribe for a number of shares of Common Stock in excess of the total number of shares of Common Stock remaining, available shares shall be allocated among subscribing Other Members so as to permit each such Other Member, to the extent possible, to purchase a number of shares which will make his or her total allocation equal to the lesser of the number of shares

subscribed for or 100 shares. Any remaining available shares shall be allocated among subscribing Other Members whose subscriptions remain unsatisfied on a pro rata basis in the same proportion as each such Other Member’s subscription bears to the total subscriptions of all such subscribing Other Members, provided that no fractional shares shall be issued.

9.	COMMUNITY OFFERING, SYNDICATED COMMUNITY OFFERING, PUBLIC OFFERING AND OTHER OFFERINGS.

(a) If less than the total number of shares of Common Stock offered by the Holding Company are sold in the Subscription Offering, it is anticipated that all remaining shares of Common Stock shall, if practicable, be sold in a Community Offering. Subject to the requirements set forth herein, the manner in which the Common Stock is sold in the Community Offering shall have as the objective the achievement of the widest possible distribution of such stock.

(b) In the event of a Community Offering, all shares of Common Stock that are not subscribed for in the Subscription Offering shall be offered for sale by means of a direct community marketing program, which may provide for the use of brokers, dealers or investment banking firms experienced in the sale of financial institution securities. Any available shares in excess of those not subscribed for in the Subscription Offering will be available for purchase by members of the general public to whom a Prospectus is delivered by the Holding Company or on its behalf, with preference given first to Preferred Subscribers).

(c) A Prospectus and Order Form shall be furnished to such Persons as the Holding Company and the Bank may select in connection with the Community Offering, and each order for Common Stock in the Community Offering shall be subject to the absolute right of the Holding Company and the Bank to accept or reject any such order in whole or in part either at the time of receipt of an order or as soon as practicable following completion of the Community Offering. Available shares will be allocated first to each Preferred Subscriber whose order is accepted in an amount equal to the lesser of 100 shares or the number of shares subscribed for by each such Preferred Subscriber, if possible. Thereafter, unallocated shares shall be allocated among the Preferred Subscribers whose accepted orders remain unsatisfied in the same proportion that the unfilled order bears to the total unfilled orders of all Preferred Subscribers whose accepted orders remain unsatisfied, provided that no fractional shares shall be issued. If there are any shares remaining after all accepted orders by Preferred Subscribers have been satisfied, such remaining shares shall be allocated to other members of the general public who purchase in the Community Offering, applying the same allocation described above for Preferred Subscribers.

(d) The amount of Common Stock that any Person may purchase in the Community Offering shall not exceed $200,000 of Common Stock, provided, however, that this amount may be increased to up to 5% of the total offering of shares of Common Stock or decreased to less than $200,000, subject to any required regulatory approval but without the further approval of the Members or the resolicitation of subscribers; and provided further that to the extent applicable, and subject to the preferences set forth in Section 9(b) and (c) of this Plan and the limitations on purchases of Common Stock set forth in this Section 9(d) and Section 10 of this Plan, orders for Common Stock in the Community Offering shall first be filled to a maximum of 2% of the total number of shares of Common Stock sold in the Offerings and thereafter any remaining shares shall be allocated on an equal number of shares basis per order until all orders have been filled, provided no fractional shares shall be issued. The Holding Company and the Bank may commence the Community Offering concurrently with, at any time during, or as soon as practicable after the end of, the Subscription Offering, and the Community Offering must be completed within 45 days after the completion of the Subscription Offering, unless extended by the Holding Company and the Bank with any required regulatory approval.

(e) Subject to such terms, conditions and procedures as may be determined by the Holding Company and the Bank, all shares of Common Stock not subscribed for in the Subscription Offering or ordered in the Community Offering may be sold by a syndicate of broker-dealers to the general public in a Syndicated Community Offering. Each order for Common Stock in the Syndicated Community Offering shall be subject to the absolute right of the Holding Company and the Bank to accept or reject any such order in whole or in part either at the time of receipt of an order or as soon as practicable after completion of the Syndicated Community Offering. The amount of Common Stock that any Person may purchase in the Syndicated Community Offering shall not exceed $200,000 of Common Stock, provided, however, that this amount may be increased to up to 5% of the total offering of shares of Common Stock or decreased to less than $200,000, subject to any required regulatory approval but without the further approval of the Members or the resolicitation of subscribers; and provided further that, to the extent applicable, and subject to the limitations on purchases of Common Stock set forth in this Section 9(e) and Section 10 of this Plan, orders for Common Stock in the Syndicated Community Offering shall first be filled to a maximum of 2% of the total number of shares of Common Stock sold in the Offerings and thereafter any remaining shares shall be allocated on an equal number of shares basis per order until all orders have been filled, provided no fractional shares shall be issued. The Holding Company and the Bank may commence the Syndicated Community Offering concurrently with, at any time during, or as soon as practicable after the end of, the Subscription Offering and/or Community Offering, and the Syndicated Community Offering must be completed within 45 days after the completion of the Subscription Offering, unless extended by the Holding Company and the Bank with any required regulatory approval.

(f) The Holding Company and the Bank may sell any shares of Common Stock remaining following the Subscription Offering, Community Offering and/or the Syndicated Community Offering in a Public Offering. The provisions of Section 10 hereof shall not be applicable to the sales to underwriters for purposes of the Public Offering but shall be applicable to sales by the underwriters to the public. The price to be paid by the underwriters in such an offering shall be equal to the Actual Purchase Price less an underwriting discount to be negotiated among such underwriters and the Holding Company and the Bank, subject to any required regulatory approval or consent.

(g) If for any reason a Syndicated Community Offering or Public Offering of shares of Common Stock not sold in the Subscription Offering and the Community Offering cannot be effected, or if any insignificant residue of shares of Common Stock is not sold in the Subscription Offering, Community Offering or Syndicated Community Offering, the Holding Company and the Bank shall use their best efforts to obtain other purchasers for such shares in such manner and upon such conditions as may be satisfactory to the OTS.

10.

LIMITATIONS ON SUBSCRIPTIONS AND PURCHASES OF COMMON STOCK.

The following limitations shall apply to all purchases of Common Stock in the Offerings:

(a) The maximum amount of Common Stock that may be subscribed for or purchased in all categories of the Offerings by any Person, together with any Associate or group of Persons Acting in Concert, shall not exceed $350,000, except for Tax-Qualified Employee Stock Benefit Plans.

(b) The maximum number of shares of Common Stock which may be purchased in the Conversion by the ESOP shall not exceed 8% and all Tax-Qualified Employee Stock Benefit Plans shall not exceed 10% of the total number of shares of Holding Company Common Stock issued in the Conversion, in each instance, including (i) any shares which may be issued in the event of an increase in the maximum Estimated Price Range to reflect changes in market, financial and economic conditions after commencement of the Subscription Offering and before completion of the Offerings, and (ii) any shares of Common Stock contributed to the Foundation; provided, however, that purchases of Common Stock which are made by Plan

Participants pursuant to the exercise of Subscription Rights granted to such Plan Participant in his or her individual capacity as a Participant or purchases by a Plan Participant in the Community Offering using the funds thereof held in Tax-Qualified Employee Stock Benefit Plans shall not be deemed to be purchases by a Tax-Qualified Employee Stock Benefit Plan for purposes of this Section 10(b).

(c) No Person may purchase fewer than 25 shares of Common Stock in the Offerings, to the extent such shares are available; provided, however, that if the Actual Purchase Price is greater than $20.00 per share, such minimum number of shares shall be adjusted so that the aggregate Actual Purchase Price for such minimum shares will not exceed $500.00.

(d) The maximum amount of Common Stock that directors and officers of the Holding Company or the Bank and their Associates may purchase in the aggregate in the Offerings shall not exceed 31% of the total number of shares of Common Stock sold in the Offerings, including any shares which may be issued in the event of an increase in the maximum of the Estimated Price Range to reflect changes in market, financial and economic conditions after commencement of the Subscription Offering and before completion of the Offerings.

(e) For purposes of the foregoing limitations and the determination of Subscription Rights, (i) directors, Officers and employees of the Holding Company, the Bank or their subsidiaries shall not be deemed to be Associates or a group Acting in Concert solely as a result of their capacities as such, (ii) shares purchased by Tax-Qualified Employee Stock Benefit Plans shall not be attributable to the individual trustees or beneficiaries of any such plan for purposes of determining compliance with the limitations set forth in Section 10(b) hereof, and (iii) shares purchased by a Tax-Qualified Employee Stock Benefit Plan pursuant to instructions of an individual in an account in such plan in which the individual has the right to direct the investment, including any plan of the Bank qualified under Section 401(k) of the Code, shall be aggregated and included in that individual’s purchases and not attributed to the Tax-Qualified Employee Stock Benefit Plan.

(f) Subject to any required regulatory approval and the requirements of applicable laws and regulations, but without further approval of the Members, the Holding Company and the Bank may increase or decrease any of the individual or aggregate purchase limitations set forth herein to a percentage which does not exceed 5% of the total offering of shares of Common Stock in the Offerings whether before, during or after the Subscription Offering, Community Offering and/or Syndicated Community Offering. If an individual purchase limitation is increased after commencement of the Subscription Offering or any other offering, the Holding Company and the Bank shall permit any Person who subscribed for the maximum number of shares of Common Stock to purchase an additional number of shares, so that such Person shall be permitted to subscribe for the then maximum number of shares permitted to be subscribed for by such Person, subject to the rights and preferences of any Person who has priority Subscription Rights. If any of the individual or aggregate purchase limitations are decreased after commencement of the Subscription Offering or any other offering, the orders of any Person who subscribed for more than the new purchase limitation shall be decreased by the minimum amount necessary so that such Person shall be in compliance with the then maximum number of shares permitted to be subscribed for by such Person. In the event that the maximum purchase limitation is increased to 5% of the shares sold in the Offerings, such limitation may be further increased to 9.99%, provided that orders for Common Stock exceeding 5% of the shares of Common Stock sold in the Offerings shall not exceed in the aggregate 10% of the total shares of Common Stock sold in the Offerings.

(g) The Holding Company and the Bank shall have the right to take all such action as they may, in their sole discretion, deem necessary, appropriate or advisable to monitor and enforce the terms, conditions, limitations and restrictions contained in this Section 10 and elsewhere in this Plan and the terms, conditions and representations contained in the Order Form, including, but not limited to, the absolute right (subject only to any necessary regulatory approvals or concurrences) to reject, limit or revoke acceptance of any subscription

or order and to delay, terminate or refuse to consummate any sale of Common Stock that they believe might violate, or is designed to, or is any part of a plan to, evade or circumvent such terms, conditions, limitations, restrictions and representations. Any such action shall be final, conclusive and binding on all persons, and the Holding Company, the Bank and their respective Boards shall be free from any liability to any Person on account of any such action.

11.

TIMING OF SUBSCRIPTION OFFERING; MANNER OF EXERCISING SUBSCRIPTION RIGHTS AND ORDER FORMS.

(a) The Offerings shall be conducted in compliance with Part 563g of the Rules and Regulations of the OTS, to the extent applicable, and Form OC.

(b) The exact timing of the commencement of the Subscription Offering shall be determined by the Holding Company and the Bank in consultation with the Independent Appraiser and any financial or advisory or investment banking firm retained by them in connection with the Conversion. The Holding Company and the Bank may consider a number of factors, including, but not limited to, their current and projected future earnings, local and national economic conditions, and the prevailing market for stocks in general and stocks of financial institutions in particular. The Holding Company and the Bank shall have the right to withdraw, terminate, suspend, delay, revoke or modify any such Subscription Offering, at any time and from time to time, as they in their sole discretion may determine, without liability to any Person, subject to compliance with applicable securities laws and any necessary regulatory approval or concurrence.

(c) Promptly after the SEC has declared the Registration Statement, which includes the Prospectus, effective and all required regulatory approvals have been obtained, the Holding Company shall, distribute or make available the Prospectus, together with Order Forms for the purchase of Common Stock, to all Participants for the purpose of enabling them to exercise their respective Subscription Rights, subject to Section 13 hereof.

(d) A single Order Form for all Deposit Accounts maintained with the Bank by an Eligible Account Holder and any Supplemental Eligible Account Holder may be furnished, irrespective of the number of Deposit Accounts maintained with the Bank on the Eligibility Record Date and Supplemental Eligibility Record Date, respectively. No person holding a Subscription Right may exceed any otherwise applicable purchase limitation by submitting multiple orders for Common Stock. Multiple orders are subject to adjustment, as appropriate, on a pro rata basis and deposit balances will be divided equally among such orders in allocating shares in the event of an oversubscription.

(e) The recipient of an Order Form shall have no less than 20 days and no more than 45 days from the date of mailing of the Order Form (with the exact termination date to be set forth on the Order Form) to properly complete and execute the Order Form and deliver it to the Holding Company. The Holding Company may extend such period by such amount of time as it determines is appropriate. Failure of any Participant to deliver a properly executed Order Form to the Holding Company, along with full payment (or authorization for full payment by withdrawal) for the shares of Common Stock subscribed for, within the time limits prescribed, shall be deemed a waiver and release by such person of any rights to subscribe for shares of Common Stock. Each Participant shall be required to confirm to the Holding Company by executing an Order Form that such Person has fully complied with all of the terms, conditions, limitations and restrictions in the Plan.

(f) The Holding Company and the Bank shall have the absolute right, in their sole discretion and without liability to any Participant or other Person, to reject any Order Form, including, but not limited to, any Order Form that is (i) improperly completed or executed; (ii) not timely received; (iii) not accompanied by the proper and full payment (or authorization of withdrawal for full payment) or, in the case of institutional

investors in the Community Offering, not accompanied by an irrevocable order together with a legally binding commitment to pay the full amount of the purchase price before 48 hours before the completion of the Offerings; or (iv) submitted by a Person whose representations the Holding Company and the Bank believe to be false or who they otherwise believe, either alone, or Acting in Concert with others, is violating, evading or circumventing, or intends to violate, evade or circumvent, the terms and conditions of the Plan. Furthermore, in the event Order Forms (i) are not delivered and are returned to the Holding Company by the United States Postal Service or the Holding Company is unable to locate the addressee, or (ii) are not mailed pursuant to a “no mail” order placed in effect by the account holder, the Subscription Rights of the Person to which such rights have been granted will lapse as though such Person failed to return the contemplated Order Form within the time period specified thereon. The Holding Company and the Bank may, but will not be required to, waive any irregularity on any Order Form or may require the submission of corrected Order Forms or the remittance of full payment for shares of Common Stock by such date as they may specify. The interpretation of the Holding Company and the Bank of the terms and conditions of the Order Forms shall be final and conclusive.

12.

PAYMENT FOR COMMON STOCK.

(a) Payment for shares of Common Stock subscribed for by Participants in the Subscription Offering and payment for shares of Common Stock ordered by Persons in the Community Offering shall be equal to the Initial Purchase Price multiplied by the number of shares that are being subscribed for or ordered, respectively. Such payment may be made in cash, if delivered in person, or by check, bank draft or money order at the time the Order Form is delivered to the Holding Company, provided that checks will only be accepted subject to collection. The Holding Company and the Bank, in their sole and absolute discretion, may also elect to receive payment for shares of Common Stock by wire transfer. In addition, the Holding Company may elect to provide Participants and/or other Persons who have a Deposit Account with the Bank the opportunity to pay for shares of Common Stock by authorizing the Bank to withdraw from such Deposit Account an amount equal to the aggregate Initial Purchase Price of such shares. Payment may also be made by a Participant using funds held for such Participant’s benefit by a Bank Benefit Plan to the extent that such plan allows participants or any related trust established for the benefit of such participants to direct that some or all of their individual accounts or sub-accounts be invested in Common Stock. If the Actual Purchase Price is less than the Initial Purchase Price, the Holding Company shall refund the difference to all Participants and other Persons, unless the Holding Company chooses to provide Participants and other Persons the opportunity on the Order Form to elect to have such difference applied to the purchase of additional whole shares of Common Stock. If the Actual Purchase Price is more than the Initial Purchase Price, the Holding Company shall reduce the number of shares of Common Stock ordered by Participants and other Persons and refund any remaining amount that is attributable to a fractional share interest, unless the Holding Company chooses to provide Participants and other Persons the opportunity to increase the Actual Purchase Price submitted by them.

(b) Notwithstanding the above, if the Tax-Qualified Employee Stock Benefit Plans subscribe for shares during the Subscription Offering, such plans will not be required to pay for the shares at the time they subscribe but rather may pay for such shares of Common Stock subscribed for by such plans at the Actual Purchase Price upon consummation of the Conversion, provided that, in the case of the Employee Stock Ownership Plan, there is in force from the time of its subscription until the consummation of the Offerings, a loan commitment to lend to the Employee Stock Ownership Plan, at such time, the aggregate price of the shares for which it subscribed.

(c) If a Participant or other Person authorizes the Bank to withdraw the amount of the Initial Purchase Price from his or her Deposit Account, the Bank shall have the right to make such withdrawal or to freeze funds equal to the aggregate Initial Purchase Price upon receipt of the Order Form. Notwithstanding any regulatory provisions regarding penalties for early withdrawals from certificate accounts, the Bank may allow payment by means of withdrawal from certificate accounts without the assessment of such penalties. In the

case of an early withdrawal of only a portion of such account, the certificate evidencing such account shall be canceled if any applicable minimum balance requirement ceases to be met. In such case, the remaining balance will earn interest at the regular passbook rate. However, where any applicable minimum balance is maintained in such certificate account, the rate of return on the balance of the certificate account shall remain the same as before such early withdrawal. This waiver of the early withdrawal penalty applies only to withdrawals made in connection with the purchase of Common Stock and is entirely within the discretion of the Holding Company and the Bank.

(d) The subscription funds will be held by the Bank or, in the Bank’s discretion, in an escrow account at an unaffiliated insured financial institution. The Holding Company shall pay interest, at not less than the Bank’s passbook rate, for all amounts paid in cash, by check, bank draft or money order to purchase shares of Common Stock in the Subscription Offering and the Community Offering from the date payment is received until the date the Offerings are completed or terminated.

(e) The Holding Company will not offer or sell any of the Common Stock proposed to be issued to any Person whose purchase would be financed by funds loaned, directly or indirectly, to the Person by the Bank.

(f) Each share of Common Stock shall be non-assessable upon payment in full of the Actual Purchase Price.

13.

ACCOUNT HOLDERS IN NONQUALIFIED STATES OR FOREIGN COUNTRIES.

The Holding Company and the Bank shall make reasonable efforts to comply with the securities laws of all jurisdictions in the United States in which Participants reside. However, no Participant will be offered or receive any Common Stock under the Plan if such Participant resides in a foreign country or resides in a jurisdiction of the United States with respect to which any of the following apply: (a) there are few Participants otherwise eligible to subscribe for shares under this Plan who reside in such jurisdiction; (b) the granting of Subscription Rights or the offer or sale of shares of Common Stock to such Participants would require any of the Holding Company or the Bank or their respective directors and Officers, under the laws of such jurisdiction, to register as a broker-dealer, salesman or selling agent or to register or otherwise qualify the Common Stock for sale in such jurisdiction, or any of the Holding Company or the Bank would be required to qualify as a foreign corporation or file a consent to service of process in such jurisdiction; or (c) such registration, qualification or filing in the judgment of the Holding Company and the Bank would be impracticable or unduly burdensome for reasons of cost or otherwise.

14.

REQUIREMENTS FOLLOWING THE CONVERSION FOR REGISTRATION, MARKET MAKING AND STOCK EXCHANGE LISTING.

In connection with the Conversion, the Holding Company shall register the Common Stock pursuant to Section 12 of the Securities Exchange Act of 1934, as amended, and shall undertake not to deregister such stock for a period of three years thereafter. The Holding Company also shall use its best efforts to (i) encourage and assist a market maker to establish and maintain a market for the Common Stock, and (ii) list the Common Stock on a national or regional securities exchange or to have quotations for such stock disseminated on the Nasdaq Stock Market.

15.

LIQUIDATION ACCOUNT.

(a) At the time of the Conversion, the Bank shall establish a liquidation account in an amount equal to the Bank’s net worth as reflected in its statement of financial condition contained in the Prospectus

used in the Conversion. The function of the liquidation account will be to preserve the rights of certain holders of Deposit Accounts in the Bank who maintain such accounts in the Bank following the Conversion to a priority to distributions in the unlikely event of a liquidation of the Bank subsequent to the Conversion.

(b) The liquidation account shall be maintained for the benefit of Eligible Account Holders and Supplemental Eligible Account Holders, if any, who maintain their Deposit Accounts in the Bank after the Conversion. Each such account holder will, with respect to each Deposit Account held, have a related inchoate interest in a portion of the liquidation account balance, which interest will be referred to in this Section 15 as the “subaccount balance.” All Deposit Accounts having the same social security number will be aggregated for purposes of determining the initial subaccount balance with respect to such Deposit Accounts, except as provided in Section 15(d) hereof.

(c) In the event of a complete liquidation of the Bank subsequent to the Conversion (and only in such event), each Eligible Account Holder and Supplemental Eligible Account Holder, if any, shall be entitled to receive a liquidation distribution from the liquidation account in the amount of the then current subaccount balances for Deposit Accounts then held (adjusted as described below) before any liquidation distribution may be made with respect to the capital stock of the Bank. No merger, consolidation, sale of bulk assets or similar combination transaction with another FDIC-insured institution in which the Bank is not the surviving entity shall be considered a complete liquidation for this purpose. In any such transaction, the liquidation account shall be assumed by the surviving entity.

(d) The initial subaccount balance for a Deposit Account held by an Eligible Account Holder and Supplemental Eligible Account Holder, if any, shall be determined by multiplying the opening balance in the liquidation account by a fraction, of which the numerator is the amount of the Qualifying Deposits of such account holder and the denominator is the total amount of Qualifying Deposits of all Eligible Account Holders and Supplemental Eligible Account Holders, if any. For Deposit Accounts in existence at both the Eligibility Record Date and the Supplemental Eligibility Record Date, if any, separate initial subaccount balances shall be determined on the basis of the Qualifying Deposits in such Deposit Accounts on each such record date. Initial subaccount balances shall not be increased, and shall be subject to downward adjustment as provided below.

(e) If the aggregate deposit balance in the Deposit Account(s) of any Eligible Account Holder or Supplemental Eligible Account Holder, if any, at the close of business on any annual closing date (which date is the Bank’s fiscal year end), commencing on or after the effective date of the Conversion, is less than the lesser of (a) the aggregate deposit balance in such Deposit Account(s) at the close of business on any other annual closing date subsequent to such record dates or (b) the aggregate deposit balance in such Deposit Account(s) as of the Eligibility Record Date or the Supplemental Eligibility Record Date, if any, the subaccount balance for such Deposit Account(s) shall be adjusted by reducing such subaccount balance in an amount proportionate to the reduction in such deposit balance. In the event of such a downward adjustment, the subaccount balance shall not be subsequently increased, notwithstanding any subsequent increase in the deposit balance of the related Deposit Account(s). The subaccount balance of an Eligible Account Holder or Supplemental Eligible Account Holder, if any, will be reduced to zero if the Account Holder ceases to maintain a Deposit Account at the Bank that has the same social security number as appeared on his Deposit Account(s) at the Eligibility Record Date or, if applicable, the Supplemental Eligibility Record Date.

(f) Subsequent to the Conversion, the Bank may not pay cash dividends generally on deposit accounts and/or capital stock of the Bank, or repurchase any of the capital stock of the Bank, if such dividend or repurchase would reduce the Bank’s regulatory capital below the aggregate amount of the then current subaccount balances for Deposit Accounts then held; otherwise, the existence of the liquidation account shall not operate to restrict the use or application of any of the net worth accounts of the Bank.

(g) For purposes of this Section 15, a Deposit Account includes a predecessor or successor account which is held by an Account Holder with the same social security number.

16.

COMPLETION OF THE CONVERSION.

The effective date of the Conversion shall be the date of the closing of the sale of all shares of Common Stock. The closing of the sale of all shares of Common Stock sold in the Offerings shall occur simultaneously and shall be conditioned upon the prior receipt of all requisite regulatory and other approvals.

17.

REQUIREMENTS FOR STOCK PURCHASES BY DIRECTORS AND OFFICERS FOLLOWING THE CONVERSION.

For a period of three years following the Conversion, the directors and Officers of the Holding Company and the Bank and their Associates may not purchase Common Stock without the prior written approval of the OTS except from a broker-dealer registered with the SEC. This prohibition shall not apply, however, to (i) a negotiated transaction involving more than 1% of the outstanding Common Stock, and (ii) purchases of stock made by and held by any Tax-Qualified Employee Stock Benefit Plan (and purchases of stock made by and held by any Non-Tax-Qualified Employee Stock Benefit Plan following the receipt of shareholder approval of such plan) even if such Common Stock may be attributable to individual Officers or directors and their Associates. The foregoing restriction on purchases of Common Stock shall be in addition to any restrictions that may be imposed by federal and state securities laws.

18.

ESTABLISHMENT AND FUNDING OF CHARITABLE FOUNDATION .

As part of the Conversion, the Holding Company and the Bank intend to establish the Foundation and donate to the Foundation from authorized but unissued shares of Holding Company Common Stock, an amount up to 8% of the number of shares of Holding Company Common Stock issued in the Conversion. A portion of this donation may be in cash. The Foundation is being formed in connection with the Conversion in order to complement the Bank’s existing community reinvestment activities and to share with the Bank’s local community a part of the Bank’s financial success as a locally headquartered, community-minded, financial services institution. The funding of the Foundation with Holding Company Common Stock accomplishes this goal as it enables the community to share in the growth and profitability of the Holding Company and the Bank over the long term.

The Foundation will be dedicated to the promotion of charitable purposes including grants or donations to support housing, not-for-profit community groups and other types of organizations or civic-minded projects. The Foundation annually will distribute total grants to assist charitable organizations or to fund charitable projects within its local community of not less than 5% of the average fair value of Foundation assets each year, less certain expenses. In order to serve the purposes for which it was formed and maintain its Section 501(c)(3) qualification, the Foundation may sell, on an annual basis, a limited portion of Holding Company Common Stock contributed to it by the Holding Company.

The establishment and funding of the Foundation as part of the Conversion is subject to the receipt of OTS approval and approval of Members. The Conversion is not conditioned upon the establishment and funding of the Foundation. The Conversion may proceed and be completed whether or not the Foundation is established and funded.

The Board of Directors of the Foundation will be comprised of individuals who are Officers and/or Directors of the Holding Company or the Bank and, for at least five years after its organization, at least one member of the Bank’s community who is not an Officer or Director of the Holding Company or the Bank. The Board of Directors of the Foundation will be responsible for establishing the policies of the Foundation with respect to grants or donations, consistent with the stated purposes of the Foundation.

19.

RESTRICTIONS ON TRANSFER OF STOCK.

All shares of Common Stock that are purchased by Persons other than directors and Officers of the Holding Company or the Bank shall be transferable without restriction. Shares of Common Stock purchased by directors and Officers of the Holding Company or the Bank on original issue from the Holding Company (by subscription or otherwise) shall be subject to the restriction that such shares shall not be sold or otherwise disposed of for value for a period of one year following the date of purchase, except for any disposition of such shares following the death of the original purchaser. The shares of Common Stock issued by the Holding Company to such directors and Officers shall bear the following legend giving appropriate notice of such one-year restriction:


		“The shares of stock evidenced by this Certificate are restricted as to transfer for a period of one year from the date of this Certificate pursuant to Part 563b of the Rules and Regulations of the Office of Thrift Supervision. These shares may not be transferred during such one-year period without a legal opinion of counsel for the Company that said transfer is permissible under the provisions of applicable law and regulation. This restrictive legend shall be deemed null and void after one year from the date of this Certificate.”

In addition, the Holding Company shall give appropriate instructions to the transfer agent for the Holding Company with respect to the applicable restrictions relating to the transfer of restricted stock. Any shares issued at a later date as a stock dividend, stock split or otherwise with respect to any such restricted stock shall be subject to the same holding period restrictions as may then be applicable to such restricted stock. The foregoing restriction on transfer shall be in addition to any restrictions on transfer that may be imposed by federal and state securities laws.

20.

STOCK COMPENSATION PLANS.

(a) The Holding Company and the Bank are authorized to adopt Tax-Qualified Employee Stock Benefit Plans in connection with the Conversion, including without limitation an ESOP.

(b) Subsequent to the Conversion, the Holding Company and the Bank are authorized to adopt Non-Tax Qualified Employee Stock Benefit Plans, including without limitation, stock option plans and restricted stock plans. In addition, any such plan implemented during the one-year period subsequent to the date of consummation of the Conversion: (i) shall be disclosed in the Prospectus; (ii) in the case of stock option plans and employee recognition or grant plans, shall be submitted for approval by the holders of the Common Stock no earlier than six months following consummation of the Conversion; and (iii) shall comply with all other applicable requirements of the OTS.

(c) Existing, as well as any newly-created, Tax-Qualified Employee Stock Benefit Plans may purchase shares of Common Stock in the Offerings, to the extent permitted by the terms of such benefit plans and this Plan.

(d) The Holding Company and the Bank are authorized to enter into employment or severance agreements with their executive officers.

21.

DIVIDEND AND REPURCHASE RESTRICTIONS ON STOCK.

The Holding Company may not declare or pay a cash dividend on its Common Stock if the effect thereof would cause the regulatory capital of the Bank to be reduced below the amount required under § 567.2 of the OTS rules and regulations. Otherwise, the Holding Company may declare dividends or make other capital distributions in accordance with § 563b.520 of the Rules and Regulations of the OTS. Following completion of the Conversion, the Holding Company may repurchase its Common Stock consistent with § 563b.510 and § 563b.515 of the Rules and Regulations of the OTS relating to stock repurchases, as long as such repurchases do not cause the regulatory capital of the Bank to be reduced below the amount required under the Rules and Regulations of the OTS.

22.

AMENDMENT OR TERMINATION OF THE PLAN.

If deemed necessary or desirable by the Boards of Directors of the Holding Company and the Bank, this Plan may be substantively amended, as a result of comments from regulatory authorities or otherwise, at any time before the solicitation of proxies from Voting Members to vote on the Plan and at any time thereafter with the concurrence of the OTS.

Before the Special Meeting, this Plan may be terminated by the Boards of Directors of the Holding Company and the Bank without approval of the OTS. After the Special Meeting, the Boards of Directors of the Holding Company and the Bank may terminate this Plan only with the concurrence of the OTS.

This Plan shall terminate if the Conversion is not completed within 24 months from the date that the Plan is approved by the Voting Members at the Special Meeting.

23.

INTERPRETATION OF THE PLAN.

All interpretations of this Plan and application of its provisions to particular circumstances by a majority of each of the Board of Directors of the Holding Company and the Board of Directors of the Bank shall be final, subject to the authority of the OTS.

Exhibit 3.1

ARTICLES OF INCORPORATION

FIRST SAVINGS FINANCIAL GROUP, INC.

ARTICLE I

NAME

The name of this corporation is First Savings Financial Group, Inc.

ARTICLE II

PURPOSE

The purpose of this corporation is to transact any and all lawful business for which corporations may be incorporated under the Indiana Business Corporation Law.

ARTICLE III

CAPITAL STOCK

Section 3.01. Amount. The total number of shares of all classes of stock which this corporation shall have authority to issue is twenty one million (21,000,000), of which twenty million (20,000,000) shall be common stock, par value $0.01 per share, and one million (1,000,000) shall be serial preferred stock, par value $0.01 per share.

Section 3.02. Terms of Preferred Stock. The shares of preferred stock may be issued from time to time in one or more series. The board of directors of this corporation shall have authority to fix by resolution or resolutions the designations and the powers, preferences and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof, including, without limitation, the voting rights, the dividend rate, conversion rights, redemption price and liquidation preference, of any series of shares of preferred stock, to fix the number of shares constituting any such series, and to increase or decrease the number of shares of any such series (but not below the number of shares thereof then outstanding). In case the number of shares of any such series shall be so decreased, the shares constituting such decrease shall resume the status which they had before the adoption of the resolution or resolutions originally fixing the number of shares of such series.

Sections 3.03. Terms of Common Stock. The shares of common stock may be issued from time to time. Each share of common stock shall have the same relative rights as and be identical in all respects with all the other shares of common stock. Except as provided in Section 3.04, every holder of common stock shall have the right, at every stockholders’ meeting, to one vote for each share standing in his or her name on the books of the corporation.

Whenever there shall have been paid, or declared and set aside for payment, to the holders of the outstanding shares of any class of stock having preference over the common stock as to the payment of dividends, the full amount of dividends and of sinking fund or retirement fund or other retirement payments, if any, to which such holders are respectively entitled in

preference to the common stock, then dividends may be paid on the common stock and on any class or series of stock entitled to participate therewith as to dividends, out of any assets legally available for the payment of dividends, but only when and as declared by the board of directors.

In the event of any liquidation, dissolution or winding up of this corporation, after there shall have been paid to or set aside for the holders of any class having preferences over the common stock in the event of liquidation, dissolution or winding up the full preferential amounts to which they are respectively entitled, the holders of the common stock, and any class or series of stock entitled to participate therewith, in whole or in part, as to the distribution of assets, shall be entitled after payment or provision for payment of all debts and liabilities of this corporation, to receive the remaining assets of this corporation available for distribution, in cash or in kind.

Section 3.04 Limitation on Voting Rights.

1. Notwithstanding any other provision of these Articles of Incorporation, in no event shall any record owner of any outstanding common stock which is beneficially owned, directly or indirectly, by a person who, as of any record date for the determination of stockholders entitled to vote on any matter, beneficially owns in excess of 10% of the then-outstanding shares of common stock (the “Limit”), be entitled, or permitted to any vote in respect of the shares held in excess of the Limit, unless a majority of the Whole Board (as hereinafter defined) shall have by resolution granted in advance such entitlement or permission. The number of votes which may be cast by any record owner by virtue of the provisions hereof in respect of common stock beneficially owned by such person owning shares in excess of the Limit shall be a number equal to the total number of votes which a single record owner of all common stock owned by such person would be entitled to cast, multiplied by a fraction, the numerator of which is the number of shares of such class or series which are both beneficially owned by such person and owned of record by such record owner and the denominator of which is the total number of shares of common stock beneficially owned by such person owning shares in excess of the Limit.

2. The following definitions shall apply to this Section 3.04 of this Article III.

(a) “Affiliate” shall have the meaning ascribed to it in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as in effect on the date of filing of these Articles of Incorporation.

(b) “Beneficial ownership” shall be determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934 (or any successor rule or statutory provision), or, if said Rule 13d-3 shall be rescinded and there shall be no successor rule or provision thereto, pursuant to said Rule 13d-3 as in effect on the date of filing of these Articles of Incorporation; provided, however , that a person shall, in any event, also be deemed the “beneficial owner” of any common stock:

(i) which such person or any of its affiliates beneficially owns, directly or indirectly; or

(ii) which such person or any of its affiliates has (A) the right to acquire (whether such right is exercisable immediately or only after the passage of time), pursuant to any agreement, arrangement or understanding (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of an agreement, contract, or other arrangement with this corporation to effect any transaction which is described in any one or more of subparagraphs (1)(a) through (h) of Section 5.01 of Article V or upon the exercise of conversion rights, exchange rights, warrants, or options or otherwise, or (B) sole or shared voting or investment power with respect thereto pursuant to any agreement, arrangement, understanding, relationship or otherwise (but shall not be deemed to be the beneficial owner of any voting shares solely by reason of a revocable proxy granted for a particular meeting of stockholders, pursuant to a public solicitation of proxies for such meeting, with respect to shares of which neither such person nor any such affiliate is otherwise deemed the beneficial owner); or

(iii) which are beneficially owned, directly or indirectly, by any other person with which such first mentioned person or any of its affiliates acts as a partnership, limited partnership, syndicate or other group pursuant to any agreement, arrangement or understanding for the purpose of acquiring, holding, voting or disposing of any shares of capital stock of this corporation; and provided further, however , that (i) no director or officer of this corporation (or any Affiliate of any such director or officer) shall, solely by reason of any or all of such directors or officers acting in their capacities as such, be deemed, for any purposes hereof, to beneficially own any common stock beneficially owned by any other such director or officer (or any Affiliate thereof), and (ii) neither any employee stock ownership or similar plan of this corporation or any subsidiary of this corporation, nor any trustee with respect thereto or any Affiliate of such trustee (solely by reason of such capacity of such trustee), shall be deemed, for any purposes hereof, to beneficially own any common stock held under any such plan. For purposes of computing the percentage beneficial ownership of common stock of a person, the outstanding common stock shall include shares deemed owned by such person through application of this subsection but shall not include any other common stock which may be issuable by this corporation pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or otherwise. For all other purposes, the outstanding common stock shall include only common stock then outstanding and shall not include any common stock which may be issuable by this corporation pursuant to any agreement, or upon the exercise of conversion rights, warrants or options, or otherwise.

(d) “Whole Board” shall mean the total number of directors which this corporation would have if there were no vacancies on the board of directors.

3. The board of directors shall have the power to construe and apply the provisions of this Section 3.04 and to make all determinations necessary or desirable to implement such provisions, including but not limited to matters with respect to (i) the number of shares of common stock beneficially owned by any person, (ii) whether a person is an Affiliate of another, (iii) whether a person has an agreement, arrangement, or understanding with another as to the matters referred to in the definition of beneficial ownership, (iv) the application of any other definition or operative provision of this Section 3.04 to the given facts, or (v) any other matter relating to the applicability or effect of this Section 3.04.

4. The board of directors shall have the right to demand that any person who is reasonably believed to beneficially own common stock in excess of the Limit (or holds of record common stock beneficially owned by any person in excess of the Limit) supply this corporation with complete information as to (i) the record owner(s) of all shares beneficially owned by such person who is reasonably believed to own shares in excess of the Limit, and (ii) any other factual matter relating to the applicability or effect of this section as may reasonably be required of such person.

5. Except as otherwise provided by law or expressly provided in this Section 3.04, the presence, in person or by proxy, of the holders of record of shares of capital stock of this corporation entitling the holders thereof to cast a majority of the votes (after giving effect, if required, to the provisions of this Section 3.04) entitled to be cast by the holders of shares of capital stock of this corporation entitled to vote shall constitute a quorum at all meetings of this stockholders, and every reference in these Articles of Incorporation to a majority or other proportion of capital stock (or the holders thereof) for purposes of determining any quorum requirement or any requirement for stockholder consent or approval shall be deemed to refer to such majority or other proportion of the votes (or the holders thereof) then entitled to be cast in respect of such capital stock.

6. Any constructions, applications, or determinations made by the board of directors pursuant to this Section 3.04 in good faith and on the basis of such information and assistance as was then reasonably available for such purpose shall be conclusive and binding upon this corporation and its stockholders.

7. If any provision (or portion thereof) of this Section 3.04 shall be found to be invalid, prohibited or unenforceable for any reason, the remaining provisions (or portions thereof) of this Section 3.04 shall remain in full force and effect, and shall be construed as if such invalid, prohibited or unenforceable provision had been stricken here from or otherwise rendered inapplicable, it being the intent of this corporation and its stockholders that each such remaining provision (or portion thereof) of this Section 3.04 remain, to the fullest extent permitted by law, applicable and enforceable as to all stockholders, including stockholders owning an amount of stock over the Limit, notwithstanding any such finding.

ARTICLE IV

BOARD OF DIRECTORS

Section 4.01. General. All corporate powers shall be exercised by or under the authority of, and the business and affairs of this corporation shall be managed under the direction of, a board of directors except as may be otherwise provided by law or these Articles of Incorporation.

Section 4.02. Number and Terms. The authorized number of directors shall in no case be fewer than five (5) nor more than fifteen (15). The exact number of directors shall be fixed in or in accordance with the Bylaws.

The directors shall be divided into three classes, as nearly equal in number as reasonably possible, with the term of office of the first class to expire at the first annual meeting of the stockholders after their election, the term of office of the second class to expire at the second annual meeting of stockholders after their election, and the term of office of the third class to expire at the third annual meeting of stockholders after their election, with each director to hold office until his or her successor shall have been duly elected and qualified. At each annual meeting of stockholders following the initial classification and election, directors elected to succeed those directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election, with each director to hold office until his or her successor shall have been duly elected and qualified.

There shall be no cumulative voting by stockholders of any class or series in the election of directors of this corporation.

Section 4.03. Initial Directors. The names of the initial members of the board of directors of this corporation are as follows:

Charles E. Becht, Jr.

Cecile A. Blau

Gerald Wayne Clapp, Jr.

John P. Lawson, Jr.

Robert E. Libs

Michael F. Ludden

Larry W. Myers

Douglas A. York

Section 4.04. Newly Created Directorships and Vacancies. Any vacancies on the board of directors resulting from death, resignation, retirement, disqualification, removal from office or other cause shall be filled by the affirmative vote of a majority of directors then in office, although less than a quorum, or by the sole remaining director, or, if the directors or sole remaining director fail to so act, by the stockholders at the next election of directors. Directors so chosen shall hold office for a term expiring at the annual meeting of stockholders at which the term of the class to which they have been elected expires and until his or her successor shall have been elected and qualified. A director elected to fill a vacancy by reason of an increase in the number of directorships shall be elected by a majority vote of the directors then in office, although less than a quorum of the board of directors, to serve until the next election of the class for which such director shall have been chosen and until his or her successor shall have been elected and qualified. If the number of directors is changed, any increase or decrease shall be apportioned among the three (3) classes so as to make all classes as nearly equal in number as possible. If, consistent with the preceding requirement, the increase or decrease may be allocated to more than one (1) class, the increase or decrease may be allocated to any such class the board of directors selects in its discretion. No decrease in the number of directors constituting the board of directors shall shorten the term of any incumbent director.

Section 4.05. Removal. A director, or the entire board of directors, may be removed only for cause as determined by the affirmative vote of the holders of at least a two-thirds ( ² / 3 ) majority of the shares then entitled to vote in an election of directors, which vote may only be taken at a meeting of stockholders called expressly for that purpose. Cause for removal shall be deemed to exist only if the director whose removal is proposed has been convicted of a felony by a court of competent jurisdiction or has been adjudged by a court of competent jurisdiction to be liable for gross negligence or gross misconduct in the performance of such director’s duty to this corporation, in a matter of substantial importance to this corporation and such conviction or adjudication is no longer subject to direct appeal.

Section 4.06. Special Stockholder Meetings. Special meetings of the stockholders of this corporation may only be called by the chairman of the board of directors or by the board of directors pursuant to a resolution adopted by a majority of the total number of directors which this corporation would have if there were no vacancies on the board of directors.

ARTICLE V

APPROVAL OF CERTAIN BUSINESS COMBINATIONS

The stockholder vote required to approve a Business Combination (as hereinafter defined) shall be as set forth in this Article V.

Section 5.01. Transactions with Related Persons.

1. Except as otherwise expressly provided in this Article V, the affirmative vote of the holders of (i) at least 80% of the outstanding shares entitled to vote thereon (and, if any class or series of shares is entitled to vote thereon separately, the affirmative vote of the holders of at least 80% of the outstanding shares of each such class or series), and (ii) at least a majority of the outstanding shares entitled to vote thereon, not including shares deemed beneficially owned by a Related Person (as hereinafter defined), shall be required in order to authorize any of the following:

(a) any merger or consolidation of this corporation with or into a Related Person (as hereinafter defined);

(b) any sale, lease, exchange, transfer or other disposition, including without limitation, a mortgage, or any other security device, of all or any Substantial Part (as hereinafter defined) of the assets of this corporation (including without limitation any voting securities of a subsidiary) or of a subsidiary, to a Related Person;

(d) any sale, lease, exchange, transfer or other disposition of all or any Substantial Part of the assets of a Related Person to this corporation or a subsidiary of this corporation;

(e) the issuance of any securities of this corporation or a subsidiary of this corporation to a Related Person;

(f) the acquisition by this corporation or a subsidiary of this corporation of any securities of a Related Person;

(g) any reclassification of the common stock of this corporation, or any recapitalization involving the common stock of this corporation; and

(h) any agreement, contract or other arrangement providing for any of the transactions described in this Article V.

2. Such affirmative vote shall be required notwithstanding any other provision of these Articles of Incorporation, any provision of law, or any agreement with any regulatory agency or national securities exchange which might otherwise permit a lesser vote or no vote.

3. “Business Combination”, as used in this Article V, shall mean any transaction which is referred to in any one or more of subparagraphs (1)(a) through (h) above.

Section 5.02. Exception for Prior Approved Transactions. The provisions of Section 5.01 shall not be applicable to any particular Business Combination, and such Business Combination shall require only such affirmative vote as is required by any other provision of these Articles of Incorporation, any provision of law, or any agreement with any regulatory agency or national securities exchange, if such Business Combination shall have been approved by a two-thirds ( ² / 3 ) vote of the Continuing Directors (as hereinafter defined); provided, however, that such approval shall be effective only if obtained at a meeting at which a Continuing Director Quorum (as hereinafter defined) is present.

Section 5.03. Definitions. For the purposes of this Article V the following definitions apply:

1. “Related Person” shall mean and include (a) any individual, corporation, partnership or other person or entity which together with its “affiliates” (as that term is defined in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended), “beneficially owns” (as that term is defined in Rule 13d-3 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended) in the aggregate 10% or more of the outstanding shares of the common stock of this corporation; and (b) any “affiliate” (as that term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended) of any such individual, corporation, partnership or other person or entity. Without limitation, any shares of the common stock of this corporation which any Related Person has the right to acquire pursuant to any agreement, or upon exercise or conversion rights, warrants or options, or otherwise, shall be deemed “beneficially owned” by such Related Person.

2. “Substantial Part” shall mean more than 25% of the total assets of this corporation, as of the end of its most recent fiscal year ending prior to the time the determination is made.

3. “Continuing Director” shall mean any member of the board of directors of this corporation who is unaffiliated with the Related Person and was a member of the board of directors before the Related Person became a Related Person, and any successor of a Continuing Director who is unaffiliated with the Related Person and is recommended to succeed a Continuing Director by a majority of Continuing Directors then in office.

4. “Continuing Director Quorum” shall mean two-thirds (2/3) of the Continuing Directors capable of exercising the powers conferred on them.

ARTICLE VI

EVALUATION OF BUSINESS COMBINATIONS

In addition to any other considerations which the board of directors may lawfully take into account in determining whether to take or to refrain from taking any corporate action on any matter, including making or declining to make any recommendation to the stockholders of this corporation, the board of directors may in its discretion consider both the short-term and long-term best interests of this corporation (including the possibility that these interests may be best served by the continued independence of this corporation), taking into account, and weighing as the directors deem appropriate, the social and economic effects of such action on present and future employees, suppliers, customers of this corporation and its subsidiaries (including account holders and borrowers of any of this corporation’s subsidiaries), the effect upon communities in which offices or other facilities of this corporation are located, and any other factors the directors consider pertinent.

ARTICLE VII

INDEMNIFICATION

she either had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not meet the prescribed standard of conduct.

enterprise of which such person is or was serving at the request of this corporation as a director, officer, partner, trustee, employee or agent. The provisions of this Section 7.03 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standards of conduct set forth in Section 7.01 of this Article VII.

For purposes of this Article VII, “party” includes any individual who is or was a plaintiff, defendant or respondent in any action, suit or proceeding.

ARTICLE VIII

INITIAL REGISTERED OFFICE AND AGENT

The address of this corporation’s initial registered office in the State of Indiana is 501 East Lewis & Clark Parkway, Clarksville, Indiana 47129. The name of its initial registered agent at such address is Larry W. Myers.

ARTICLE IX

CONDUCT OF AFFAIRS OF CORPORATION

Section 9.01. Control Share Acquisitions Chapter of the Indiana Business Corporations Law. The provisions of the Control Share Acquisitions Chapter of the Indiana Business Corporations Law, codified at Indiana Code §23-1-42, as amended from time to time, shall not apply to Control Share Acquisitions of shares of this corporation.

Section 9.02. Business Combinations Chapter of the Indiana Business Corporations Law. This corporation elects not to be subject to or be governed by the provisions of the Business Combinations Chapter of the Indiana Business Corporations Law, codified at Indiana Code §23-1-43, as amended from time to time.

ARTICLE X

AMENDMENT AND REPEAL OF ARTICLES OF INCORPORATION

This corporation reserves the right to amend, alter, change or repeal any provision contained in these Articles of Incorporation in the manner now or hereafter prescribed by statute. Notwithstanding the foregoing, (i) the approval of at least a two-thirds (2/3) majority of the directors then in office (or such greater proportion of directors and stockholders as may otherwise be required pursuant to any specific provision of these Articles of Incorporation) shall be required to amend, alter, repeal or change any provision of these Articles of Incorporation and (ii) the provisions set forth in Section 3.04 of Article III, Sections 4.02, 4.05 and 4.06 of Article IV, and in Articles V, VI, VII, IX and this Article X may not be repealed, altered, amended or rescinded in any respect unless the same is approved by the affirmative vote of the holders of not less than two-thirds (2/3) of the outstanding shares of capital stock of the corporation entitled to vote generally in the election of directors (considered for this purpose as a single class) cast at a meeting of the stockholders called for that purpose (provided that notice of such proposed adoption, repeal, alteration, amendment or rescission is included in the notice of such meeting).

ARTICLE XI

AMENDMENT AND REPEAL OF BYLAWS

This corporation’s Bylaws may be adopted, amended or repealed by a resolution adopted by a two-thirds (2/3) majority of the directors then in office.

ARTICLE XII

INCORPORATOR

The name and address of the incorporator of this corporation is as follows:

Larry W. Myers

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

IN WITNESS WHEREOF, the undersigned, being the incorporator named above, executes these Articles of Incorporation and affirms under penalties of perjury that the statements contained herein are true, this 23 ^rd day of May, 2008.

/s/ Larry W. Myers

Larry W. Myers, Incorporator

Exhibit 3.2

BYLAWS

FIRST SAVINGS FINANCIAL GROUP, INC.

ARTICLE I

OFFICES

Section 1. Principal Office. First Savings Financial Group, Inc. (hereinafter referred to as the “Corporation”) shall at all times maintain a principal office in the State of Indiana, which, except as otherwise determined by the Board of Directors of the Corporation (hereinafter referred to as the “Board”), shall be in the City of Clarksville, County of Clark.

Section 2. Other Offices. The Corporation may also have offices at such other places within or without the State of Indiana as the Board shall from time to time designate or the business of the Corporation shall require.

ARTICLE II

STOCKHOLDERS

Section 1. Place of Meetings. All annual and special meetings of stockholders shall be held at such places within or without the State of Indiana as may from time to time be designated by the Board and specified in the notice of meeting.

Section 2. Annual Meeting. A meeting of the stockholders of the Corporation for the election of directors and for the transaction of any other business of the Corporation shall be held annually at such date and time as the Board may determine and specify in the notice of the meeting.

Section 3. Special Meetings. A special meeting of the stockholders may only be called by those persons authorized to do so in the Corporation’s Articles of Incorporation. Business transacted at any special meeting of the stockholders shall be confined to the purpose or purposes stated in the notice of such meeting.

Section 4. Conduct of Meetings. Annual and special meetings of the stockholders shall be conducted in accordance with Indiana law unless otherwise prescribed by these Bylaws. The Chairman, or in the absence of the Chairman, the highest ranking officer of the Corporation who is present, or such other person as the Board shall have designated, shall call to order any meeting of the stockholders and act as chairman of the meeting. The Secretary of the Corporation, if present at the meeting, shall be the secretary of the meeting. In the absence of the Secretary of the Corporation, the secretary of the meeting shall be such person as the chairman of the meeting shall appoint. The chairman of any meeting of the stockholders, unless otherwise prescribed by law or regulation or unless the Chairman has otherwise determined, shall determine the order of business and the procedure at the meeting.

Section 5. Notice of Meetings. Written notice stating the date, time and place of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting of the stockholders is called shall be delivered no fewer than ten (10) nor more than sixty (60) days before the date of the meeting, either personally or by mail, by or at the direction of the Chairman, the Secretary or the directors requesting the meeting to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed given when deposited in the United States mail, postage prepaid, addressed to the stockholder at his address as it appears on the stock transfer books or records of the Corporation as of the record date prescribed in Section 6 of this Article II. When any meeting of the stockholders, either annual or special, is adjourned for more than thirty (30) days or if, after adjournment, a new record date is fixed for the adjourned meeting, notice of the adjourned meeting shall be given as in the case of an original meeting. It shall not be necessary to give any notice of the date, time and place of any other adjourned meeting of the stockholders, other than an announcement at the meeting at which such adjournment is taken.

Section 6. Fixing of Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of the stockholders or any adjournment thereof, or stockholders entitled to receive payment of any dividend, or in order to make a determination of stockholders for any other proper purpose under Indiana law, the Board may fix, in advance, a date as the record date for any such determination of stockholders. Such date shall not be more than the seventy (70) days before the meeting or action requiring a determination of stockholders.

Section 7. Voting Lists. The Secretary of the Corporation, or other officer or agent of the Corporation having charge of the stock transfer books for shares of the capital stock of the Corporation, shall prepare and make, at least five (5) business days before each meeting of the stockholders, a complete list of the stockholders entitled to vote at such meeting, or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each stockholder. Such list shall be open to the examination of any stockholder entitled to vote at the meeting, for any purpose germane to the meeting, during ordinary business hours, for a period of at least five (5) business days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or at the Corporation’s principal office. Such list shall also be produced and kept open at the time and place of the meeting during the whole time thereof and shall be subject to the inspection of any stockholder present at the meeting. The stock transfer books shall be the only evidence as to who are the stockholders entitled to examine the stock transfer books, or to vote in person or by proxy at any meeting of stockholders.

Section 8. Quorum. A majority of the outstanding shares of the Corporation entitled to vote at a meeting of the stockholders, represented in person or by proxy, shall constitute a quorum at a meeting. If less than a majority of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time

without further notice except as otherwise provided in Section 5 of this Article II. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted at the meeting as originally called. The stockholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

Section 9. Proxies. At any meeting of the stockholders, every stockholder having the right to vote shall be entitled to vote in person, or by proxy appointed by an instrument in writing and complying with the requirements of Indiana law.

Section 10. Voting by the Corporation. Neither treasury shares of its own capital stock held by the Corporation, nor shares held by another corporation, if a majority of the shares entitled to vote for the election of directors of such other corporation are held by the Corporation, shall be entitled to vote or be counted for quorum purposes at any meeting of the stockholders; provided, however, that the Corporation may vote shares of its capital stock held by it, or by any such other corporation, if such shares of capital stock are held by the Corporation or such other corporation in a fiduciary capacity.

Section 11. Inspectors of Election. The Board shall, in advance of any meeting of stockholders, appoint one or three persons as inspectors of election, to act at the meeting or any adjournment thereof and make a written report thereof.

Section 12. Notice for Nominations and Proposals

A. Nominations for the election of directors and proposals for any new business to be taken up at any annual or special meeting of stockholders may be made by the Board of Directors of the Corporation or by any stockholder of the Corporation entitled to vote generally in the election of directors. In order for a stockholder of the Corporation to make any such nominations and/or proposals, he or she shall give notice thereof in writing, delivered or mailed by first class United States mail, postage prepaid, to the Secretary of the Corporation not less than sixty (60) days nor more than ninety (90) days prior to any such meeting; provided, however, that if less than seventy-one (71) days’ notice or prior public disclosure of the date of the meeting is given to stockholders, such written notice shall be delivered or mailed, as prescribed, to the Secretary of the Corporation not later than the close of the tenth day following the day on which notice of the meeting was mailed to stockholders or such public disclosure was made. Each such notice given by a stockholder with respect to nominations for election of directors shall set forth (i) the name, age, business address and, if known, residence address of each nominee proposed in such notice, (ii) the principal occupation or employment of each such nominees, (iii) the number of shares of stock of the Corporation which are beneficially owned by each such nominee, (iv) such other information as would be required to be included in a proxy statement soliciting proxies for the election of the proposed nominee pursuant to Regulation 14A of the Securities Exchange Act of 1934, as amended, including, without limitation, such person’s written consent to being named in the proxy statement as a nominee and to serving as a director, if elected, and (v) as to the stockholder giving such notice (a) his name and address as they appear on the Corporation’s books and (b) the ownership interests such stockholder has in the

Corporation, including the class and number of shares of the Corporation which are beneficially owned by such stockholder, and any hedges, economic incentives or other ownership positions in the Corporation’s securities. In addition, the stockholder making such nomination shall promptly provide any other information reasonably requested by the Corporation.

B. Each such notice given by a stockholder to the Secretary with respect to business proposals to bring before a meeting shall set forth in writing as to each matter: (i) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting; (ii) the name and address, as they appear on the Corporation’s books, of the stockholder proposing such business; (iii) the ownership interests such stockholder has in the Corporation, including the class and number of shares of the Corporation which are beneficially owned by such stockholder, and any hedges, economic incentives or other ownership positions in the Corporation’s securities; and (iv) any material interest of the stockholder in such business. Notwithstanding anything in this Certificate to the contrary, no business shall be conducted at the meeting except in accordance with the procedures set forth in this Article.

C. The Chairman of the annual or special meeting of stockholders may, if the facts warrant, determine and declare to the meeting that a nomination or proposal was not made in accordance with the foregoing procedure, and, if the Chairman should so determine, the Chairman shall so declare to the meeting and the defective nomination or proposal shall be disregarded and laid over for action at the next succeeding adjourned, special or annual meeting of the stockholders taking place thirty days or more thereafter. This provision shall not require the holding of any adjourned or special meeting of stockholders for the purpose of considering such defective nomination or proposal.

D. The various requirements set forth in this Section 12 shall apply to all stockholder nominations and proposals, without regard to whether such nominations or proposals are required to be included in the Corporation’s proxy statement or form of proxy.

ARTICLE III

BOARD OF DIRECTORS

Section 1. General Powers. All corporate powers shall be exercised by or under the authority of, and the business and affairs of the Corporation shall be managed under the direction of, the Board except as may be otherwise provided by law or the Articles of Incorporation. The Board shall elect from among its members a Chairman, and may elect one (1) or more Vice Chairmen of the Board. The Chairman, or in his absence the Vice Chairman, shall preside at all meetings of the Board.

Section 2. Number. The number of directors of the Corporation shall be fixed from time to time exclusively by the Board by resolution adopted by a majority of the total number of the Corporation’s directors.

Section 3. Regular Meetings. A regular meeting of the Board shall be held without other notice than this Bylaw immediately after, and at the same place as, the annual meeting of the stockholders or at such other place as may be designated by the Board. Additional meetings shall be held at such time as the Board shall fix at such places within or without the State of Indiana as shall be fixed by the Board. No call shall be required for regular meetings for which the time and place has been fixed.

Section 4. Special Meetings. Special meetings of the Board may be called by or at the request of the Chairman or the Vice Chairman, or in the absence or disability of both of them, a majority of the remaining directors. The persons authorized to call special meetings of the Board may fix any place as the place for holding any special meeting of the Board called by such persons.

Section 5. Participation In Meetings. Members of the Board may participate in regular or special meetings by means of conference telephone or similar communications equipment by which all persons participating in the meeting can communicate with each other. A director participating in a meeting by this means is deemed to be present in person at the meeting.

Section 6. Notice. The persons authorized to call special meetings of the Board shall cause the Secretary of the Corporation to give written or oral notice of the meeting, specifying the time and place of the meeting, to each director, either personally, by mailing, or by telegram, at least two (2) days in advance of the meeting. Any director may waive notice of any meeting by a writing filed with the Secretary. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except in the event a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any meeting of the Board need be specified in the notice or waiver of notice of such meeting.

Section 7. Quorum. A majority of the number of directors fixed pursuant to Section 2 of this Article III shall constitute a quorum for the transaction of business at any meeting of the Board, but if less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time. Notice of any adjourned meeting shall be given in the same manner as prescribed by Section 6 of this Article III.

Section 8. Manner of Acting. Unless otherwise prescribed in the Articles of Incorporation or these Bylaws, the act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board.

Section 9. Action Without a Meeting. Any action required or permitted to be taken by the Board at a meeting may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the directors.

Section 10. Resignation. Any director may resign at any time by sending a written notice of such resignation to the Corporation addressed to the Chairman or the Vice Chairman. Unless otherwise specified therein, such resignation shall take effect upon receipt thereof.

Section 11. Vacancies. Any vacancy occurring in the Board may be filled in accordance with the Articles of Incorporation.

Section 12. Compensation. Directors, as such, may receive pursuant to resolution of the Board, fixed fees and other compensation for their services as directors, including their services as members of committees of the Board.

Section 13. Qualification.

A. No person seventy (70) years of age or older shall be eligible for election, reelection, appointment or reappointment to the Board of Directors but a person that attains seventy (70) years of age while serving as a director may continue to serve until the expiration of his or her term. Following the expiration of the term during which a person serving as a director attains seventy (70) years of age, such person shall be eligible for election, reelection, appointment or reappointment as a director in the sole discretion of the nominating committee of the Board of Directors for no more than one (1) additional term but in no event shall such person serve as a director beyond the annual meeting of the Bank immediately following such person becoming seventy-five (75) years of age. The provisions of this Section 13(A) do not apply to an advisory or honorary director.

B. A person is not qualified to serve as director or nominate anyone to serve as a director of the Corporation if he or she: (1) is under indictment for, or has ever been convicted of, a criminal offense involving dishonesty or breach of trust and the penalty for such offense could be imprisonment for more than one year, or (2) is a person who a banking agency has issued a cease and desist order for conduct involving dishonesty or breach of trust and that order is final and not subject to appeal, or (3) has been found either by a regulatory agency whose decision is final and not subject to appeal or by a court to have (i) breached a fiduciary duty involving personal profit or (ii) committed a willful violation of any law, rule or regulation governing banking, securities, commodities or insurance, or any final cease and desist order issued by a banking, securities, commodities or insurance regulatory agency.

ARTICLE IV

EXECUTIVE AND OTHER COMMITTEES

Section 1. Appointment. The Board, by resolution adopted by a majority of the Board, may designate the Chairman, the President and one (1) or more of the other directors to constitute an Executive Committee. The designation of any committee pursuant to this Article IV and the delegation of authority thereto shall not operate to relieve the Board, or any director, of any responsibility imposed by law or regulation.

Section 2. Authority. The Executive Committee, when the Board is not in session, shall have and may exercise all of the authority of the Board except to the extent, if any, that such authority shall be limited by the resolution appointing the Executive Committee, or as otherwise expressly provided by law, the Articles of Incorporation or these Bylaws.

Section 3. Tenure. Subject to the provisions of Section 8 of this Article IV, each member of the Executive Committee shall hold office until the next regular annual meeting of the Board following his designation and until a successor is designated as a member of the Executive Committee.

Section 4. Meetings. Regular meetings of the Executive Committee may be held without notice at such times and places as the Executive Committee may fix from time to time. Special meetings of the Executive Committee may be called by the Chairman or the President, or in the absence or disability of both of them, by a majority of the remaining members of the Executive Committee upon not less than one (1) day’s notice stating the place, date and hour of the meeting, which notice may be written or oral. Any member of the Executive Committee may waive notice of any meeting and no notice of any meeting need be given to any member thereof who attends in person. The notice of a meeting of the Executive Committee need not state the business proposed to be transacted at the meetings.

Regular or special meetings may be held by means of conference telephone or similar communications equipment by which all persons participating in the meeting can communicate with each other.

Section 5. Quorum. A majority of the members of the Executive Committee shall constitute a quorum for the transaction of business at any meeting thereof, and action of the Executive Committee must be authorized by the affirmative vote of a majority of the members present as a meeting at which a quorum is present.

Section 6. Action Without a Meeting. Any action required or permitted to be taken by the Executive Committee at a meeting may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the members of the Executive Committee.

Section 7. Vacancies. Any vacancy in the Executive Committee may be filled by a resolution adopted by a majority of the Board.

Section 8. Resignations and Removal. Any member of the Executive Committee may be removed at any time with or without cause by resolution adopted by a majority of the Board. Any member of the Executive Committee may resign from the Executive Committee at any time by giving written notice to the Chairman or the President. Unless otherwise specified thereon, such resignation shall take effect upon receipt. The acceptance of such resignation shall not be necessary to make it effective.

Section 9. Procedure. The Chairman shall be presiding officer of the Executive Committee, or, in his absence or disability, the President, or in the absence or disability of both of them, such other persons as may be elected by a majority of the members present. The

Executive Committee may fix its own rules of procedure which shall not be inconsistent with these bylaws. It shall keep regular minutes of its proceedings and report the same to the Board for its information at the meeting thereof held next after the proceedings shall have been taken.

Section 10. Other Committees. The Board may by resolution establish an audit committee or other committees composed of directors as they may determine to be necessary or appropriate for the conduct of the business of the Corporation and may prescribe the duties, constitution and procedures thereof.

ARTICLE V

OFFICERS

Section 1. Positions. The officers of the Corporation shall consist of a President, one (1) or more Vice Presidents, a Secretary and a Treasurer, each of whom shall be elected by the Board. The same individual may simultaneously hold more than one office in the corporation. The Board may designate one (1) or more Vice Presidents as Executive Vice President or Senior Vice President. The Board may also elect or authorize the appointment of such other officers as the business of the Corporation may require. The officers shall have such authority and perform such duties as the Board may from time to time authorize or determine. In the absence of action by the Board, the officers shall have such powers and duties as generally pertain to their respective offices.

Section 2. Election and Term of Office. The officers of the Corporation shall be elected annually at the first meeting of the Board held after each annual meeting of the stockholders. If the election of officers is not held at such meeting, such election shall be held as soon thereafter as possible. Each officer shall hold office until his successor shall have been duly elected and qualified or until his death, resignation or removal in the manner hereinafter provided. Election or appointment of an officer, employee or agent shall not by itself create any contractual rights. The Board may authorize the Corporation to enter into an employment contract with any officer, but no contract shall impair the right of the Board to remove any officer at any time in accordance with Section 8 of this Article V.

Section 3. President. The President shall have the authority and the duty to manage the affairs of the Corporation and shall have such other powers and perform such other duties as are delegated to him by the Board of Directors or as are incidental to his office. The President shall be a director.

Section 4. Vice President. The Vice President or Vice Presidents, if any, shall perform the duties of the President in his absence or during his disability to act. In addition, the Vice Presidents shall perform the duties and exercise the powers usually incident to their respective offices and/or such other duties and powers as may be properly assigned to them from time to time by the Board of Directors or the President.

Section 5. Secretary. The Secretary shall have custody of the minutes and records of the Corporation. He shall keep the minutes of all meetings of the stockholders and of the Board of Directors, shall give such notice as may be required for all such meetings and shall have such other powers and perform such other duties as are delegated to him by the Board of Directors or the President or as are incidental to his office.

Section 6. Treasurer. The Treasurer shall keep correct and complete books of account in accordance with the accounting methods adopted by the Board of Directors, showing the financial condition of the Corporation and the results of its operations. He shall have custody of all monies, securities, and other certificates evidencing intangible personal property belonging to the Corporation. He shall upon request furnish statements of the current financial condition and the current results of operations of the Corporation and he shall have such other powers and perform such other duties as are delegated to him by the Board of Directors or the President or as are incidental to his office.

Section 7. Other Offices. All other officers shall have such powers and perform such duties as are delegated to them by the Board of Directors or the President.

Section 8. Removal. Any officer may be removed by the Board whenever in its judgment the best interests of the Corporation will be served thereby.

Section 9. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by a majority vote of the Board for the unexpired portion of the term.

Section 10. Remuneration. The remuneration of the officers shall be fixed from time to time by the Board.

ARTICLE VI

CONTRACTS, LOANS, CHECKS AND DEPOSITS

Section 1. Contracts. To the extent permitted by applicable law, the Articles of Incorporation or these Bylaws, the Board may authorize any officer, employee or agent of the Corporation to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation. Such authority may be general or confined to specific instances.

Section 2. Loans. No loans shall be contracted on behalf of the Corporation and no evidence of indebtedness shall be issued in its name unless authorized by the Board. Such authority may be general or confined to specific instances.

Section 3. Checks, Drafts, Etc. All checks, drafts or other orders for the payment of money, notes or other evidences of indebtedness issued in the name of the Corporation shall be signed by one (1) or more officers, employees or agents of the Corporation in such manner as shall from time to time be determined by the Board.

Section 4. Deposits. All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in any duly authorized depositories as the Board may select.

ARTICLE VII

CERTIFICATES FOR SHARES AND THEIR TRANSFER

Section 1. Certificates for Shares. Certificates representing shares of capital stock of the Corporation shall be in such form as shall be determined by the Board. Such certificates shall be signed by the President or any other officer of the Corporation authorized by the Board, attested by the Secretary or an Assistant Secretary, and sealed with the corporate seal or a facsimile thereof. The signatures of such officers upon a certificate may be facsimiles if the certificate is manually signed on behalf of a transfer agent or a registrar other than the Corporation itself or one of its employees. Each certificate for shares of capital stock shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares are issued, with the number of shares issued and date of issue, shall be entered on the stock transfer books of the Corporation.

Notwithstanding the foregoing, the Board may provide by resolution that some or all of any or all classes or series of the Corporation’s common stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation.

In the event that any shares of the Corporation’s capital stock are issued without a certificate, within a reasonable time after the issue or transfer of shares without certificates, the Corporation shall send the shareholder a written statement that includes the following:

(a) the name of the issuing corporation and that it is organized under the laws of Indiana;

(b) the name of the person to whom the shares were issued;

(d) if the issuing corporation is authorized to issue different classes of shares or different series within a class, the designations, relative rights, preferences and limitations applicable to each class and the variations in rights, preferences and limitations determined for each series (and the authority of the Board of Directors to determine variations for future series).

In the case of certificated shares, all certificates surrendered to the Corporation for transfer shall be cancelled and no new certificate or evidence of the issuance of uncertificated shares shall be issued until the former certificate for a like number of shares has been surrendered and cancelled. In the case of uncertificated shares, proper transfer instructions for

the number of shares involved shall be received before a new certificate or evidence of the issuance of uncertificated shares is issued therefor. In the case of a lost or destroyed certificate, a new certificate or uncertificated shares may be issued upon such terms and indemnity to the Corporation as the Board may prescribe.

Section 2. Transfer of Shares. Transfer of shares of capital stock of the Corporation shall be made only on its stock transfer books. Authority for such transfer shall be given only by the holder of record thereof or by his legal representative, who shall furnish proper evidence of such authority, or by his attorney thereunto duly authorized by power of attorney duly executed and filed with the Corporation. Such transfer shall be made only, in the case of certificated shares, on surrender for cancellation of the certificate for such shares or, in the case of uncertificated shares, on delivery of proper transfer instructions for the number of shares involved. The person in whose name shares of capital stock stand on the books of the Corporation shall be deemed by the Corporation to be the owner thereof for all purposes.

ARTICLE VIII

DIVIDENDS

Subject to applicable law, the Articles of Incorporation or these Bylaws, the Board may, from time to time, declare, and the Corporation may pay, dividends on the outstanding shares of capital stock of the Corporation.

ARTICLE IX

SECURITIES OF OTHER CORPORATIONS

Unless otherwise ordered by the Board, the President shall have full power and authority on behalf of the Corporation to purchase, sell, transfer, encumber or vote any and all securities of any other corporation owned by the Corporation, and may execute and deliver such documents as may be necessary to effectuate such purchase, sale, transfer, encumbrance or vote. The Board may, from time to time, confer like powers upon any other person or persons.

ARTICLE X

FISCAL YEAR, ANNUAL AUDIT

The fiscal year of the Corporation shall end on the 30 ^th day of September of each year. The Corporation shall be subject to an annual audit as of the end of its fiscal year by independent public accountants appointed by and responsible to the Board.

ARTICLE XI

CORPORATE SEAL

The corporate seal of the Corporation, if any, shall be in such form as the Board shall prescribe.

ARTICLE XII

AMENDMENTS

These Bylaws may be adopted, amended or repealed by a resolution adopted by a two-thirds ( ² / 3 ) majority of the directors then in office.

Exhibit 4.1


COMMON STOCK				COMMON STOCK
PAR VALUE $0.01				SEE REVERSE FOR CERTAIN DEFINITIONS
				CUSIP

FIRST SAVINGS FINANCIAL GROUP, INC.

INCORPORATED UNDER THE LAWS OF THE STATE OF INDIANA

THIS CERTIFIES THAT

S P E C I M E N

is the owner of:

FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK, $0.01 PAR VALUE PER SHARE, OF

FIRST SAVINGS FINANCIAL GROUP, INC.

The shares represented by this certificate are transferable only on the stock transfer books of the Corporation by the holder of record hereof, or by his duly authorized attorney or legal representative, upon the surrender of this certificate properly endorsed. This certificate and the shares represented hereby are issued and shall be held subject to all the provisions of the Articles of Incorporation of the Corporation and any amendments thereto (copies of which are on file with the Transfer Agent and registrar), to all of which provisions the holder by acceptance hereof, assents.

This certificate is not valid unless countersigned and registered by the Transfer Agent and Registrar. The shares represented by this certificate are not insured by the Federal Deposit Insurance Corporation or any other government agency.

IN WITNESS THEREOF, First Savings Financial Group, Inc. has caused this certificate to be executed by the facsimile signatures of its duly authorized officers and has caused a facsimile of its corporate seal to be hereunto affixed.


Dated:		[SEAL]
	President and Chief Executive Officer		Corporate Secretary

First Savings Financial Group, Inc.

The shares represented by this certificate are subject to a limitation contained in the Articles of Incorporation to the effect that in no event shall any record owner of any outstanding common stock which is beneficially owned, directly or indirectly, by a person who beneficially owns in excess of 10% of the outstanding shares of common stock (the “Limit”) be entitled or permitted to any vote in respect of shares held in excess of the Limit.

The Board of Directors of the Corporation is authorized by resolution(s), from time to time adopted, to provide for the issuance of serial preferred stock in series and to fix and state the voting powers, designations, preferences and relative, participating, optional, or other special rights of the shares of each such series and the qualifications, limitations and restrictions thereof. The Corporation will furnish to any shareholder upon request and without charge a full description of each class of stock and any series thereof.

The shares represented by this certificate may not be cumulatively voted on any matter. Pursuant to the Articles of Incorporation, the affirmative vote of the holders of at least 80% of the voting stock of the Corporation, voting together as a single class, shall be required to approve certain business combinations and other transactions and to amend certain provisions of the Articles of Incorporation.

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations:


TEN COM -	as tenants in common	UNIF GIFTS MIN ACT -	custodian
			(Cust)	(Minor)

TEN ENT -	as tenants by the entireties	under Uniform Gifts to Minors Act
			________________
				(State)
JT TEN -	as joint tenants with right of survivorship and not as tenants in common	UNIF TRF MIN ACT -	custodian (until age )
			under Uniform Transfers
			to Minors Act
		(State)

Additional abbreviations may also be used though not in the above list.

For value received, hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY OR OTHER

IDENTIFICATION NUMBER OF ASSIGNEE



Please print or typewrite name and address including postal zip code of assignee

shares of the common stock represented by the within certificate, and do hereby irrevocably constitute and appoint Attorney to transfer the said stock on the books of the within-named Corporation with full power of substitution in the premises.


DATED
				NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.


SIGNATURE GUARANTEED:
				THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15

Exhibit 5.1

[Kilpatrick Stockton LLP Letterhead]

, 2008

Board of Directors

First Savings Financial Group, Inc.

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

Re: Registration Statement on Form S-1

Dear Board of Directors:

We have acted as special counsel for First Savings Financial Group, Inc., an Indiana corporation (the “Company”), in connection with the Registration Statement on Form S-1 (the “Registration Statement”) initially filed by the Company on , 2008 with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the “Act”), and the regulations promulgated thereunder.

The Registration Statement relates to the proposed issuance by the Company of (i) up to 4,086,525 shares of common stock, $0.01 par value per share, of the Company (the “Common Stock”) in a subscription offering, a community offering and a syndicated community offering (the “Offerings”) pursuant to a Plan of Conversion adopted by the Board of Directors of First Savings Bank, F.S.B. (the “Bank”) and (ii) 110,000 shares of Common Stock to First Savings Charitable Foundation, a private foundation.

In the preparation of this opinion, we have examined originals or copies identified to our satisfaction of: (i) the Company’s articles of incorporation; (ii) the Company’s bylaws; (iii) the Registration Statement, including the prospectus contained therein and the exhibits thereto; (iv) certain resolutions of the Board of Directors of the Company relating to the issuance of the Common Stock being registered under the Registration Statement; (v) the Plan of Conversion; (vi) the trust agreement for the Bank’s employee stock ownership plan (the “ESOP”) and the form of loan agreement between the Company and the ESOP; and (vii) the form of stock certificate approved by the Board of Directors of the Company to represent shares of the Common Stock. We have also examined originals or copies of such documents, corporate records, certificates of public officials and other instruments, and have conducted such other investigations of law and fact, as we have deemed necessary or advisable for purposes of our opinion.

In our examination, we have relied on the genuineness of all signatures, the authenticity of all documents and instruments submitted to us as originals, and the conformity to the originals of all documents and instruments submitted to us as certified or conformed copies. In addition, we have relied on the accuracy and completeness of all records, documents, instruments and materials made available to us by the Company.

Our opinion is limited to the matters set forth herein, and we express no opinion other than as expressly set forth herein. In rendering the opinions set forth below, we do not express any opinion concerning law other than the laws of the State of Indiana.

For purposes of this opinion, we have assumed that, prior to the issuance of any shares of Common Stock, (i) the Registration Statement, as finally amended, will have become effective under the Act and (ii) the conversion of the Bank will have become effective.

Based upon and subject to the foregoing, it is our opinion that, upon the due adoption by the Board of Directors of the Company (or authorized committee thereof) of a resolution fixing the number of shares of Common Stock to be sold in the Offerings, such shares, when issued and sold in the manner described in the Registration Statement, will be validly issued, fully paid and nonassessable.

We consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our firm under the heading “Legal and Tax Opinions” in the prospectus which is part of the Registration Statement, as such may be amended or supplemented, or incorporated by reference in any Registration Statement covering additional shares of Common Stock to be issued or sold under the Plan of Conversion that is filed pursuant to Rule 462(b) under the Act. In giving such consent, we do not hereby admit that we are experts or are otherwise within the category of persons whose consent is required under Section 7 of the Act or the rules or regulations of the Securities and Exchange Commission thereunder.


Very truly yours,

KILPATRICK STOCKTON LLP

By:
		Victor L. Cangelosi, a Partner

Exhibit 8.1

[Kilpatrick Stockton LLP Letterhead]

, 2008

Board of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

Re:

Federal Income Tax Opinion Relating to the Conversion of First Savings Bank, F.S.B.

from a Federally-Chartered Mutual Savings Bank to a Federally-Chartered Stock Savings Bank

Gentlemen:

You have asked for our opinion regarding the material federal income tax consequences of the proposed conversion of First Savings Bank, F.S.B. (“First Savings Bank”) from a federally-chartered mutual savings bank to a federally-chartered stock savings bank (the “Converted Bank”) and the acquisition of the Converted Bank’s capital stock by First Savings Financial Group, Inc., an Indiana corporation (“First Savings Financial Group”), pursuant to a plan of conversion initially adopted by the Board of Directors of First Savings Bank on April 30, 2008 (the “Plan of Conversion”). All capitalized terms used but not defined herein shall have the meanings assigned to them in the Plan of Conversion.

In connection with the opinions expressed below, we have examined and relied upon originals, or copies certified or otherwise identified to our satisfaction, of the Plan of Conversion and of such corporate records of the parties to the conversion as we have deemed appropriate. We have also relied upon, without independent verification, the representations of First Savings Bank and First Savings Financial Group contained in their letter to us dated , 2008. We have assumed that such representations are true and that the parties to the conversion will act in accordance with the Plan of Conversion. In addition, we have made such investigations of law as we have deemed appropriate to form a basis for the opinions expressed below.

We have assumed that the conversion contemplated by the Plan of Conversion will be consummated in accordance therewith and as described in the prospectus included as part of the Registration Statement on Form S-1 filed by First Savings Financial Group.

In issuing the opinions set forth below, we have referred solely to existing provisions of the Internal Revenue Code of 1986, as amended (the “Code”), and the Treasury Regulations and similar guidance issued by the Internal Revenue Service (the “IRS”) under the Code. Changes in the tax laws could affect the continued validity of the opinions expressed below. Furthermore, there can be no assurance that the opinions expressed herein would be adopted by the IRS or a court of law. We assume no obligation to revise or supplement this opinion should the present federal income tax laws be changed by any legislation, judicial decisions or otherwise.

Board of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

, 2008

Page 2

Based

on and subject to the foregoing, it is our opinion that, for federal income tax purposes, under current law:

The conversion of First Savings Bank from the mutual to the stock form of organization will qualify as a reorganization within the meaning of Section 368(a)(1)(F) of the Code (see Rev. Rul. 80-105, 1980-1 C.B. 78), and no gain or loss will be recognized by account holders and no gain or loss will be recognized by First Savings Bank by reason of such conversion.

No gain or loss will be recognized by First Savings Financial Group upon the sale of shares of common stock in the Offering (Section 1032(a) of the Code).

No gain or loss will be recognized by account holders of First Savings Bank upon the issuance to them of accounts in the Converted Bank immediately after the conversion, in the same dollar amounts and on the same terms and conditions as their accounts at First Savings Bank plus interests in the liquidation account in the Converted Bank (Section 354(a) of the Code).

It is more likely than not that the fair market value of the non-transferable subscription rights to purchase shares of common stock of First Savings Financial Group to be issued to Eligible Account Holders, Supplemental Eligible Account Holders and Employees, Officers and directors is zero (the “Subscription Rights”), and, accordingly, that no income will be realized by Eligible Account Holders, Supplemental Eligible Account Holders and Employees, Officers and directors upon the issuance to them of Subscription Rights (Section 356(a) of the Code) or upon the exercise of the Subscription Rights (Rev. Rul. 56-572, 1956-2 C.B. 182).

It is more likely than not that the tax basis to the holders of shares of common stock purchased in the Offering pursuant to the exercise of Subscription Rights will be the amount paid therefor, and that the holding period for such shares of common stock will begin on the date of completion of the Offering (Section 1223(5) of the Code).

The holding period for shares of common stock purchased in the Community Offering or Syndicated Community Offering will begin on the day after the date of the purchase (Rev. Rul. 70-598, 1970-2 C.B. 168).

Board of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

, 2008

Page 3

The opinions set forth in 4 and 5 above are based on the position that the Subscription Rights do not have any market value at the time of distribution or at the time they are exercised. Whether subscription rights have a market value for federal income tax purposes is a question of fact, depending upon all relevant facts and circumstances. The IRS will not issue rulings on whether subscription rights have a market value. We are unaware of any instance in which the IRS has taken the position that nontransferable subscription rights issued by a converting financial institution have a market value. The subscription rights will be granted at no cost to the recipients, will be nontransferable and of short duration, and will afford the recipients the right only to purchase First Savings Financial Group common stock at a price equal to its estimated fair market value, which will be the same price as the purchase price for the unsubscribed shares of common stock. We believe that it is more likely than not (i.e., that there is a more than a 50% likelihood) that the Subscription Rights have no market value for federal income tax purposes.

Except as set forth above, we express no opinion to any party as to the tax consequences, whether federal, state, local or foreign, of the conversion or of any transaction related thereto or contemplated by the Plan of Conversion. This opinion is given solely for the benefit of First Savings Bank and First Savings Financial Group and Eligible Account Holders, Supplemental Eligible Account Holders and Employees, Officers and directors who receive Subscription Rights, and other investors in the Offerings, and may not be relied upon by any other party or entity or otherwise referred to in any document without our express written consent. We consent to the filing of this opinion as an exhibit to the Application for Conversion on Form AC filed with the Office of Thrift Supervision and as an exhibit to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission, all filed in connection with the conversion, and to reference to our firm and to this opinion in the prospectus included in both the Registration Statement on Form S-1 and the Application for Conversion on Form AC under the headings “The Conversion and Stock Offering—Material Income Tax Consequences” and “Legal and Tax Opinions.” In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended.


Very truly yours, KILPATRICK STOCKTON LLP

By:
		Eric S. Kracov, a Partner

Exhibit 8.2

[Monroe Shine & Co., Inc. Letterhead]

, 2008

Boards of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

Re:

State Income Tax Opinion Relating to the Conversion of First Savings Bank,

F.S.B. from a Federally-Chartered Mutual Savings Bank to a Federally-Chartered Stock Savings Bank

Gentlemen:

In accordance with your request, set forth herein is our opinion regarding the Indiana income tax consequences of the proposed conversion of First Savings Bank, F.S.B., (“Savings Bank”) form a federally-chartered mutual savings bank to a federally-chartered stock savings bank (the “Converted Bank”) and the acquisition of the Converted Bank’s capital stock by First Savings Financial Group, Inc., an Indiana corporation (“First Savings Financial Group”), pursuant to a Plan of Conversion (“Plan”) adopted by First Savings Bank, F.S.B., (“Savings Bank”) on April 30, 2008.

In connection with the opinions expressed below, we have examined and relied upon originals or copies certified or otherwise identified to our satisfaction, of the Plan as adopted by the Board of Directors of the Savings Bank on April 30, 2008, such corporate records of the parties to the conversion as we have deemed appropriate and the prospectus included in the Registration Statement on Form S-1 filed by First Savings Financial Group. We have assumed the representations are true and that the parties to the Plan will act in accordance with the Plan. Also, we have relied upon the Federal Income Tax Opinion of Kilpatrick Stockton LLP dated , 2008 (“Federal Income Tax Opinion”), incorporated hereunder by reference. In addition, we have made such investigations of law as we have deemed appropriate to form a basis for the opinions expressed below.

In issuing the opinions set forth below, we have referred solely to existing provisions of the Indiana Code. We assume no obligation to revise or supplement this opinion should the present Indiana income tax laws be changed by legislation, judicial decisions or otherwise.

Based on and subject to the foregoing, and the conclusions stated in the Federal Income Tax Opinion as to the federal income tax consequences of the Conversion, it is our opinion that for Indiana income tax purposes, under current law:

Board of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

, 2008

Page 2

The Conversion transaction and the subsequent stock offering will be treated in an identical manner as it is treated for federal income tax purposes under the Internal Revenue Code. The Internal Revenue Code in effect as of January 1, 2008, is incorporated by reference into the income tax laws of the state of Indiana.

2.	Under the income tax laws of the state of Indiana, consummation of the Conversion will not be a taxable event to the Savings Bank, its account holders, the Converted Bank, or First Savings Financial Group.

This opinion is given solely for the benefit of the parties to the Plan, the Savings Bank and First Savings Financial Group, eligible account holders, supplemental eligible account holders and employees, officers and directors who received subscription rights and other investors who purchase common stock pursuant to the Conversion, and may not be relied upon by any other party or entity or referred to in any document without our express written consent. As noted above, this opinion is limited to the Indiana income tax consequences of the Conversion and we undertake no responsibility to update or supplement our opinion.

We consent to the filing of this opinion as an exhibit to the Application for Conversion on Form AC filed with the Office of Thrift Supervision and as an exhibit to the Registration Statement on Form S-1 filed with the Securities and Exchange Commission, all filed in connection with the conversion, and to reference to our firm and to this opinion in the prospectus included in both the Registration Statement on Form S-1 and the Application for Conversion on Form AC under the headings “The Conversion and Stock Offering—Material Income Tax Consequences” and “Legal and Tax Opinions.”

Yours truly,

Monroe Shine & Co., Inc.

Exhibit 10.1

FORM OF

FIRST SAVINGS BANK, F.S.B.

EMPLOYEE STOCK OWNERSHIP PLAN

Effective as of January 1, 2008

FIRST SAVINGS BANK, F.S.B.

EMPLOYEE STOCK OWNERSHIP PLAN

CERTIFICATION

I, Larry W. Myers, President and Chief Executive Officer of First Savings Bank, F.S.B., hereby certify that the attached First Savings Bank, F.S.B. Employee Stock Ownership Plan, effective January 1, 2008, was adopted at a duly held meeting of the Board of Directors of the Bank.


FIRST SAVINGS BANK, F.S.B.

By:
		Larry W. Myers
		President and Chief Executive Officer

First Savings Bank, F.S.B.

Employee Stock Ownership Plan

Table of Contents


Section 1 - Introduction		1

Section 2 - Definitions		1

Section 3 - Eligibility and Participation		8

Section 4 - Contributions		10

Section 5 - Plan Accounting		12

Section 6 - Vesting and Forfeitures		18

Section 7 - Distributions		20

Section 8 - Voting of Company Stock and Tender Offers		25

Section 9 - The Committee and Plan Administration		26

Section 10 - Rules Governing Benefit Claims		29

Section 11 - The Trust		30

Section 12 - Adoption, Amendment and Termination		31

Section 13 - General Provisions		33

Section 14 - Top-Heavy Provisions		38

SECTION 1

Introduction

Section 1.01 Nature of the Plan .

Effective as of January 1, 2008 (the “Effective Date”), First Savings Bank, F.S.B. (the “Bank”) hereby establishes the First Savings Bank, F.S.B. Employee Stock Ownership Plan (the “Plan”) to enable Eligible Employees (as defined in Section 2.01(o) of the Plan) to acquire stock ownership interests in First Savings Financial Group, Inc. (the “Company”), the holding company of the Bank. The Bank intends this Plan to be a tax-qualified stock bonus plan under Section 401(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and an employee stock ownership plan within the meaning of Section 407(d)(6) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and Sections 409 and 4975(e)(7) of the Code. The Plan is designed to invest primarily in the common stock of the Company, which stock constitutes “qualifying employer securities” within the meaning of Section 407(d)(5) of ERISA and Sections 409(l) and 4975(e)(8) of the Code. Accordingly, the Plan and Trust Agreement (as defined in Section 2.01(mm) of the Plan) shall be interpreted and applied in a manner consistent with the Bank’s intent for it to be a tax-qualified plan designed to invest primarily in qualifying employer securities.

The Plan reflects certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”). The provisions related to EGTRRA are intended as good faith compliance with EGTRRA and the guidance issued thereunder. To the extent any provision of the Plan was operated according to an effective date earlier than as required by law, then such date shall be the effective date with respect to that provision of the Plan.

Section 1.02 Employers and Affiliates .

The Bank and each of its Affiliates (as defined in Section 2.01(c) of the Plan) that, with the consent of the Bank, adopt the Plan pursuant to the provisions of Section 12.01 of the Plan are collectively referred to as the “Employers” and individually as an “Employer.” The Plan shall be treated as a single plan with respect to all participating Employers.

SECTION 2

Definitions

Section 2.01 Definitions .

In this Plan, whenever the context so indicates, the singular or the plural number and the masculine or feminine gender shall be deemed to include the other, the terms “he,” “his,” and “him,” shall refer to a Participant or Beneficiary, as the case may be, and, except as otherwise provided, or unless the context otherwise requires, the capitalized terms shall have the following meanings:

(a)	“Account” or “Accounts” mean a Participant’s or Beneficiary’s Company Stock Account and/or his Other Investments Account, as the context so requires.

(b)	“Acquisition Loan” means a loan or other extension of credit, including an installment obligation to a “party in interest” (as defined in Section 3(14) of ERISA) incurred by the Trustee in connection with the purchase of Company Stock.

(c)

“Affiliate” means any corporation, trade or business, which, at the time of reference, is together with the Bank, a member of a controlled group of corporations, a group of trades or businesses (whether or not incorporated) under common control, or an affiliated service group, as described in Sections 414(b), 414(c), and 414(m) of the Code, respectively, or any other organization treated as a single employer with the Bank under Section 414(o) of the Code; provided, however, that, where the context so requires, the term “Affiliate” shall be construed to give full effect to the provisions of Sections 409(l)(4) and 415(h) of the Code.

(d)	“Bank” means First Savings Bank, F.S.B., and any entity that succeeds to the business of the First Savings Bank, F.S.B. and adopts this Plan in accordance with the provisions of Section 12.02 of the Plan, or by written agreement assumes the obligations of the Plan.

(e)	“Beneficiary” means the person(s) entitled to receive benefits under the Plan following a Participant’s death, pursuant to Section 7.03 of the Plan.

(f)	“Change in Control” means any one of the following events occurs:

(i)

Merger : The Company or the Bank merges into or consolidates with another corporation, or merges another corporation into the Company or the Bank, and as a result less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of the Company or the Bank immediately before the merger or consolidation;

(ii)

Acquisition of Significant Share Ownership : The Company files, or is required to file, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Exchange Act, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner of twenty-five percent (25%) or more of a class of the Company’s voting securities, but this clause (b) shall not apply to beneficial ownership of Company voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns fifty (50%) or more of its outstanding voting securities;

(iii)

Change in Board Composition : During any period of two consecutive years, individuals who constitute the Company’s or the Bank’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Bank’s or the Company’s Board of Directors; provided, however, that for purposes of this clause (iii), each director who is first elected by the board (or first nominated by the board for election by the stockholders) by a vote of at

least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period shall be deemed to have also been a director at the beginning of such period; or

(iv)

Sale of Assets : The Company or the Bank sells to a third party all or substantially all of its assets.

(g)	“Code” means the Internal Revenue Code of 1986, as amended.

(h)	“Committee” means the individual(s) responsible for the administration of the Plan in accordance with Section 9 of the Plan.

(i)	“Company” means First Savings Financial Group, Inc. and any entity which succeeds to the business of First Savings Financial Group, Inc.

(j)	“Company Stock” means shares of the voting common stock or preferred stock, meeting the requirements of Section 409 of the Code and Section 407(d)(5) of ERISA, issued by the Company or its Affiliates.

(k)	“Company Stock Account” means the account established and maintained in the name of each Participant or Beneficiary to reflect his share of the Trust Fund invested in Company Stock.

(l)

“Compensation” means a Participant’s wages as defined in Code Section 3401(a) and all other payments of Compensation and all other payments of compensation by the Employer (in the course of the Employer’s trade or business) for a Plan Year for which Employer is required to furnish the Participant a written statement under Code Sections 6041(d), 6051(a)(3) and 6052. Compensation must be determined without regard to any rules under Section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the exception for agricultural labor in Code Section 3401(a)(2)). Compensation shall also include amounts not currently includible in gross income by reason of the application of Code Sections 125 (cafeteria plan), 132(f)(4) (qualified transportation fringe), 402(e)(3) (401(k) plan), 402(h)(1)(B)(simplified employee pension plan), 414(h) (employer pickup contributions under a governmental plan), 403(b) (tax sheltered annuity) or 457(b) (eligible deferred compensation plan).

A Participant’s Compensation shall not exceed the limit set forth in Section 401(a)(17) of the Code ($230,000 for Plan Years beginning January 1, 2008). If the Plan Year for which a Participant’s Compensation is measured is less than twelve (12) calendar months, then the amount of Compensation taken into account for such Plan Year shall be the adjusted amount for such Plan Year, as prescribed by the Secretary of the Treasury under Section 401(a)(17) of the Code, multiplied by a fraction, the numerator of which is the number of months taken into account for such Plan Year and the denominator of which is twelve (12). In determining the dollar limitation hereunder, Compensation received from an Affiliate shall be recognized as Compensation.

(m)

“Disability” means a physical or mental condition of a Participant resulting from bodily injury, disease, or mental disorder which renders the Participant incapable of continuing any gainful occupation and which condition constitutes total disability under the federal Social Security Act. The Disability of a Participant shall be determined by the Plan Administrator, in its sole discretion.

(n)	“Effective Date” means January 1, 2008.

(o)	“Eligible Employee” means any Employee who is not precluded from participating in the Plan by reason of the provisions of Section 3.02 of the Plan.

(p)

“ Eligibility Computation Period ” shall mean the twelve (12) consecutive month period beginning on the date an Employee first performed an Hour of Service for the Employer (employment commencement date). Subsequent Eligibility Computation Periods shall be the Plan Year, commencing with the first Plan Year that includes the first anniversary date of the Employee’s employment commencement date. To determine an Eligibility Computation Period after a One Year Break in Service, the Plan shall use the twelve (12) consecutive month period beginning on the date the Employee again performs an Hour of Service for the Employer.

(q)	“ Employee” means any person who is actually performing services for the Employer or an Affiliate in a common-law, employer-employee relationship as determined under Sections 31.3121(d)-1, 31.3306(i)-1, or 31.3401(c)-1 of the Treasury Regulations.

(r)

“Employer” or “Employers” means the Bank and any of its Affiliates that adopt the Plan in accordance with the provisions of Section 12.01 of the Plan, and any entity which succeeds to the business of the Bank or its Affiliates and which adopts the Plan in accordance with the provisions of Section 12.02 of the Plan, or by written agreement assumes the obligations under the Plan.

(s)	“Entry Date” means the January 1 ^st or July 1 ^st coincident with or next following the date the Employee satisfies the requirements for participation under Section 3.01 of the Plan.

(t)	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

(u)	“Exchange Act” means the Securities Exchange Act of 1934, as amended.

(v)	“Financed Shares” means shares of Company Stock acquired by the Trustee with the proceeds of an Acquisition Loan, which shall constitute “qualifying employer securities” under Section 409(l) of the Code and any shares of Company Stock received upon conversion or exchange of such shares.

(w)	“Highly Compensated Employee” means an Employee who, for a particular Plan Year, satisfies one of the following conditions:

(i)

was a “5-percent owner” (as defined in Section 414(q)(2) of the Code) during the year or the preceding year, or

(ii)

for the preceding year, had “compensation” (as defined in Section 414(q)(4) of the Code) from the Bank and its Affiliates exceeding the limit in Section 414(q)(1) of the Code ($105,000 for Plan Years beginning January 1, 2008).

(x)	“Hours of Service” means:

(i)

Each hour for which an Employee is paid, or entitled to payment, for performing duties for the Employer during the applicable computation period.

(ii)

Each hour for which an Employee is paid, or entitled to payment, for a period during which no duties are performed (irrespective of whether the employment relationship has terminated) due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty or leave of absence. Notwithstanding the preceding sentence, no credit shall be given to the Employee for:

(A)

more than 501 hours under this clause (ii) because of any single continuous period in which the Employee performs no duties (whether or not such period occurs in a single computation period);

(B)

an hour for which the Employee is directly or indirectly paid, or entitled to payment, because of a period in which no duties are performed if such payment is made or due under a plan maintained solely for the purpose of complying with applicable worker’s or workmen’s compensation, unemployment, or disability insurance laws; or

(C)

an hour or a payment which solely reimburses the Employee for medical or medically-related expenses incurred by the Employee.

(iii)

Each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by the Employer; provided, however, that hours credited under either clause (i) or (ii) above shall not also be credited under this clause (iii). Crediting of hours for back pay awarded or agreed to with respect to periods described in clause (ii) above will be subject to the limitations set forth in that clause.

The crediting of Hours of Service shall be determined by the Committee in accordance with the rules set forth in Section 2530.200b-2 of the regulations prescribed by the Department of Labor, which rules shall be consistently applied with respect to all Employees within the same job classification. If an Employer finds it impracticable to count actual Hours of Service for any class or group of non-hourly Employees, each Employee in that class or group shall be credited with 45 Hours of Service for each weekly period in which he has at least one Hour of Service. However, an Employee shall be credited with Hours of Service only for his normal working hours during a paid absence. Hours of Service shall be credited for employment with an Affiliate.

For purposes of determining whether an Employee has incurred a One Year Break in Service and for vesting and participation purposes, if an Employee begins a maternity/paternity leave of absence described in Section 411(a)(6)(E)(i) of the Code, his Hours of Service shall include the Hours of Service that would have been credited to him if he had not been so absent (or 45 Hours of Service for each week of such absence if the actual Hours of Service cannot be determined). An Employee shall be credited for such Hours of Service (up to a maximum of 501 Hours of Service) in the Plan Year in which his absence begins (if such crediting will prevent him from incurring a One Year Break in Service in such Plan Year) or, in all other cases, in the following Plan Year. An absence from employment for maternity or paternity reasons means an absence:

(i)

by reason of pregnancy of the Employee,

(ii)

by reason of the birth of a child of the Employee,

(iii)

by reason of the placement of a child with the Employee in connection with the adoption of such child by such Employee, or

(iv)

for purposes of caring for such child for a period beginning immediately following such birth or placement.

(y)	“Later Retirement Date” means the first day of the month coincident with or next following a Participant’s date of actual retirement which occurs after his Normal Retirement Date.

(z)	“Loan Suspense Account” means that portion of the Trust Fund consisting of Company Stock acquired with an Acquisition Loan which has not yet been allocated to the Participants’ Accounts.

(aa)	“Named Fiduciary” means the Board of Directors of the Bank.

(bb)	“Normal Retirement Age” means attainment of age 65.

(cc)	“Normal Retirement Date” means the first day of the month coincident with or next following the Participant’s attainment of Normal Retirement Age.

(dd)	“One Year Break in Service” means a twelve (12) consecutive month period during which the Participant does not complete more than 500 Hours of Service.

(ee)	“Other Investments Account” means the account established and maintained in the name of each Participant or Beneficiary to reflect his share of the Trust Fund, other than Company Stock.

(ff)	“Participant” means any Eligible Employee who has become a Participant in accordance with Section 3.01 of the Plan or any other person with an Account balance under the Plan.

(gg)	“Plan” means this First Savings Bank, F.S.B. Employee Stock Ownership Plan, as amended from time to time.

(hh)	“ Plan Year” means the calendar year.

(ii)	“Recognized Absence” means a period for which:

(i)

an Employer grants an Employee a leave of absence for a limited period of time, but only if an Employer grants such leaves of absence on a nondiscriminatory basis to all Eligible Employees; or

(ii)

an Employee is temporarily laid off by an Employer because of a change in the business conditions of the Employer; or

(iii)

an Employee is on active military duty, but only to the extent that his employment rights are protected by the Military Selective Service Act of 1967 and the Uniformed Services Employment and Reemployment Rights Act of 1994.

(jj)	“Retirement Date” means a Participant’s Normal or Later Retirement Date, whichever is applicable.

(kk)	“Service” means employment with the Bank or an Affiliate.

(ll)

“Termination of Service” means the earlier of (a) the date on which an Employee’s Service is terminated by reason of his resignation, retirement, discharge, death or Disability or (b) the first anniversary of the date on which such Employee’s service is terminated for disability of a short-term nature or any other reason. Service in the Armed Forces of the United States shall not constitute a Termination of Service but shall be considered to be a period of employment by the Employer provided (i) such military service is caused by war or other emergency or the Employee is required to serve under the laws of conscription in time of peace, (ii) the Employee returns to employment with the Employer within six (6) months following discharge from such military service and (iii) such Employee is reemployed by the Employer at a time when the Employee had a right to reemployment at his former position or substantially similar position upon separation from such military duty in accordance with seniority rights as protected under the laws of the United States. A leave of absence granted to an Employee by the Employer shall not constitute a Termination of Service provided that the Participant returns to the active service of the Employer at the expiration of any such period for which leave has been granted. Notwithstanding the foregoing, an Employee who is absent from service with the Employer beyond the first anniversary of the first date of absence for maternity or paternity reasons set forth in Section 2.01 of the Plan shall incur a Termination of Service for purposes of the Plan on the second anniversary of the date of such absence.

(mm)	“Treasury Regulations” mean the regulations promulgated by the Department of the Treasury under the Code.

(nn)	“Trust” means the First Savings Bank, F.S.B. Employee Stock Ownership Plan Trust created in connection with the establishment of the Plan.

(oo)	“Trust Agreement” means the trust agreement establishing the Trust.

(pp)	“Trust Fund” means the assets held in the Trust for the benefit of Participants and their Beneficiaries.

(qq)	“Trustee” means the trustee or trustees from time to time in office under the Trust Agreement.

(rr)	“Valuation Date” means the last day of the Plan Year and each other date as of which the Committee shall determine the investment experience of the Trust Fund and adjust Participants’ Accounts accordingly.

(ss)	“Valuation Period” means the period following a Valuation Date and ending with the next Valuation Date.

SECTION 3

Eligibility and Participation

Section 3.01 Participation .

(a)	All Eligible Employees who are over 21 years of age on the closing date of the Bank’s mutual to stock conversion shall enter the Plan and become Participants as of the later of: (i) the Effective Date; or (ii) the Eligible Employee’s date of hire.

(b)	An Eligible Employee who is first employed by an Employer after the closing date of the Bank’s mutual to stock conversion shall become a Participant in the Plan upon satisfying the following requirements:

(i)

The Eligible Employee is at least 21 years of age; and

(ii)

The Eligible Employee has completed at least 1,000 Hours of Service during an Eligibility Computation Period.

(c)	An Eligible Employee who has satisfied the eligibility requirements of Section 3.01(b) shall enter the Plan and become a Participant on the Entry Date coincident with or next following the date he satisfies such requirements.

Section 3.02 Certain Employees Ineligible .

The following Employees are ineligible to participate in the Plan:

(a)	Employees covered by a collective bargaining agreement between the Employer and the Employee’s collective bargaining representative if:

(i)

retirement benefits have been the subject of good faith bargaining between the Employer and the representative, and

(ii)

the collective bargaining agreement does not expressly provide that Employees of such unit be covered under the Plan;

(b)	Employees who are nonresident aliens and who receive no earned income from an Employer which constitutes income from sources within the United States; and

(c)	Employees of an Affiliate of the Bank that has not adopted the Plan pursuant to Sections 12.01 or 12.02 of the Plan.

Section 3.03 Transfer to and from Eligible Employment .

(a)	If an Employee ineligible to participate in the Plan by reason of Section 3.02 of the Plan transfers to employment as an Eligible Employee, he shall enter the Plan as of the later of:

(i)

the first Entry Date after the date of transfer, or

(ii)

the first Entry Date on which he could have become a Participant pursuant to Section 3.01 of the Plan.

(b)

If a Participant transfers to an employment position that makes him ineligible to participate in the Plan as of the date of such transfer, he shall cease active participation in the Plan as of such date and his transfer shall be treated for all purposes under the Plan in the same manner as any other termination of Service.

Section 3.04 Participation after Reemployment .

(a)	If an Employee incurs a One Year Break in Service prior to satisfying the eligibility requirements of Section 3.01 of the Plan, Service prior to such One Year Break in Service shall be disregarded and the Employee must satisfy the eligibility requirements of Section 3.01 as a new Employee.

(b)

If an Employee incurs a One Year Break in Service after satisfying the eligibility requirements of Section 3.01 of the Plan and again performs an Hour of Service, the Employee shall receive credit for Service prior to his One Year Break in Service and shall be eligible to participate in the Plan immediately upon reemployment, provided the Employee is not excluded from participation under the provisions of Section 3.02 of the Plan.

Section 3.05 Participation Not Guarantee of Employment .

Participation in the Plan does not constitute a guarantee or contract of employment and will not give any Employee the right to be retained in the employ of the Bank or any of its Affiliates nor any right or claim to any benefit under the terms of the Plan unless such right or claim has specifically accrued under the Plan.

SECTION 4

Contributions

Section 4.01 Employer Contributions .

(a)

Discretionary Contributions. Each Plan Year, each Employer, in its discretion, may make a contribution to the Trust. Each Employer making a contribution for any Plan Year under this Section 4.01(a) will contribute to the Trustee cash equal to, or Company Stock or other property having an aggregate fair market value equal to, such amount as the Board of Directors of the Employer shall determine by resolution. Notwithstanding the Employer’s discretion with respect to the medium of contribution, an Employer shall not make a contribution in any medium which would make such contribution a prohibited transaction (for which no exemption is provided) under Section 406 of ERISA or Section 4975 of the Code.

(b)

Employer Contributions for Acquisition Loans. Each Plan Year, the Employers shall, subject to any regulatory prohibitions, contribute an amount of cash sufficient to enable the Trustee to discharge any indebtedness incurred with respect to an Acquisition Loan pursuant to the terms of the Acquisition Loan. The Employers’ obligation to make contributions under this Section 4.01(b) shall be reduced to the extent of any investment earnings attributable to such contributions and any cash dividends paid with respect to Company Stock held by the Trustee in the Loan Suspense Account. If there is more than one Acquisition Loan, the Employers shall designate the one to which any contribution pursuant to this Section 4.01(b) is to be applied.

Section 4.02 Limitations on Contributions .

In no event shall an Employer’s contribution(s) made under Section 4.01 of the Plan for any Plan Year exceed the lesser of:

(a)	The maximum amount deductible under Section 404 of the Code by that Employer as an expense for Federal income tax purposes; and

(b)	The maximum amount which can be credited for that Plan Year in accordance with the allocation limitation provisions of Section 5.05 of the Plan.

Section 4.03 Acquisition Loans .

The Trustee may incur Acquisition Loans from time to time to finance the acquisition of Company Stock for the Trust or to repay a prior Acquisition Loan. An Acquisition Loan shall be for a specific term, shall bear a reasonable rate of interest, shall not be payable on demand, except in the event of default, and shall be primarily for the benefit of Participants and Beneficiaries of the Plan. An Acquisition Loan may be secured by a collateral pledge of the Financed Shares so acquired and any other Plan assets which are permissible securities within the provisions of Section 54.4975-7(b) of the Treasury Regulations. No other assets of the Plan or Trust may be pledged as collateral for an Acquisition Loan, and no lender shall have recourse against any other Trust assets. Any pledge of Financed Shares must provide for the release of shares so pledged on a basis equal to the principal and interest (or if the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are met and the Employer so elects, principal payments only), paid by the Trustee on the Acquisition Loan. The released Financed Shares shall be allocated to Participants’ Accounts in accordance with the provisions of Sections 5.04 or 5.08 of the Plan, whichever is applicable. Payment of principal and interest on any Acquisition Loan shall be made by the Trustee only from the Employer contributions paid in cash to enable the Trustee to repay such loan in accordance with Section 4.01(b) of the Plan, from earnings attributable to such contributions, and any cash dividends received by the Trustee on Financed Shares acquired with the proceeds of the Acquisition Loan (including contributions, earnings and dividends received during or prior to the year of repayment less such payments in prior years), whether or not allocated. Financed Shares shall initially be credited to the Loan Suspense Account and shall be transferred for allocation to the Company Stock Accounts of Participants only as payments of principal and interest (or, if the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are met and the Employer so elects, principal payments only), on the Acquisition Loan are made by the Trustee. The number of Financed Shares to be released from the Loan Suspense Account for allocation to Participants’ Company Stock Account for each Plan Year shall be based on the ratio that the payments of principal and interest (or, if the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are met and the Employer so elects, principal payments only), on the Acquisition Loan for that Plan Year bears to the sum of the payments of principal and interest on the Acquisition Loan for that Plan Year plus the total remaining payment of principal and interest projected (or, if the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are met and the Employer so elects, principal payments only), on the Acquisition Loan over the duration of the Acquisition Loan repayment period, subject to the provisions of Section 5.05 of the Plan.

Section 4.04 Conditions as to Contributions .

In addition to the provisions of Section 12.03 of the Plan for the return of an Employer’s contributions in connection with a failure of the Plan to qualify initially under the Code, any amount contributed by an Employer due to a good faith mistake of fact, or based upon a good faith but erroneous determination of its deductibility under Section 404 of the Code, shall be returned to the Employer within one year after the date on which the Employer originally made such contribution, or within one year after its nondeductibility has been finally determined. However, the amount to be returned shall be reduced to take account of any adverse investment experience within the Trust in order that the balance credited to each Participant Account is not less than it would have been if the contribution had never been made by the Employer.

Section 4.05 Employee Contributions .

Employee contributions are neither required nor permitted under the Plan.

Section 4.06 Rollover Contributions .

Rollover contributions to the Plan of assets from other tax-qualified retirement plans are not permitted under the Plan.

Section 4.07 Trustee-to-Trustee Transfers .

Trustee-to-trustee transfers of assets from other tax-qualified retirement plans are not permitted under the Plan.

SECTION 5

Plan Accounting

Section 5.01 Accounting for Allocations .

The Committee shall establish the Accounts (and sub-accounts, if deemed necessary) for each Participant, and the accounting procedures for the purpose of making allocations to Participants’ Accounts as provided for in this Section 5. The Committee shall maintain adequate records of the cost basis of shares of Company Stock allocated to each Participant’s Company Stock Account. The Committee also shall keep separate records of Financed Shares attributable to each Acquisition Loan and of contributions made by the Employers (and any earnings thereon) made for the purpose of enabling the Trustee to repay any Acquisition Loan. From time to time, the Committee may modify its accounting procedures for the purpose of achieving equitable and nondiscriminatory allocations among the Accounts of Participants, in accordance with the provisions of this Section 5 and the applicable requirements of the Code and ERISA. In accordance with Section 9 of the Plan, the Committee may delegate the responsibility for maintaining Accounts and records.

Section 5.02 Maintenance of Participants’ Company Stock Accounts .

As of each Valuation Date, the Committee shall adjust the Company Stock Account of each Participant to reflect activity during the Valuation Period as follows:

(a)	First, charge to each Participant’s Company Stock Account all distributions and payments made to the Participant that have not been previously charged;

(b)	Next, credit to each Participant’s Company Stock Account the shares of Company Stock, if any, that have been purchased with amounts from the Participant’s Other Investments Account, and adjust such Other Investments Account in accordance with the provisions of Section 5.03 of the Plan;

(c)

Next, credit to each Participant’s Company Stock Account the shares of Company Stock representing contributions made by the Employers in the form of Company Stock and the number of Financed Shares released from the Loan Suspense Account under Section 4.03 of the Plan that are to be allocated and credited as of that date in accordance with the provisions of Section 5.04 of the Plan; and

(d)	Finally, credit to each Participant’s Company Stock Account the shares of Company Stock released from the Loan Suspense Account that are to be allocated in accordance with the provisions of Section 5.09 of the Plan.

Section 5.03 Maintenance of Participants’ Other Investments Accounts .

Except as otherwise provided for under Section 5.08 of the Plan, as of each Valuation Date, the Committee shall adjust the Other Investments Account of each Participant to reflect activity during the Valuation Period as follows:

(a)	First, charge to each Participant’s Other Investments Account all distributions and payments made to the Participant that have not previously been charged;

(b)	Next, if Company Stock is purchased with assets from a Participant’s Other Investments Account, charge the Participant’s Other Investments Account accordingly;

(c)

Next, subject to the dividend provisions of Section 5.09 of the Plan, credit to the Other Investments Account of each Participant any cash dividends paid to the Trustee on shares of Company Stock held in that Participant’s Company Stock Account (as of the record date for such cash dividends) and dividends paid on shares of Company Stock held in the Loan Suspense Account that have not been used to repay any Acquisition Loan. Subject to the provisions of Section 5.09 of the Plan, cash dividends that have not been used to repay any Acquisition Loan and have been credited to a Participant’s Other Investments Account shall be applied by the Trustee to purchase shares of Company Stock, which shares shall then be credited to the Company Stock Account of such Participant. The Participant’s Other Investments Account shall then be charged by the amount of cash used to purchase such Company Stock. In addition, any earnings on:

(i)

Participants’ Other Investments Accounts will be allocated to Accounts, pro rata, based on Participants’ Other Investments Account balances as of the first day of the Valuation Period, and

(ii)

the Loan Suspense Account, other than dividends used to repay the Acquisition Loan, will be allocated to Participants’ Other Investments Accounts, pro rata, based on their Other Investments Account balances as of the first day of the Valuation Period;

(d)

Next, allocate and credit the Employer contributions made pursuant to Section 4.01(b) of the Plan for the purpose of repaying any Acquisition Loan, in accordance with Section 5.04 of the Plan. Such amount shall then be used to repay any Acquisition Loan and such Participant’s Other Investments Account shall be charged accordingly; and

(e)	Finally, allocate and credit the Employer contributions (other than amounts contributed to repay an Acquisition Loan) that are made in cash (or property other than Company Stock) for the Plan Year to the Other Investments Account of each Participant in accordance with Section 5.04 of the Plan.

Section 5.04 Allocation and Crediting of Employer Contributions .

(a)	Except as otherwise provided for in Sections 5.08 and 5.09 of the Plan, as of the Valuation Date for each Plan Year:

(i)

Company Stock released from the Loan Suspense Account for that year and shares of Company Stock contributed directly to the Plan shall be allocated and credited to each Active Participant’s (as defined in paragraph (b) of this Section 5.04) Company Stock Account based on the ratio that each Active Participant’s Compensation bears to the aggregate Compensation of all Active Participants for the Plan Year, and then

(ii)

The cash contributions not used to repay an Acquisition Loan and any other property contributed for that year shall be allocated and credited to each Active Participant’s Other Investments Account based on the ratio determined by comparing each Active Participant’s Compensation to the aggregate Compensation of all Active Participants for the Plan Year.

(b)	For purposes of this Section 5.04, the term “Active Participant” means those Eligible Employees who:

(i)

are employed on the last day of the Plan Year; or

(ii)

terminated employment during the Plan Year by reason of death, Disability, or attainment of their Normal or Later Retirement Date.

Section 5.05 Limitations on Allocations .

(a)	*In General.* Subject to the provisions of this Section 5.05, Section 415 of the Code shall be incorporated by reference into the terms of the Plan. No allocation shall be made under Section 5.04 of the Plan that would result in a violation of Section 415 of the Code.

(b)	*Code Section 415 Compensation.* For purposes of this Section 5.05, Compensation shall be adjusted to reflect the general rule of Section 1.415-2(d) of the Treasury Regulations.

(c)	*Limitation Year.* The “limitation year” (within the meaning of Section 415 of the Code) shall be the calendar year.

(d)

Multiple Defined Contribution Plans. In any case where a Participant also participates in another defined contribution plan of the Bank or its Affiliates, the appropriate committee of such other plan shall first reduce the after-tax contributions under any such plan, shall then reduce any elective deferrals under any such plan subject to Section 401(k) of the Code, shall then reduce all other contributions under any other such plan and, if necessary, shall then reduce contributions under this Plan.

(e)

Excess Allocations. If, after applying the allocation provisions under Section 5.04 of the Plan, allocations under Section 5.04 of the Plan would otherwise result in a violation of Section 415 of the Code, the Committee shall allocate and reallocate employer contributions to other Participants in the Plan for the limitation year or, if such allocation and reallocation causes the limitations of Section 415 of the Code to be exceeded, shall hold excess amounts in an unallocated suspense account for allocation in a subsequent Plan Year in accordance with Section 1.415-6(b)(6)(i) of the Treasury Regulations. Such suspense account, if permitted, will be credited before any allocation of contributions for subsequent limitation years.

(f)

Allocations Pursuant to Section 5.08. For purposes of this Section 5.05, no amount credited to any Participant’s Account pursuant to Section 5.08 of the Plan shall be counted as an “annual addition” for purposes of Section 415 of the Code. In the event any amount cannot be allocated to Affected Participants (as defined in Section 5.08 of the Plan) under the Plan pursuant to Section 5.08 of the Plan in the year of a Change in Control, the amount which may not be so allocated in the year of the Change in Control shall be treated in accordance with paragraph (e) of this Section 5.05.

Section 5.06 Other Limitations .

Aside from the limitations set forth in Section 5.05 of the Plan, in no event shall more than one-third of the Employer contributions to the Plan be allocated to the Accounts of Highly Compensated Employees. In order to ensure that such allocations are not made, the Committee shall, beginning with the Participants whose Compensation exceeds the limit then in effect under Section 401(a)(17) of the Code, reduce the amount of Compensation of such Highly Compensated Employees on a pro-rata basis per individual that would otherwise be taken into account for purposes of allocating benefits under Section 5.04 of the Plan. If, in order to satisfy this Section 5.06, any such Participant’s Compensation must be reduced to an amount that is lower than the Compensation amount of the next highest paid (based on such Participant’s Compensation) Highly Compensated Employee (the “breakpoint amount”), then, for purposes of allocating benefits under Section 5.04 of the Plan, the Compensation of all concerned Participants shall be reduced to an amount not to exceed such breakpoint amount.

Section 5.07 Limitations as to Certain Section 1042 Transactions .

To the extent that a shareholder of Company Stock sells qualifying Company Stock to the Plan and elects (with the consent of the Bank) nonrecognition of gain under Section 1042 of the Code, no portion of the Company Stock purchased in such nonrecognition transaction (or other dividends or other income attributable thereto) may accrue or be allocated during the nonallocation period (the ten (10) year period beginning on the later of the date of the sale of the qualified Company Stock, or the date of the Plan allocation attributable to the final payment of an Acquisition Loan incurred in connection with such sale) for the benefit of:

(a)	the selling shareholder;

(b)	the spouse, brothers or sisters (whether by the whole or half blood), ancestors or lineal descendants of the selling shareholder or descendant referred to in (a) above; or

(c)	any other person who owns, after application of Section 318(a) of the Code, more than twenty-five percent (25%) of:

(i)

any class of outstanding stock of the Company or any Affiliate, or

(ii)

the total value of any class of outstanding stock of the Company or any Affiliate.

For purposes of this Section 5.07, Section 318(a) of the Code shall be applied without regard to the employee trust exception of Section 318(a)(2)(B)(i) of the Code.

Section 5.08 Allocations Upon Termination Prior to Satisfaction of Acquisition Loan .

(a)

Notwithstanding any other provision of the Plan, in the event of a Change in Control, the Plan shall terminate as of the effective date of the Change in Control and, as soon as practicable thereafter, the Trustee shall repay in full any outstanding Acquisition Loan. In connection with such repayment, the Trustee shall: (i) apply cash, if any, received by the Plan in connection with the transaction constituting a Change in Control, with respect to the unallocated shares of Company Stock acquired with the proceeds of the Acquisition Loan, and (ii) to the extent additionally required to effect the repayment of the Acquisition Loan, obtain cash through the sale of any stock or security received by the Plan in connection with such transaction, with respect to such unallocated shares of Company Stock. After repayment of the Acquisition Loan, all remaining shares of Company Stock held in the Loan Suspense Account, all other stock or securities, and any cash proceeds from the sale or other disposition of any shares of Company Stock held in the Loan Suspense Account, shall be allocated among the Accounts of all Participants who were employed by an Employer on the date immediately preceding the effective date of the Change in Control. Such allocations of shares or cash proceeds shall be credited as earnings for purposes of Section 5.05 of the Plan and Section 415 of the Code, as of the effective date of the Change in Control, to the Account of each Participant who is either in active Service with an Employer, or is on a Recognized Absence, on the date immediately preceding the effective date of the Change of Control (each an “Affected

Participant”), in proportion to the opening balances in their Company Stock Accounts as of the first day of the current Valuation Period. As of the effective date of a Change in Control, all Participant Accounts shall be fully vested and nonforfeitable.

(b)

In the event of a termination of the Plan in connection with a Change in Control, this Section 5.08 shall have no force and effect unless the price paid for the Company Stock in connection with a Change in Control is greater than the average basis of the unallocated Company Stock held in the Loan Suspense Account as of the date of the Change in Control.

Section 5.09 Dividends .

(a)

Stock Dividends. Dividends on Company Stock which are received by the Trustee in the form of additional Company Stock shall be retained in the portion of the Trust Fund consisting of Company Stock, and shall be allocated among the Participants’ Accounts and the Loan Suspense Account in accordance with their holdings of the Company Stock on which the dividends have been paid.

(b)	*Cash Dividends on Allocated Shares.* Dividends on Company Stock credited to Participants’ Accounts which are received by the Trustee in the form of cash shall, at the direction of the Bank, either:

(i)

be credited to Participants’ Accounts in accordance with Section 5.03 of the Plan and invested as part of the Trust Fund;

(ii)

be distributed immediately to the Participants;

(iii)

be distributed to the Participants within ninety (90) days of the close of the Plan Year in which paid; or

(iv)

be used to repay principal and interest on the Acquisition Loan used to acquire Company Stock on which the dividends were paid.

In addition to the alternatives specified in the preceding paragraph regarding the treatment of cash dividends paid with respect to shares of Company Stock credited to Participants’ Accounts, if authorized by the Committee for the Plan Year, a Participant may elect that cash dividends paid on Company Stock credited to the Participant’s Account shall either be:

(i)

paid to the Plan, reinvested in Company Stock and credited to the Participant’s Account;

(ii)

distributed in cash to the Participant; or

(iii)

distributed to the Participant within ninety (90) days of the close of the Plan Year in which paid.

Dividends subject to an election under this paragraph (and any Company Stock acquired therewith pursuant to a Participant’s election) shall at all times be fully vested. To the extent the Committee authorizes dividend elections pursuant to this paragraph, the Committee shall establish policies and procedures relating to Participant elections and, if applicable, the reinvestment of cash dividends in Company Stock, which are consistent with guidance issued under Section 404(k) of the Code.

(c)	*Cash Dividends on Unallocated Shares.* Dividends on Company Stock held in the Loan Suspense Account received by the Trustee in the form of cash shall be applied as soon as practicable to payments of principal and interest under the Acquisition Loan incurred with the purchase of Company Stock.

(d)	*Financed Shares.* Financed Shares released from the Loan Suspense Account by reason of dividends paid with respect to Company Stock shall be allocated under Sections 5.03 and 5.04 of the Plan as follows:

(i)

First, Financed Shares with a fair market value at least equal to the dividends paid with respect to the Company Stock allocated to Participants’ Accounts shall be allocated among and credited to the Accounts of such Participants, pro rata, according to the number of shares of Company Stock held in such accounts on the date the dividend is declared by the Company; and

(ii)

Next, any remaining Financed Shares released from the Loan Suspense Account by reason of dividends paid with respect to Company Stock held in the Loan Suspense Account shall be allocated among and credited to the Accounts of all Participants, pro rata, according to each Participant’s Compensation.

SECTION 6

Vesting and Forfeitures

Section 6.01 Deferred Vesting in Accounts .

(a)	A Participant shall vest in his Accounts according to the following schedule. [CONFIRM]


Completed Years of Service		Vested Percentage
Less than 3		0
3 or more		100%

For purposes of vesting, a Participant’s Years of Service shall be determined using the calendar year as the computation period. A Participant shall be credited with a Year of Service if he or she completes 1,000 Hours of Service during the calendar year.

(b)

For purposes of determining a Participant’s Years of Service under Section 6.01(a), all Years of Service shall be included, beginning with the Employee’s initial service with the Employer. Also for purposes of this Section 6.01, employment with the Bank or any affiliate shall be deemed employment with the Employer.

Section 6.02 Immediate Vesting in Certain Situations .

(a)	Notwithstanding Section 6.01(a) of the Plan, a Participant shall become fully vested in his Accounts upon the earlier of:

(i)

termination of the Plan or the permanent and complete discontinuance of contributions by the Employer to the Plan; provided, however, that in the event of a partial termination of the Plan, the interest of each Participant shall fully vest only with respect to that part of the Plan which is terminated;

(ii)

Termination of Service on or after the Participant’s Normal Retirement Age;

(iii)

a Change in Control; or

(iv)

Termination of Service by reason of death or Disability.

Section 6.03 Treatment of Forfeitures .

(a)	If a Participant who is not fully vested in his Accounts terminates employment, that portion of his Accounts in which he is not vested shall be forfeited upon the earlier of:

(i)

the date the Participant receives a distribution of his entire vested benefits under the Plan, or

(ii)

the date at which the Participant incurs five (5) consecutive One Year Breaks in Service.

(b)

If a Participant who has terminated employment and has received a distribution of his entire vested benefits under the Plan is subsequently reemployed by an Employer prior to incurring five (5) consecutive One Year Breaks in Service, he shall have the portion of his Accounts which was previously forfeited restored to his Accounts, provided he repays to the Trustee within five (5) years of his subsequent employment date an amount equal to the previous distribution. The amount restored to the Participant’s Account shall be credited to his Account as of the last day of the Plan Year in which the Participant repays the distributed amount to the Trustee and the restored amount shall come from other Employees’ forfeitures and, if such forfeitures are insufficient, from a special contribution by the Employer for that year. If a Participant’s employment terminates prior to his

Account having become vested, such Participant shall be deemed to have received a distribution of his entire vested interest as of the Valuation Date next following his termination of employment.

(c)

If a Participant who has terminated employment but has not received a distribution of his entire vested benefits under the Plan is subsequently reemployed by an Employer subsequent to incurring five (5) consecutive One Year Breaks in Service, any undistributed balance of his Accounts from his prior participation which was not forfeited shall be maintained as a fully vested subaccount within his Account.

(d)	If a portion of a Participant’s Account is forfeited, assets other than Company Stock must be forfeited before any Company Stock may be forfeited.

(e)	Forfeitures shall be reallocated among the other Participants in the Plan.

Section 6.04 Accounting for Forfeitures .

A forfeiture shall be charged to the Participant’s Account as of the first day of the first Valuation Period in which the forfeiture becomes certain pursuant to Section 6.03 of the Plan. Except as otherwise provided in Section 6.03 of the Plan, a forfeiture shall be added to the contributions of the terminated Participant’s Employer which are to be credited to other Participants pursuant to Section 5 as of the last day of the Plan Year in which the forfeiture becomes certain.

Section 6.05 Vesting Upon Reemployment .

If a Participant incurs a One Year Break in Service and again performs an Hour of Service, such Participant shall receive credit, for purposes of Section 6.01 of the Plan, for his Years of Service prior to his One Year Break in Service.

SECTION 7

Distributions

Section 7.01 Distribution of Benefit Upon a Termination of Employment .

(a)

A Participant whose employment terminates for any reason shall receive the entire vested portion of his Accounts in a single payment on a date selected by the Committee; provided, however, that such date shall be on or before the 60th day after the end of the Plan Year in which the Participant’s employment terminated. The benefits from that portion of the Participant’s Other Investments Account shall be calculated on the basis of the most recent Valuation Date before the date of payment. Subject to the provisions of Section 7.05 of the Plan, if the Committee so provides, a Participant may elect that his benefits be distributed to him in the form of Company Stock, cash, or some combination thereof.

(b)	Notwithstanding paragraph (a) of this Section 7.01, if the balance credited to a Participant’s Accounts exceeds, at the time such benefit was distributable, $1,000, his

benefits shall not be paid before the latest of his 65th birthday or the tenth anniversary of the year in which he commenced participation in the Plan, unless he elects an early payment date in a written election filed with the Committee. Such an election is not valid unless it is made after the Participant has received the required notice under Section 1.411(a)-11(c) of the Treasury Regulations that provides a general description of the material features of a lump sum distribution and the Participant’s right to defer receipt of his benefits under the Plan. The notice shall be provided no less than 30 days and no more than ninety (90) days before the first day on which all events have occurred which entitle the Participant to such benefit. Written consent of the Participant to the distribution generally may not be made within 30 days of the date the Participant receives the notice and shall not be made more than ninety (90) days from the date the Participant receives the notice. However, a distribution may be made less than 30 days after the notice provided under Section 1.411(a)-11(c) of the Treasury Regulations is given, if:

(i)

the Committee clearly informs the Participant that he has a right to a period of at least 30 days after receiving the notice to consider the decision of whether or not to elect a distribution (and if applicable, a particular distribution option), and

(ii)

the Participant, after receiving the notice, affirmatively elects a distribution.

A Participant may modify such an election at any time, provided any new benefit payment date is at least 30 days after a modified election is delivered to the Committee.

Section 7.02 Minimum Distribution Requirements .

With respect to all Participants, other than those who are “5% owners” (as defined in Section 416 of the Code), benefits shall be paid on the required beginning date which is no later than the April 1st of the later of:

(i)

the calendar year following the calendar year in which the Participant attains age 70- ¹ / 2 , or

(ii)

the calendar year in which the Participant retires.

With respect to all Participants who are 5% owners within the meaning of Section 416 of the Code, such Participants’ benefits shall be paid no later than the April 1st of the calendar year following the calendar year in which the Participant attains age 70- ¹ / 2 .

Section 7.03 Benefits on a Participant’s Death .

(a)

If a Participant dies before his benefits are paid pursuant to Section 7.01 of the Plan, the balance credited to his Accounts shall be paid to his Beneficiary in a single distribution on or before the 60th day after the end of the Plan Year in which the Participant died. If the Participant has not named a Beneficiary or his named Beneficiary should not survive him, then the balance in his Accounts shall be paid to his estate. The benefits from that portion of the Participant’s Other Investments Account shall be calculated on the basis of the most recent Valuation Date before the date of payment.

(b)

If a married Participant dies before his benefit payments begin, then, unless he has specifically elected otherwise, the Committee shall cause the balance in his Accounts to be paid to his spouse, as Beneficiary. A married Participant may name an individual other than his spouse as Beneficiary provided that such election is accompanied by the spouse’s written consent which must:

(i)

acknowledge the effect of the election;

(ii)

explicitly provide either that the designated Beneficiary may not subsequently be changed by the Participant without the spouse’s further consent or that it may be changed without such consent; and

(iii)

must be witnessed by the Committee, its representative, or a notary public.

This requirement shall not apply if the Participant establishes to the Committee’s satisfaction that the spouse may not be located.

(c)

The Committee shall, from time to time, take whatever steps it deems appropriate to keep informed of each Participant’s marital status. Each Employer shall provide the Committee with the most reliable information in the Employer’s possession regarding its Participants’ marital status, and the Committee may, in its discretion, require a notarized affidavit from any Participant as to his marital status. The Committee, the Plan, the Trustee, and the Employers shall be fully protected and discharged from any liability to the extent of any benefit payments made as a result of the Committee’s good faith and reasonable reliance upon information obtained from a Participant as to the Participant’s marital status.

Section 7.04 Delay in Benefit Determination .

If the Committee is unable to determine the benefits payable to a Participant or Beneficiary on or before the latest date prescribed for payment pursuant to this Section 7, the benefits shall in any event be paid within sixty (60) days after they can first be determined.

Section 7.05 Options to Receive and Sell Company Stock .

(a)

Unless ownership of virtually all Company Stock is restricted to active Employees and qualified retirement plans for the benefit of Employees pursuant to the certificates of incorporation or by-laws of the Employers issuing Company Stock, a terminated Participant or the Beneficiary of a deceased Participant may instruct the Committee to distribute the Participant’s entire vested interest in his Accounts in the form of Company Stock. In that event, the Committee shall apply the Participant’s vested interest in his Other Investments Account to purchase sufficient Company Stock to make the required distribution.

(b)

Any Participant who receives Company Stock pursuant to this Section 7.05, and any person who has received Company Stock from the Plan or from such a Participant by reason of the Participant’s death or incompetency, by reason of divorce or separation from the Participant, or by reason of a rollover distribution described in Section 402(c) of the Code, shall have the right to require the Employer which issued the Company Stock to purchase the Company Stock for its current fair market value (hereinafter referred to as the “put right”). The put right shall be exercisable by written notice to the Committee during the first sixty (60) days after the Company Stock is distributed by the Plan, and, if not exercised in that period, during the first sixty (60) days in the following Plan Year after the Committee has communicated to the Participant its determination as to the Company Stock’s current fair market value. If the put right is exercised, the Trustee may, if so directed by the Committee in its sole discretion, assume the Employer’s rights and obligations with respect to purchasing the Company Stock. However, the put right shall not apply to the extent that the Company Stock, at the time the put right would otherwise be exercisable, may be sold on an established market in accordance with federal and state securities laws and regulations.

(c)

With respect to a put right, the Employer or the Trustee, as the case may be, may elect to pay for the Company Stock in equal periodic installments, not less frequently than annually, over a period not longer than five (5) years from the 30th day after the put right is exercised pursuant to paragraph (b) of this Section 7.05, with adequate security and interest at a reasonable rate on the unpaid balance, all such terms to be set forth in a promissory note delivered to the seller with normal terms as to acceleration upon any uncured default.

(d)

Nothing contained in this Section 7.05 shall be deemed to obligate any Employer to register any Company Stock under any federal or state securities law or to create or maintain a public market to facilitate the transfer or disposition of any Company Stock. The put right described in this Section 7.05 may only be exercised by a person described in paragraph (b) of this Section 7.05, and may not be transferred with any Company Stock to any other person. As to all Company Stock purchased by the Plan in exchange for any Acquisition Loan, the put right must be nonterminable. The put right for Company Stock acquired through an Acquisition Loan shall continue with respect to such Company Stock after the Acquisition Loan is repaid or the Plan ceases to be an employee stock ownership plan. Except as provided above, in accordance with the provisions of Sections 54.4975-7(b)(4) of the Treasury Regulations, no Company Stock acquired with the proceeds of an Acquisition Loan may be subject to any put, call or other option or buy-sell or similar arrangement while held by, and when distributed from, the Plan, whether or not the Plan is then an employee stock ownership plan.

Section 7.06 Restrictions on Disposition of Company Stock .

Except in the case of Company Stock which is traded on an established market, a Participant who receives Company Stock pursuant to this Section 7, and any person who has received Company Stock from the Plan or from such a Participant by reason of the Participant’s death or incompetency, divorce or separation from the Participant, or a rollover distribution described in

Section 402(c) of the Code, shall, prior to any sale or other transfer of the Company Stock to any other person, first offer the Company Stock to the issuing Employer and to the Plan at its current fair market value. This restriction shall apply to any transfer, whether voluntary, involuntary, or by operation of law, and whether for consideration or gratuitous. Either the Employer or the Trustee may accept the offer within 14 days after it is delivered. Any Company Stock distributed by the Plan shall bear a conspicuous legend describing the right of first refusal under this Section 7.06, as applicable, as well as any other restrictions upon the transfer of the Company Stock imposed by federal and state securities laws and regulations.

Section 7.07 Direct Transfer of Eligible Plan Distributions .

(a)

Notwithstanding any provision of the Plan to the contrary that would otherwise limit a distributee’s election under this Section, a distributee (as defined below) may elect to have any portion of an eligible rollover distribution (as defined below) paid directly to an eligible retirement plan (as defined below) specified by the distributee in a direct rollover (as defined below). A “distributee” includes a Participant or former Participant. In addition, the Participant’s or former Participant’s surviving spouse and the Participant’s or former Participant’s spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, are distributees with regard to the interest of the spouse or former spouse. For purposes of this Section 7.07 a “direct rollover” is a payment by the Plan to the eligible retirement plan specified by the distributee.

(b)

To effect such a direct transfer, the distributee must notify the Committee that a direct rollover is desired and provide to the Committee sufficient information regarding the eligible retirement plan to which the payment is to be made. Such notice shall be made in such form and at such time as the Committee may prescribe. Upon receipt of such notice, the Committee shall direct the Trustee to make a trustee-to-trustee transfer of the eligible rollover distribution to the eligible retirement plan so specified.

(c)

For purposes of this Section 7.07, an “eligible rollover distribution” shall have the meaning set forth in Section 402(c)(4) of the Code and any Treasury Regulations promulgated thereunder. To the extent such meaning is not inconsistent with the above references, an eligible rollover distribution shall mean any distribution of all or any portion of the Participant’s Account, except that such term shall not include any distribution which is one of a series of substantially equal periodic payments (not less frequently than annually) made (i) for the life (or life expectancy) of the Participant or the joint lives (or joint life expectancies) of the Participant and a designated Beneficiary, or (ii) for a period of ten (10) years or more. Further, the term “eligible rollover distribution” shall not include any distribution required to be made under Section 401(a)(9) of the Code or, the portion of any distribution that is not includible in gross income (determined without regard to the exclusions for net unrealized appreciation with respect to Company Stock). To the extent applicable under the Plan, “eligible rollover distributions” shall also not include any hardship distribution described in Section 401(k)(2)(B)(i)(IV) of the Code.

(d)

For purposes of this Section 7.07, an “eligible retirement plan” shall have the meaning set forth in Section 402(c)(8) of the Code and any Treasury Regulations promulgated thereunder. To the extent such meaning is not consistent with the above references, an eligible retirement plan shall mean: (i) an individual retirement account described in Section 408(a) of the Code, (ii) an individual retirement annuity described in Section 408(b) of the Code, (iii) an annuity or annuity plan described in Section 403(a) or Section 403(b) of the Code, (iv) a qualified trust described in Section 401(a) of the Code, or (v) a governmental plan under Section 457 of the Code that accepts the distributee’s eligible rollover distribution. However, in the case of an eligible rollover distribution to a surviving spouse, an eligible retirement plan means an individual retirement account or individual retirement annuity.

(e)

An eligible retirement plan shall also mean an annuity contract described in Section 403(b) of the Code and an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state which agrees to separately account for amounts transferred into such plan from this Plan. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order as defined in Section 414(p) of the Code.

SECTION 8

Voting of Company Stock and Tender Offers

Section 8.01 Voting of Company Stock .

(a)	*In General.* The Trustee shall generally vote all shares of Company Stock held in the Trust in accordance with the provisions of this Section 8.01.

(b)	*Allocated Shares.* Shares of Company Stock which have been allocated to Participants’ Accounts shall be voted by the Trustee in accordance with the Participants’ written instructions.

(c)

Uninstructed and Unallocated Shares. Shares of Company Stock which have been allocated to Participants’ Accounts but for which no written instructions have been received by the Trustee regarding voting shall be voted by the Trustee in a manner calculated to most accurately reflect the instructions the Trustee has received from Participants regarding voting shares of allocated Company Stock. Shares of unallocated Company Stock shall also be voted by the Trustee in a manner calculated to most accurately reflect the instructions the Trustee has received from Participants regarding voting shares of allocated Company Stock. Notwithstanding the preceding two sentences, all shares of Company Stock which have been allocated to Participants’ Accounts and for which the Trustee has not timely received written instructions regarding voting and all unallocated shares of Company Stock must be voted by the Trustee in a manner determined by the Trustee to be solely in the best interests of the Participants and Beneficiaries.

(d)

Voting Prior to Allocation. In the event no shares of Company Stock have been allocated to Participants’ Accounts at the time Company Stock is to be voted, each Participant shall be deemed to have one share of Company Stock allocated to his Accounts for the sole purpose of providing the Trustee with voting instructions.

(e)

Procedure and Confidentiality. Whenever such voting rights are to be exercised, the Employers, the Committee, and the Trustee shall see that all Participants and Beneficiaries are provided with the same notices and other materials as are provided to other holders of the Company Stock, and are provided with adequate opportunity to deliver their instructions to the Trustee regarding the voting of Company Stock allocated to their Accounts or deemed allocated to their Accounts for purposes of voting. The instructions of the Participants with respect to the voting of shares of Company Stock shall be confidential.

Section 8.02 Tender Offers .

In the event of a tender offer, Company Stock shall be tendered by the Trustee in the same manner set forth in Section 8.01 of the Plan regarding the voting of Company Stock.

SECTION 9

The Committee and Plan Administration

Section 9.01 Identity of the Committee .

The Committee shall consist of three or more individuals selected by the Bank. Any individual, including a director, trustee, shareholder, officer, or Employee of an Employer, shall be eligible to serve as a member of the Committee. The Bank shall have the power to remove any individual serving on the Committee at any time without cause upon ten (10) days’ written notice to such individual and any individual may resign from the Committee at any time without reason upon ten (10) days’ written notice to the Bank. The Bank shall notify the Trustee of any change in membership of the Committee.

Section 9.02 Authority of Committee .

(a)

The Committee shall be the “plan administrator” within the meaning of ERISA and shall have exclusive responsibility and authority to control and manage the operation and administration of the Plan, including the interpretation and application of its provisions, except to the extent such responsibility and authority are otherwise specifically:

(i)

allocated to the Bank, the Employers, or the Trustee under the Plan and Trust Agreement;

(ii)

delegated in writing to other persons by the Bank, the Employers, the Committee, or the Trustee; or

(iii)

allocated to other parties by operation of law.

(b)	The Committee shall have exclusive responsibility regarding decisions concerning the payment of benefits under the Plan.

(c)	The Committee shall have full investment responsibility with respect to the Investment Fund except to the extent, if any, specifically provided for in the Trust Agreement.

(d)

In the discharge of its duties, the Committee may employ accountants, actuaries, legal counsel, and other agents (who also may be employed by an Employer or the Trustee in the same or some other capacity) and may pay such individuals reasonable compensation and expenses for their services rendered with respect to the operation or administration of the Plan, to the extent such payments are not otherwise prohibited by law.

Section 9.03 Duties of Committee .

(a)

The Committee shall keep whatever records may be necessary in connection with the maintenance of the Plan and shall furnish to the Employers whatever reports may be required from time to time by the Employers. The Committee shall furnish to the Trustee whatever information may be necessary to properly administer the Trust. The Committee shall see to the filing with the appropriate government agencies of all reports and returns required with respect to the Plan under ERISA, the Code and other applicable laws and regulations.

(b)

The Committee shall have exclusive responsibility and authority with respect to the Plan’s holdings of Company Stock and shall direct the Trustee in all respects regarding the purchase, retention, sale, exchange, and pledge of Company Stock and the creation and satisfaction of any Acquisition Loan to the extent such responsibilities are not set forth in the Trust Agreement.

(c)

The Committee shall at all times act consistently with the Bank’s long-term intention that the Plan, as an employee stock ownership plan, be invested primarily in Company Stock. Subject to the direction of the Committee with respect to any Acquisition Loan pursuant to the provisions of Section 4.03 of the Plan, and subject to the provisions of Sections 7.05 and 11.04 of the Plan as to Participants’ rights under certain circumstances to have their Accounts invested in Company Stock or in assets other than Company Stock, the Committee shall determine, in its sole discretion, the extent to which assets of the Trust shall be used to repay any Acquisition Loan, to purchase Company Stock, or to invest in other assets selected by the Committee or an investment manager. No provision of the Plan relating to the allocation or vesting of any interests in Company Stock or investments other than Company Stock shall restrict the Committee from changing any holdings of the Trust Fund, whether the changes involve an increase or a decrease in the Company Stock or other assets credited to Participants’ Accounts. In determining the proper extent of the Trust Fund’s investment in Company Stock, the Committee shall be authorized to employ investment counsel, legal counsel, appraisers, and other agents and to pay their reasonable compensation and expenses to the extent such payments are not prohibited by law.

(d)

If the valuation of any Company Stock is not established by reported trading on a generally recognized public market, then the Committee shall have the exclusive authority and responsibility to determine the value of the Company Stock for all purposes under the Plan. Such value shall be determined as of each Valuation Date and on any other date as of which the Trustee purchases or sells Company Stock in a manner consistent with Section 4975 of the Code and the Treasury Regulations issued thereunder. The Committee shall use generally accepted methods of valuing stock of similar corporations for purposes of arm’s length business and investment transactions, and in this connection the Committee shall obtain, and shall be protected in relying upon, the valuation of Company Stock as determined by an independent appraiser (as defined in Section 401(a)(28)(c) of the Code).

Section 9.04 Compliance with ERISA and the Code .

The Committee shall perform all acts necessary to ensure the Plan’s compliance with ERISA and the Code. Each individual member of the Committee shall discharge his duties in good faith and in accordance with the applicable requirements of ERISA and the Code.

Section 9.05 Action by Committee .

All actions of the Committee shall be governed by the affirmative vote of a majority of the total number of Committee members. The members of the Committee may meet informally and may take any action without meeting as a group.

Section 9.06 Execution of Documents .

Any instrument to be executed by the Committee may be signed by any member of the Committee.

Section 9.07 Adoption of Rules .

The Committee shall adopt such rules and regulations of uniform applicability as it deems necessary or appropriate for the proper operation, administration and interpretation of the Plan.

Section 9.08 Responsibilities to Participants .

The Committee shall determine which Employees qualify to participate in the Plan. The Committee shall furnish to each Eligible Employee whatever summary plan descriptions, summary annual reports, and other notices and information that may be required under ERISA. The Committee also shall determine when a Participant or his Beneficiary qualifies for the payment of benefits under the Plan. The Committee shall furnish to each such Participant or Beneficiary whatever information is required under ERISA or the Code (or is otherwise appropriate) to enable the Participant or Beneficiary to make whatever elections may be available pursuant to Section 7, and the Committee shall provide for the payment of benefits in the proper form and amount from the Trust. The Committee may decide in its sole discretion to permit modifications of elections and to defer or accelerate benefits to the extent consistent with the terms of the Plan, applicable law, and the best interests of the individuals concerned.

Section 9.09 Alternative Payees in Event of Incapacity .

If the Committee finds at any time that an individual qualifying for benefits under this Plan is a minor or is incompetent, the Committee may direct the benefits to be paid, in the case of a minor, to his parents, his legal guardian, a custodian for him under the Uniform Transfers to Minors Act, or the person having actual custody of him, or, in the case of an incompetent, to his spouse, his legal guardian, or the person having actual custody of him. The Committee and the Trustee shall not be obligated to inquire as to the actual use of the funds by the person receiving them under this Section 9.09, and any such payment shall completely discharge the obligations of the Plan, the Trustee, the Committee, and the Employers to the extent of the payment.

Section 9.10 Indemnification by Employers .

Except as separately agreed upon in writing, the Committee, and any member or employee of the Committee, shall be indemnified and held harmless by the Employers, jointly and severally, to the fullest extent permitted by law, against any and all costs, damages, expenses, and liabilities reasonably incurred by or imposed upon the Committee or such individual in connection with any claim made against the Committee or such individual, or in which the Committee or such individual may be involved by reason of being, or having been, the Committee, or a member or employee of the Committee, to the extent such amounts are not paid by insurance.

Section 9.11 Abstention by Interested Member .

Any member of the Committee who is also a Participant in the Plan shall take no part in any determination specifically relating to his own participation or benefits under the Plan, unless an abstention would render the Committee incapable of acting on the matter.

SECTION 10

Rules Governing Benefit Claims

Section 10.01 Claim for Benefits .

Any Participant or Beneficiary who qualifies for the payment of benefits shall file a claim for benefits with the Committee on a form provided by the Committee. The claim, including any election of an alternative benefit form, shall be filed at least thirty (30) days before the date on which the benefits are to begin. If a Participant or Beneficiary fails to file a claim by the 30 ^th day before the date on which benefits become payable, he shall be presumed to have filed a claim for payment for the Participant’s benefits in the standard form prescribed by Section 7 of the Plan.

Section 10.02 Notification by Committee .

Within ninety (90) days after receiving a claim for benefits (or within 180 days, if special circumstances require an extension of time and written notice of the extension is given to the Participant or Beneficiary within ninety (90) days after receiving the claim for benefits), the Committee shall notify the Participant or Beneficiary whether the claim has been approved or denied. If the Committee denies a claim in any respect, the Committee shall set forth in a written notice to the Participant or Beneficiary:

(a)	each specific reason for the denial;

(b)	specific references to the pertinent Plan provisions on which the denial is based;

(c)	a description of any additional material or information which could be submitted by the Participant or Beneficiary to support his claim, with an explanation of the relevance of such information; and

(d)	an explanation of the claims review procedures set forth in Section 10.03 of the Plan.

Section 10.03 Claims Review Procedure .

Within sixty (60) days after a Participant or Beneficiary receives notice from the Committee that his claim for benefits has been denied in any respect, he may file with the Committee a written notice of appeal setting forth his reasons for disputing the Committee’s determination. In connection with his appeal, the Participant or Beneficiary or his representative may inspect or purchase copies of pertinent documents and records to the extent not inconsistent with other Participants’ and Beneficiaries’ rights of privacy. Within sixty (60) days after receiving a notice of appeal from a prior determination (or within one hundred and twenty (120) days, if special circumstances require an extension of time and written notice of the extension is given to the Participant or Beneficiary and his representative within sixty (60) days after receiving the notice of appeal), the Committee shall furnish to the Participant or Beneficiary and his representative, if any, a written statement of the Committee’s final decision with respect to his claim, including the reasons for such decision and the particular Plan provisions upon which it is based.

SECTION 11

The Trust

Section 11.01 Creation of Trust Fund .

All amounts received under the Plan from an Employer and investments shall be held in a Trust Fund pursuant to the terms of this Plan and the Trust Agreement. The benefits described in this Plan shall be payable only from the assets of the Trust Fund. Neither the Bank, any other Employer, its board of directors or trustees, its stockholders, its officers, its employees, the Committee, nor the Trustee shall be liable for payment of any benefit under this Plan except from the Trust Fund.

Section 11.02 Company Stock and Other Investments .

The Trust Fund held by the Trustee shall be divided into Company Stock and investments other than Company Stock. The Trustee shall have no investment responsibility for the portion of the Trust Fund consisting of Company Stock, but shall accept any Employer contributions made in the form of Company Stock, and shall acquire, sell, exchange, distribute, and otherwise deal with and dispose of Company Stock in accordance with the instructions of the Committee.

Section 11.03 Acquisition of Company Stock .

From time to time the Committee may, in its sole discretion, direct the Trustee to acquire Company Stock from the issuing Employer or from shareholders, including shareholders who are or have been Employees, Participants, or fiduciaries with respect to the Plan. The Trustee shall pay for such Company Stock no more than its fair market value, which shall be determined conclusively by the Committee pursuant to Section 9.03(d) of the Plan. The Committee may direct the Trustee to finance the acquisition of Company Stock through an Acquisition Loan subject to the provisions of Section 4.03 of the Plan.

Section 11.04 Participants’ Option to Diversify .

The Committee shall establish a procedure under which each Participant may, during the first five years of a certain six-year period, elect to have up to twenty-five percent (25%) of the value of his Accounts committed to alternative investment options within an “Investment Fund.” For the sixth year in this period, the Participant may elect to have up to fifty percent (50%) of the value of his Accounts committed to other investments. The six-year period shall begin with the Plan Year following the first Plan Year in which the Participant has both reached age 55 and completed 10 years of participation in the Plan; a Participant’s election to diversify his Accounts must be made within the 90-day period immediately following the last day of each of the six Plan Years. The Committee shall see that the Investment Fund includes a sufficient number of investment options to comply with Section 401(a)(28)(B) of the Code. The Committee may, in its discretion, permit a transfer of a portion of the Participant’s Accounts to the First Savings Bank, F.S.B. Retirement Plan in order to satisfy this Section 11.04, provided such investments comply with Section 401(a)(28)(B) of the Code and such transfer is not otherwise prohibited under the Code or ERISA. The Trustee shall comply with any investment directions received from Participants in accordance with the procedures adopted from time to time by the Committee under this Section 11.04.

SECTION 12

Adoption, Amendment and Termination

Section 12.01 Adoption of Plan by Other Employers .

With the consent of the Bank, any entity may become a participating Employer under the Plan by:

(a)	taking such action as shall be necessary to adopt the Plan;

(b)	becoming a party to the Trust Agreement establishing the Trust Fund; and

(c)	executing and delivering such instruments and taking such other action as may be necessary or desirable to put the Plan into effect with respect to the entity’s Employees.

Section 12.02 Adoption of Plan by Successor .

In the event that any Employer shall be reorganized by way of merger, consolidation, transfer of assets or otherwise, so that an entity other than an Employer shall succeed to all or substantially all of the Employer’s business, the successor entity may be substituted for the Employer under the Plan by adopting the Plan and becoming a party to the Trust Agreement. Contributions by the Employer shall be automatically suspended from the effective date of any such reorganization until the date upon which the substitution of the successor entity for the Employer under the Plan becomes effective. If, within ninety (90) days following the effective date of any such reorganization, the successor entity shall not have elected to become a party to the Plan, or if the Employer shall adopt a plan of complete liquidation other than in connection with a reorganization, the Plan shall be automatically terminated with respect to Employees of the Employer as of the close of business on the 90th day following the effective date of the reorganization, or as of the close of business on the date of adoption of a plan of complete liquidation, as the case may be.

Section 12.03 Plan Adoption Subject to Qualification .

Notwithstanding any other provision of the Plan, the adoption of the Plan and the execution of the Trust Agreement are conditioned upon their being determined initially by the Internal Revenue Service to meet the qualification requirements of Section 401(a) of the Code, so that the Employers may deduct currently for federal income tax purposes their contributions to the Trust and so that the Participants may exclude the contributions from their gross income and recognize income only when they receive benefits. In the event that this Plan is held by the Internal Revenue Service not to qualify initially under Section 401(a) of the Code, the Plan may be amended retroactively to the earliest date permitted by the Code and the applicable Treasury Regulations in order to secure qualification under Section 401(a) of the Code. If this Plan is held by the Internal Revenue Service not to qualify initially under Section 401(a) of the Code either as originally adopted or as amended, each Employer’s contributions to the Trust under this Plan (including any earnings thereon) shall be returned to it and this Plan shall be terminated. In the event that this Plan is amended after its initial qualification, and the Plan, as amended, is held by the Internal Revenue Service not to qualify under Section 401(a) of the Code, the amendment may be modified retroactively to the earliest date permitted by the Code and the applicable Treasury Regulations in order to secure approval of the amendment under Section 401(a) of the Code.

Section 12.04 Right to Amend or Terminate .

(a)	The Bank intends to continue this Plan as a permanent program. However, each participating Employer separately reserves the right to suspend, supersede, or terminate the Plan at any time and for any reason, as it applies to that Employer’s Employees, and

the Bank reserves the right to amend, suspend, supersede, merge, consolidate, or terminate the Plan at any time and for any reason, as it applies to the Employees of all Employers.

(b)

No amendment, suspension, supersession, merger, consolidation, or termination of the Plan shall reduce any Participant’s or Beneficiary’s proportionate interest in the Trust Fund, or shall divert any portion of the Trust Fund to purposes other than the exclusive benefit of the Participants and their Beneficiaries prior to the satisfaction of all liabilities under the Plan. Except as is required for purposes of compliance with the Code or ERISA, neither the provisions of Section 5.04 relating to the crediting of contributions, forfeitures and shares of Company Stock released from the Loan Suspense Account, nor any other provision of the Plan relating to the allocation of benefits to Participants, may be amended more frequently than once every six months. Moreover, there shall not be any transfer of assets to a successor plan or merger or consolidation with another plan unless, in the event of the termination of the successor plan or the surviving plan immediately following such transfer, merger, or consolidation, each participant or beneficiary would be entitled to a benefit equal to or greater than the benefit he would have been entitled to if the plan in which he was previously a participant or beneficiary had terminated immediately prior to such transfer, merger, or consolidation. Following a termination of this Plan by the Bank, the Trustee shall continue to administer the Trust and pay benefits in accordance with the Plan and the Committee’s instructions.

(c)	In the event of a Change in Control, the Plan shall be terminated and allocations made to Participants in accordance with the provisions of Section 5.08 of the Plan.

SECTION 13

General Provisions

Section 13.01 Nonassignability of Benefits .

The interests of Participants and other persons entitled to benefits under the Plan shall not be subject to the claims of their creditors and may not be voluntarily or involuntarily assigned, alienated, pledged, encumbered, sold, or transferred. The prohibitions set forth in this Section 13.01 shall also apply to any judgment, decree, or order (including approval of a property or settlement agreement) which relates to the provision of child support, alimony, or property rights to a present or former spouse, child, or other dependent of a Participant pursuant to a domestic relations order, unless such judgment, decree or order is determined to be a “qualified domestic relations order” as defined in Section 414(p) of the Code.

Section 13.02 Limit of Employer Liability .

The liability of the Employers with respect to Participants and other persons entitled to benefits under the Plan shall be limited to making contributions to the Trust from time to time, in accordance with Section 4 of the Plan.

Section 13.03 Plan Expenses .

All expenses incurred by the Committee or the Trustee in connection with administering the Plan and Trust shall be paid by the Trustee from the Trust Fund to the extent the expenses have not been paid or assumed by the Employer.

Section 13.04 Nondiversion of Assets .

Except as provided in Sections 5.05 and 12.03 of the Plan, under no circumstances shall any portion of the Trust Fund be diverted to or used for any purpose other than the exclusive benefit of Participants and their Beneficiaries prior to the satisfaction of all liabilities under the Plan.

Section 13.05 Separability of Provisions .

If any provision of the Plan is held to be invalid or unenforceable, the other provisions of the Plan shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in the Plan.

Section 13.06 Service of Process .

The agent for the service of process upon the Plan shall be the Chairman of the Board of the Bank and the Trustee, or such other person as may be designated from time to time by the Bank.

Section 13.07 Governing Law .

The Plan is established under, and its validity, construction and effect shall be governed by the laws of the State of Tennessee to the extent those laws are not preempted by federal law, including the provisions of ERISA.

Section 13.08 Special Rules for Persons Subject to Section 16(b) Requirements .

Notwithstanding anything herein to the contrary, any former Participant who is subject to the provisions of Section 16(b) of the Exchange Act, who becomes eligible to again participate in the Plan, may not become a Participant prior to the date that is six months from the date such former Participant terminated participation in the Plan. In addition, any person subject to the provisions of Section 16(b) of the Exchange Act receiving a distribution of Company Stock from the Plan must hold such Company Stock for a period of six months, commencing with the date of distribution. However, this restriction will not apply to Company Stock distributions made in connection with death, retirement, Disability or termination of employment, or made pursuant to the terms of a qualified domestic relations order.

Section 13.09 Military Service .

Notwithstanding any other provision of this Plan to the contrary, contributions, benefits and Service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.

Section 13.10 Minimum Distribution Requirements .

General Rules

1.1 Precedence. The requirements of this Section 13.10 will take precedence over any inconsistent provisions of the Plan.

1.2 Requirements of Treasury Regulations Incorporated . All distributions required under this Section will be determined and made in accordance with the Treasury regulations under section 401(a)(9) of the Internal Revenue Code.

1.3 TEFRA Section 242(b)(2) Elections . Notwithstanding the other provisions of this article, distributions may be made under a designation made before January 1, 1984, in accordance with section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the plan that relate to section 242(b)(2) of TEFRA.

Time and Manner of Distribution.

1.1 Required Beginning Date. The participant’s entire interest will be distributed, or begin to be distributed, to the participant no later than the participant’s required beginning date.

1.2 Death of Participant Before Distributions Begin. If the participant dies before distributions begin, the participant’s entire interest will be distributed, or begin to be distributed, no later than as follows:

(a)

If the participant’s surviving spouse is the participant’s sole designated beneficiary, then, except as provided in the adoption agreement, distributions to the surviving spouse will begin by December 31 of the calendar year immediately following the calendar year in which the participant died, or by December 31 of the calendar year in which the participant would have attained age 70 ¹ / 2 , if later.

(b)

If the participant’s surviving spouse is not the participant’s sole designated beneficiary, then, except as provided in the adoption agreement, distributions to the designated beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the participant died.

(c)

If there is no designated beneficiary as of September 30 of the year following the year of the participant’s death, the participant’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the participant’s death.

(d)

If the participant’s surviving spouse is the participant’s sole designated beneficiary and the surviving spouse dies after the participant but before distributions to the surviving spouse begin, this section 1.2, other than section 1.2(a), will apply as if the surviving spouse were the participant.

1.3 Forms of Distribution . All distributions under this Plan will be made in a single lump sum.

Required Minimum Distributions During Participant’s Lifetime.

1.1 Amount of Required Minimum Distribution For Each Distribution Calendar Year . During the participant’s lifetime, the minimum amount that will be distributed for each distribution calendar year is the lesser of:

(a)

the quotient obtained by dividing the participant’s account balance by the distribution period in the Uniform Lifetime Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the participant’s age as of the participant’s birthday in the distribution calendar year; or

(b)

if the participant’s sole designated beneficiary for the distribution calendar year is the participant’s spouse, the quotient obtained by dividing the participant’s account balance by the number in the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the participant’s and spouse’s attained ages as of the participant’s and spouse’s birthdays in the distribution calendar year; or

1.2 Lifetime Required Minimum Distributions Continue Through Year of Participant’s Death. Required minimum distributions will be determined under this section 3 beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the participant’s date of death.

Required Minimum Distributions After Participant’s Death.

1.1 Death On or After Date Distributions Begin.

(a)

Participant Survived by Designated Beneficiary. If the participant dies on or after the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the participant’s death is the quotient obtained by dividing the participant’s account balance by the longer of the remaining life expectancy of the participant or the remaining life expectancy of the participant’s designated beneficiary, determined as follows:

The participant’s remaining life expectancy is calculated using the age of the participant in the year of death, reduced by one for each subsequent year.

If the participant’s surviving spouse is the participant’s sole designated beneficiary, the remaining life expectancy of the surviving spouse is calculated for each distribution calendar year after the year of the participant’s death using the surviving spouse’s age as of the spouse’s birthday in that year. For distribution calendar years after the year of the surviving spouse’s death, the remaining life expectancy of the surviving spouse is calculated using the age of the surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.

If the participant’s surviving spouse is not the participant’s sole designated beneficiary, the designated beneficiary’s remaining life expectancy is calculated using the age of the beneficiary in the year following the year of the participant’ death, reduced by one for each subsequent year.

(b)

No Designated Beneficiary. If the participant dies on or after the date distributions begin and there is no designated beneficiary as of September 30 of the year after the year of the participant’s death, the minimum amount that will be distributed for each distribution calendar year after the year of the participant’s death is the quotient obtained by dividing the participant’s account balance by the participant’s remaining life expectancy calculated using the age of the participant in the year of death, reduced by one for each subsequent year.

1.2 Death Before Date Distributions Begin.

(a)

Participant Survived by Designated Beneficiary. Except as provided in the adoption agreement, if the participant dies before the date distributions begin and there is a designated beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the participant’s death is the quotient obtained by dividing the participant’s account balance by the remaining life expectancy of the participant’s designated beneficiary, determined as provided in this Section.

(b)

No Designated Beneficiary. If the participant dies before the date distributions begin and there is no designated beneficiary as of September 30 of the year following the year of the participant’s death, distribution of the participant’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the participant’s death.

(c)

Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin. If the participant dies before the date distributions begin, the participant’s surviving spouse is the participant’s sole designated beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse, this section will apply as if the surviving spouse were the participant.

Definitions for Section 13.10.

Designated beneficiary . The individual who is designated as the beneficiary under the Plan and is the designated beneficiary under section 401(a)(9) of the Internal Revenue Code and section 1.401(a)(9)-1, Q&A-4, of the Treasury regulations.

Distribution calendar year. A calendar year for which a minimum distribution is required. For distributions beginning before the participant’s death, the first distribution calendar year is the calendar year immediately preceding the calendar year which contains the participant’s required beginning date. For distributions beginning after the participant’s death, the first distribution calendar year is the calendar year in which distributions are required to begin under section 2.2. The required minimum distribution for the participant’s first distribution calendar year will be made on or before the participant’s required beginning date. The required minimum distribution for other distribution calendar years, including the required minimum distribution for the distribution calendar year in which the participant’s required beginning date occurs, will be made on or before December 31 of that distribution calendar year.

Life expectancy. Life expectancy as computed by use of the Single Life Table in section 1.401(a)(9)-9 of the Treasury regulations.

Participant’s account balance. The account balance as of the last valuation date in the calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The account balance for the valuation calendar year includes any amounts rolled over transferred to the plan either in the valuation calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar year.

SECTION 14

Top-Heavy Provisions

Section 14.01 Top-Heavy Provisions .

(i)

Key employee . Key employee means any employee or former employee (including any deceased employee) who at any time during the Plan Year that includes the Determination Date was an officer of the Employer having annual compensation greater than $130,000 (as adjusted under Section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5% owner of the Employer or a 1% owner of the Employer having annual compensation of more than $150,000. For this purpose, annual compensation means compensation within the meaning of Section 415(c)(3) of the Code. The determination of who is a key employee will be made in accordance with Section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

(ii)	Determination of present values and amounts . This section (ii) shall apply for purposes of determining the present values of accrued benefits and the amounts of account balances of Participants as of the distribution date.

(A)

Distributions during year ending on the Determination Date . The present values of accrued benefits and the amounts of account balances of a Participant as of the Determination Date shall be increased by the distributions made with respect to the Participant under the Plan and any Plan aggregated with the Plan under Section 416(g)(2) of the Code during the 1-year period ending on the Determination Date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason other than separation from service, death or disability, this provision shall be applied by substituting “5-year period” for “1-year period”.

(B)

Participants not performing services during the year ending on the Determination Date . The accrued benefits and accounts of any individual who has not performed services for the Employer during the 1-year period ending on the Determination Date shall not be taken into account.

Section 14.02 Plan Modifications Upon Becoming Top-Heavy .

(a)

Minimum Accruals. Section 5.04 of the Plan will be modified to provide that the aggregate amount of Employer contributions allocated in each Plan Year to the Accounts of each Participant who is a non-Key Employee (as defined under Section 416(i)(1) of the Code), and who is employed by an Employer as of the last day of the Plan Year, may not be less than the lesser of:

(i)

three percent (3%) of his Compensation for the Plan Year; and

(ii)

a percentage of his Compensation equal to the largest percentage obtained by dividing the sum of the amount credited to the Accounts of any Key Employee by that Key Employee’s Compensation.

(b)

The preceding provision will remain in effect for the period in which the Plan is top-heavy. If, for any particular year thereafter, the Plan is no longer top-heavy, the provisions contained in this Section 14.02 shall cease to apply, except that any previously vested portion of any Account balance shall remain nonforfeitable.

Exhibit 10.2

TRUST AGREEMENT

BETWEEN

FIRST SAVINGS BANK, F.S.B.

AND

[ ]

FOR THE

FIRST SAVINGS BANK, F.S.B.

EMPLOYEE STOCK OWNERSHIP PLAN TRUST

Effective as of January 1, 2008

CONTENTS


		Page No.
Section 1	Creation of Trust	1

Section 2	Investment of Trust Fund and Administrative Powers of the Trustee	2

Section 3	Compensation and Indemnification of Trustee and Payment of Expenses and Taxes	7

Section 4	Records and Valuation	8

Section 5	Instructions from Committee	9

Section 6	Change of Trustee	10

Section 7	Miscellaneous	10

This TRUST AGREEMENT dated as of January 1, 2008 between FIRST SAVINGS BANK, F.S.B. with its administrative office at 501 East Lewis & Clark Parkway, Clarksville, IN 47129 (hereinafter called the “Company”), [ ] with its administrative office at (hereinafter called the “Trustee”).

WITNESSETH THAT:

WHEREAS, the Company has approved and adopted an employee stock ownership plan for the benefit of its employees, the First Savings Bank, F.S.B. Employee Stock Ownership Plan (hereinafter called the “Plan”); and

WHEREAS, the Company has authorized the execution of this Trust Agreement and has appointed [ ] as Trustee of the Trust Fund created pursuant to the Plan; and

WHEREAS, [ ] has agreed to act as Trustee and to hold and administer the assets of the Plan in accordance with the terms of this Trust Agreement.

NOW, THEREFORE, the Company and the Trustee agree as follows:

Section 1. Creation of Trust .

1.1 Trustee . [ ] shall serve as Trustee of the Trust Fund created in accordance with and in furtherance of the Plan, and shall serve as Trustee until its removal or resignation in accordance with Section 6.

1.2 Trust Fund . The Trustee hereby agrees to accept contributions from the Employer as defined in the Plan and amounts transferred from other qualified retirement plans from time to time in accordance with the terms of the Plan. All such property and contributions, together with income thereon and increments thereto, shall constitute the “Trust Fund” to be held in accordance with the terms of the Trust Agreement.

1.3 Incorporation of Plan . An instrument entitled “First Savings Bank, F.S.B. Employee Stock Ownership Plan” is incorporated herein by reference, and this Trust Agreement shall be interpreted consistently with that Plan. All words and phrases defined in that Plan shall have the same meanings when used in this Trust Agreement.

1.4 Name . The name of this trust shall be “First Savings Bank, F.S.B. Employee Stock Ownership Plan Trust.”

1.5 Nondiversion of Assets . In no event shall any part of the corpus or income of the Trust Fund be used for, or diverted to, purposes other than for the exclusive benefit of the Participants and their Beneficiaries prior to the satisfaction of all liabilities under the Plan, except to the extent that assets may be returned to the Employer in accordance with the Plan where the Plan fails to qualify initially under Section 401(a) of the Internal Revenue Code (the “Code”), or where they are attributable to contributions made by mistake of fact or in excess of the deductibility allowed under the Code.

Section 2. Investment of Trust Fund and Administrative Powers of the Trustee .

2.1 Stock and Other Investments . The basic investment policy of the Plan shall be to invest primarily in Stock of the Employer for the exclusive benefit of the Participants and their Beneficiaries. The Committee shall have full and complete investment authority and responsibility with respect to the purchase, retention, sale, exchange, and pledge of Stock and the payment of Stock Obligations, and the Trustee shall not deal in any way with Stock except in accordance with its obligations pursuant to this Trust Agreement and the written instructions of the Committee. The Trustee shall invest, or keep invested, all or a portion of the Trust Fund in Stock, and shall pay Stock Obligations out of assets of the Trust Fund, as instructed from time to time by the Committee. The Trustee shall invest any balance of the Trust Fund (the “Investment Fund”) in such other property as the Committee, in its sole discretion, shall deem advisable, subject to any delegation of such investment responsibility pursuant to Section 2.2. Nothing contained herein shall provide investment discretion authority or any like responsibility in regard to the assets of the Trust Fund.

In connection with instructions to acquire Stock, the Trustee may purchase newly issued or outstanding Stock from the Employer or any other holders of Stock, including Participants, Beneficiaries, and Plan fiduciaries. All purchases and sales of Stock shall be made by the Trustee at fair market value as determined by the Committee in good faith and in accordance with any applicable requirements under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”). Such purchases may be made with assets of the Trust Fund, with funds borrowed for this purpose (with or without guarantees of repayment to the lender by the Employer), or by any combination of the foregoing.

Notwithstanding any other provision of this Trust Agreement or the Plan, neither the Committee nor the Trustee shall make any purchase, sale, exchange, investment, pledge, valuation, or loan, or take any other action involving those assets for which they are responsible which (i) is inconsistent with the policy of the Plan and Trust, (ii) is inconsistent with the prudence and diversification requirements set forth in Sections 404(a)(1)(B) and (C) of ERISA (to the extent such requirements apply to an employee stock ownership plan and trust), (iii) is prohibited by Section 406 or 407 of ERISA, or (iv) would impair the qualification of the Plan or the exemption of the Trust under Sections 401 and 501, respectively, of the Code.

2.2 Delegation of Investment Responsibility . The Committee may, by written notice and in accordance with the Plan, direct the Trustee to segregate any portion or all of the Investment Fund into one or more separate accounts for each of which full investment responsibility will be delegated to an investment manager appointed in such notice pursuant to Section 402(c)(3) of ERISA (hereinafter a “Manager”). For any separate account where the Trustee is to maintain custody of the assets, the Trustee and the Manager shall agree upon procedures for the transmittal of investment instructions from the Manager to the Trustee, and the Trustee may provide the Manager with such documents as may be necessary to authorize the Manager to effect transactions directly on behalf of the segregated account.

Further, the Committee may, by written notice and in accordance with the Plan, direct the Trustee to segregate any portion or all of the Investment Fund into one or more separate accounts for each of which full investment responsibility will be delegated to an insurance company through one or more group annuity contracts, deposit administration contracts, or similar contracts, which may provide for investments in any commingled separate accounts established under such contracts. An insurance company shall be a Manager with respect to any amounts held under such a contract except to the extent the insurer’s assets are not deemed assets of the Plan and Trust Fund pursuant to Section 401(b)(2) of ERISA. The allocation of amounts held under such a contract among the insurer’s general account and one or more individual or commingled separate accounts shall be determined by the Committee except as otherwise agreed by the Committee and the insurer.

Any Manager shall have all of the powers given to the Trustee pursuant to Section 2.3 with respect to the portion of the Trust Fund committed to its investment discretion and control. The Trustee shall be responsible for the safekeeping of any assets which remain in their custody, but in no event shall the Trustee be under any duty to question or make any inquiry or suggestion regarding the action or inaction of a Manager or an insurer or the advisability of acquiring, retaining, or disposing of any asset of a segregated account. The Employer shall indemnify and hold the Trustee harmless from any and all costs, damages, expenses, and liabilities which the Trustee may incur by reason of any action taken or omitted to be taken by the Trustee upon directions from the Committee, a Manager, or an insurer pursuant to this Section 2.2.

2.3 Trustee Powers . In addition to and not by way of limitation upon the fiduciary powers granted to it by law, the Trustee shall have the following specific powers, subject to the limitations set forth in Section 2.1:

2.3-1 to receive, hold, manage, invest and reinvest the money or other property which constitutes the Trust Fund, without distinction between principal and income;

2.3-2 to hold funds uninvested temporarily, provided it is a period of time that is not unreasonable, without liability for interest thereon, and to deposit funds in one or more savings or similar accounts with any banks and savings and loan associations which are insured by an instrumentality of the federal government, including the Trustee if it is such an institution;

2.3-3 at the direction of the Committee, to invest or reinvest the whole or any portion of the money or other property which constitutes the Trust Fund in such common or preferred stocks, investment trust shares, mutual funds, commingled trust funds, partnership interests, bonds, notes, or other evidences of indebtedness, and real and personal property as the Trustee in their absolute judgment and discretion may deem to be for the best interests of the Trust Fund, regardless of nondiversification to the extent that such nondiversification is clearly prudent, and regardless of whether any such investment or property is authorized by law regarding the investment of trust funds, of a wasting asset nature, temporarily non-income producing, or within or without the United States;

2.3-4 to invest in common and preferred stocks, bonds, notes, or other obligations of any corporation or business enterprise in which an Employer or its owners may own an interest;

2.3-5 at the direction of the Committee, to exchange any investment or property, real or personal, for other investments or properties at such time and upon such terms as the Trustee shall deem proper;

2.3-6 at the direction of the Committee, to sell, transfer, convey or otherwise dispose of any investment or property, real or personal, for cash or on credit, in such manner and upon such terms and conditions as the Trustee shall deem advisable, and no person dealing with the Trustee shall be under any duty to inquire as to the validity, expediency, or propriety of any such sale or as to the application of the purchase money paid to the Trustee;

2.3-7 to hold any investment or property in the name of the Trustee, with or without the designation of any fiduciary capacity, or in the name of a nominee, or unregistered, or in such other form that title may pass by delivery; provided, however, that the Trustee’s records always show that such investment or property belongs to the Trust Fund and the Trustee shall not be relieved hereby of its responsibility to maintain safe custody of such investment or property;

2.3-8 to organize one or more corporations to hold, manage, or liquidate any property, including real estate, owned or acquired by the Trust Fund if in the sole discretion of the Trustee the organization of such corporation or corporations is for the best interests of the Trust and the Plan Participants and Beneficiaries;

2.3-9 to extend the time for payment of, to modify, to renew, or to release security from any mortgage, note or other evidence of indebtedness, or to take advantage of or waive any default; to foreclose mortgages and bid on property under foreclosure or to take title to property by conveyance in lieu of foreclosure, either with or without the payment of additional consideration;

2.3-10 to vote in person or by proxy all stocks and other securities having voting privileges; to exercise or refrain from exercising any option or privilege with respect to stocks and other securities, including any right or privilege to subscribe for or otherwise to acquire stocks and other securities; or to sell any such right or privilege; to assent to and join in any plan of refinance, merger, consolidation, reorganization or liquidation of any corporation or other enterprise in which this Trust may have an interest, to deposit stocks and other securities with any committee formed to effectuate the same, to pay any expense incidental thereto, to exchange stocks and other securities for those which may be issued pursuant to any such plan, and to retain as an investment the stocks and other securities received by the Trustee; and to deposit any investment in a voting trust; notwithstanding the preceding, Participants and Beneficiaries shall be entitled to direct the manner in which stock allocated to their respective accounts are to be voted on all matters. All stock which has been allocated to Participants’ Accounts for which the Trustee has received no written direction and all unallocated Employer securities will be voted by the Trustee in direct proportion to any Participant’s directions received and solely in the interest of the Participants and Beneficiaries. Whenever such voting rights are to be exercised, the Employer, the Committee and the Trustee shall see that all Participants and Beneficiaries are

provided with adequate opportunity to deliver their instructions to the Trustee regarding voting of stock allocated to their accounts. The instructions of the Participants with respect to the voting of allocated shares hereunder shall be confidential;

2.3-11 to abandon any property, real or personal, which the Trustee shall consider to be worthless or not of sufficient value to warrant its keeping or protecting; to abstain from the payment of taxes, water rents, assessments, repairs, maintenance, and upkeep of any such property; to permit any such property to be lost by tax sale or other proceedings, and to convey any such property for a nominal consideration or without consideration;

2.3-12 to borrow money from the Employer or from others (including the Trustee), and to enter into installment contracts, for the purchase of Stock upon such terms and conditions and at such reasonable rates of interest as the Committee may deem to be advisable, to issue its promissory notes as Trustee to evidence such debt, to secure the payment of such notes by pledging any property of the Trust Fund, and to authorize the holders of any such notes to pledge them to secure obligations of the holders and in connection therewith to repledge any assets of the Trust as security therefor; provided that, with respect to any extension of credit to the Trust involving, as a lender or guarantor, the Employer or other “disqualified person” within the meaning of Section 4975(e)(2) of the Code —

(a)

each loan or installment contract is primarily for the benefit of Participants and Beneficiaries of the Plan;

(b)

any interest on a loan or installment contract does not exceed a reasonable rate;

(c)

the proceeds of any loan shall be used only to acquire Stock, to repay the loan, or to repay a previous loan meeting these conditions, and the subject of any installment contract shall be only the Trust’s purchase of Stock;

(d)

any collateral pledged to a creditor by the Trustee shall consist only of qualifying employer securities as that term is defined under Section 4975(e)(8) of the Code and the creditor shall have no recourse against the Trust Fund except with respect to the collateral (although the creditor may have recourse against an Employer as guarantor);

(e)

payments with respect to a loan or installment contract shall be made only from those amounts contributed by the Employer to the Trust Fund, from amounts earned on such contributions, and from cash dividends received on unallocated Stock held by the Trust as collateral for such an obligation; and

(f)

upon the payment of any portion of balance due on a loan or upon any installment payment, a proportionate part of any qualified employer securities originally pledged as collateral for such indebtedness shall be released from encumbrance in accordance with Section 4.2 of the Plan and the Committee shall at least annually advise the Trustee of the number of shares of Stock so released and the proper allocation of such shares under the terms of the Plan;

2.3-13 to manage and operate any real property which shall at any time constitute an asset of the Trust Fund; to make repairs, alterations, and improvements thereto; to insure such property against loss by fire or other casualty; to lease or grant options for the sale of such property, which lease or option may be for a period of time which may extend beyond the life of this Trust; and to take any other action or enter into any other contract respecting such property which is consistent with the best interests of the Trust;

2.3-14 to pay any and all reasonable and normal expenses incurred in connection with the exercise of any power, right, authority or discretion granted herein, and, upon prior notice to the Company, to employ and compensate agents, investment counsel, custodians, actuaries, attorneys, and accountants in such connection;

2.3-15 to employ and consult with any legal counsel, who also may be counsel to an Employer or the Administrator, with respect to the meaning or construction of this Trust Agreement, the extent of the Trustee’s obligations and duties hereunder, and whether the Trustee should take or decline to take a particular action hereunder, and the Trustee shall be fully protected with respect to any action taken or omitted by such Trustee in good faith pursuant to such advice;

2.3-16 to defend any action or proceeding instituted against the Trust Fund, to institute any action on behalf of the Trust Fund, and to compromise or submit to arbitration any dispute concerning the Trust Fund;

2.3-17 to make, execute, acknowledge and deliver any and all documents of transfer and conveyance and any and all other instruments that may be necessary or appropriate to carry out the powers herein granted;

2.3-18 to commingle the Trust Fund created pursuant hereto, in whole or in part, in a single trust with all or any portion of any other trust fund, assigning an undivided interest to each such commingled trust fund, provided that such commingled trust is itself exempt from taxation pursuant to Section 501(a) of the Code, or its successor Section; and provided further that the trust agreement governing such commingled trust shall be deemed incorporated by reference in the Plan;

2.3-19 where two or more trusts governed by this Trust Agreement have an undivided interest in any property, to credit the income from such property to such trusts in proportion to their undivided interests, and when non pro rata distributions of property or money are made from such trusts, to make appropriate adjustments to the undivided fractional interests of such trusts;

2.3-20 to invest all or any portion of the Trust Fund in one or more group annuity contracts, deposit administration contracts, and other such contracts with insurance companies, including any commingled separate accounts established under such contracts;

2.3-21 generally, with respect to all cash, stocks and other securities, and property, both real and personal, received or held in the Trust Fund by the Trustee, to exercise all the same rights and powers as are or may be lawfully exercised by persons owning cash, or stocks and other securities, or such property in their own right; and to do all other acts, whether or not expressly authorized, which it may deem necessary or proper for the protection of the Trust Fund; and

2.3-22 whenever more than two persons shall qualify to act as co-Trustee, to exercise and perform every power (including discretionary powers), authority or duty by the concurrence of a majority of them the same effect as if all had joined therein, except that the unanimous vote of such persons shall be necessary to determine the number (one or more) and identity of persons who may sign checks, make withdrawals from financial institutions, have access to safe deposit boxes, or direct the sale of trust assets and the disposition of the proceeds.

2.4 Brokerage . If permitted in writing by the Committee the Trustee shall have the power and authority, to be exercised in their sole discretion at any time and from time to time, to issue and place orders for the purchase or sale of securities with qualified brokers and dealers. Such orders may be placed with such qualified brokers and/or dealers who also provide investment information or other research or statistical services to the Trustee in its capacity as a fiduciary or investment manager for other clients.

Section 3. Compensation and Indemnification of Trustee and Payment of Expenses and Taxes .

3.1 Fees and Expenses from Fund . In consideration for rendering services pursuant to this Trust Agreement, the Trustee shall be paid fees in accordance with the Trustee’s fee schedule as in effect from time to time. Fee changes resulting in fee increases shall be effective upon not less than 30 days’ notice to the Company. In addition, the Trustee shall be reimbursed for any reasonable expenses, including reasonable attorneys’ fees, incurred in the administration of the Trust created hereby. Fees and expenses shall be allocated to Participants’ Accounts, if any, unless paid directly by the Employer. All compensation and expenses of the Trustee shall be paid out of the Trust Fund or by the Employer as specified in the Plan. If and to the extent the Trust Fund shall not be sufficient, such compensation and expenses shall be paid by the Employer upon demand. If payment is due but not paid by the Employer, such amount shall be paid from the assets of the Trust Fund. The Trustee is hereby empowered to withdraw all such compensation and expenses which are 60 days past due from the Trust Fund, and, in furtherance thereof, liquidate any assets of the Trust Fund, without further authorization or direction from or by any person. Notwithstanding the foregoing, in the event any officer or director of First Savings Bank, F.S.B. serves as trustee of the Plan, no compensation shall be paid to the officer or director in exchange for his or her services as trustee.

3.2 Indemnification . Notwithstanding any other provision of this Trust Agreement, any individual designated as a trustee hereunder shall be indemnified and held harmless by the Employer to the fullest extent permitted by law against any and all costs, damages, expenses and liabilities including, but not limited to attorneys’ fees and disbursements reasonably incurred by or imposed upon such individual in connection with any claim made against him or in which he may be involved by reason of his being, or having been, a trustee hereunder, to the extent such amounts are not satisfied by insurance maintained by the Employer, except liability which is adjudicated to have resulted from the gross negligence or willful misconduct of the Trustee by reason of any action so taken. Further, any corporate trustee and its officers, directors and agents may be indemnified and held harmless by the Employer to the fullest extent permitted by law against any and all costs, damages, expenses and liabilities including, but not limited to,

attorneys’ fees and disbursements reasonably incurred by or imposed upon such persons and/or corporation in connection with any claim made against it or them or in which such persons and/or corporation may be involved by reason of its being, or having been, a trustee hereunder as may be agreed between the Employer and such trustee, except liability which is adjudicated to have resulted from the gross negligence or willful misconduct of the Trustee by reason of any action so taken.

3.3 Expenses . All expenses of administering the Trust and the Plan, whether incurred by the Trustee or the Committee, shall be paid by the Trustee from the Trust Fund to the extent such expenses shall not have been assumed by the Employer.

3.4 Taxes . All taxes that may be levied or assessed upon or in respect of the Trust Fund shall be paid from the Trust Fund. The Trustee shall notify the Committee of any proposed or final assessments of taxes and may assume that any such taxes are lawfully levied or assessed unless the Committee advises it in writing to the contrary within fifteen days after receiving the above notice from the Trustee. In such case, the Trustee, if requested by the Committee in writing, shall contest the validity of such taxes in any manner deemed appropriate by the Committee; the Employer may itself contest the validity of any such taxes, in which case the Committee shall so notify the Trustee and the Trustee shall have no responsibility or liability respecting such contest. If either party to this Agreement contests any such proposed levy or assessments, the other party shall provide such information and cooperation as the party conducting the contest shall reasonably request.

Section 4. Records and Valuation .

4.1 Records . The Trustee, and any investment manager appointed pursuant to Section 2.2, shall maintain accurate and detailed records and accounts of all investments, receipts, disbursements and other transactions made by it with respect to the Trust Fund, and all accounts, books and records relating thereto shall be open at all reasonable time to inspection and audit by the Committee and the Employer.

4.2 Valuation . From time to time upon the request of the Committee, but at least annually as of the last day of each Plan Year, the Trustee shall prepare a balance sheet of the Investment Fund in accordance with the Plan and shall deliver copies of the balance sheet to the Committee and the Employer.

4.3 Discharge of Trustee . Ninety (90) days after the filing of any balance sheet under Section 4.2 or any accounting under Section 6, the Trustee shall be forever released and discharged from any liability or accountability other than for gross negligence or wilful misconduct on the part of the Trustee to anyone with respect to the transactions shown or reflected in such balance sheet or accounting, except with respect to any acts or transactions as to which the Committee, within such 90-day period, files written objections with the Trustee. The written approval of the Committee of any balance sheet or accounting so filed by the Trustee, or the Committee’s failure to file written objections within 90 days, shall be a settlement of such balance sheet or accounting as against all persons, and shall forever release and discharge the Trustee from any liability of accountability to anyone with respect to the transactions shown or

reflected in such balance sheet or accounting other than liability arising out of the Trustee’s gross negligence or wilful misconduct. If a statement of objections is filed by the Committee and the Committee is satisfied that its objections should be withdrawn or if the balance sheet or accounting is adjusted to its satisfaction, the Committee shall indicate its approval of the balance sheet or accounting in a written statement filed with the Trustee and the Trustee shall be forever released and discharged from any liability of accountability to anyone in accordance with the immediately preceding sentence. If an objection is not settled by the Committee and the Trustee, the Trustee may start a proceeding for a judicial settlement of the balance sheet or accounting in any court of competent jurisdictions; the only parties that need be joined in such a proceeding are the Trustee, the Committee, the Employer and any other parties whose participation is required by law.

4.4 Right to Judicial Settlement . Nothing in this Agreement shall prevent the Trustee from having its account settled by a court of competent jurisdiction at any time. The only parties that need be joined in any such proceeding are the Employer, the Committee, the Trustee and any other parties whose participation is required by law.

Section 5. Instructions from Committee .

5.1 Certification of Members of the Committee . From time to time the Company shall certify to the Trustee in writing the names of the individuals comprising the Committee and shall furnish to the Trustee specimens of their signatures and the signatures of their agents, if any. The Trustee shall be entitled to presume that the identities of such individuals and their agents are unchanged until it receives a certification from the Company notifying it of any changes.

5.2 Instructions to Trustee .

(a) The Trustee shall pay benefits and administrative expenses under the Plan only when it receives (and in accordance with) written instructions of the Committee indicating the amount of the payment and the name and address of the recipient in accordance with the terms of the Plan. The Trustee need not inquire into whether any payment the Committee instructs the Trustee to make is consistent with the terms of the Plan or applicable law or otherwise proper. Any payment made by the Trustee in accordance with such instructions shall be a complete discharge and acquaintance to the Trustee. If the Committee advises the Trustee that benefits have become payable with respect to a Participant’s interest in the Trust Fund but does not instruct the Trustee as to the manner of payment, the Trustee shall hold the Participant’s interest in the Trust until the Trustee receives written instructions from the Committee as to the manner of payment. The Trustee shall not pay benefits from the Trust Fund without such instructions, even though it may be informed from other sources, including, without limitation, a Participant or Beneficiary, that benefits are payable under the Plan. The Trustee shall have no responsibility to determine when, to whom or in what amount benefits and expenses are payable under the Plan. Further, the Trustee shall have no power, authority or duty to interpret the Plan or inquire into the decisions or determinations of the Committee, or to question the instructions given to it by the Committee. If the Committee so directs, the Trustee shall segregate amounts payable with respect to the interest in the Plan of any Participant and administer them separately from the rest of the Trust Fund in accordance with the Committee’s instructions.

(b) The Trustee may require the Committee to certify in writing that any payment of benefits or expenses it instructs the Trustee to make pursuant to Section 5.2(a) above is: (i) in accordance with the terms of the Plan and/or (ii) one which the Committee is authorized by the Plan and any other applicable instruments to direct and/or (iii) made for the exclusive purpose of providing benefits to Participants and Beneficiaries, or defraying reasonable expenses of Plan administration and/or (iv) not made to a party in interest (within the meaning of ERISA Section 3(14)), and/or (v) not a prohibited transaction (within the meaning of Code Section 4975 and ERISA Section 406). If the Trustee requests, instructions to pay benefits shall be made by the Committee on forms prepared by the Trustee to include any or all of the above representations. The Trustee shall be fully protected in relying on the truth of any such representation by the Committee and shall have no duty to investigate whether such representations are correct or to see to the application of any amounts paid to and received by the recipient.

5.3 Plan Change . In the event of an amendment, merger, division, or termination of the Plan, the Trustee shall continue to disburse funds and to take other proper actions in accordance with the instructions of the Committee.

Section 6. Change of Trustee .

The Company may at any time remove any person or entity serving as a Trustee hereunder by giving to such person or entity written notice of removal and, if applicable, the name and address of the successor trustee. Any person or entity serving as a Trustee hereunder may resign at any time by giving written notice to the Company. Any such removal or resignation shall take effect within 30 days after notice has been given by the Trustee or by the Company, as the case may be. Within those 30 days, the removed or resigned Trustee shall transfer, pay over and deliver any portion of the Trust Fund in its possession or control (less an appropriate reserve for any unpaid fees, expenses, and liabilities) and all pertinent records to the successor or remaining trustee; provided, however, that any assets which are invested in a collective fund or in some other manner which prevents their immediate transfer shall be transferred and delivered to the successor trustee as soon as may be practicable. Thereafter, the removed or resigned Trustee shall have no liability for the Trust Fund or for its administration by the successor or remaining trustee, but shall render an accounting to the Committee of its administration of the Trust Fund through the date on which its Trusteeship shall have been terminated. The Company may also, upon 30 days’ notice to each person currently serving as a trustee, appoint one or more persons to serve as co-Trustee hereunder.

Section 7. Miscellaneous .

7.1 Right to Amend . This Trust Agreement may be amended from time to time by an instrument executed by the Company; provided, however, that any amendment affecting the powers, duties or liabilities of the Trustee must be approved by the Trustee, and provided, further, that no amendment may divert any portion of the Trust Fund to purposes other than the exclusive benefit of the Participants and their Beneficiaries prior to the satisfaction of all liabilities for benefits. Any amendment shall apply to the Trust Fund as constituted at the time of the amendment as well as to that portion of the Trust Fund which is subsequently acquired.

7.2 Compliance with ERISA . In the exercise of its powers and the performance of its duties, the Trustee shall act in good faith and in accordance with the applicable requirements under ERISA. Except as may be otherwise required by ERISA, the Trustee shall not be required to furnish any bond in any jurisdiction for the performance of their duties and, if a bond is required despite this provision, no surety shall be required on it.

7.3 Nonresponsibility for Funding . The Trustee shall be under no duty to enforce the payment of any contributions and shall not be responsible for the adequacy of the Trust Fund to satisfy any obligations for benefits, expenses, and liabilities under the Plan.

7.4 Reports . The Trustees shall file any report which they are required by law to file with any governmental authority with respect to this Trust, and the Committee shall furnish to the Trustee whatever information is necessary to prepare the report.

7.5 Dealings with the Trustee . Persons dealing with the Trustee, including, but not limited to, banks, brokers, dealers, and insurers, shall be under no obligation to inquire concerning the validity of anything which the Trustee purports to do, nor need any person see to the proper application of any money paid or any property transferred upon the order of the Trustee or to inquire into the Trustee’s authority as to any transaction.

7.6 Limitation Upon Responsibilities . The Trustee shall have no responsibilities with respect to the Plan or Trust other than those specifically enumerated or explicitly allocated to it under this Trust Agreement or the provisions of ERISA. All other responsibilities are retained and shall be performed by one or more of the Employer, the Committee, and such advisors or agents as they choose to engage.

The Trustee may execute any of the trusts or powers hereof and perform any of its duties by or through attorneys, agents, receivers or employees and shall not be answerable for the conduct of the same if chosen with reasonable care and shall be entitled to advice of counsel concerning all matters of trust hereof and the duties hereunder, and may in all cases pay such reasonable compensation to all such attorneys, agents, receivers and employees as may reasonably be employed in connection with the trusts hereof. The Trustee may act upon the opinion or advice of any attorney (who may be the attorney for the Trustee or attorney for the Committee), approved by the Trustee in the exercise of reasonable care. The Trustee shall not be responsible for any loss or damage resulting from any action or non-action in good faith in reliance upon such opinion or advice.

The Trustee shall be protected in acting upon any notice, request, consent, certificate, order, affidavit, letter, telegram or other paper or document believed to be genuine and correct and to have been signed or sent by the proper person or persons, and the Trustee shall be under no duty to make any investigation or inquiry as to any statement contained in any such writing but may accept the same as conclusive evidence of the truth and accuracy of the statements therein contained.

The Trustee shall not be liable for other than their gross negligence or willful misconduct. Except in the case of gross negligence or wilful misconduct on the part of the Trustee, the Trustee in its corporate capacity shall not be liable for claims of any persons in any manner regarding the Plan; such claims shall be limited to the Trust Fund. Unless the Trustee participates knowingly in, or knowingly undertakes to conceal, an act or omission of the Committee or any other fiduciary, knowing such act or omission to be a breach of fiduciary responsibility, the Trustee shall be under no liability for any loss of any kind which may result by reason of such act or omission.

Before taking any action hereunder at the request or direction of the Committee, the Trustee may require that indemnity in form and amount satisfactory to the Trustee be furnished for the reimbursement of any and all costs and expenses to which they may be put including, without limitation, reasonable attorneys’ fees and to protect them against all liability, except liability which is adjudicated to have resulted from the gross negligence or willful misconduct of the Trustee by reason of any action so taken.

No provision of this Trust Agreement shall require the Trustee to expend or risk their own funds or otherwise incur any financial liability in the performance of any of their duties hereunder, or in the exercise of any of their rights or powers, if they shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to them.

7.7 Qualification of the Plan and Trust . The Trustee shall be fully protected in assuming that the Plan and Trust meet the requirements of Code Sections 401 and 501, respectively, and all the applicable provisions of ERISA, unless they are advised to the contrary in writing by the Committee or a governmental agency.

7.8 Party in Interest Information . The Employer shall provide the Trustee with such information concerning the relationship between any person or organization and the Plan as the Trustee reasonably requests in order to determine whether such person or organization is a party in interest with respect to the Plan within the meaning of ERISA Section 3(14).

7.9 Disputes . If a dispute arises as to the payment of any funds or delivery of any assets by the Trustee, the Trustee may withhold such payment or delivery until the dispute is determined by a court of competent jurisdiction or finally settled in writing by the parties concerned.

7.10 Successor Trustee . This Trust Agreement shall apply to any person who shall be appointed to succeed the person currently appointed as the Trustee; and any reference herein to the Trustee shall be deemed to include any one or more individuals or corporations or any combination thereof who or which have at any time acted as a co-trustee or as the sole trustee.

7.11 Governing State Law . This Trust Agreement shall be interpreted in accordance with the laws of the State of Indiana to the extent those laws may be applicable under the provisions of ERISA.

IN WITNESS WHEREOF, the parties hereto have executed this Trust Agreement as of the day and year first above written.


ATTEST:	FIRST SAVINGS BANK, F.S.B.

	By:
		For the Entire Board of Directors

ATTEST:	[ ]

Exhibit 10.3

FORM OF

ESOP LOAN AGREEMENT

THIS LOAN AGREEMENT (“Loan Agreement”) is made and entered into as of the day of , 2008, by and between the FIRST SAVINGS BANK, F.S.B. EMPLOYEE STOCK OWNERSHIP PLAN TRUST (“Borrower”), a trust forming part of the First Savings Bank, F.S.B. Employee Stock Ownership Plan (“ESOP”), and FIRST SAVINGS FINANCIAL GROUP, INC. (“Lender”), a corporation organized and existing under the laws of Indiana.

WITNESSETH

WHEREAS, the Borrower is authorized to purchase shares of common stock of First Savings Financial Group, Inc. (“Common Stock”), either directly from First Savings Financial Group, Inc. or in open market purchases in an amount not to exceed [ ] ( ) shares of Common Stock.

WHEREAS, the Borrower is authorized to borrow funds from the Lender for the purpose of financing authorized purchases of Common Stock; and

WHEREAS, the Lender is willing to make a loan to the Borrower for such purpose.

NOW, THEREFORE, the parties agree hereto as follows:

ARTICLE I

DEFINITIONS

The following definitions shall apply for purposes of this Loan Agreement, except to the extent that a different meaning is plainly indicated by the context:

Business Day means any day other than a Saturday, Sunday or other day on which banks are authorized or required to close under federal or local law or regulation.

Code means the Internal Revenue Code of 1986, as amended (including the corresponding provisions of any succeeding law).

Default means an event or condition which would constitute an Event of Default. The determination as to whether an event or condition would constitute an Event of Default shall be determined without regard to any applicable requirements of notice or lapse of time.

ERISA means the Employee Retirement Income Security Act of 1974, as amended (including the corresponding provisions of any succeeding law).

Event of Default means an event or condition described in Article 5.

Loan means the loan described in section 2.1.

Loan Documents means, collectively, the Loan Agreement, the Promissory Note and the Pledge Agreement and all other documents now or hereafter executed and delivered in connection with such documents, including all amendments, modifications and supplements of or to all such documents.

Pledge Agreement means the agreement described in section 2.8(a).

Principal Amount means the face amount of the Promissory Note, determined as set forth in section 2.1(c).

Promissory Note means the promissory note described in section 2.3.

Register means the register described in section 2.9.

ARTICLE II

THE LOAN; PRINCIPAL AMOUNT;

INTEREST; SECURITY; INDEMNIFICATION

Section 2.1 The Loan; Principal Amount .

(a) The Lender hereby agrees to lend to the Borrower such amount, and at such time, as shall be determined under this Section 2.1; provided, however, that in no event shall the aggregate amount lent under this Loan Agreement from time to time exceed the greater of (i) [ ] or (ii) the aggregate amount paid by the Borrower to purchase up to [ ] shares of Common Stock.

(b) Subject to the limitations of Section 2.1(a), the Borrower shall determine the amounts borrowed under this Agreement, and the time at which such borrowings are effected. Each such determination shall be evidenced in a writing which shall set forth the amount to be borrowed and the date on which the Lender shall disburse such amount, and such writing shall be furnished to the Lender by notice from the Borrower. The Lender shall disburse to the Borrower the amount specified in each such notice on the date specified therein or, if later, as promptly as practicable following the Lender’s receipt of such notice; provided, however, that the Lender shall have no obligation to disburse funds pursuant to this Agreement following the occurrence of a Default or an Event of Default until such time as such Default or Event of Default shall have been cured.

(i)

the aggregate amount disbursed by the Lender pursuant to section 2.1(b) on or before such date; over

(ii)

the aggregate amount of any repayments of such amounts made before such date.

The Lender shall maintain on the Register a record of, and shall record in the Promissory Note, the Principal Amount, any changes in the Principal Amount and the effective date of any changes in the Principal Amount.

Section 2.2 Interest .

(a) The Borrower shall pay to the Lender interest on the Principal Amount, for the period commencing with the first disbursement of funds under this Loan Agreement and continuing until the Principal Amount shall be paid in full, at the rate of [ ] percent ( %) per annum. Interest payable under this Agreement shall be computed on the basis of a year of 365 days and actual days elapsed (including the first day but excluding the last) occurring during the period to which the computation relates.

(b) Accrued interest on the Principal Amount shall be payable by the Borrower on the dates set forth in Schedule I to the Promissory Note. All interest on the Principal Amount shall be paid by the Borrower in immediately available funds.

(c) Anything in the Loan Agreement or the Promissory Note to the contrary notwithstanding, the obligation of the Borrower to make payments of interest shall be subject to the limitation that payments of interest shall not be required to be made to the Lender to the extent that the Lender’s receipt thereof would not be permissible under the law or laws applicable to the Lender limiting rates of interest which may be charged or collected by the Lender. Any such payment referred to in the preceding sentence shall be made by the Borrower to the Lender on the earliest interest payment date or dates on which the receipt thereof would be permissible under the laws applicable to the Lender limiting rates of interest which may be charged or collected by the Lender. Such deferred interest shall not bear interest.

Section 2.3 Promissory Note .

The Loan shall be evidenced by the Promissory Note of the Borrower attached hereto as an exhibit payable to the order of the lender in the Principal Amount and otherwise duly completed.

Section 2.4 Payment of Trust Loan .

The Principal Amount of the Loan shall be repaid in accordance with Schedule I to the Promissory Note on the dates specified therein until fully paid.

Section 2.5 Prepayment .

The Borrower shall be entitled to prepay the Loan in whole or in part, at any time and from time to time; provided, however, that the Borrower shall give notice to the Lender of any such prepayment; and provided, further, that any partial prepayment of the Loan shall be in an amount not less than $1,000. Any such prepayment shall be: (a) permanent and irrevocable; (b) accompanied by all accrued interest through the date of such prepayment; (c) made without premium or penalty; and (d) applied on the inverse order of the maturity of the installment thereof unless the Lender and the Borrower agree to apply such prepayments in some other order.

Section 2.6 Method of Payments .

(a) All payments of principal, interest, other charges (including indemnities) and other amounts payable by the Borrower hereunder shall be made in lawful money of the United States, in immediately available funds, to the Lender at the address specified in or pursuant to this Loan Agreement for notices to the Lender, on the date on which such payment shall become due. Any such payment made on such date but after such time shall, if the amount paid bears interest, and except as expressly provided to the contrary herein, be deemed to have been made on, and interest shall continue to accrue and be payable thereon until, the next succeeding Business Day. If any payment of principal or interest becomes due on a day other than a Business Day, such payment may be made on the next succeeding Business Day, and when paid, such payment shall include interest to the day on which payment is in fact made.

(b) Notwithstanding anything to the contrary contained in this Loan Agreement or the Promissory Note, the Borrower shall not be obligated to make any payment, repayment or pre-payment on the Promissory Note if doing so would cause the ESOP to cease to be an employee stock ownership plan within the meaning of section 4975(e)(7) of the Code or qualified under section 401(a) of the Code or cause the Borrower to cease to be a tax exempt trust under section 501(a) of the Code or if such act or failure to act would cause the Borrower to engage in any “prohibited transaction” as such term is defined in the section 4975(c) of the Code and the regulations promulgated thereunder which is not exempted by section 4975(c)(2) or (d) of the Code and the regulations promulgated thereunder or in section 406 of ERISA and the regulations promulgated thereunder which is not exempted by section 408(b) of ERISA and the regulations promulgated thereunder; provided, however, that in each case, the Borrower, may act or refrain from acting pursuant to this section 2.6(b) on the basis of an opinion of counsel, and any opinion of such counsel. The Borrower may consult with counsel, and any opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in accordance with such opinion of counsel. Nothing contained in this section 2.6(b) shall be construed as imposing a duty on the Borrower to consult with counsel. Any obligation of the Borrower to make any payment, repayment or prepayment on the Promissory Note or refrain from taking any other act hereunder or under the Promissory Note which is excused pursuant to this section 2.6(b) shall be considered a binding obligation of the Borrower, or both, as the case may be, for the purposes of determining whether a Default or Event of Default has occurred hereunder or under the Promissory Note and nothing in this section 2.6(b) shall be construed as providing a defense to any remedies otherwise available upon a Default or an Event of Default hereunder (other than the remedy of specific performance).

Section 2.7 Use of Proceeds of Loan .

The entire proceeds of the Loan shall be used solely for acquiring shares of Common Stock, and for no other purpose whatsoever.

Section 2.8 Security .

(a) In order to secure the due payment and performance by the Borrower of all of its obligations under this Loan Agreement, simultaneously with the execution and delivery of this Loan Agreement by the Borrower, the Borrower shall:

(i)

pledge to the Lender as Collateral (as defined in the Pledge Agreement), and grant to the Lender a first priority lien on and security interest in, the Common Stock purchased with the Principal Amount, by the execution and delivery to the lender of the Pledge Agreement attached hereto as an exhibit; and

(ii)

execute and deliver, or cause to be executed and delivered, such other agreement, instruments and documents as the Lender may reasonably require in order to effect the purposes of the Pledge Agreement and this Loan Agreement.

(b) The Lender shall release from encumbrance under the Pledge Agreement and transfer to the Borrower, as of the date on which any payment or repayment of the Principal Amount is made, a number of shares of Common Stock held as Collateral determined pursuant to the applicable provisions of the ESOP.

Section 2.9 Registration of the Promissory Note .

(a) The Lender shall maintain a Register providing for the registration of the Principal Amount and any stated interest and of transfer and exchange of the Promissory Note. Transfer of the Promissory Note may be effected only by the surrender of the old instrument and either the reissuance by the Borrower of the old instrument to the new holder or the issuance by the Borrower of a new instrument to the new holder. The old Promissory Note so surrendered shall be canceled by the Lender and returned to the Borrower after such cancellation.

(b) Any new Promissory Note issued pursuant to section 2.9(a) shall carry the same rights to interest (unpaid and to accrue) carried by the Promissory Note so transferred or exchanged so that there will not be any loss or gain of interest on the note surrender. Such new Promissory Note shall be subject to all of the provisions and entitled to all of the benefits of this Agreement. Prior to due presentment for registration or transfer, the Borrower may deem and treat the registered holder of any Promissory Note as the holder thereof for purposes of payment and other purposes. A notation shall be made on each new Promissory Note of the amount of all payments of principal and interest theretofore paid.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE BORROWER

The Borrower hereby represents and warrants to the Lender as follows:

Section 3.1 Power, Authority, Consents .

The Borrower has the power to execute, deliver and perform this Loan Agreement, the Promissory Note and Pledge Agreement, all of which have been duly authorized by all necessary and proper corporate or other action.

Section 3.2 Due Execution, Validity, Enforceability .

Each of the Loan Documents, including, without limitation, this Loan Agreement, the Promissory Note and the Pledge Agreement, has been duly executed and delivered by the Borrower; and each constitutes the valid and legally binding obligation of the Borrower, enforceable in accordance with its terms.

Section 3.3 Properties, Priority of Liens .

The liens which have been created and granted by the Pledge Agreement constitute valid, first liens on the properties and assets covered by the Pledge Agreement, subject to no prior or equal lien.

Section 3.4 No Defaults, Compliance with Laws .

The Borrower is not in default in any material respect under any agreement, ordinance, resolution, decree, bond, note, indenture, order or judgment to which it is a party or by which it is bound, or any other agreement or other instrument by which any of the properties or assets owned by it is materially affected.

Section 3.5 Purchase of Common Stock .

Upon consummation of any purchase of Common Stock by the Borrower with the proceeds of the Loan, the Borrower shall acquire valid, legal and marketable title to all of the Common Stock so purchased, free and clear of any liens, other than a pledge to the Lender of the Common Stock so purchased pursuant to the Pledge Agreement. Neither the execution and delivery of the Loan Documents nor the performance of any obligation thereunder violates any provisions of law or conflicts with or results in a breach of or creates (with or without the giving of notice of lapse of time, or both) a default under any agreement to which the Borrower is a party or by which it is bound or any of its properties is affected. No consent of any federal, state, or local governmental authority, agency, or other regulatory body, the absence of which could have a materially adverse effect on the Borrower or the Trustee, is or was required to be obtained in connection with the execution, delivery, or performance of the Loan Documents and the transaction contemplated therein or in connection therewith, including without limitation, with respect to the transfer of the shares of Common Stock purchased with the proceeds of the Loan pursuant thereto.

Section 3.6 ESOP; Contributions .

As of the effective date of the ESOP sponsor’s conversion, the ESOP and the Borrower will be duly created, organized and maintained by the ESOP sponsor in compliance with all applicable laws, regulations and rulings. The ESOP will qualify as an “employee stock ownership plan” as defined in section 4975(e)(7) of the Code. The ESOP provides that the ESOP sponsor may make contributions to the ESOP in an amount necessary to enable the Trustee to amortize the Loan in accordance with the terms of the Promissory Note; provided, however, that no such contributions shall be required if they would adversely affect the qualification of the ESOP under section 401(a) of the Code.

Section 3.7 Trustee .

The trustee of the ESOP has been duly appointed by the ESOP sponsor.

Section 3.8 Compliance with Laws; Actions .

Neither the execution and delivery by the Borrower of this Loan Agreement or any instruments required thereby, nor compliance with the terms and provisions of any such documents by the lender, constitutes a violation of any provision of any law or any regulation, order, writ, injunction or decree of any court or governmental instrumentality, or an event of default under any agreement, to which the Borrower is a party, to which the Borrower is bound or to which the Borrower is subject, which violation or event of default would have a material adverse effect on the Borrower. There is no action or proceeding pending or threatened against either the ESOP or the Borrower before any court or administrative agency.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE LENDER

The Lender hereby represents and warrants to the Borrower as follows:

Section 4.1 Power, Authority, Consents .

The Lender has the power to execute, deliver and perform this Loan Agreement, the Pledge Agreement and all documents executed by the Lender in connection with the Loan, all of

which have been duly authorized by all necessary and proper corporate or other action. No consent, authorization or approval or other action by any governmental authority or regulatory body, and no notice by the Lender to, or filing by the Lender with, any governmental authority or regulatory body is required for the due execution, delivery and performance of this Loan Agreement.

Section 4.2 Due Execution, Validity, Enforceability .

This Loan Agreement and the Pledge Agreement have been duly executed and delivered by the Lender, and each constitutes a valid and legally binding obligation of the Lender, enforceable in accordance with its terms.

ARTICLE V

EVENTS OF DEFAULT

Section 5.1 Events of Default under Loan Agreement .

Each of the following events shall constitute an “Event of Default” hereunder:

(a) Failure to make any payment or mandatory prepayment of principal of the Promissory Note when due, or failure to make any payment of interest on the Promissory Note not later than five (5) Business Days after the date when due.

(b) Failure by the Borrower to perform or observe any term, condition or covenant of this Loan Agreement or of any of the other Loan Documents, including, without limitation, the Promissory Note and the Pledge Agreement.

(c) Any representation or warranty made in writing to the Lender in any of the Loan Documents, or any certificate, statement or report made or delivered in compliance with this Loan Agreement, shall have been false or misleading in any material respect when made or delivered.

Section 5.2 Lender’s Rights upon Event of Default .

If an Event of Default under this Loan Agreement shall occur and be continuing, the Lender shall have no rights to assets of the Borrower other than: (a) contributions (other than contributions of Common Stock) that are made by the ESOP sponsor to enable the Borrower to meet its obligations pursuant to this Loan Agreement and earnings attributable to the investment of such contributions and (b) “Eligible Collateral” (as defined in the Pledge Agreement); provided, however, that: (i) the value of the Borrower’s assets transferred to the Lender following an Event of Default in satisfaction of the due and unpaid amount of the Loan shall not exceed the amount in default (without regard to amounts owing solely as a result of any acceleration of the Loan); (ii) the Borrower’s assets shall be transferred to the Lender following an Event of Default only to the extent of the failure of the Borrower to meet the payment schedule of the Loan; and (iii) all rights of the Lender to the Common Stock purchased with the proceeds of the Loan covered by the Pledge Agreement following an Event of Default shall be governed by the terms of the Pledge Agreement.

ARTICLE VI

MISCELLANEOUS PROVISIONS

Section 6.1 Payments Due to the Lender .

If any amount is payable by the Borrower to the Lender pursuant to any indemnity obligation contained herein, then the Borrower shall pay, at the time or times provided therefor, any such amount and shall indemnify the Lender against and hold it harmless from any loss or damage resulting from or arising out of the nonpayment or delay in payment of any such amount. If any amounts as to which the Borrower has so indemnified the Lender hereunder shall be assessed or levied against the Lender, the Lender may notify the Borrower and make immediate payment thereof, together with interest or penalties in connection therewith, and shall thereupon be entitled to and shall receive immediate reimbursement therefor from the Borrower, together with interest on each such amount as provided for in section 2.2(c). Notwithstanding any other provision contained in this Loan Agreement, the covenants and agreements of the Borrower contained in this section 6.1 shall survive: (a) payment of the Promissory Note and (b) termination of this Loan Agreement.

Section 6.2 Payments .

All payments hereunder and under the Promissory Note shall be made without set-off or counterclaim and in such amounts as may be necessary in order that all such payments shall not be less than the amounts otherwise specified to be paid under this Loan Agreement and the Promissory Note, subject to any applicable tax withholding requirements. Upon payment in full of the Promissory Note, the Lender shall mark such Promissory Note “Paid” and return it to the Borrower.

Section 6.3 Survival .

All agreements, representations and warranties made herein shall survive the delivery of this Loan Agreement and the Promissory Note.

Section 6.4 Modifications, Consents and Waivers; Entire Agreement .

No modification, amendment or waiver of or with respect to any provision of this Loan Agreement, the Promissory Note, the Pledge Agreement, or any of the other Loan Documents, nor consent to any departure from any of the terms or conditions thereof, shall in any event be effective unless it shall be in writing and signed by the party against whom enforcement thereof is sought. Any such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No consent to or demand on a party in any case shall, of itself, entitle it to any other or further notice or demand in similar or other circumstances. This Loan Agreement embodies the entire agreement and understanding between the Lender and the Borrower and supersedes all prior agreements and understandings relating to the subject matter hereof.

Section 6.5 Remedies Cumulative .

Each and every right granted to the Lender hereunder or under any other document delivered hereunder or in connection herewith, or allowed it by law or equity, shall be cumulative and may be exercised from time to time. No failure on the part of the Lender or the holder of the Promissory Note to exercise, and no delay in exercising, any right shall operate as a waiver thereof, nor shall any single or partial exercise of any right preclude any other or future exercise thereof or the exercise of any other right. The due payment and performance of the

obligations under the Loan Documents shall be without regard to any counterclaim, right of offset or any other claim whatsoever which the Borrower may have against the Lender and without regard to any other obligation of any nature whatsoever which the Lender may have to the Borrower, and no such counterclaim or offset shall be asserted by the Borrower in any action, suit or proceeding instituted by the Lender for payment or performance of such obligations.

Section 6.6 Further Assurances; Compliance with Covenants .

At any time and from time to time, upon the request of the Lender, the Borrower shall execute, deliver and acknowledge or cause to be executed, delivered and acknowledged, such further documents and instruments and do such other acts and things as the Lender may reasonably request in order to fully effect the terms of this Loan Agreement, the Promissory Note, the Pledge Agreement, the other Loan Documents and any other agreements, instruments and documents delivered pursuant hereto or in connection with the Loan.

Section 6.7 Notices .

Except as otherwise specifically provided for herein, all notice, requests, reports and other communications pursuant to this Loan Agreement shall be in writing, either by letter (delivered by hand or commercial messenger service or sent by registered or certified mail, return receipt requested, except for routine reports delivered in compliance with Article VI hereof which may be sent by ordinary first-class mail) or telex or telecopier addressed as follows:

(a)

If to the Borrower:

First Savings Bank, F.S.B. Employee Stock Ownership Plan

c/o [ ]

(b)

If to the Lender:

First Savings Financial Group, Inc.

501 East Lewis & Clark Parkway

Clarksville, IN 47129

Attn: Larry W. Myers

Any notice, request or communication hereunder shall be deemed to have been given on the day on which it is delivered by hand or by commercial messenger service, or sent by telex or telecopier, to such party at its address specified above, or, if sent by mail, on the third Business Day after the day deposited in the mail, postage prepaid, addressed as aforesaid. Any party may change the person or address to whom or which notices are to be given hereunder, by notice duly given hereunder; provided, however, that any such notice shall be deemed to have been given only when actually received by the party to whom it is addressed.

Section 6.8 Counterparts .

This Loan Agreement may be signed in any number of counterparts which, when taken together, shall constitute one and the same document.

Section 6.9 Construction; Governing Law .

The headings used in the table of contents and in this Loan Agreement are for convenience only and shall not be deemed to constitute a part hereof. All uses herein of any

gender or of singular or plural terms shall be deemed to include uses of the other genders or plural or singular terms, as the context may require. All references in this Loan Agreement of an Article or section shall be to an Article or section of this Loan Agreement, unless otherwise specified. This Loan Agreement, the Promissory Note, the Pledge Agreement and the other Loan Documents shall be governed by, and construed and interpreted in accordance with, the laws of the State of Indiana.

Section 6.10 Severability .

Wherever possible, each provision of this Loan Agreement shall be interpreted in such manner as to be effective and valid under applicable law; however, the provisions of this Loan Agreement are severable, and if any clause or provision hereof shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provisions in this Loan Agreement in any jurisdiction. Each of the covenants, agreements and conditions contained in this Loan Agreement are independent, and compliance by a party with any of them shall not excuse non-compliance by such party with any other. The Borrower shall not take any action the effect of which shall constitute a breach or violation of any provision of this Loan Agreement.

Section 6.11 Binding Effect: No Assignment or Delegation .

This Loan Agreement shall be binding upon and inure to the benefit of the Borrower and its successors and the Lender and its successors and assigns. The rights and obligations of the Borrower under this Agreement shall not be assigned or delegated without the prior written consent of the Lender, and any purported assignment or delegation without such consent shall be void.

IN WITNESS WHEREOF, the parties have caused this Loan Agreement to be executed as of the date first written above.


FIRST SAVINGS BANK, F.S.B. EMPLOYEE STOCK OWNERSHIP PLAN TRUST


Authorized Trust Officer for [ ]

FIRST SAVINGS FINANCIAL GROUP, INC.

By:
		Larry W. Myers
		President and Chief Executive Officer

FORM OF

PLEDGE AGREEMENT

THIS PLEDGE AGREEMENT (“Pledge Agreement”) is made as of the day of , 2008, by and between the FIRST SAVINGS BANK, F.S.B. EMPLOYEE STOCK OWNERSHIP PLAN TRUST (“Pledgor”), and FIRST SAVINGS FINANCIAL GROUP, INC. (“Pledgee”).

WITNESSETH

WHEREAS, this Pledge Agreement is being executed and delivered to the Pledgee pursuant to the terms of a Loan Agreement (“Loan Agreement”), by and between the Pledgor and the Pledgee;

NOW, THEREFORE, in consideration of the mutual agreements contained herein and in the Loan Agreement, the parties hereto do hereby covenant and agree as follows:

Section 1. Definitions. The following definitions shall apply for purposes of this Pledge Agreement, except to the extent that a different meaning is plainly indicated by the context; all capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Loan Agreement:

Collateral shall mean the Pledged Shares and, subject to section 5 hereof, and to the extent permitted by applicable law, all rights with respect thereto, and all proceeds of such Pledged Shares and rights.

ESOP shall mean the First Savings Bank, F.S.B. Employee Stock Ownership Plan.

Event of Default shall mean an event so defined in the Loan Agreement.

Liabilities shall mean all the obligations of the Pledgor to the Pledgee, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due, under the Loan Agreement and the Promissory Note.

Pledged Shares shall mean all the Shares of Common Stock of the Pledgee purchased by the Pledgor with the proceeds of the loan made by the Pledgee to the Pledgor pursuant to the Loan Agreement, but excluding any such shares previously released pursuant to section 4.

Section 2. Pledge. To secure the payment of and performance of all the Liabilities, the Pledgor hereby pledges to the Pledgee, and grants to the Pledgee, a security interest in, and lien upon, the Collateral.

Section 3. Representations and Warranties of the Pledgor. The Pledgor represents, warrants, and covenants to the Pledgee as follows:

(a) the execution, delivery and performance of this Pledge Agreement and the pledging of the Collateral hereunder do not and will not conflict with, result in a violation of, or constitute a default under, any agreement binding upon the Pledgor;

(b) the Pledged Shares are and will continue to be owned by the Pledgor free and clear of any liens or rights of any other person except the lien hereunder and under the Loan Agreement in favor of the Pledgee, and the security interest of the Pledgee in the Pledged Shares and the proceeds thereof is and will continue to be prior to and senior to the rights of all others;

(c) this Pledge Agreement is the legal, valid, binding and enforceable obligation of the Pledgor in accordance with its terms;

(d) the Pledgor shall, from time to time, upon request of the Pledgee, promptly deliver to the Pledgee such stock powers, proxies, and similar documents, satisfactory in form and substance to the Pledgee, with respect to the Collateral as the Pledgee may reasonably request; and

(e) subject to the first sentence of section 4(b), the Pledgor shall not, so long as any Liabilities are outstanding, sell, assign, exchange, pledge or otherwise transfer or encumber any of its rights in and to any of the Collateral.

Section 4. Eligible Collateral.

(a) As used herein the term “Eligible Collateral” shall mean the amount of Collateral which has an aggregate fair market value equal to the amount by which the Pledgor is in default (without regard to any amounts owing solely as the result of an acceleration of the Loan Agreement) or such lesser amount of Collateral as may be required pursuant to section 13 of this Pledge Agreement.

(b) The Pledged Shares shall be released from this Pledge Agreement in a manner conforming to the requirements of Treasury Regulations Section 54.4975-7(b)(8), as the same may be from time to time amended or supplemented, and the applicable provisions of the ESOP. Subject to such Regulations, the Pledgee may from time to time, after any Default or Event of Default, and without prior notice to the Pledgor, transfer all or any part of the Eligible Collateral in the name of the Pledgee or its nominee, without disclosing that such Eligible Collateral is subject to any rights of the Pledgor and may from time to time, whether before or after any of the Liabilities shall become due and payable, without notice to the Pledgor, take all or any of the following actions: (i) notify the parties obligated on any of the Eligible Collateral to make payment to the Pledgee of any amounts due or due to become due thereunder, (ii) release or exchange all or any part of the Eligible Collateral, or compromise or extend or renew for any period (whether or not longer than the original period) any obligations of any nature of any party with respect thereto, and (iii) take control of any proceeds of the Eligible Collateral.

Section 5. Delivery.

(a) The Pledgor shall deliver to the Pledgee upon execution of this Pledge Agreement (i) either (A) certificates for the Pledged Shares, each certificate duly signed in blank by the Pledgor or accompanied by a stock transfer power duly signed in blank by the Pledgor and each such certificate accompanied by all required documentary or stock transfer tax stamps or (B) if the Trustee does not yet have possession of the Pledged Shares, an assignment by the Pledgor of all the Pledgor’s rights to and interest in the Pledged Shares and (ii) an irrevocable proxy, in form and substance satisfactory to the Pledgee, signed by the Pledgor with respect to the Pledged Shares.

(b) So long as no Default or Event of Default shall have occurred and be continuing, (i) the Pledgor shall be entitled to exercise any and all voting and other rights pertaining to the Collateral or any part thereof for any purpose not inconsistent with the terms of this Pledge Agreement, and (ii) the Pledgor shall be entitled to receive any and all cash dividends or other distributions paid in respect of the Collateral.

Section 6. Events of Default.

(a) If a Default or Event Default shall be existing, in addition to the rights it may have under the Loan Agreement, the Promissory Note, and this Pledge Agreement, or by virtue of any other instrument, (i) the Pledgee may exercise, with respect to the Eligible Collateral, from time to time, any rights and remedies available to it under the Uniform Commercial Code as in effect from time to time in the State of Indiana or otherwise available to it and (ii) the Pledgee shall have the right, for and in the name, place and stead of the Pledgor, to execute endorsement, assignments, stock powers and other instruments of conveyance or transfer with respect to all or any of the Eligible Collateral. Written notification of intended disposition of any of the Eligible Collateral shall be given by the Pledgee to the Pledgor at least three (3) business days before such disposition. Subject to section 13 below, any proceeds of any disposition of Eligible Collateral may be applied by the Pledgee to the payment of expenses in connection with the Eligible Collateral, including, without limitation, reasonable attorneys’ fees and legal expenses, and any balance of such proceeds may be applied by the Pledgee toward the payment of such of the Liabilities as are in Default, and in such order of application, as the Pledgee may from time to time elect. No action of the Pledgee permitted hereunder shall impair or affect its rights in and to the Eligible Collateral. All rights and remedies of the Pledgee expressed hereunder are in addition to all other rights and remedies possessed by it, including, without limitation, those contained in the documents referred to in the definition of Liabilities in section 1 hereof.

(b) In any sale of any of the Eligible Collateral after a Default or an Event of Default shall have occurred, the Pledgee is hereby authorized to comply with any limitation or restriction in connection with such sale as it may be advised by counsel if necessary in order to avoid violation of applicable law (including, without limitation, compliance with such procedures as may restrict the number of prospective bidders and purchasers or further restrict such prospective bidders or purchasers to persons who will represent and agree that they are purchasing for their own account for investment and not with a view to the distribution or resale of such Eligible

Collateral), or in order to obtain such required approval of the sale or of the purchase by any governmental regulatory authority or official, and the Pledgor further agrees that such compliance shall not result in such sale’s being considered or deemed not to have been made in a commercially reasonable manner, nor shall the Pledgee be liable or accountable to the Pledgor for any discount allowed by reason of the fact that such Eligible Collateral is sold in compliance with any such limitation or restriction.

Section 7. Payment in Full. Upon the payment in full of all outstanding Liabilities, this Pledge Agreement shall terminate and the Pledgee shall forthwith assign, transfer and deliver to the Pledgor, against receipt and without recourse to the Pledgee, all Collateral then held by the Pledgee pursuant to the Pledge Agreement.

Section 8. No Waiver. No failure or delay in the part of the Pledgee in exercising any right or remedy hereunder or under any other document which confers or grants any rights to the Pledgee in respect of the Liabilities shall operate as a waiver thereof nor shall any single or partial exercise of any such rights or remedy preclude any other or further exercise thereof or the exercise of any other right or remedy of the Pledgee.

Section 9. Binding Effect; No Assignment or Delegation. This Pledge Agreement shall be binding upon and inure to the benefit of the Pledgor, the Pledgee and their respective successors and assigns, except that the Pledgor may not assign or transfer its rights hereunder without the prior written consent of the Pledgee (which consent shall not unreasonably be withheld). Each duty or obligation of the Pledgor to the Pledgee pursuant to the provisions of this Pledge Agreement shall be performed in favor of any person or entity designated by the Pledgee, and any duty or obligation of the Pledgee to the Pledgor may be performed by any other person or entity designated by the Pledgee.

Section 10. Governing Law. This Pledge Agreement shall be governed by and construed in accordance with the laws of the State of Indiana applicable to agreements to be performed wholly within the State of Indiana.

Section 11. Notices. All notices, requests, instructions or documents hereunder shall be in writing and delivered personally or sent by United States mail, registered or certified, return receipt requested, with proper postage prepaid as follows:

(a)

If to the Pledgee:

First Savings Financial Group, Inc.

501 East Lewis & Clark Parkway

Clarksville, IN 47129

Attn: Larry W. Myers

(b)

If to the Pledgor:

First Savings Bank, F.S.B.

Employee Stock Ownership Plan Trust

or at such other address as either of the parties may designate by written notice to the other party. If delivered personally, the date on which a notice, request, instruction or document is delivered shall be the date on which such delivery is made, and, if delivered by mail, the date on which such notice, request, instruction, or document is deposited in the mail shall be the date of delivery. Each notice, request, instruction or document shall bear the date on which it is delivered.

Section 12. Interpretation. Wherever possible each provision of this Pledge Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision herein shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions hereof.

Section 13. Construction. All provisions hereof shall be construed so as to maintain (a) the ESOP as a qualified leveraged employee stock ownership plan under section 401(a) and 4975(e)(7) of the Internal Revenue Code of 1986 (the “Code”), (b) the Trust as exempt from taxation under section 501(a) of the Code and (c) the Trust Loan as an exempt loan under section 54.4975-7(b) of the Treasury Regulations and as described in Department of Labor Regulation section 2550.408b-3.

IN WITNESS WHEREOF, this Pledge Agreement has been duly executed by the parties hereto as of the day and year first above written.


FIRST SAVINGS BANK, F.S.B. EMPLOYEE STOCK OWNERSHIP PLAN TRUST


Authorized Trust Officer for [ ]

FIRST SAVINGS FINANCIAL GROUP, INC.

By:
		Larry W. Myers
		President and Chief Executive Officer

FORM OF

PROMISSORY NOTE

FOR VALUE RECEIVED , the undersigned, FIRST SAVINGS BANK, F.S.B. EMPLOYEE STOCK OWNERSHIP PLAN TRUST (the “Borrower”), hereby promises to pay to the order of FIRST SAVINGS FINANCIAL GROUP, INC. (the “Lender”) up to [ ] $( ) payable in accordance with the Loan Agreement made and entered into between the Borrower and the Lender of even date herewith (“Loan Agreement”) pursuant to which this Promissory Note is issued.

The Principal Amount of this Promissory Note shall be payable in accordance with the schedule attached hereto (“Schedule I”).

This Promissory Note shall bear interest at the rate per annum set forth or established under the Loan Agreement, such interest to be payable in accordance with Schedule I.

Anything herein to the contrary notwithstanding, the obligation of the Borrower to make payments of interest shall be subject to the limitation that payments of interest shall not be required to be made to the Lender to the extent that the Lender’s receipt thereof would not be permissible under the law or laws applicable to the Lender limiting rates on interest which may be charged or collected by the Lender. Any such payments on interest which are not made as a result of the limitation referred to in the preceding sentence shall be made by the Borrower to the Lender on the earliest interest payment date or dates on which the receipt thereof would be permissible under the laws applicable to the Lender limiting rates of interest which may be charged or collected by the Lender. Such deferred interest shall not bear interest.

Payments of both principal and interest on this Promissory Note are to be made at the principal office of the Lender or such other place as the holder hereof shall designate to the Borrower in writing, in lawful money of the United States of America in immediately available funds.

Failure to make any payments of principal on this Promissory Note when due, or failure to make any payment of interest on this Promissory Note not later than five (5) Business Days after the date when due, shall constitute a default hereunder, whereupon the principal amount of accrued interest on this Promissory Note shall immediately become due and payable in accordance with the terms of the Loan Agreement.

This Promissory Note is secured by a Pledge Agreement between the Borrower and the Lender of even date herewith and is entitled to the benefits thereof.

FIRST SAVINGS BANK, F.S.B.

EMPLOYEE STOCK OWNERSHIP PLAN TRUST

Authorized Trust Officer for [ ]

Exhibit 10.5

FORM OF

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is entered into as [date] , by and among FIRST SAVINGS FINANCIAL GROUP, INC. , an Indiana corporation (the “Corporation”), FIRST SAVINGS BANK, FSB , a federally-chartered savings bank and a wholly-owned subsidiary of the Corporation (the “Bank”), and [NAME] (the “Executive”). The Corporation and the Bank are sometimes referred to in this Agreement individually and together as the “Employer.”

WHEREAS, the Executive serves in position of substantial responsibility with the Corporation and the Bank;

WHEREAS , the Corporation and the Bank wish to set forth the terms of the Executive’s continued employment in these positions;

WHEREAS, the Executive is willing and desires to serve in these positions with the Corporation and the Bank.

NOW THEREFORE, in consideration of these premises, the mutual covenants contained herein, and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

ARTICLE 1

EMPLOYMENT

1.1 Employment . The Employer hereby employs the Executive to serve as [title] of each of the Corporation and the Bank according to the terms and conditions of this Agreement and for the period stated in Section 1.3 of this Agreement. The Executive hereby accepts employment according to the terms and conditions of this Agreement and for the period stated in Section 1.3 of this Agreement.

1.2 Duties . As [title], the Executive shall serve under the boards of directors. The Executive shall report directly to the boards of directors. The Executive shall serve the Employer faithfully, diligently, competently, and to the best of the Executive’s ability. The Executive shall exclusively devote full working time, energy, and attention to the business of the Employer and to the promotion of the interests of the Employer throughout the term of this Agreement. Without the prior written consent of the board of directors of each of the Corporation and the Bank, during the term of this Agreement the Executive shall not render services to or for any person, firm, corporation, or other entity or organization in exchange for compensation, regardless of the form in which the compensation is paid and regardless of whether it is paid directly or indirectly to the Executive. Nothing in this Section 1.2 shall prevent the Executive from managing personal investments and affairs, provided that doing so does not interfere with the proper performance of the Executive’s duties and responsibilities under this Agreement.

1.3 Term .

(a) The term of this Agreement shall include: (i) the initial term, consisting of the period commencing on the date of this Agreement (the “Effective Date”) and ending on the third anniversary of the Effective Date, plus (ii) any and all extensions of the initial term made pursuant to this Section 1.3.

(b) Commencing on the first anniversary of the Effective Date and continuing on each anniversary of the Effective Date thereafter, the disinterested members of the Boards of Directors may

extend the Agreement term for an additional year, so that the remaining term of the Agreement again becomes thirty-six (36) months, unless Executive elects not to extend the term of this Agreement by giving proper written notice. The Boards of Directors will review the Agreement and Executive’s performance annually for purposes of determining whether to extend the Agreement term and will include the rationale and results of its review in the minutes of the meetings. The Boards of Directors will notify Executive as soon as possible after each annual review whether it has determined to extend the Agreement.

1.4 Service on the Boards of Directors . The Executive serves as a member of the board of directors each of the Corporation and the Bank. The board of directors of each of the Corporation and the Bank shall undertake every lawful effort to ensure that the Executive continues throughout the term of his employment to be elected or reelected as a director of the Corporation and the Bank. Notwithstanding anything in this Agreement to the contrary, unless otherwise agreed to by the parties, the Executive shall be deemed to have resigned as a director of each of the Corporation and the Bank effective immediately after termination of the Executive’s employment under Article 3 of this Agreement, regardless of whether the Executive submits a formal, written resignation as director.

ARTICLE 2

COMPENSATION AND BENEFITS

2.1 Base Salary . In consideration of the Executive’s performance of the obligations under this Agreement, the Employer shall pay or cause to be paid to the Executive a salary at the annual rate of not less than $ [amount] , payable according to the regular payroll practices of the Employer. The Executive’s salary shall be subject to annual review. The Executive’s salary, as the same may be modified from time to time, is referred to in this Agreement as the “Base Salary.” All compensation under this Agreement shall be subject to customary income tax withholding and such other employment taxes as are imposed by law.

2.2 Benefit Plans and Perquisites . For as long as the Executive is employed by the Employer, the Executive shall be eligible (x) to participate in any and all officer or employee compensation, incentive compensation and benefit plans in effect from time to time, including without limitation plans providing retirement, medical, dental, disability, and group life benefits and including stock-based compensation, incentive, or bonus plans existing on the date of this Agreement or adopted after the date of this Agreement, provided that the Executive satisfies the eligibility requirements for any the plans or benefits, and (y) to receive any and all other fringe and other benefits provided from time to time, including the specific items described in (a)-(d) below.

(a) Club dues . In addition to any other compensation provided for under this Agreement, the Employer shall pay the Executive an amount sufficient, on an after-tax basis, to maintain his membership at the [name] .

(b) Reimbursement of business expenses . The Executive shall be entitled to reimbursement for all reasonable business expenses incurred while performing his obligations under this Agreement, including but not limited to all reasonable business travel and entertainment expenses incurred while acting at the request of or in the service of the Employer and reasonable expenses for attendance at annual and other periodic meetings of trade associations. Expenses will be reimbursed if they are submitted in accordance with the Employer’s policies and procedures.

(c) Automobile . The Employer shall provide the Executive with, and the Executive shall have the primary use of, an automobile owned or leased by the Employer the Employer shall pay (or reimburse the Executive) for all expenses of insurance, registration, operation and maintenance of the automobile. The Executive shall comply with reasonable reporting and expense limitations on the use of such automobile, as the Employer may establish from time to time, and the Employer shall annually include on the Executive’s Form W-2 any amount attributable to the Executive’s personal use of such automobile.

(d) Facilities . The Employer will furnish the Executive with the working facilities and staff customary for executive officers with the comparable titles and duties of the Executive as set forth in Sections 1.1 and 1.2 of this Agreement and as are necessary for the Executive to perform his duties. The location of such facilities and staff shall be at the principal administrative offices of the Corporation, or at such other site or sites customary for such offices.

2.3 Vacation; Leave . The Executive shall be entitled to sick leave and paid annual vacation in accordance with policies established from time to time by the Employer. In addition to paid vacations and other leave, the boards of directors may grant the Executive a leave or leaves of absence, with or without pay, at such time or times and upon such terms and conditions as the boards of directors may determine.

2.4 Insurance . The Employer shall maintain or cause to be maintained liability insurance covering the Executive throughout the term of this Agreement.

ARTICLE 3

EMPLOYMENT TERMINATION

3.1 Termination Because of Death .

(a) Death . The Executive’s employment shall terminate automatically at the Executive’s death. If the Executive dies in active service to the Employer, the Executive’s estate shall receive any sums due to the Executive as base salary and reimbursement of expenses through the end of the month in which his death occurred.

(b) Disability . By delivery of written notice thirty (30) days in advance to the Executive, the Employer may terminate the Executive’s employment if the Executive is disabled. For purposes of this Agreement the Executive shall be considered “disabled” if an independent physician selected by the Employer and reasonably acceptable to the Executive or the Executive’s legal representative determines that, because of illness or accident, the Executive is unable to perform the Executive’s duties and will be unable to perform the Executive’s duties for a period of ninety (90) consecutive days. The Executive shall not be considered disabled, however, if the Executive returns to work on a full-time basis within thirty (30) days after the Employer gives notice of termination due to disability. If the Executive is terminated by either of the Corporation or the Bank because of disability, the Executive’s employment with the other shall also terminate at the same time. During the period of incapacity leading up to the termination of the Executive’s employment under this provision, the Employer shall continue to pay the full Base Salary at the rate then in effect and all perquisites and other benefits (other than bonus) until the Executive becomes eligible for benefits under any disability plan or insurance program maintained by the Employer, provided that the amount of the payments by the Employer to the Executive under this Section 3.1(b) shall be reduced by the sum of the amounts, if any, payable to the Executive for the same period under any disability benefit or pension plan covering the Executive.

3.2 Involuntary Termination with Cause . The Employer may terminate the Executive’s employment for Cause. If the Executive’s employment terminates for Cause, the Executive shall receive the Base Salary through the date on which termination becomes effective and reimbursement of expenses to which the Executive is entitled when termination becomes effective. If the Executive is terminated for Cause by either of the Corporation or the Bank, the Executive shall be deemed also to have been terminated for Cause by the other. The Executive shall not be deemed to have been terminated for Cause under this Agreement unless and until there is delivered to the Executive a copy of a resolution adopted at a meeting of the board of directors called and held for the purpose, which resolution shall (x) contain findings that the Executive has committed an act constituting Cause, and (y) specify the particulars thereof. The resolution of the board of directors shall be deemed to have been duly adopted if and only if it is adopted by the affirmative vote of a majority of the directors of the Corporation then in office or a majority of the directors of the Bank then in office, in either case excluding the Executive. Notice of the meeting and the proposed termination for Cause shall be given to the Executive a reasonable time before the meeting of the board of directors. The Executive and the Executive’s counsel (if the Executive chooses to have counsel present) shall have a reasonable opportunity to be heard by the board of directors at the meeting. For purposes of this Agreement “Cause” means any of the following:

(1)

Personal dishonesty;

(2)

Incompetence

(3)

Willful misconduct;

(4)

Breach of fiduciary duty involving personal profit;

(5)

Intentional failure to perform stated duties;

(6)

Willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order; or

(7)

Material breach of any provision of this Agreement.

3.3 Voluntary Termination by the Executive Without Good Reason . If the Executive terminates employment without Good Reason, the Executive shall receive the Base Salary and expense reimbursement to which the Executive is entitled through the date on which termination becomes effective.

3.4 Involuntary Termination Without Cause and Voluntary Termination with Good Reason . With written notice to the Executive thirty (30) days in advance, the Employer may terminate the Executive’s employment without Cause. Termination shall take effect at the end of the thirty (30) day period. With advance written notice to the Employer as provided in clause (y), the Executive may terminate employment for Good Reason. If the Executive’s employment terminates involuntarily without Cause or voluntarily but with Good Reason, the Executive shall be entitled to the benefits specified in Article 4 of this Agreement. For purposes of this Agreement a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if the conditions stated in both clauses (x) and (y) of this Section 3.4 are satisfied:

(x) a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if any of the following occur without the Executive’s written consent, and the term Good Reason shall mean the occurrence of any of the following without the Executive’s written consent:

(1)

a material diminution of the Executive’s Base Salary,

(2)

a material diminution of the Executive’s authority, duties, or responsibilities, or

(3)

a change in the geographic location at which the Executive must perform services for the Employer by more than 35 miles from such location at the effective date.

(y) the Executive must give notice to the Employer of the existence of one or more of the conditions described in clause (x) within sixty (60) days after the initial existence of the condition, and the Employer shall have thirty (30) days thereafter to remedy the condition. In addition, the Executive’s voluntary termination because of the existence of one or more of the conditions described in clause (x) must occur within six (6) months after the initial existence of the condition.

ARTICLE 4

SEVERANCE COMPENSATION

4.1 Cash Severance after Termination Without Cause or Termination for Good Reason .

(a) Subject to the possibility that cash severance after employment termination might be delayed under Section 4.1(b), if the Executive’s employment terminates involuntarily but without Cause or if the Executive voluntarily terminates employment with Good Reason, the Executive shall for the unexpired term of this Agreement and in accordance with the Employer’s regular pay practices continue to receive the Base Salary in effect at employment. However, the Employer and the Executive acknowledge and agree that the compensation and benefits under this Section 4.1 shall not be payable if compensation and benefits are payable or shall have been paid to the Executive under Article 5 of this Agreement.

(b) If when employment termination occurs the Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) if the cash severance payment under Section 4.1(a) would be considered deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available, the Executive’s continued Base Salary under Section 4.1(a) for the first six months after employment termination shall be paid to the Executive in a single lump sum without interest on the first day of the seventh (7 ^th ) month after the month in which the Executive’s employment terminates. References in this Agreement to Section 409A of the Code include rules, regulations, and guidance of general application issued by the Department of the Treasury under Internal Revenue Section 409A of the Code.

4.2 Post-Termination Insurance Coverage .

(a) If the Executive’s employment terminates involuntarily but without Cause or voluntarily but with Good Reason, or because of disability, the Employer shall continue or cause to be continued at the Employer’s expense medical insurance benefits for the Executive and any of his dependents covered at the time of his termination. The medical insurance benefits shall continue until the first to occur of (w) the Executive’s return to employment with the Employer or another employer, (x) the Executive’s attainment of age 65, (y) the Executive’s death, or (z) the end of the term remaining under this Agreement when the Executive’s employment terminates.

(b) If (x) under the terms of the applicable policy or policies for the insurance benefits specified in section 4.2(a) it is not possible to continue coverage for the Executive and his dependents, or (y) when employment termination occurs the Executive is a “specified employee” within the meaning of Section 409A of the Code, if any of the continued insurance coverage benefits specified in Section 4.2(a) would be considered deferred compensation under Section 409A of the Code, and finally, if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available for that particular insurance benefit, the Employer shall pay to the Executive in a single lump sum an amount in cash equal to the present value of the Employer’s projected cost to maintain that particular insurance

benefit (and associated income tax gross-up benefit, if applicable) had the Executive’s employment not terminated, assuming continued coverage for 36 months. The lump-sum payment shall be made thirty (30) days after employment termination or, if Section 4.1(b) applies, on the first day of the seventh (7 ^th ) month after the month in which the Executive’s employment terminates.

ARTICLE 5

CHANGE IN CONTROL BENEFITS

5.1 Change in Control Benefits . If a Change in Control occurs during the term of this Agreement and, thereafter, the Executive’s employment terminates involuntarily but without Cause or if the Executive voluntarily terminates employment with Good Reason, the Employer shall make or cause to be made a lump-sum payment to the Executive in an amount in cash equal to three (3) times the Executive’s average annual compensation. For this purpose, average annual compensation means the Executive’s taxable income reported by the Employer (or any affiliate of the Employer) for the five (5) calendar years immediately preceding the calendar year in which the Change in Control occurs, regardless of when the cash bonus or cash incentive compensation earned for the preceding calendar year. The payment required under this paragraph is payable no later than five (5) business days after the Executive’s termination of employment. If the Executive receives payment under Section 5.1, the Executive shall not be entitled to any additional severance benefits under Section 4.1 of this Agreement. In addition, the Employer shall provide the Executive with the post-termination insurance coverage described in Section 4.2(a) of this Agreement, subject to the provisions of Section 4.2(b) of this Agreement.

5.2 Change in Control Defined . For purposes of this Agreement “Change in Control” means a change in control as defined in Internal Revenue Section 409A of the Code and rules, regulations, and guidance of general application thereunder issued by the Department of the Treasury, including:

(a) Change in ownership : a change in ownership of the Corporation occurs on the date any one person or group accumulates ownership of Corporation stock constituting more than 50% of the total fair market value or total voting power of Corporation stock,

(b) Change in effective control : (x) any one person or more than one person acting as a group acquires within a 12-month period ownership of Corporation stock possessing 30% or more of the total voting power of Corporation stock, or (y) a majority of the Corporation’s board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed in advance by a majority of the Corporation’s board of directors, or

(c) Change in ownership of a substantial portion of assets : a change in ownership of a substantial portion of the Corporation’s assets occurs if in a 12-month period any one person or more than one person acting as a group acquires from the Corporation assets having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of all of the Corporation’s assets immediately before the acquisition or acquisitions. For this purpose, gross fair market value means the value of the Corporation’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.

5.3 Potential Limitation of Benefits Under Certain Circumstances . Notwithstanding any other provisions of this Agreement, in the event that (x) the aggregate payments or benefits to be made or afforded to the Executive under this Agreement or otherwise, which are deemed to be parachute payments as defined in Section 280G of the Code or any successor thereof, (the “Termination Benefits”) would be deemed to include an “excess parachute payment” under Section 280G of the Code; and (y) if such Termination Benefits were reduced to an amount (the “Non-Triggering

Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times the Executive’s “base amount,” as determined in accordance with Section 280G of the Code and the Non-Triggering Amount less the product of the marginal rate of any applicable state and federal income tax and the Non-Triggering Amount would be greater than the aggregate value of the Termination Benefits (without such reduction) minus (1) the amount of tax required to be paid by the Executive thereon by Section 4999 of the Code and further minus (2) the product of the Termination Benefits and the marginal rate of any applicable state and federal income tax, then the Termination Benefits shall be reduced to the Non-Triggering Amount. The allocation of the reduction required hereby among the Termination Benefits shall be determined by the Executive. Notwithstanding the foregoing, the Bank shall not pay the Executive Termination Benefits in excess of three (3) times his average annual compensation (or such other amount that may be permitted by the Office of Thrift Supervision pursuant to regulation or regulatory guidance). Any payment of Termination Benefits in excess of three (3) times the Executive average annual compensation shall be made by the Company. The Company’s independent public accountants will determine the value of any reduction in the payments and benefits; the Employer will pay for the accountants’ opinion. If the Employer and/or the Executive do not agree with the accountants’ opinion, the Employer will pay to the Executive the maximum amount of payments and benefits pursuant to Sections 4 and 5 of this Agreement or otherwise, as selected by Executive, that the opinion indicates have a high probability of not causing any of the payments and benefits to be non-deductible and subject to the excise tax imposed under Section 4999 of the Code. The Employer may also request, and the Executive has the right to demand that, a ruling from the IRS as to whether the disputed payments and benefits have such tax consequences. The Employer will promptly prepare and file the request for a ruling from the IRS, but in no event will the Employer make this filing later than thirty (30) days from the date of the accountant’s opinion referred to above. The request will be subject to the Executive’s approval prior to filing; the Executive shall not unreasonably withhold his approval. The Employer and the Executive agree to be bound by any ruling received from the IRS and to make appropriate payments to each other to reflect any IRS rulings, together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code. Nothing contained in this Agreement shall result in a reduction of any payments or benefits to which the Executive may be entitled upon termination of employment other than pursuant to Sections 4 and 5 hereof, or a reduction in the payments and benefits specified, below zero.

ARTICLE 6

CONFIDENTIALITY AND CREATIVE WORK

6.1 Non-disclosure . The Executive covenants and agrees not to reveal to any person, firm, or corporation any confidential information of any nature concerning the Employer or its business, or anything connected therewith. As used in this Article 6 the term “confidential information” means all of the Employer’s and the Employer’s affiliates’ confidential and proprietary information and trade secrets in existence on the date hereof or existing at any time during the term of this Agreement, including but not limited to:

(a) the whole or any portion or phase of any business plans, financial information, purchasing data, supplier data, accounting data, or other financial information,

(b) the whole or any portion or phase of any research and development information, design procedures, algorithms or processes, or other technical information,

(c) the whole or any portion or phase of any marketing or sales information, sales records, customer lists, prices, sales projections, or other sales information, and

(d) trade secrets, as defined from time to time by the laws of Indiana. This Section 6.1 does not prohibit disclosure required by an order of a court having jurisdiction or a subpoena from an appropriate governmental agency or disclosure made by the Executive in the ordinary course of business and within the scope of the Executive’s authority.

6.2 Return of Materials . The Executive agrees to immediately deliver or return to the Employer upon termination, upon expiration of this Agreement, or as soon thereafter as possible, all written information and any other similar items furnished by the Employer or prepared by the Executive in connection with the Executive’s services hereunder and to immediately delete all electronically stored data of the Employer maintained on the Executive’s personal computers and to return all Employer-provided computers or communication devices (i.e., laptop, Blackberry, PDA, etc.). The Executive will retain no copies thereof after termination of this Agreement or termination of the Executive’s employment.

6.3 Creative Work . The Executive agrees that all creative work and work product, including but not limited to all technology, business management tools, processes, software, patents, trademarks, and copyrights developed by the Executive during the term of this Agreement, regardless of when or where such work or work product was produced, constitutes work made for hire, all rights of which are owned by the Employer. The Executive hereby assigns to the Employer all rights, title, and interest, whether by way of copyrights, trade secret, trademark, patent, or otherwise, in all such work or work product, regardless of whether the same is subject to protection by patent, trademark, or copyright laws.

6.4 Affiliates’ Confidential Information is Covered; Confidentiality Obligation Survives Termination . For purposes of this Agreement, the term “affiliate” of the Employer includes any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Corporation or the Bank. The rights and obligations set forth in this Article 6 shall survive termination of this Agreement.

6.5 Injunctive Relief . The Executive acknowledges that it is impossible to measure in money the damages that will accrue to the Employer if the Executive fails to observe the obligations imposed by this Article 6. Accordingly, if the Employer institutes an action to enforce the provisions hereof, the Executive hereby waives the claim or defense that an adequate remedy at law is available to the Employer, and the Executive agrees not to urge in any such action the claim or defense that an adequate remedy at law exists. The confidentiality and remedies provisions of this Article 6 shall be in addition to and shall not be deemed to supersede or restrict, limit, or impair the Employer’s rights under applicable state or federal statute or regulation dealing with or providing a remedy for the wrongful disclosure, misuse, or misappropriation of trade secrets or proprietary or confidential information.

ARTICLE 7

COMPETITION AFTER EMPLOYMENT TERMINATION

7.1 Covenant Not to Solicit Employees . The Executive agrees not to, directly or indirectly, solicit or employ the services of any officer or employee of the Employer (including an individual who was an officer or employee of the Employer during the one year period following the Executive’s termination) for two years after the Executive’s employment termination.

7.2 Covenant Not to Compete .

(a) The Executive covenants and agrees not to compete directly or indirectly with the Employer for one year after employment termination. For purposes of this Section 7.2:

(1)

the term compete means:

(i)

providing financial products or services on behalf of any financial institution for any person residing in the territory,

(ii)

assisting (other than through the performance of ministerial or clerical duties) any financial institution in providing financial products or services to any person residing in the territory, or

(iii)

inducing or attempting to induce any person who was a customer of the Employer at the date of the Executive’s employment termination to seek financial products or services from another financial institution.

(2)

the words directly or indirectly mean:

(i)

acting as a consultant, officer, director, independent contractor, or employee of any financial institution in competition with the Employer in the territory, or

(ii)

communicating to such financial institution the names or addresses or any financial information concerning any person who was a customer of the Employer when the Executive’s employment terminated.

(3)

the term customer means any person to whom the Employer is providing financial products or services on the date of the Executive’s employment termination or within one year thereafter.

(4)

the term financial institution means any bank, savings association, or bank or savings association holding company, or any other institution, the business of which is engaging in activities that are financial in nature or incidental to such financial activities as described in Section 4(k) of the Bank Holding Company Act of 1956, other than the Employer or any of its affiliated corporations.

(5)

financial product or service means any product or service that a financial institution or a financial holding company could offer by engaging in any activity that is financial in nature or incidental to such a financial activity under Section 4(k) of the Bank Holding Company Act of 1956 and that is offered by the Employer or an affiliate on the date of the Executive’s employment termination, including but not limited to banking activities and activities that are closely related and a proper incident to banking.

(6)

the term person means any individual or individuals, corporation, partnership, fiduciary or association.

(7)

the term territory means the area within a 25-mile radius of any office of the Employer at the date of the Executive’s employment termination.

(b) If any provision of this section or any word, phrase, clause, sentence or other portion thereof (including, without limitation, the geographical and temporal restrictions contained therein) is held to be unenforceable or invalid for any reason, the unenforceable or invalid provision or portion shall be modified or deleted so that the provisions hereof, as modified, are legal and enforceable to the fullest extent permitted under applicable law.

(c) The Executive acknowledges that the Employer’s willingness to enter into this Agreement and to make the payments contemplated by Articles 3 and 4 of this Agreement is conditioned on the Executive’s acceptance of the covenants set forth in Articles 6 and 7 of this Agreement and that the Employer would not have entered into this Agreement without such covenants in force.

7.3 Injunctive and Other Relief . Because of the unique character of the services to be rendered by the Executive hereunder, the Executive understands that the Employer would not have an adequate remedy at law for the material breach or threatened breach by the Executive of any one or more of the Executive’s covenants in this Article 7. Accordingly, the Executive agrees that the Employer’s remedies for a breach of this Article 7 include, but are not limited to, (x) forfeiture of any money representing accrued salary, contingent payments, or other fringe benefits (including any amount payable pursuant to Article 4) due and payable to the Executive during the period of any breach by Executive, and (y) a suit in equity by the Employer to enjoin the Executive from the breach or threatened breach of such covenants. The Executive hereby waives the claim or defense that an adequate remedy at law is available to the Bank and the Executive agrees not to urge in any such action the claim or defense that an adequate remedy at law exists. Nothing herein shall be construed to prohibit the Employer from pursuing any other or additional remedies for the breach or threatened breach.

7.4 Article 7 Survives Termination But Is Void After a Change in Control . The rights and obligations set forth in this Article 7 shall survive termination of this Agreement. However, Article 7 shall become null and void effective immediately upon a Change in Control.

ARTICLE 8

MISCELLANEOUS

8.1 Successors and Assigns .

(a) This Agreement shall be binding upon the Employer and any successor to the Employer, including any persons acquiring directly or indirectly all or substantially all of the business or assets of the Employer by purchase, merger, consolidation, reorganization, or otherwise. But this Agreement and the Employer’s obligations under this Agreement are not otherwise assignable, transferable, or delegable by the Employer. By agreement in form and substance satisfactory to the Executive, the Employer shall require any successor to all or substantially all of the business or assets of the Employer expressly to assume and agree to perform this Agreement in the same manner and to the same extent the Employer would be required to perform had no succession occurred.

(b) This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, and legatees.

(c) Without written consent of the other parties, no party shall assign, transfer, or delegate this Agreement or any rights or obligations under this Agreement, except as expressly provided herein. Without limiting the generality or effect of the foregoing, the Executive’s right to receive payments hereunder is not assignable or transferable, whether by pledge, creation of a security interest, or otherwise, except for a transfer by the Executive’s will or by the laws of descent and distribution. If the Executive attempts an assignment or transfer that is contrary to this Section 8.1, the Employer shall have no liability to pay any amount to the assignee or transferee.

8.2 Governing Law, Jurisdiction and Forum . This Agreement shall be construed under and governed by the internal laws of the State of Indiana, without giving effect to any conflict of laws provision or rule that would cause the application of the laws of any jurisdiction other than Indiana. By entering into this Agreement, the Executive acknowledges that the Executive is subject to the jurisdiction of both the federal and state courts in Indiana.

8.3 Entire Agreement . This Agreement sets forth the entire agreement of the parties concerning the employment of the Executive by the Employer. Any oral or written statements, representations, agreements, or understandings made or entered into prior to or contemporaneously with the execution of this Agreement are hereby rescinded, revoked, and rendered null and void by the parties.

8.4 Notices . All notices, requests, demands, and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid. Unless otherwise changed by notice, notice shall be properly addressed to the Executive if addressed to the address of the Executive on the books and records of the Employer at the time of the delivery of such notice, and properly addressed to the Employer if addressed to the board of directors of the Corporation and the Bank at the Bank’s executive officers.

8.5 Severability . If there is a conflict between any provision of this Agreement and any statute, regulation, or judicial precedent, the latter shall prevail, but the affected provisions of this Agreement shall be curtailed and limited solely to the extent necessary to bring them within the requirements of law. If any provisions of this Agreement is held by a court of competent jurisdiction to be indefinite, invalid, void or voidable, or otherwise unenforceable, the remainder of this Agreement shall continue in full force and effect unless that would clearly be contrary to the intentions of the parties or would result in an injustice.

8.6 Captions and Counterparts . The captions in this Agreement are solely for convenience. The captions do not define, limit, or describe the scope or intent of this Agreement. This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

8.7 No Duty to Mitigate . The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment. Moreover, provided the Executive is not in breach of any obligation under Articles 6 and 7 of this Agreement, the amount of any payment provided for in this Agreement shall not be reduced by any compensation earned or benefits provided as the result of employment of the Executive or as a result of the Executive being self-employed after employment termination.

8.8 Amendment and Waiver . This Agreement may not be amended, released, discharged, abandoned, changed, or modified in any manner, except by an instrument in writing signed by each of the parties hereto. The failure of any party hereto to enforce at any time any of the provisions of this Agreement shall not be construed to be a waiver of any such provision, nor affect the validity of this Agreement or any part thereof or the right of any party thereafter to enforce each and every such provision. No waiver or any breach of this Agreement shall be held to be a waiver of any other or subsequent breach.

8.9 Compliance with Internal Revenue Code Section 409A . The Employer and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with Section 409A of the Code. If any provision of this Agreement does not satisfy the requirements of Section 409A of the Code, such provision shall nevertheless be applied in a manner consistent with those requirements. If any provision of this Agreement would subject the Executive to additional tax or interest under Section 409A of the Code, the Employer shall reform the provision. However, the Employer shall maintain to the maximum extent practicable the original intent of the applicable provision without subjecting the Executive to additional tax or interest, and the Employer shall not be required to incur any additional compensation expense as a result of the reformed provision.

8.10 Required Provisions . In the event any of the foregoing provisions of this Agreement conflict with the terms of this Section 8.10, this Section 8.10 shall prevail.

(a) The Bank’s Board of Directors may terminate the Executive’s employment at any time, but any termination by the Bank, other than termination for Cause, shall not prejudice the Executive’s right to compensation or other benefits under this Agreement. The Executive shall not have the right to receive compensation or other benefits for any period after termination for Cause as defined in Section 3.2 of this Agreement.

(b) If the Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1818(e)(3) or (g)(1), the Bank’s obligations under this Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Bank may, in its discretion: (i) pay the Executive all or part of the compensation withheld while its contract obligations were suspended; and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

(c) If the Executive is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1818(e)(4) or (g)(1), all obligations of the Bank under this Agreement shall terminate as of the effective date of the order, but vested rights of the contracting parties shall not be affected.

(d) If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1813(x)(1), all obligations under this Agreement shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action.

(f) Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to, and conditioned upon, their compliance with 12 U.S.C. Section 1828(k) and FDIC Regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of the date first written above.


FIRST SAVINGS FINANCIAL GROUP, INC.


Name:
Title:

FIRST SAVINGS BANK, FSB


Name:
Title:


Executive

Exhibit 10.6

FORM OF

CHANGE IN CONTROL

SEVERANCE AGREEMENT

THIS CHANGE IN CONTROL SEVERANCE AGREEMENT (the “Agreement”) is entered into effective as of this [date] , by and between FIRST SAVINGS BANK, FSB , and [NAME] (the “Executive”).

WHEREAS, the Executive has contributed to the profitability, growth, and financial strength of First Savings Bank, FSB;

WHEREAS , First Savings Bank, FSB wishes to provide additional incentives for the Executive to remain in the employment of First Savings Bank, FSB;

NOW THEREFORE, in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

1. Termination after a Change in Control .

(a) Cash benefit . If the Executive’s employment terminates involuntarily but without Cause or voluntarily but with Good Reason, in either case within 12 months after a Change in Control, First Savings Bank, FSB (the “Bank”) shall make a lump-sum payment to the Executive in an amount in cash equal to three times the Executive’s base salary (at the rate in effect immediately prior to the Change in Control or, if higher, the rate in effect when the Executive terminates employment). Unless a delay in payment is required under Section 1(b) of this Agreement, the payment required under this Section 1(a) shall be made within five (5) business days after the Executive’s employment termination. The amount payable to the Executive hereunder shall not be reduced to account for the time value of money or discounted to present value. If the Executive’s employment terminates involuntarily but without Cause before the Change in Control occurs but after discussions regarding the Change in Control commence, then for purposes of this Agreement the Executive’s employment shall be deemed to have terminated immediately after the Change in Control and, unless delay is required under Section 1(b) of this Agreement, the Executive shall be entitled to the cash benefit under this Section 1(a) within five (5) business days after the Change in Control.

(b) Payment of the benefit . If when employment termination occurs the Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), if the cash severance benefit under Section 1(a) would be considered deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available, payment of the benefit under Section 1(a) shall be delayed and shall be made to the Executive in a single lump sum without interest on the first day of the seventh (7 ^th ) month after the month in which the Executive’s employment terminates. References in this Agreement to Section 409A of the Code include rules, regulations, and guidance of general application issued by the Department of the Treasury under Section 409A of the Code.

(c) Change in Control defined . For purposes of this Agreement, a Change in Control means a change in control as defined in Section 409A of the Code, including –

(1)

Change in ownership : a change in ownership of First Savings Financial Group, Inc. (the “Company”) occurs on the date any one person or group accumulates ownership of Company stock constituting more than 50% of the total fair market value or total voting power of Company stock, or

(2)

Change in effective control : ( x ) any one person or more than one person acting as a group acquires within a 12-month period ownership of Company stock possessing 30% or more of the total voting power of Company stock, or ( y ) a majority of the Company’s board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed in advance by a majority of the Company’s board of directors, or

(3)

Change in ownership of a substantial portion of assets : a change in ownership of a substantial portion of the Company’s assets occurs if in a 12-month period any one person or more than one person acting as a group acquires from the Company assets having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of all of the Company’s assets immediately before the acquisition or acquisitions. For this purpose, gross fair market value means the value of the Company’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.

(d) Involuntary termination with Cause defined . For purposes of this Agreement involuntary termination of the Executive’s employment shall be considered involuntary termination with Cause if the Executive shall have been terminated for any of the following reasons:

(1)

Personal dishonesty;

(2)

Incompetence

(3)

Willful misconduct;

(4)

Breach of fiduciary duty involving personal profit;

(5)

Intentional failure to perform stated duties;

(6)

Willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order; or

(7)

Material breach of any provision of this Agreement.

For purposes of this Agreement, no act or failure to act on the Executive’s part shall be deemed to have been intentional if it was due primarily to an error in judgment or negligence. An act or failure to act on the Executive’s part shall be considered intentional if it is not in good faith and if it is without a reasonable belief that the action or failure to act is in the Bank’s best interests. Any act or failure to act based upon authority granted by resolutions duly adopted by the board of directors or based upon the advice of counsel for the Bank shall be conclusively presumed to be in good faith and in the Bank’s best interests.

(e) Voluntary termination with Good Reason defined . For purposes of this Agreement a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if the conditions stated in both clauses (1) and (2) are satisfied –

(1)

a voluntary termination by the Executive shall be considered a voluntary termination with Good Reason if any of the following occur without the Executive’s advance written consent, and the term Good Reason shall mean the occurrence of any of the following without the Executive’s advance written consent –

(i)

a material diminution of the Executive’s base salary,

(ii)

a material diminution of the Executive’s authority, duties, or responsibilities,

(iii)

a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Executive is required to report, or

(iv)

a change by more than thirty-five (35) miles in the geographic location at which the Executive must perform services.

(2)

the Executive must give notice to the Bank of the existence of one or more of the conditions described in clause (1) within sixty (60) days after the initial existence of the condition, and the Bank shall have thirty (30) days thereafter to remedy the condition. In addition, the Executive’s voluntary termination because of the existence of one or more of the conditions described in clause (1) must occur within six months after the initial existence of the condition.

2. Continuation of Benefits .

(a) Benefits . Subject to Section 2(b) of this Agreement, if the Executive’s employment terminates involuntarily but without Cause or voluntarily but for Good Reason within twelve (12) months after a Change in Control, the Bank shall continue or cause to be continued life and health insurance coverage substantially identical to the coverage maintained for the Executive before termination and in accordance with the same schedule prevailing before employment termination. The insurance coverage shall cease thirty-six (36) months after the Executive’s termination, whichever occurs first.

(b) Alternative lump-sum cash payment . If ( x ) under the terms of the applicable policy or policies for the insurance benefits specified in Section 2(a) it is not possible to continue the Executive’s coverage, or ( y ) if when employment termination occurs the Executive is a specified employee within the meaning of Section 409A of the Code, if any of the continued insurance coverage benefits specified in Section 2(a) would be considered deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available for that particular insurance benefit, instead of continued insurance coverage under Section 2(a) the Bank shall pay or cause to be paid to the Executive in a single lump sum an amount in cash equal to the present value of the Bank’s projected cost to maintain that particular insurance benefit had the Executive’s employment not terminated, assuming continued coverage for thirty-six (36) months. The lump-sum payment shall be made within five (5) business days after employment termination or, if the Executive is a specified employee within the meaning of Section 409A of the Code and an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available, on the first day of the seventh month after the month in which the Executive’s employment terminates.

3. Termination for Which No Benefits Are Payable . Despite anything in this Agreement to the contrary, the Executive shall be entitled to no benefits under this Agreement if the Executive’s employment terminates with Cause, if the Executive dies while actively employed by the Bank, or if the Executive becomes totally disabled while actively employed by the Bank. For purposes of this Agreement, the term “totally disabled” means that because of injury or sickness the Executive is unable to perform the Executive’s duties. The benefits, if any, payable to the Executive or the Executive’s beneficiary or estate relating to the Executive’s death or disability shall be determined solely by such benefit plans or arrangements as the Bank may have with the Executive relating to death or disability, not by this Agreement.

4. Term of Agreement .

(b) Commencing on the first anniversary of the Effective Date and continuing on each anniversary of the Effective Date thereafter, the disinterested members of the Boards of Directors may extend the Agreement term for an additional year, so that the remaining term of the Agreement again becomes thirty-six (36) months, unless Executive elects not to extend the term of this Agreement by giving proper written notice. The Boards of Directors will review the Agreement and Executive’s performance annually for purposes of determining whether to extend the Agreement term and will include the rationale and results of its review in the minutes of the meetings. The Boards of Directors will notify Executive as soon as possible after each annual review whether it has determined to extend the Agreement.

5. Limitation of Benefits Under Certain Circumstances . If the payments and benefits pursuant to Sections 1 and 2 of this Agreement, either alone or together with other payments and benefits the Executive has the right to receive from the Employer, would constitute a “parachute payment” under Section 280G of the Code, the payments and benefits shall be reduced or revised, in the manner determined by the Executive, by the amount, if any, which is the minimum necessary to result in no portion of the payments and benefits being non-deductible pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the code. The Company’s independent public accountants will determine any reduction in the payments and benefits; the Employer will pay for the accountants’ opinion. If the Employer and/or the Executive do not agree with the accountants’ opinion, the Employer will pay to the Executive the maximum amount of payments and benefits pursuant to Sections 1 and 2 of this Agreement, as selected by Executive, that the opinion indicates have a high probability of not causing any of the payments and benefits to be non-deductible and subject to the excise tax imposed under Section 4999 of the Code. The Employer may also request, and the Executive has the right to demand that, a ruling from the IRS as to whether the disputed payments and benefits have such tax consequences. The Employer will promptly prepare and file the request for a ruling from the IRS, but in no event will the Employer make this filing later than thirty (30) days from the date of the accountant’s opinion referred to above. The request will be subject to the Executive’s approval prior to filing; the Executive shall not unreasonably withhold his approval. The Employer and the Executive agree to be bound by any ruling received from the IRS and to make appropriate payments to each other to reflect any IRS rulings, together with interest at the applicable federal rate provided for in Section 7872(f)(2) of the Code. Nothing contained in this Agreement shall result in a reduction of any payments or benefits to which the Executive may be entitled upon termination of employment other than pursuant to Sections 1 and 2 hereof, or a reduction in the payments and benefits specified below zero.

6. This Agreement Is Not an Employment Contract . The parties hereto acknowledge and agree that ( x ) this Agreement is not a management or employment agreement and ( y ) nothing in this Agreement shall give the Executive any rights or impose any obligations to continued employment by the Bank or any subsidiary or successor of the Bank.

7 . Withholding of Taxes . The Bank may withhold from any benefits payable under this Agreement all Federal, state, local or other taxes as may be required by law, governmental regulation, or ruling.

8. Successors and Assigns .

(a) This Agreement shall be binding upon the Bank and any successor to the Bank, including any persons acquiring directly or indirectly all or substantially all of the business or assets of the Bank by purchase, merger, consolidation, reorganization, or otherwise. But this Agreement and the Bank’s obligations under this Agreement are not otherwise assignable, transferable, or delegable by the Bank. By agreement in form and substance satisfactory to the Executive, the Bank shall require any successor to all or substantially all of the business or assets of the Bank expressly to assume and agree to perform this Agreement in the same manner and to the same extent the Bank would be required to perform had no succession occurred.

(b) This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, and legatees.

(c) This Agreement is personal in nature. Without written consent of the other party, neither party shall assign, transfer, or delegate this Agreement or any rights or obligations under this Agreement except as expressly provided in this Section 8. Without limiting the generality of the foregoing, the Executive’s right to receive payments hereunder is not assignable or transferable, whether by pledge, creation of a security interest, or otherwise, except for a transfer by Executive’s will or by the laws of descent and distribution. If the Executive attempts an assignment or transfer that is contrary to this Section 8, the Bank shall have no liability to pay any amount to the assignee or transferee.

9. Notices . Any notice under this Agreement shall be deemed to have been effectively made or given if in writing and personally delivered, delivered by mail properly addressed in a sealed envelope, postage prepaid by certified or registered mail, delivered by a reputable overnight delivery service, or sent by facsimile. Unless otherwise changed by notice, notice shall be properly addressed to the Executive if addressed to the address of the Executive on the books and records of the Bank at the time of the delivery of the notice, and properly addressed to the Bank if addressed to the board of directors at the Bank’s executive offices.

10. Captions and Counterparts . The headings and subheadings in this Agreement are included solely for convenience and shall not affect the interpretation of this Agreement. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same agreement.

11. Amendments and Waivers . No provision of this Agreement may be modified, waived, or discharged unless the waiver, modification, or discharge is agreed to in a writing signed by the Executive and by the Bank. No waiver by either party hereto at any time of any breach by the other party hereto or waiver of compliance with any condition or provision of this Agreement to be performed by the other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

12. Severability . The provisions of this Agreement are severable. The invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions of this Agreement. Any provision held to be invalid or unenforceable shall be reformed to the extent and solely to the extent necessary to make it valid and enforceable.

13. Governing Law, Jurisdiction and Forum . This Agreement shall be construed under and governed by the internal laws of the State of Indiana, without giving effect to any conflict of laws provision or rule that would cause the application of the laws of any jurisdiction other than Indiana. By entering into this Agreement, the Executive acknowledges that the Executive is subject to the jurisdiction of both the federal and state courts in Indiana.

14. Entire Agreement . This Agreement constitutes the entire agreement between the Bank and the Executive concerning the subject matter. No rights are granted to the Executive under this Agreement other than those specifically set forth. No agreements or representations, oral or otherwise, expressed or implied concerning the subject matter hereof have been made by either party that are not set forth expressly in this Agreement. This Agreement supersedes and replaces in its entirety any prior severance or employment agreement between the Bank and the Executive.

15. No Mitigation Required . The Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, nor shall any profits, income, earnings, or other benefits from any source whatsoever create any mitigation, offset, reduction, or any other obligation on the part of the Executive hereunder or otherwise.

16. Internal Revenue Code Section 409A . The Bank and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with Section 409A of the Code. If any provision of this Agreement does not satisfy the requirements of Section 409A of the Code, the provision shall be applied in a manner consistent with those requirements, despite any contrary provision of this Agreement. If any provision of this Agreement would subject the Executive to additional tax or interest under Section 409A of the Code, the Bank shall reform the provision. However, the Bank shall maintain to the maximum extent practicable the original intent of the applicable provision without subjecting the Executive to additional tax or interest, and the Bank shall not be required to incur any additional compensation expense as a result of the reformed provision. References in this Agreement to Section 409A of the Code include rules, regulations, and guidance of general application issued by the Department of the Treasury under Section 409A of the Code.

17. Required Provisions . In the event any of the foregoing provisions of this Agreement conflict with the terms of this Section 17, this Section 17 shall prevail.

(e) All obligations under this Agreement shall terminate, except to the extent determined that continuation of the Agreement is necessary for the continued operation of the institution: (i) by the Director of the Office of Thrift Supervision (OTS), or his designee, at the time the Federal Deposit Insurance Corporation (FDIC) enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. Section 1823(c), or (ii) by the Director of the OTS (or his designee) at the time the Director (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action.

IN WITNESS WHEREOF, the parties have executed this Change in Control Severance Agreement as of the date first written above.


FIRST SAVINGS BANK, FSB


By:
Its:


Executive

Exhibit 10.7

FORM OF

FIRST SAVINGS BANK, F.S.B.

EMPLOYEE SEVERANCE COMPENSATION PLAN

A.	Purpose .

The primary purpose of the First Savings Bank, F.S.B. Employee Severance Compensation Plan (the “Plan”) is to ensure the successful continuation of the business of First Savings Bank, F.S.B. (the “Bank”) and the fair and equitable treatment of the Bank’s employees following a Change in Control (as defined below).

B.	Covered Employees .

Subject to paragraph C below, any employee of the Bank with at least one year of service as of his or her termination date shall be eligible to receive a Change in Control Severance Benefit (as defined below) if, within the period beginning on the effective date of a Change in Control and ending on the first anniversary of such date, (i) the employee’s employment with the Bank is involuntarily terminated or (ii) the employee terminates employment with the Bank voluntarily after being offered continued employment in a position that is not a Comparable Position (as defined below).

C.	Limitations on Eligibility for Change in Control Severance Benefits or Management Restructuring Benefits .

(1) No employee shall be eligible for a Change in Control Severance Benefit if (a) his or her employment is terminated for “Cause,” (b) he or she is offered a Comparable Position and declines to accept such position, or (c) the employee is, at the time of termination of employment, a party to an individual employment agreement or change in control agreement with the Bank and/or First Savings Financial Group, Inc. (the “Company”).

(2) For purposes of this Plan, a termination of employment for “Cause” shall include termination because of the employee’s personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule, or regulation (other than traffic violations or similar offenses) or final cease-and-desist order, or material breach of any provision of the Plan.

(3) For purposes of this Plan, a “Comparable Position” shall mean a position that would (a) provide the employee with base compensation and benefits that are comparable in the aggregate to those provided to the employee prior to the Change in Control; (b) provide the employee with an opportunity for variable bonus compensation that is comparable to the opportunity provided to the employee prior to the Change in Control; (c) be in a location that would not require the employee to increase his or her daily one-way commuting distance by more than thirty-five (35) miles as compared to the employee’s commuting distance immediately prior to the Change in Control; and (d) have job skill requirements and duties that are comparable to the requirements and duties of the position held by the employee prior to the Change in Control.

D.	Definitions of Change in Control .

For purposes of this Plan “Change in Control” means a change in control as defined in Internal Revenue Section 409A of the Code and rules, regulations, and guidance of general application thereunder issued by the Department of the Treasury, including:

(a) Change in ownership : a change in ownership of the Company occurs on the date any one person or group accumulates ownership of Company stock constituting more than 50% of the total fair market value or total voting power of Company stock,

(b) Change in effective control : (x) any one person or more than one person acting as a group acquires within a 12-month period ownership of Company stock possessing 30% or more of the total voting power of Company stock, or (y) a majority of the Company’s board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed in advance by a majority of the Company’s board of directors, or

(c) Change in ownership of a substantial portion of assets : a change in ownership of a substantial portion of the Company’s assets occurs if in a 12-month period any one person or more than one person acting as a group acquires from the Company assets having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of all of the Company’s assets immediately before the acquisition or acquisitions. For this purpose, gross fair market value means the value of the Company’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.

E.	Determination of the Change in Control Severance Benefit .

(1) The Change in Control Severance Benefit payable to an eligible employee under this Plan shall be determined under the following schedule:

(a) An eligible Employee who does not receive a benefit pursuant to paragraph (b) of this Paragraph shall receive a Change in Control Severance Benefit equal to the product of (i) the employee’s years of service from his or her hire date (including partial years and years prior to the adoption of this plan) through the termination date and (ii) an amount equal to two (2) weeks of the employee’s Base Compensation (as defined below). A “year of service” shall mean each 12-month period of service following an employee’s hire date determined without regard the number of hours worked during such period(s). The taking of a leave of absence shall not eliminate a period of time from being a year of service if such period of time otherwise qualifies as a year of service. Further if a particular 12-month period of time would not otherwise qualify under the Plan as a year of service because one hour of service is not credited during each month of such period due to the taking of a leave of absence, then such period of time shall be deemed to be a year of service for all other sections of this Plan. For purposes of this Plan, a “leave of absence” means (i) the taking of an authorized or approved leave of absence under the provisions of the federal Family and Medical Leave Act (“FMLA”), (ii) any state law providing qualitatively similar benefits as the FMLA, or (iii) a leave of absence authorized under the policies of the Bank. The minimum payment to an eligible employee under this paragraph shall be an amount equal to two (2) weeks of Base Compensation and the maximum payment to an eligible employee shall be an amount equal to twenty-six (26) months of Base Compensation.

(b) The Change in Control Severance Benefit shall be paid in a lump sum not later than five (5) business days after the date of the employee’s termination of employment.

(2) For purpose of determinations under this Paragraph E, “Base Compensation” shall mean:

(a) For salaried employees, the employee’s annual base salary at the rate in effect on his or her termination date or, if greater, the rate in effect on the date immediately preceding the Change in Control.

(b) For employees whose compensation is determined in whole or in part on the basis of commission income, the employee’s base salary at termination (or, if greater, the employee’s base salary on the date immediately preceding the effective date of the Change in Control), if any, plus the commissions earned by the employee in the twelve (12) full calendar months preceding his or her termination date (or, if greater, the commissions earned in the twelve (12) full calendar months immediately preceding the effective date of the Change in Control).

(c) For hourly employees, the employee’s total hourly wages for the twelve (12) full calendar months preceding his or her termination date or, if greater, the twelve (12) full calendar months preceding the effective date of the Change in Control.

F.	Withholding .

All payments will be subject to customary withholding for federal, state and local tax purposes.

G.	Parachute Payment .

Notwithstanding anything in this Plan to the contrary, if a Change in Control Severance Benefit to an employee who is a “Disqualified Individual” shall be in an amount which includes an “Excess Parachute Payment,” taking into account payments under this Plan and otherwise, the benefit payable under this Plan shall be reduced to the maximum amount which does not include an Excess Parachute Payment. The terms “Disqualified Individual” and “Excess Parachute Payment” shall have the same meanings as under Section 280G of the Code or any successor provision thereto.

H.	Adoption by Affiliates .

Upon approval by the Board of Directors of the Bank (the “Board of Directors”), this Plan may be adopted by any “Subsidiary” or “Parent” of the Bank. Upon such adoption, the provisions of the Plan shall be fully applicable to the employees of that Subsidiary or Parent. The term “Subsidiary” means any corporation in which the Bank, directly or indirectly, holds a majority of the voting power of its outstanding shares of capital stock. The term “Parent” means any corporation which holds a majority of the voting power of the Bank’s outstanding shares of capital stock.

I.	Administration .

The Plan is administered by the Board of Directors, which shall have the discretion to interpret the terms of the Plan and to make all determinations about eligibility and payment of benefits. All decisions of the Board of Directors, any action taken by the Board of Directors with respect to the Plan and within the powers granted to the Board of Directors under the Plan, and any interpretation by the Board of Directors of any term or condition of the Plan, are conclusive and binding on all persons, and will be given the maximum possible deference allowed by law. The Board of Directors may delegate and reallocate any authority and responsibility with respect to the Plan.

J.	Source of Payments .

Unless otherwise determined by the Board of Directors, all payments and benefits provided under this Agreement shall be paid solely by the Bank or, if applicable, any affiliate that adopts the Plan pursuant to Paragraph H of the Plan. Notwithstanding anything in this Agreement to the contrary, no provision of this Agreement shall be construed so as to result in the duplication of any payment or benefit.

K.	Inalienability .

In no event may any Employee sell, transfer, anticipate, assign or otherwise dispose of any right or interest under the Plan. At no time will any such right or interest be subject to the claims of creditors, nor liable to attachment, execution or other legal process.

L.	Governing Law .

The provisions of the Plan will be construed, administered and enforced in accordance with the laws of the State of Indiana, except to the extent that federal law applies.

M.	Severability .

If any provision of the Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of the Plan, and the Plan will be construed and enforced as if such provision had not been included.

N.	No Employment Rights .

Neither the establishment nor the terms of this Plan shall be held or construed to confer upon any employee the right to a continuation of employment, nor constitute a contract of employment, express or implied. The Bank and, if applicable, any affiliate that adopts the Plan reserves the right to dismiss or otherwise deal with any employee to the same extent and on the same basis as though this Plan had not been adopted. Nothing in this Plan is intended to alter the at-will status of an employee’s at will employment status, it being understood that, except to the extent otherwise expressly set forth to the contrary in an individual employment-related agreement, the employment of any employee may be terminated at any time by either the Bank and, if applicable, any affiliate that adopts the Plan or the employee with or without cause.

O.	Amendment and Termination .

The Plan may be terminated or amended in any respect by resolution adopted by a majority of the Board of Directors, unless a Change in Control has previously occurred. If a Change in Control occurs, the Plan no longer shall be subject to amendment, change, substitution, deletion, revocation or termination in any respect whatsoever. The form of any proper amendment or termination of the Plan shall be a written instrument signed by a duly authorized officer or officers of the Bank, certifying that the amendment or termination has been approved by the Board of Directors. A proper amendment of the Plan automatically shall effect a corresponding amendment to each Participant’s rights hereunder. A proper termination of the Plan automatically shall effect a termination of all employees’ rights and benefits hereunder.

P.	Required Provisions .

(1) In the event any of the provisions of this Paragraph P are in conflict with the terms of this Plan, this Paragraph P shall prevail.

(2) The Bank may terminate an employee’s employment at any time, but any termination by the Bank, other than termination for Cause, shall not prejudice an employee’s right to compensation or other benefits under this Plan. An employee shall not have the right to receive compensation or other benefits for any period after termination for Cause.

(3) If an employee is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(3) or (g)(1); the Bank’s obligations under this Plan shall be suspended as of the date of service, unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Bank may in its discretion: (i) pay the employee all or part of the compensation withheld while their contract obligations were suspended; and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

(4) If an employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e)(4) or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(1), all obligations of the Bank under this Plan shall terminate as of the effective date of the order, but vested rights of the contracting parties shall not be affected.

(5) If the Bank is in default as defined in Section 3(x)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1813(x)(1) all obligations under this Plan shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

(6) All obligations under this Plan shall be terminated, except to the extent determined that continuation of the Plan is necessary for the continued operation of the Bank: (i) by the Director of the Office of Thrift Supervision (OTS), or his designee, at the time the Federal Deposit Insurance Corporation (FDIC) enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c); or (ii) by the Director of the OTS (or his designee) at the time the Director (or his designee) approves a supervisory merger to resolve problems related to the operations of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition. Any rights of the parties that have already vested, however, shall not be affected by such action.

(7) Any payments made to employees pursuant to this Plan, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

This plan has been approved and adopted by the Board of Directors of the Bank and is effective as of [date].


	FIRST SAVINGS BANK, F.S.B.

Attest:	By:
		For the Entire Board of Directors

Exhibit 10.8

FORM OF

FIRST SAVINGS BANK, F.S.B.

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

Effective January 1, 2008

First Savings Bank, F.S.B.

Supplemental Executive Retirement Plan

Table of Contents


ARTICLE I	Introduction	1

ARTICLE II	Definitions	1

ARTICLE III	Eligibility and Participation	3

ARTICLE IV	Benefits	3

ARTICLE V	Accounts	5

ARTICLE VI	Supplemental Benefit Payments	5

ARTICLE VII	Claims Procedures	6

ARTICLE VIII	Amendment and Termination	7

ARTICLE IX	General Provisions	7

ARTICLE I

INTRODUCTION

Section 1.01 Purpose, Design and Intent .

(a)

The purpose of the First Savings Bank, F.S.B. Supplemental Executive Retirement Plan (the “Plan”) is to assist First Savings Bank, F.S.B. (the “Bank”) and its affiliates in retaining the services of key employees until their retirement, to induce such employees to use their best efforts to enhance the business of the Bank and its affiliates, and to provide certain supplemental retirement benefits to such employees.

(b)

The Plan, in relevant part, is intended to constitute an unfunded “excess benefit plan” as defined in Section 3(36) of the Employee Retirement Income Security Act of 1974, as amended. In this respect, the Plan is specifically designed to provide certain key employees with retirement benefits that would have been provided under various tax-qualified retirement plans sponsored by the Bank but for the applicable limitations placed on benefits and contributions under such plans by various provisions of the Internal Revenue Code of 1986, as amended.

ARTICLE II

DEFINITIONS

Section 2.01 Definitions . In this Plan, whenever the context so indicates, the singular or the plural number and the masculine or feminine gender shall be deemed to include the other, the terms “he,” “his,” and “him,” shall refer to a Participant or a beneficiary of a Participant, as the case may be, and, except as otherwise provided, or unless the context otherwise requires, the capitalized terms shall have the following meanings:

(a) “Affiliate” means any corporation, trade or business, which, at the time of reference, is together with the Bank, a member of a controlled group of corporations, a group of trades or businesses (whether or not incorporated) under common control, or an affiliated service group, as described in Sections 414(b), 414(c), and 414(m) of the Code, respectively, or any other organization treated as a single employer with the Bank under Section 414(o) of the Code.

(b) “Applicable Limitations” means one or more of the following, as applicable:

(i)

the maximum limitations on annual additions to a tax-qualified defined contribution plan under Section 415(c) of the Code; and

(ii)

the maximum limitation on the annual amount of compensation that may, under Section 401(a)(17) of the Code, be taken into account in determining contributions to and benefits under tax-qualified plans.

(d) “Board of Directors” means the Board of Directors of the Bank.

(e) “Change in Control” means a change in control as defined in Internal Revenue Section 409A of the Code and rules, regulations, and guidance of general application thereunder issued by the Department of the Treasury, including:

(i)

Change in ownership : a change in ownership of the Company occurs on the date any one person or group accumulates ownership of Company stock constituting more than 50% of the total fair market value or total voting power of Company stock, or

(ii)

(iii)

(f) “Code” means the Internal Revenue Code of 1986, as amended.

(g) “Committee” means the person(s) designated by the Board of Directors, pursuant to Section 9.02 of the Plan, to administer the Plan.

(h) “Common Stock” means the common stock of the Company.

(i) “Company” means First Savings Financial Group, Inc. and its successors.

(j) “Eligible Individual” means any Employee who participates in the ESOP, as the case may be, and whom the Board of Directors determines is one of a “select group of management or highly compensated employees,” as such phrase is used for purposes of Sections 101, 201, and 301 of ERISA.

(k) “Employee” means any person employed by the Bank or an Affiliate.

(l) “Employer” means the Bank or Affiliate thereof that employs the Employee.

(m) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

(n) “ESOP” means the First Savings Bank, F.S.B. Employee Stock Ownership Plan, as amended from time to time.

(o) “ESOP Acquisition Loan” means a loan or other extension of credit incurred by the trustee of the ESOP in connection with the purchase of Common Stock on behalf of the ESOP.

(p) “ESOP Valuation Date” means any day as of which the investment experience of the trust fund of the ESOP is determined and individuals’ accounts under the ESOP are adjusted accordingly.

(q) “Effective Date” means January 1, 2008.

(r) “Participant” means an Eligible Employee who is entitled to benefits under the Plan.

(s) “Plan” means this First Savings Bank, F.S.B. Supplemental Executive Retirement Plan.

(t) “Separation from Service” means a termination of a Participant’s services (whether as an employee or as an independent contractor) to the Bank. Whether a Separation from Service has occurred shall be determined in accordance with the requirements of Section 409A of the Code based on whether the facts and circumstances indicate that the Bank and the Participant reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the Participant would performed after a certain date or (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding thirty-six (36) month period.

(u) “Supplemental ESOP Account” means an account established by an Employer, pursuant to Section 5.01 of the Plan, with respect to a Participant’s Supplemental ESOP Benefit.

(v) “Supplemental ESOP Benefit” means the benefit credited to a Participant pursuant to Section 4.01 of the Plan.

(w) “Supplemental Stock Ownership Account” means an account established by an Employer, pursuant to Section 5.02 of the Plan, with respect to a Participant’s Supplemental Stock Ownership Benefit.

(x) “Supplemental Stock Ownership Benefit” means the benefit credited to a Participant pursuant to Section 4.02 of the Plan.

ARTICLE III

ELIGIBILITY AND PARTICIPATION

Section 3.01 Eligibility and Participation .

(a)

Each Eligible Employee may participate in the Plan. An Eligible Employee shall become a Participant in the Plan upon designation as such by the Board of Directors. An Eligible Employee whom the Board of Directors designates as a Participant in the Plan shall commence participation as of the date established by the Board of Directors. The Board of Directors shall establish an Eligible Employee’s date of participation at the same time it designates the Eligible Employee as a Participant in the Plan.

(b)	The Board of Directors may, at any time, designate an Eligible Employee as a Participant for any or all supplemental benefits provided for under Article IV of the Plan.

ARTICLE IV

BENEFITS

Section 4.01 Supplemental ESOP Benefit .

As of the last day of each plan year of the ESOP, the Employer shall credit the Participant’s Supplemental ESOP Account with a Supplemental ESOP Benefit equal to the excess of (a) over (b), where:

(a)

Equals the annual contributions made by the Employer and/or the number of shares of Common Stock released for allocation in connection with the repayment of an ESOP Acquisition Loan that would otherwise be allocated to the accounts of the Participant under the ESOP for the applicable plan year, if the provisions of the ESOP were administered without regard to any of the Applicable Limitations; and

(b)

Equals the annual contributions made by the Employer and/or the number of shares of common stock released for allocation in connection with the repayment of an ESOP Acquisition Loan that are actually allocated to the accounts of the Participant under the provisions of the ESOP for that particular plan year, after giving effect to any reduction of such allocation required by any of the Applicable Limitations.

Section 4.02 Supplemental Stock Ownership Benefit .

(a)	Upon a Change in Control, the Employer shall credit to the Participant’s Supplemental Stock Ownership Account a Supplemental Stock Ownership Benefit equal to (i) less (ii), the result of which is multiplied by (iii), where:

(i)

Equals the total number of shares of Common Stock acquired with the proceeds of all ESOP Acquisition Loans (together with any dividends, cash proceeds, or other medium related to such ESOP Acquisition Loans) that would have been allocated or credited for the benefit of the Participant under the ESOP and/or this Plan, as the case may be, had the Participant continued in the employ of the Employer through the first ESOP Valuation Date following the last scheduled payment of principal and interest on all ESOP Acquisition Loans outstanding at the time of the Change in Control; and

(ii)

(iii)

Equals the fair market value of the Common Stock immediately preceding the Change in Control.

(b)	For purposes of clause (i) of subsection (a) of this Section 4.02, the total number of shares of Common Stock shall be determined by multiplying the sum of (i) and (ii) by (iii), where:

(i)

Equals the average of the total shares of Common Stock acquired with the proceeds of an ESOP Acquisition Loan and allocated for the benefit of the Participant under the ESOP as of the three most recent ESOP Valuation Dates preceding the Change in Control (or lesser number if the Participant has not participated in the ESOP for three full years);

(ii)

Equals the average number of shares of Common Stock credited to the Participant’s Supplemental ESOP Account for the three most recent plan years of the ESOP (such that the three most recent plan years coincide with the three most recent ESOP Valuation Dates referred to in (i) above); and

(iii)

Equals the original number of scheduled annual payments on the ESOP Acquisition Loan.

ARTICLE V

ACCOUNTS

Section 5.01 Supplemental ESOP Benefit Account .

For each Participant who is credited with a benefit pursuant to Section 4.01 of the Plan, the Employer shall establish, as a memorandum account on its books, a Supplemental ESOP Account. Each year, the Committee shall credit to the Participant’s Supplemental ESOP Account the amount of benefits determined under Section 4.01 of the Plan for that year. The Committee shall credit the account with an amount equal to the appropriate number of shares of Common Stock or other medium of contribution that would have otherwise been made to the Participant’s accounts under the ESOP but for the limitations imposed by the Code. Shares of Common Stock shall be valued under this Plan in the same manner as under the ESOP. Cash contributions credited to a Participant’s Supplemental ESOP Account shall be credited annually with interest at a rate equal to the combined weighted return provided to the Participant’s non-stock accounts under the ESOP.

Section 5.02 Supplemental Stock Ownership Account .

The Employer shall establish, as a memorandum account on its books, a Supplemental Stock Ownership Account. Upon a Change in Control, the Committee shall credit to the Participant’s Supplemental Stock Ownership Account the amount of benefits determined under Section 4.02 of the Plan. The Committee shall credit the account with an amount equal to the appropriate number of shares of Common Stock or other medium of contribution that would have otherwise been made to the Participant’s accounts under the ESOP. Shares of Common Stock shall be valued under this Plan in the same manner as under the ESOP. Cash contributions credited to a Participant’s Supplemental Stock Ownership Account shall be credited annually with interest at a rate equal to the combined weighted return provided to the Participant’s non-stock accounts under the ESOP.

ARTICLE VI

SUPPLEMENTAL BENEFIT PAYMENTS

Section 6.01 Payment of Supplemental ESOP Benefit .

(a)

A Participant’s Supplemental ESOP Benefit shall be paid to the Participant or, in the event of the Participant’s death, to his beneficiary (as designated on a form acceptable to the Employer), in a single lump sum cash payment as soon as administratively practicable following the Participant’s Separation from Service.

(b)	A Participant shall have a non-forfeitable right to the Supplemental ESOP Benefit credited to him under this Plan in the same percentage as he has with respect to benefits allocated to him under the ESOP at the time the benefits become distributable to him under the ESOP.

Section 6.02 Payment of Supplemental Stock Ownership Benefit .

(a)

A Participant’s Supplemental Stock Ownership Benefit shall be paid to the Participant or, in the event of the Participant’s death, to his beneficiary (as designated on a form acceptable to the Employer), in a single lump sum cash payment as soon as administratively practicable following the Participant’s Separation from Service.

(b)	A Participant shall always have a fully non-forfeitable right to the Supplemental Stock Ownership Benefit credited to him under this Plan.

Section 6.03 Payment to Specified Employees .

If when a Separation from Service occurs the Participant is a “specified employee” within the meaning of Section 409A of the Code, the benefit shall be paid to the Participant in a single lump sum cash payment without interest on the first day of the seventh month after which the Participant incurs a Separation from Service.

ARTICLE VII

CLAIMS PROCEDURES

Section 7.01 Claims Reviewer .

For purposes of handling claims with respect to this Plan, the “Claims Reviewer” shall be the Committee, unless the Committee designates another person or group of persons as Claims Reviewer.

Section 7.02 Claims Procedure .

(a)	An initial claim for benefits under the Plan must be made by the Participant or his beneficiary or beneficiaries in accordance with the terms of this Section 7.02.

(b)

Not later than ninety (90) days after receipt of such a claim, the Claims Reviewer will render a written decision on the claim to the claimant, unless special circumstances require the extension of such 90-day period. If such extension is necessary, the Claims Reviewer shall provide the Participant or the Participant’s beneficiary or beneficiaries with written notification of such extension before the expiration of the initial 90-day period. Such notice shall specify the reason or reasons for the extension and the date by which a final decision can be expected. In no event shall such extension exceed a period of ninety (90) days from the end of the initial 90-day period.

(c)

In the event the Claims Reviewer denies the claim of a Participant or any beneficiary in whole or in part, the Claims Reviewer’s written notification shall specify, in a manner calculated to be understood by the claimant, the reason for the denial; a reference to the Plan or other document or form that is the basis for the denial; a description of any additional material or information necessary for the claimant to perfect the claim; an explanation as to why such information or material is necessary; and an explanation of the applicable claims procedure.

(d)

Should the claim be denied in whole or in part and should the claimant be dissatisfied with the Claims Reviewer’s disposition of the claimant’s claim, the claimant may have a full and fair review of the claim by the Committee upon written request submitted by the claimant or the claimant’s duly authorized representative and received by the Committee within sixty (60) days after the claimant receives written notification that the claimant’s claim has been denied. In connection with such review, the claimant or the claimant’s duly authorized representative shall be entitled to review pertinent documents and submit the claimant’s views as to the issues, in writing. The Committee shall act to deny or accept the claim within sixty (60) days after receipt of the claimant’s written request for review unless special circumstances require the extension of such 60-day period. If such extension is necessary, the Committee shall provide the claimant with written notification of such extension before the expiration of such initial 60-day period. In all events, the Committee shall act to deny or accept the claim within 120 days of the receipt of the claimant’s written request for review. The action of the Committee shall be in the form of a written notice to the claimant and its contents shall include all of the requirements for action on the original claim.

(e)	In no event may a claimant commence legal action for benefits the claimant believes are due the claimant until the claimant has exhausted all of the remedies and procedures afforded the claimant by this Article VII.

ARTICLE VIII

AMENDMENT AND TERMINATION

Section 8.01 Amendment of the Plan .

The Bank may from time to time and at any time amend the Plan; provided, however, that such amendment may not adversely affect the rights of any Participant or beneficiary with respect to any benefit under the Plan to which the Participant or beneficiary may have previously become entitled prior to the effective date of such amendment without the consent of the Participant or beneficiary. The Committee shall be authorized to make minor or administrative changes to the Plan, as well as amendments required by applicable federal or state law (or authorized or made desirable by such statutes); provided, however, that such amendments must subsequently be ratified by the Board of Directors.

Section 8.02 Termination of the Plan .

The Bank may terminate the Plan at any time; provided, however, that such termination may not adversely affect the rights of any Participant or beneficiary with respect to any benefit under the Plan to which the Participant or beneficiary may have previously become entitled prior to the effective date of such termination without the consent of the Participant or beneficiary. Any amounts credited to the supplemental accounts of any Participant shall remain subject to the provisions of the Plan and no distribution of benefits shall be accelerated because of termination of the Plan.

ARTICLE IX

GENERAL PROVISIONS

Section 9.01 Unfunded, Unsecured Promise to Make Payments in the Future .

The right of a Participant or any beneficiary to receive a distribution under this Plan shall be an unsecured claim against the general assets of the Bank or its Affiliates, and neither a Participant, nor his designated beneficiary or beneficiaries, shall have any rights in or against any amount credited to any account under this Plan or any other assets of the Bank or an Affiliate. The Plan at all times shall be considered entirely unfunded both for tax purposes and for purposes of Title I of ERISA. Any funds invested hereunder shall continue for all purposes to be part of the general assets of the Bank or an Affiliate and available to its general creditors in the event of bankruptcy or insolvency. Accounts under this Plan and any benefits which may be payable pursuant to this Plan are not subject in any manner to anticipation, sale, alienation, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of a Participant or a Participant’s beneficiary. The Plan constitutes a mere promise by the Bank or Affiliate to make benefit payments in the future. No interest or right to receive a benefit may be taken, either voluntarily or involuntarily, for the satisfaction of the debts of, or other obligations or claims against, such Participant or beneficiary, including claims for alimony, support, separate maintenance and claims in bankruptcy proceedings.

Section 9.02 Committee as Plan Administrator .

(a)	The Plan shall be administered by the Committee designated by the Board of Directors of the Bank.

(b)

The Committee shall have the authority, duty and power to interpret and construe the provisions of the Plan as it deems appropriate. The Committee shall have the duty and responsibility of maintaining records, making the requisite calculations and disbursing the payments hereunder. In addition, the Committee shall have the authority and power to delegate any of its administrative duties to employees of the Bank or an Affiliate, as they may deem appropriate. The Committee shall be entitled to rely on all tables, valuations, certificates, opinions, data and reports furnished by any actuary, accountant, controller, counsel or other person employed or retained by the Bank with respect to the Plan. The interpretations, determinations, regulations and calculations of the Committee shall be final and binding on all persons and parties concerned.

Section 9.03 Expenses .

Expenses of administration of the Plan shall be paid by the Bank or an Affiliate.

Section 9.04 Statements .

The Committee shall furnish individual annual statements of accrued benefits to each Participant, or current beneficiary, in such form as determined by the Committee or as required by law.

Section 9.05 Rights of Participants and Beneficiaries .

(a)	The sole rights of a Participant or beneficiary under this Plan shall be to have this Plan administered according to its provisions and to receive whatever benefits he or she may be entitled to hereunder.

(b)	Nothing in the Plan shall be interpreted as a guaranty that any funds in any trust which may be established in connection with the Plan or assets of the Bank or an Affiliate will be sufficient to pay any benefit hereunder.

(c)

The adoption and maintenance of this Plan shall not be construed as creating any contract of employment or service between the Bank or an Affiliate and any Participant or other individual. The Plan shall not affect the right of the Bank or an Affiliate to deal with any Participants in employment or service respects, including their hiring, discharge, compensation, and other conditions of employment or service.

Section 9.06 Incompetent Individuals .

The Committee may, from time to time, establish rules and procedures which it determines to be necessary for the proper administration of the Plan and the benefits payable to a Participant or beneficiary in the event that such Participant or beneficiary is declared incompetent and a conservator or other person is appointed and legally charged with that Participant’s or beneficiary’s care. Except as otherwise provided for herein, when the Committee determines that such Participant or beneficiary is unable to manage his financial affairs, the Committee may pay such Participant’s or beneficiary’s benefits to such conservator, person legally charged with such Participant’s or beneficiary’s care, or institution then contributing toward or providing for the care and maintenance of such Participant or beneficiary. Any such payment shall constitute a complete discharge of any liability of the Bank or an Affiliate and the Plan for such Participant or beneficiary.

Section 9.07 Sale, Merger or Consolidation of the Bank .

The Plan may be continued after a sale of assets of the Bank, or a merger or consolidation of the Bank into or with another corporation or entity only if, and to the extent that, the transferee, purchaser or successor entity agrees to continue the Plan. Additionally, upon a merger, consolidation or other Change in Control, any amounts credited to Participant’s deferral accounts shall be placed in a grantor trust to the extent not already in such a trust. In the event that the Plan is not continued by the transferee, purchaser or successor entity, then the Plan shall be terminated subject to the provisions of Section 8.02 of the Plan. Any legal fees incurred by a Participant in determining benefits to which such Participant is entitled under the Plan following a sale, merger, or consolidation of the Bank or an Affiliate of which the Participant is an Employee or, if applicable, a member of the Board of Directors, shall be paid by the resulting or succeeding entity.

Section 9.08 Location of Participants .

Each Participant shall keep the Bank informed of his current address and the current address of his designated beneficiary or beneficiaries. The Bank shall not be obligated to search for any person. If such person is not located within three (3) years after the date on which payment of the Participant’s benefits payable under this Plan may first be made, payment may be made as though the Participant or his beneficiary had died at the end of such three-year period.

Section 9.09 Liability of the Bank and its Affiliates .

Notwithstanding any provision herein to the contrary, neither the Bank nor any individual acting as an employee or agent of the Bank shall be liable to any Participant, former Participant, beneficiary, or any other person for any claim, loss, liability or expense incurred in connection with the Plan, unless attributable to fraud or willful misconduct on the part of the Bank or any such employee or agent of the Bank.

Section 9.10 Governing Law .

All questions pertaining to the construction, validity and effect of the Plan shall be determined in accordance with the laws of the United States and, to the extent not preempted by such laws, by the laws of the State of Indiana.

This Plan has been approved and adopted by the Board of Directors of the Bank and is effective as of January 1, 2008.

Exhibit 10.9

AMENDED AND RESTATED

DIRECTOR DEFERRED COMPENSATION AGREEMENT

This Amended and Restated Director Deferred Compensation Agreement (the “2005 Agreement”), effective as of the 1st day of January, 2005, by and between First Savings Bank, FSB (the “Bank”), a mutual savings Bank organized and existing under the laws of the State of Indiana, hereinafter referred to as “Bank” and G.W. Clapp, Jr., hereinafter referred to as “Director”, for the purpose of formalizing the agreement between the Bank and the Director in which the Director defers receipt of fees under the terms and conditions described below. The 2005 Agreement amends and restates the Director Deferred Compensation Agreement effective as of the 1 ^st day of January, 2002 by and between the parties (the “Prior Agreement”). It is intended that deferral under the Prior Agreement shall be subject to and governed by the provisions of this 2005 Agreement and shall be subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) as those provisions apply to amounts deferred after December 31, 2004.

WITNESSETH:

WHEREAS , the Director serves the Bank as a member of the Board of Directors; and

WHEREAS , the Bank recognizes the valuable services heretofore performed for it by Director and wishes to encourage continued service; and

WHEREAS , the Bank values the efforts, abilities and accomplishments of the Director and recognizes that Director’s services will substantially contribute to its continued growth and profits in the future; and

WHEREAS , the Director wishes to defer a certain portion of fees to be earned in the future; and

WHEREAS , the parties hereto desire to formalize the terms and conditions upon which the Bank shall pay such deferred compensation to the Director or his designated beneficiary; and

WHEREAS , the parties hereto intend that this Agreement be considered an unfunded arrangement, and the Director shall be considered an unsecured general creditor of the Bank with respect to amounts deferred or benefits payable hereunder; and

WHEREAS , the Bank has adopted this Director Deferred Compensation Agreement which controls all issues relating to the Deferred Compensation Benefit as described herein;

NOW, THEREFORE , in consideration of the mutual promises herein contained, the parties hereto agree to the following terms and conditions:

ARTICLE I.

DEFINITIONS

When used herein, the following words and phrases shall have the meanings below unless the context clearly indicates otherwise:

1.1	“Accrued Benefit” means the sum of all deferred amounts and interest credited monthly at a rate equal to the rate set forth in Section 4.4 to the Director’s Retirement Account and due and owing to the Director or his Beneficiaries pursuant to this Agreement.

1.2	“Bank” means First Savings Bank, FSB and any successor thereto.

1.3

“Beneficiary” means the person or persons designated as Beneficiary in writing to the Bank to whom the share of a deceased Director’s account is payable. If no Beneficiary is so designated, then the Director’s Spouse, if living, will be deemed the Beneficiary. If the Director’s Spouse is not living, then the Children of Director will be deemed the Beneficiaries and will take on a per stirpes basis. If there are no living Children, then the Estate of the Director will be deemed the Beneficiary.

1.4	“Children” means the Director’s children, both natural and adopted, then living at the time payments are due the Children under this Agreement.

1.5	“Deferral Period” means the period which commences on January 1, 2005 and extends until the commencement of benefit payments under this Agreement.

1.6	“Deferred Compensation Benefit” means the value of the Accrued Benefit payable for a one hundred eighty (180) month period using an interest rate equal to the rate set forth in Section 4.4. Such period to begin at Director’s Normal Retirement Date.

1.7

“Disability Retirement Benefit” means the benefit payable to Director following a determination that he is disabled pursuant to Section 4.3. Said benefit shall be payable monthly for a one hundred eighty (180) month period which, subject to the provisions of Section 4.3, shall begin not more than thirty (30) days following the above-mentioned disability determination.

1.8	“Effective Date” shall be the effective date of this Agreement, January 1, 2005.

1.9	“Estate” means the Estate of the Director.

1.10	“Normal Retirement Date” means the first day of the month following the Director’s seventieth (70) birthday.

1.11

“Payout Period” means the time frame in which certain benefits payable hereunder shall be distributed. Said benefits shall be paid in equal monthly installments commencing on the first day of the month coincident with or next following the event giving rise to an entitlement to benefit payments hereunder and continuing for a period of one hundred eighty (180) months.

1.12

“Retirement Account” means book entries maintained by the Bank reflecting deferred amounts and credited with interest calculated and compounded monthly at a rate set forth in Section 4.4; provided, however, that the existence of such book entries and the Retirement Account shall not create and shall not be deemed to create a trust of any kind, or a fiduciary relationship between the Bank and the Director, his designated Beneficiary, or other Beneficiaries under this Agreement. Compensation shall be deferred when it is earned by the Director.

1.13	“Spouse” means the individual to whom the Director is legally married at the time of the Director’s death.

1.14	“Survivor’s Benefit” means the balance of the Retirement Account at the date of the Director’s death distributed in accordance with the provisions of this agreement.

ARTICLE II.

DEFERRED COMPENSATION

Commencing on the Effective Date, and continuing through the end of the Deferral Period, the Director and the Bank agree that the Director shall defer into his Retirement Account Director’s fees of $875.00 per meeting that the Director would otherwise be entitled to receive from the Bank during the Deferral Period. In the event the Director desires to change his deferrals during the term of this Agreement, the Director shall have the option to change such amounts in whole or in part on an annual basis for the next succeeding calendar year, provided a Notice of Change

in Deferral (Exhibit B attached hereto) is filed with the Bank no less than thirty (30) days prior to the end of a calendar year preceding the year for which the change is effective. If an election to defer a higher amount is made, the approval of the Board of Directors is required. The failure to timely notify the Bank of an election to change the deferrals shall prohibit the Director from making any such change for the next succeeding calendar year.

ARTICLE III.

TERMINATION OF ELECTION

The Director’s election to defer compensation shall continue in effect, pursuant to the terms of this Agreement unless and until the Director files with the Bank a Notice of Discontinuance (Exhibit C attached hereto). A Notice of Discontinuance shall be effective if filed at least five (5) days prior to any January 1st. Such Notice of Discontinuance shall be effective commencing with the January 1 ^st following its filing, whichever applies, and shall apply only with respect to the Director’s compensation attributable to services not yet performed.

ARTICLE IV.

RETIREMENT BENEFIT

4.1

Retirement Benefit . Provided Director has deferred all fees during the Deferral Period and subject to Sections 4.3, 5.1 or Article X of this Agreement, whichever is applicable, the Bank agrees to pay the Deferred Compensation Benefit commencing upon the Director’s Normal Retirement Date or such other date as may be elected by the Director in accordance with the provisions of Article XI. Such payments will be made over the Payout Period.

4.2

Continued Service Beyond Normal Retirement Date . Upon attainment of the Director’s Normal Retirement Date, payments of the Director’s Deferred Compensation Benefit shall begin in accordance with Section 4.1, and all deferrals hereunder shall cease, notwithstanding his continued service on the Board of Directors. Payments under this Section 4.2 shall be made over the Payout Period.

4.3

Disability Retirement Benefit . Notwithstanding any other provision hereof, if approved by the other members of the Board of Directors, the Director shall be entitled to receive payments hereunder prior to his Normal Retirement Date, in any case in which it is determined by a duly licensed physician selected by the Bank that, because of a disability, the Director is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to last for a continuous period of not less than 12 months. If the Director is disabled pursuant to this paragraph, the Director shall begin receiving payments of his Disability Retirement Benefit. In the event the Director dies before the Director’s entire Disability Retirement Benefit is paid pursuant to this Section 4.3, the remainder of the Director’s Disability Retirement Benefit shall be paid to Director’s Beneficiary as a single sum cash payment. This payment shall discharge the Bank’s obligation under this Agreement.

4.4

Adjustable Interest Rate . For purposes of Sections 1.1, 1.6, 1.12 and 13.9, the interest rate shall be adjusted as of the first day of each calendar quarter and shall be equal to the per annum “prime rate” as published in the Wall Street Journal on the last business day of the immediately preceding calendar quarter plus 2%; provided, however, that in no event shall such interest rate exceed 8.0% per annum.

ARTICLE V.

DEATH BENEFITS

5.1

Death Benefit Prior to Commencement of Retirement Benefits . In the event of the Director’s death while in the service of the Bank and prior to commencement of the Deferred Compensation Benefit, the Bank shall pay a Survivor’s Benefit consisting of the Director’s Accrued Benefit as a single sum cash payment.

5.2

Death Benefit After Commencement of Benefits . In the event of Director’s death after the commencement of the Deferred Compensation Benefit or Disability Retirement Benefit, but prior to the completion of all such payments due and owing hereunder, the Bank shall pay to Director’s Beneficiary the Survivor’s Benefit as a single sum cash payment, which in this event shall be the Director’s remaining Deferred Compensation Benefit or Disability Retirement Benefit, as the case may be, less payments made prior to the Director’s death.

ARTICLE VI.

OFFSET FOR OBLIGATIONS TO BANK

If, at such time as the Director becomes entitled to benefit payments hereunder, the Director has any debt, obligation or other liability representing an amount owing to the Bank, and if such debt, obligation or other liability is due and owing at the time benefit payments are payable hereunder, the Bank may offset the amount owing it against the amount of benefits otherwise distributable hereunder.

ARTICLE VII.

BENEFICIARY DESIGNATION

The Director shall have the right, at any time, to submit in substantially the form attached hereto as Exhibit A, a written designation of primary and secondary beneficiaries to whom payment under this Agreement shall be made in the event of his death prior to complete distribution of the benefits due and payable under the Agreement. Each beneficiary designation shall become effective only when receipt thereof is acknowledged in writing by the Bank.

ARTICLE VIII.

DIRECTOR’S RIGHT TO ASSETS

The rights of the Director, any Beneficiary, or any other person claiming through the Director under this Agreement, shall be solely those of an unsecured general creditor of the Bank. The Director, the Beneficiary, or any other person claiming through the Director, shall only have the right to receive from the Bank those payments as specified under this Agreement. The Director agrees that he, his Beneficiary, or any other person claiming through him shall have no rights or interests whatsoever in any asset of the Bank, including any insurance policies or contracts which the Bank may possess or obtain to informally fund this Agreement. Any asset used or acquired by the Bank in connection with the liabilities it has assumed under this Agreement, except as expressly provided, shall not be deemed to be held under any trust for the benefit of the Director or his Beneficiaries, nor shall it be considered security for the performance of the obligations of the Bank. It shall be, and remain, a general, unpledged, and unrestricted asset of the Bank.

ARTICLE IX.

RESTRICTIONS UPON FUNDING

Bank shall have no obligation to set aside, earmark or entrust any fund or money with which to pay its obligations under this Agreement. The Director, his Beneficiaries or any successor in interest to him shall be and remain simply a general creditor of the Bank in the same manner as any other creditor having a general claim for matured and unpaid compensation. The Bank reserves the absolute right at its sole discretion to either fund the obligations undertaken by this Agreement or to refrain from funding the same and to determine the extent, nature, and method of such informal funding. Should the Bank elect to fund this Agreement, in whole or in part, through the purchase of life insurance, mutual funds, disability policies or annuities , the Bank reserves the absolute right, in its sole discretion, to terminate such funding at any time, in whole or in part. At no time shall Director be deemed to have any lien, nor right, title or interest in or to any specific funding investment or to any assets of the Bank. If the Bank elects to invest in a life insurance, disability or annuity policy upon the life of the Director, then Director shall assist the Bank by freely submitting to a physical examination and supplying such additional information necessary to obtain such insurance or annuities.

ARTICLE X.

PAYMENT UPON TERMINATION OF SERVICE

If the Director terminates service prior to Normal Retirement Date, benefit payments over the Payout Period shall be made to the Director, based on the Accrued Benefit at the date such payout begins. Such payments shall begin as soon as administratively practicable following the Director’s termination of service except as may be provided pursuant to Article XI.

ARTICLE XI.

CHANGE OF DISTRIBUTION ELECTION

A Director may change the commencement date of his or her distribution with respect to his or her Retirement Account at any time; provided, however, that [i] such election shall not take effect until at least twelve (12) months after the date in which the election is made, [ii] no change may be made less than twelve (12) months prior to the date of the first scheduled payment specified under the Plan at the date of the deferral of the Director’s fees, and [iii] with respect to a payment that is not the result of death, disability (as defined in Section 4.3), the payment with respect to which such change is made must be deferred for a period of not less than five (5) years from the date such payment would otherwise have been made. Any change of distribution election which does not meet the foregoing requirements shall be disregarded.

ARTICLE XII.

ALIENABILITY AND ASSIGNMENT PROHIBITION

Neither Director nor any Beneficiary under this Agreement shall have any power or right to transfer, assign, anticipate, hypothecate, mortgage, commute, modify or otherwise encumber in advance any of the benefits payable hereunder, nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance owed by the Director or his Beneficiary, nor be transferable by operation of law in the event of bankruptcy, insolvency or otherwise. In the event Director or any Beneficiary attempts assignment, communication, hypothecation, transfer or disposal of the benefits hereunder, the Bank’s liabilities shall forthwith cease and terminate.

ARTICLE XIII.

CLAIMS PROCEDURE

Claims Procedure And Arbitration . In the event that benefits under this Agreement are not paid to the Director (or to his Beneficiary in the case of the Director’s death) and such claimants feel they are entitled to receive such benefits, then a written claim must be made to the Administrator within sixty (60) days from the date payments are refused. The Bank and its Board shall review the written claim and, if the claim is denied, in whole or in part, they shall provide in writing, within ninety (90) days of receipt of such claim, their specific reasons for such denial, reference to the provisions of this Agreement upon which the denial is based, and any additional material or information necessary to perfect the claim. Such written notice shall further indicate the additional steps to be taken by claimants if a further review of the claim denial is desired.

If claimants desire a second review, they shall notify the Administrator in writing within sixty (60) days of the first claim denial. Claimants may review the Agreement or any documents relating thereto and submit any written issues and comments they may feel appropriate. In its sole discretion, the Administrator shall then review the second claim and provide a written decision within sixty (60) days of receipt of such claim. This decision shall likewise state the specific reasons for the decision and shall include reference to specific provisions of the Agreement upon which the decision is based.

If claimants continue to dispute the benefit denial based upon completed performance of the Agreement or the meaning and effect of the terms and conditions thereof, then claimants may submit the dispute to a Board of Arbitration for final arbitration. Said Board shall consist of one member selected by the claimant, one member selected by the Bank, and the third member selected by the first two members. The Board shall operate under any generally recognized set of arbitration rules. The parties hereto agree that they and their heirs, personal representatives, successors and assigns shall be bound by the decision of such Board with respect to any controversy properly submitted to it for determination.

ARTICLE XIV.

MISCELLANEOUS

14.1	No Effect on Directorship Rights . Nothing contained herein will confer upon the Director the right to be retained in the service of the Bank nor limit the right of the Bank to discharge or otherwise deal with Director without regard to the existence of the Agreement.

14.2	State Law . The Agreement is established under, and will be construed according to, the laws of the State of Indiana, to the extent that such laws are not preempted by the Act and valid regulations published thereunder.

14.3

Severability . In the event that any of the provisions of this Agreement or portion thereof, are held to be inoperative or invalid by any court of competent jurisdiction, then: (1) insofar as is reasonable, effect will be given to the intent manifested in the provisions held invalid or inoperative, and (2) the validity and enforceability of the remaining provisions will not be affected thereby.

14.4

Incapacity of Recipient . In the event Director is declared incompetent and a conservator or other person legally charged with the care of his person or of his Estate is appointed, any benefits under the Agreement to which such Director is entitled shall be paid to such conservator or other person legally charged with the care of his person or his Estate. Except as provided above in this paragraph, when the Bank’s Board of Directors, in its sole discretion, determines that the Director is unable to manage his financial affairs, the Board may direct the Bank to make distributions to any person for the benefit of the Director.

14.5

Unclaimed Benefit . The Director shall keep the Bank informed of his current address and the current address of his Beneficiaries. The Bank shall not be obligated to search for the whereabouts of any person. If the location of the Director is not made known to the Bank within three (3) years after the date on which any payment of the Deferred Compensation Benefit may be made, payment may be made as though the Director had died at the end of the three (3) year period. If, within one (1) additional year after such three (3) year period has elapsed, or, within three (3) years after the actual death of the Director, the Bank is unable to locate any Beneficiary of the Director, then the Bank may fully discharge its obligation by payment to the Estate.

14.6

Limitations on Liability . Notwithstanding any of the preceding provisions of the Agreement, neither the Bank, nor any individual acting as an employee or agent of the Bank, or as a member of the Board of Directors shall be liable to the Director or any other person for any claim, loss, liability or expense incurred in connection with the Agreement.

14.7	Gender . Whenever in this Agreement words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply.

14.8

Affect on Other Corporate Benefit Agreements . Nothing contained in this Agreement shall affect the right of the Director to participate in or be covered by any qualified or non-qualified pension, profit sharing, group, bonus or other supplemental compensation or fringe benefit agreement constituting a part of the Bank’s existing or future compensation structure.

14.9	Headings . Headings and sub-headings in this Agreement are inserted for reference and convenience only and shall not be deemed a part of this Agreement.

ARTICLE XV.

AMENDMENT AND TERMINATION

15.1

Amendment or Termination . The Bank intends the Agreement to be permanent, but reserves the right to amend or terminate the Agreement when, in the sole opinion of the Bank, such amendment or termination is advisable. Any such amendment or termination shall be made pursuant to a resolution of the Board of Directors of the Bank and shall be effective as of the date of such resolution. No amendment or termination of the Agreement shall directly or indirectly deprive the Director of all or any portion of the Deferred Compensation Benefit payment which has commenced prior to the effective date of the resolution amending or terminating the Agreement.

15.2

No Acceleration . In the event the Agreement is terminated, any amounts credited to the Director’s Retirement Account shall remain subject to the provisions of this Agreement and distribution may not be accelerated because of the termination except as may be permitted pursuant to regulations or other guidelines issued under Code §409A.

ARTICLE XVI.

EXECUTION

16.1	This Agreement sets forth the entire understanding of the parties hereto with respect to the transactions contemplated hereby, and any previous agreements or understandings between the parties hereto regarding the subject matter hereof are merged into and superseded by this Agreement.

16.2	This Agreement shall be executed in duplicate, each copy of which, when so executed and delivered, shall be an original, but both copies shall together constitute one and the same instrument.

IN WITNESS WHEREOF , the parties have caused this Agreement to be executed on this 12 ^th day of April, 2006.


/s/ Gerald W. Clapp, Jr.
Director

FIRST SAVINGS BANK, FSB

By:		/s/ R. David Eckerty

AMENDED AND RESTATED

DIRECTOR DEFERRED COMPENSATION AGREEMENT

This Amended and Restated Director Deferred Compensation Agreement (the “2005 Agreement”), effective as of the 1st day of January, 2005, by and between First Savings Bank, FSB (the “Bank”), a mutual savings Bank organized and existing under the laws of the State of Indiana, hereinafter referred to as “Bank” and Robert E. Libs, hereinafter referred to as “Director”, for the purpose of formalizing the agreement between the Bank and the Director in which the Director defers receipt of fees under the terms and conditions described below. The 2005 Agreement amends and restates the Director Deferred Compensation Agreement effective as of the 1 ^st day of January, 2002 by and between the parties (the “Prior Agreement”). It is intended that deferral under the Prior Agreement shall be subject to and governed by the provisions of this 2005 Agreement and shall be subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) as those provisions apply to amounts deferred after December 31, 2004.

WITNESSETH:

WHEREAS , the Director serves the Bank as a member of the Board of Directors; and

WHEREAS , the Bank recognizes the valuable services heretofore performed for it by Director and wishes to encourage continued service; and

WHEREAS , the Director wishes to defer a certain portion of fees to be earned in the future; and

WHEREAS , the parties hereto desire to formalize the terms and conditions upon which the Bank shall pay such deferred compensation to the Director or his designated beneficiary; and

WHEREAS , the Bank has adopted this Director Deferred Compensation Agreement which controls all issues relating to the Deferred Compensation Benefit as described herein;

NOW, THEREFORE , in consideration of the mutual promises herein contained, the parties hereto agree to the following terms and conditions:

ARTICLE I.

DEFINITIONS

When used herein, the following words and phrases shall have the meanings below unless the context clearly indicates otherwise:

1.1	“Accrued Benefit” means the sum of all deferred amounts and interest credited monthly at a rate equal to the rate set forth in Section 4.4 to the Director’s Retirement Account and due and owing to the Director or his Beneficiaries pursuant to this Agreement.

1.2	“Bank” means First Savings Bank, FSB and any successor thereto.

1.3

1.4	“Children” means the Director’s children, both natural and adopted, then living at the time payments are due the Children under this Agreement.

1.5	“Deferral Period” means the period which commences on January 1, 2005 and extends until the commencement of benefit payments under this Agreement.

1.6	“Deferred Compensation Benefit” means the value of the Accrued Benefit payable for a one hundred eighty (180) month period using an interest rate equal to the rate set forth in Section 4.4. Such period to begin at Director’s Normal Retirement Date.

1.7

1.8	“Effective Date” shall be the effective date of this Agreement, January 1, 2005.

1.9	“Estate” means the Estate of the Director.

1.10	“Normal Retirement Date” means the first day of the month following the Director’s seventieth (70) birthday.

1.11

1.12

1.13	“Spouse” means the individual to whom the Director is legally married at the time of the Director’s death.

1.14	“Survivor’s Benefit” means the balance of the Retirement Account at the date of the Director’s death distributed in accordance with the provisions of this agreement.

ARTICLE II.

DEFERRED COMPENSATION

Commencing on the Effective Date, and continuing through the end of the Deferral Period, the Director and the Bank agree that the Director shall defer into his Retirement Account Director’s fees of $450.00 per meeting that the Director would otherwise be entitled to receive from the Bank during the Deferral Period. In the event the Director desires to change his deferrals during the term of this Agreement, the Director shall have the option to change such amounts in whole or in part on an annual basis for the next succeeding calendar year, provided a Notice of Change

ARTICLE III.

TERMINATION OF ELECTION

ARTICLE IV.

RETIREMENT BENEFIT

4.1

4.2

4.3

4.4

ARTICLE V.

DEATH BENEFITS

5.1

5.2

ARTICLE VI.

OFFSET FOR OBLIGATIONS TO BANK

ARTICLE VII.

BENEFICIARY DESIGNATION

ARTICLE VIII.

DIRECTOR’S RIGHT TO ASSETS

ARTICLE IX.

RESTRICTIONS UPON FUNDING

ARTICLE X.

PAYMENT UPON TERMINATION OF SERVICE

ARTICLE XI.

CHANGE OF DISTRIBUTION ELECTION

ARTICLE XII.

ALIENABILITY AND ASSIGNMENT PROHIBITION

ARTICLE XIII.

CLAIMS PROCEDURE

ARTICLE XIV.

MISCELLANEOUS

14.1	No Effect on Directorship Rights . Nothing contained herein will confer upon the Director the right to be retained in the service of the Bank nor limit the right of the Bank to discharge or otherwise deal with Director without regard to the existence of the Agreement.

14.2	State Law . The Agreement is established under, and will be construed according to, the laws of the State of Indiana, to the extent that such laws are not preempted by the Act and valid regulations published thereunder.

14.3

14.4

14.5

14.6

14.7	Gender . Whenever in this Agreement words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply.

14.8

14.9	Headings . Headings and sub-headings in this Agreement are inserted for reference and convenience only and shall not be deemed a part of this Agreement.

ARTICLE XV.

AMENDMENT AND TERMINATION

15.1

15.2

ARTICLE XVI.

EXECUTION

16.1	This Agreement sets forth the entire understanding of the parties hereto with respect to the transactions contemplated hereby, and any previous agreements or understandings between the parties hereto regarding the subject matter hereof are merged into and superseded by this Agreement.

16.2	This Agreement shall be executed in duplicate, each copy of which, when so executed and delivered, shall be an original, but both copies shall together constitute one and the same instrument.

IN WITNESS WHEREOF , the parties have caused this Agreement to be executed on this 12 ^th day of April, 2006.


/s/ Robert E. Libs
Director

FIRST SAVINGS BANK, FSB

By:		/s/ R. David Eckerty

AMENDED AND RESTATED

DIRECTOR DEFERRED COMPENSATION AGREEMENT

This Amended and Restated Director Deferred Compensation Agreement (the “2005 Agreement”), effective as of the 1st day of January, 2005, by and between First Savings Bank, FSB (the “Bank”), a mutual savings Bank organized and existing under the laws of the State of Indiana, hereinafter referred to as “Bank” and Michael F. Ludden, hereinafter referred to as “Director”, for the purpose of formalizing the agreement between the Bank and the Director in which the Director defers receipt of fees under the terms and conditions described below. The 2005 Agreement amends and restates the Director Deferred Compensation Agreement effective as of the 1 ^st day of January, 2002 by and between the parties (the “Prior Agreement”). It is intended that deferral under the Prior Agreement shall be subject to and governed by the provisions of this 2005 Agreement and shall be subject to the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) as those provisions apply to amounts deferred after December 31, 2004.

WITNESSETH:

WHEREAS , the Director serves the Bank as a member of the Board of Directors; and

WHEREAS , the Bank recognizes the valuable services heretofore performed for it by Director and wishes to encourage continued service; and

WHEREAS , the Director wishes to defer a certain portion of fees to be earned in the future; and

WHEREAS , the parties hereto desire to formalize the terms and conditions upon which the Bank shall pay such deferred compensation to the Director or his designated beneficiary; and

WHEREAS , the Bank has adopted this Director Deferred Compensation Agreement which controls all issues relating to the Deferred Compensation Benefit as described herein;

NOW, THEREFORE , in consideration of the mutual promises herein contained, the parties hereto agree to the following terms and conditions:

ARTICLE I.

DEFINITIONS

When used herein, the following words and phrases shall have the meanings below unless the context clearly indicates otherwise:

1.1	“Accrued Benefit” means the sum of all deferred amounts and interest credited monthly at a rate equal to the rate set forth in Section 4.4 to the Director’s Retirement Account and due and owing to the Director or his Beneficiaries pursuant to this Agreement.

1.2	“Bank” means First Savings Bank, FSB and any successor thereto.

1.3

1.4	“Children” means the Director’s children, both natural and adopted, then living at the time payments are due the Children under this Agreement.

1.5	“Deferral Period” means the period which commences on January 1, 2005 and extends until the commencement of benefit payments under this Agreement.

1.6	“Deferred Compensation Benefit” means the value of the Accrued Benefit payable for a one hundred eighty (180) month period using an interest rate equal to the rate set forth in Section 4.4. Such period to begin at Director’s Normal Retirement Date.

1.7

1.8	“Effective Date” shall be the effective date of this Agreement, January 1, 2005.

1.9	“Estate” means the Estate of the Director.

1.10	“Normal Retirement Date” means the first day of the month following the Director’s seventieth (70) birthday.

1.11

1.12

1.13	“Spouse” means the individual to whom the Director is legally married at the time of the Director’s death.

1.14	“Survivor’s Benefit” means the balance of the Retirement Account at the date of the Director’s death distributed in accordance with the provisions of this agreement.

ARTICLE II.

DEFERRED COMPENSATION

ARTICLE III.

TERMINATION OF ELECTION

ARTICLE IV.

RETIREMENT BENEFIT

4.1

4.2

4.3

4.4

ARTICLE V.

DEATH BENEFITS

5.1

5.2

ARTICLE VI.

OFFSET FOR OBLIGATIONS TO BANK

ARTICLE VII.

BENEFICIARY DESIGNATION

ARTICLE VIII.

DIRECTOR’S RIGHT TO ASSETS

ARTICLE IX.

RESTRICTIONS UPON FUNDING

ARTICLE X.

PAYMENT UPON TERMINATION OF SERVICE

ARTICLE XI.

CHANGE OF DISTRIBUTION ELECTION

ARTICLE XII.

ALIENABILITY AND ASSIGNMENT PROHIBITION

ARTICLE XIII.

CLAIMS PROCEDURE

ARTICLE XIV.

MISCELLANEOUS

14.1	No Effect on Directorship Rights . Nothing contained herein will confer upon the Director the right to be retained in the service of the Bank nor limit the right of the Bank to discharge or otherwise deal with Director without regard to the existence of the Agreement.

14.2	State Law . The Agreement is established under, and will be construed according to, the laws of the State of Indiana, to the extent that such laws are not preempted by the Act and valid regulations published thereunder.

14.3

14.4

14.5

14.6

Limitations on Liability Notwithstanding any of the preceding provisions of the Agreement, neither the Bank, nor any individual acting as an employee or agent of the Bank, or as a member of the Board of Directors shall be liable to the Director or any other person for any claim, loss, liability or expense incurred in connection with the Agreement.

14.7	Gender . Whenever in this Agreement words are used in the masculine or neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply.

14.8

14.9	Headings . Headings and sub-headings in this Agreement are inserted for reference and convenience only and shall not be deemed a part of this Agreement.

ARTICLE XV.

AMENDMENT AND TERMINATION

15.1

15.2

No Acceleration In the event the Agreement is terminated, any amounts credited to the Director’s Retirement Account shall remain subject to the provisions of this Agreement and distribution may not be accelerated because of the termination except as may be permitted pursuant to regulations or other guidelines issued under Code §409A.

ARTICLE XVI.

EXECUTION

16.1	This Agreement sets forth the entire understanding of the parties hereto with respect to the transactions contemplated hereby, and any previous agreements or understandings between the parties hereto regarding the subject matter hereof are merged into and superseded by this Agreement.

16.2	This Agreement shall be executed in duplicate, each copy of which, when so executed and delivered, shall be an original, but both copies shall together constitute one and the same instrument.

IN WITNESS WHEREOF , the parties have caused this Agreement to be executed on this 12 ^th day of April, 2006.


/s/ Michael F. Ludden
Director

FIRST SAVINGS BANK, FSB

By:		/s/ R. David Eckerty

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

The Boards of Directors

First Savings Financial Group, Inc.

First Savings Bank, F.S.B.

Clarksville, Indiana

We consent to the use in this Registration Statement on Form S-1 on behalf of First Savings Financial Group, Inc., of our report dated December 20, 2007, relating to the consolidated financial statements of First Savings Bank, F.S.B. which appear in the Prospectus contained in such Registration Statement. We also consent to the reference to us under the heading “Experts” contained in the Prospectus.

/s/ MONROE SHINE & CO., INC.

New Albany, Indiana

June 12, 2008

Exhibit 23.3


RP ^® FINANCIAL, LC.
Financial Services Industry Consultants

June 9, 2008

Board of Directors

First Savings Bank, F.S.B.

501 East Lewis & Clark Parkway

Clarksville, IN 47129

Members of the Board of Directors:

We hereby consent to the use of our firm’s name in the Form AC Application for Conversion, and any amendments thereto to be filed with Office of Thrift Supervision, and in the Registration Statement on Form S-1, and any amendments thereto to be filed with the Securities and Exchange Commission. We also hereby consent to the inclusion of, summary of and references to our Valuation Appraisal Report and any Valuation Appraisal Report Updates in such filings including the prospectus of First Savings Financial Group, Inc. and to the reference to our firm under the heading “Experts” in the prospectus.

Sincerely,

RP ^® FINANCIAL, LC.


Washington Headquarters
Rosslyn Center				Telephone: (703) 528-1700
1700 North Moore Street, Suite 2210				Fax No.: (703) 528-1788
Arlington, VA 22209				Toll-Free No.: (866) 723-0594

Exhibit 24.1

POWERS OF ATTORNEY

Each person whose signature appears below constitutes and appoints Larry W. Myers and John P. Lawson, Jr., as the true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for them and in their name, place and stead, in any and all capacities to sign any or all amendments to the Application for Conversion on Form AC by First Savings Bank, F.S.B, and the Registration Statement on Form S-1 by First Savings Financial Group, Inc. and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Office of Thrift Supervision (the “OTS”) or the U.S. Securities and Exchange Commission, respectively, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done as fully to all intents and purposes as they might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or their substitute or substitute may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of Part 563b of the OTS Rules and Regulations and the Securities Act of 1933, as amended, and any rules and regulations promulgated thereunder, the foregoing Powers of Attorney prepared in conjunction with the Application for Conversion on Form AC and the Registration Statement on Form S-1 have been duly signed by the following persons in the capacities and on the dates indicated.


NAME				DATE

/s/ Larry W. Myers				June 13, 2008
Larry W. Myers
President, Chief Executive Officer and Director
(principal executive officer)
First Savings Financial Group, Inc.

President, Chief Executive Officer and Director
(principal executive officer)
First Savings Bank, F.S.B.

/s/ M. Sue Johnson				June 13, 2008
M. Sue Johnson
Treasurer and Corporate Secretary
(principal accounting and financial officer)
First Savings Financial Group, Inc.

Treasurer and Corporate Secretary
(principal accounting and financial officer)
First Savings Bank, F.S.B.


/s/ John P. Lawson, Jr.				June 13, 2008
John P. Lawson, Jr.
Chief Operations Officer and Director
First Savings Financial Group, Inc.

Chief Operations Officer and Director
First Savings Bank, F.S.B.

/s/ Charles E. Becht, Jr				June 13, 2008
Charles E. Becht, Jr.
President and Director
First Savings Financial Group, Inc.

President and Director
First Savings Bank, F.S.B.

/s/ Cecile A. Blau				June 13, 2008
Cecile A. Blau
Director
First Savings Financial Group, Inc.

Director
First Savings Bank, F.S.B.

/s/ Gerald Wayne Clapp, Jr.				June 13, 2008
Gerald Wayne Clapp, Jr.
Director
First Savings Financial Group, Inc.

Director
First Savings Bank, F.S.B.

/s/ Robert E. Libs				June 13, 2008
Robert E. Libs
Director
First Savings Financial Group, Inc.

Director
First Savings Bank, F.S.B.


/s/ Michael F. Ludden				June 13, 2008
Michael F. Ludden
Director
First Savings Financial Group, Inc.

Director
First Savings Bank, F.S.B.

/s/ Douglas A. York				June 13, 2008
Douglas A. York
Director
First Savings Financial Group, Inc.

Director
First Savings Bank, F.S.B.

Exhibit 99.1

PRO FORMA VALUATION REPORT

FIRST SAVINGS FINANCIAL GROUP, INC

Clarksville, Indiana

PROPOSED HOLDING COMPANY FOR:

FIRST SAVINGS BANK, F.S.B.

Clarksville, Indiana

Dated As Of:

May 16, 2008

Prepared By:

RP ^® Financial, LC.

1700 North Moore Street

Suite 2210

Arlington, Virginia 22209


RP ^® FINANCIAL, LC.
Financial Services Industry Consultants

May 16, 2008

Board of Directors

First Savings Bank, F.S.B.

501 East Lewis & Clark Parkway

Clarksville, IN 47129

Members of the Board of Directors:

At your request, we have completed and hereby provide an independent appraisal ("Appraisal") of the estimated pro forma market value of the common stock which is to be issued in connection with the mutual-to-stock conversion transaction described below.

This Appraisal is furnished pursuant to the conversion regulations promulgated by the Office of Thrift Supervision (“OTS”). Specifically, this Appraisal has been prepared in accordance with the “Guidelines for Appraisal Reports for the Valuation of Savings and Loan Associations Converting from Mutual to Stock Form of Organization” as set forth by the OTS, and applicable regulatory interpretations thereof.

Description of Plan of Conversion

The Board of Directors of First Savings Bank, F.S.B., Clarksville, Indiana (“First Savings” or the “Bank”) adopted the plan of conversion on April 30, 2008, incorporated herein by reference. Pursuant to the plan of conversion, the Bank will convert from a federally-chartered mutual savings bank to a federally-chartered stock savings bank and become a wholly-owned subsidiary of First Savings Financial Group, Inc. (“FSFG” or the “Company”), a newly formed Indiana corporation. FSFG will offer 100% of its common stock in a subscription offering to Eligible Account Holders, the Employee Stock Ownership Plan (the “ESOP”), Supplemental Eligible Account Holders and Other Members, as such terms are define for purposes of applicable federal regulatory guidelines governing mutual-to-stock conversions. To the extent that shares remain available for purchase after satisfaction of all subscriptions received in the subscription offering, the shares may be offered for sale to members of the general public in a community offering and/or a syndicated community offering. Going forward, FSFG will own 100% of the Bank's stock, and the Bank will initially be FSFG’s sole subsidiary. A portion of the net proceeds received from the sale of the common stock will be used to purchase all of the then to be issued and outstanding capital stock of the Bank and the balance of the net proceeds will be retained by the Company.

Washington Headquarters

Rosslyn Center

1700 North Moore Street, Suite 2210

Arlington, VA 22209

www.rpfinancial.com

Telephone: (703) 528-1700

Fax No.: (703) 528-1788

Toll-Free No.: (866) 723-0594

E-Mail: mail@rpfinancial.com

Board of Directors

May 16, 2008

Page 2

At this time, no other activities are contemplated for the Company other than the ownership of the Bank, a loan to the newly-formed ESOP and reinvestment of the proceeds that are retained by the Company. In the future, FSFG may acquire or organize other operating subsidiaries, diversify into other banking-related activities, pay dividends or repurchase its stock, although there are no specific plans to undertake such activities at the present time.

Concurrent with the Conversion, the Bank will form a charitable foundation called the First Savings Charitable Foundation (the “Foundation”). The Bank will make a contribution to the Foundation of $1.2 million, consisting of $100,000 of cash plus 110,000 shares of conversion stock with a value of $1.1 million based on the $10.00 per share IPO price.

RP ^® Financial, LC.

RP ^® Financial, LC. (“RP Financial”) is a financial consulting firm serving the financial services industry nationwide that, among other things, specializes in financial valuations and analyses of business enterprises and securities, including the pro forma valuation for savings institutions converting from mutual-to-stock form. The background and experience of RP Financial is detailed in Exhibit V-1. We believe that, except for the fee we will receive for our appraisal, we are independent of the Bank and the other parties engaged by the Bank to assist in the corporate reorganization and stock issuance process.

Valuation Methodology

In preparing our appraisal, we have reviewed the Bank’s and the Company’s regulatory applications, including the prospectus as filed with the OTS and the Securities and Exchange Commission (“SEC”). We have conducted a financial analysis of the Bank that has included due diligence related discussions with First Savings’ management; Monroe Shine & Company, Inc., the Bank’s independent auditor; Kilpatrick Stockton, LLP, First Savings’ conversion counsel; and Keefe, Bruyette & Woods, Inc., which has been retained as the financial and marketing advisor in connection with the Bank’s stock offering. All conclusions set forth in the Appraisal were reached independently from such discussions. In addition, where appropriate, we have considered information based on other available published sources that we believe are reliable. While we believe the information and data gathered from all these sources are reliable, we cannot guarantee the accuracy and completeness of such information.

We have investigated the competitive environment within which First Savings operates and have assessed the Bank’s relative strengths and weaknesses. We have monitored all material regulatory and legislative actions affecting financial institutions

Board of Directors

May 16, 2008

Page 3

generally and analyzed the potential impact of such developments on First Savings and the industry as a whole to the extent we were aware of such matters. We have analyzed the potential effects of the stock conversion on the Bank’s operating characteristics and financial performance as they relate to the pro forma market value of FSFG. We have reviewed the economy and demographic characteristics of the primary market area in which the Bank currently operates. We have compared First Savings’ financial performance and condition with publicly-traded thrift institutions evaluated and selected in accordance with the Valuation Guidelines, as well as all publicly-traded thrifts and thrift holding companies. We have reviewed conditions in the securities markets in general and the market for thrifts and thrift holding companies, including the market for new issues.

The Appraisal is based on First Savings’ representation that the information contained in the regulatory applications and additional information furnished to us by the Bank and its independent auditors, legal counsel, investment bankers and other authorized agents are truthful, accurate and complete. We did not independently verify the financial statements and other information provided by the Bank, or its independent auditors, legal counsel, investment bankers and other authorized agents nor did we independently value the assets or liabilities of the Bank. The valuation considers First Savings only as a going concern and should not be considered as an indication of the Bank’s liquidation value.

Our appraised value is predicated on a continuation of the current operating environment for the Bank and the Company and for all thrifts and their holding companies. Changes in the local and national economy, the federal and state legislative and regulatory environments for financial institutions and mutual holding companies, the stock market, interest rates, and other external forces (such as natural disasters or significant world events) may occur from time to time, often with great unpredictability, and may materially impact the value of thrift stocks as a whole or the Bank’s value alone. It is our understanding that First Savings intends to remain an independent institution and there are no current plans for selling control of the Bank as a converted institution. To the extent that such factors can be foreseen, they have been factored into our analysis.

The estimated pro forma market value is defined as the price at which the Company’s stock, immediately upon completion of the offering, would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts.

Valuation Conclusion

It is our opinion that, as of May 16, 2008, the aggregate pro forma market value of the Company’s common stock, including the stock portion of the contribution to the Foundation immediately following the offering, is $32,000,000 at the midpoint, equal to

Board of Directors

May 16, 2008

Page 4

3,200,000 shares issued at a per share value of $10.00. The resulting range of value pursuant to regulatory guidelines and the corresponding number of shares based on the Board approved $10.00 per share offering price is set forth below.


Valuation Range	Offering Amount		Foundation Shares		Total Issued
Shares
Minimum		2,626,500		110,000		2,736,500
Midpoint		3,090,000		110,000		3,200,000
Maximum		3,553,500		110,000		3,663,500
Supermaximum		4,086,525		110,000		4,196,525
Value
Minimum	$	26,265,000	$	1,100,000	$	27,365,000
Midpoint	$	30,900,000	$	1,100,000	$	32,000,000
Maximum	$	35,535,000	$	1,100,000	$	36,635,000
Supermaximum	$	40,865,250	$	1,100,000	$	41,965,250

Limiting Factors and Considerations

The valuation is not intended, and must not be construed, as a recommendation of any kind as to the advisability of purchasing shares of the common stock. Moreover, because such valuation is determined in accordance with applicable OTS regulatory guidelines and is necessarily based upon estimates and projections of a number of matters, all of which are subject to change from time to time, no assurance can be given that persons who purchase shares of common stock in the conversion will thereafter be able to buy or sell such shares at prices related to the foregoing valuation of the estimated pro forma market value thereof. The appraisal reflects only a valuation range as of this date for the pro forma market value of FSFG immediately upon issuance of the stock and does not take into account any trading activity with respect to the purchase and sale of common stock in the secondary market on the date of issuance of such securities or at anytime thereafter following the completion of the public stock offering.

The valuation prepared by RP Financial in accordance with applicable OTS regulatory guidelines was based on the financial condition and operations of First Savings as of March 31, 2008, the date of the financial data included in the prospectus.

RP Financial is not a seller of securities within the meaning of any federal and state securities laws and any report prepared by RP Financial shall not be used as an

Board of Directors

May 16, 2008

Page 5

offer or solicitation with respect to the purchase or sale of any securities. RP Financial maintains a policy which prohibits RP Financial, its principals or employees from purchasing stock of its financial institution clients.

The valuation will be updated as provided for in the OTS conversion regulations and guidelines. These updates will consider, among other things, any developments or changes in the financial performance and condition of First Savings, management policies, and current conditions in the equity markets for thrift stocks, both existing issues and new issues. These updates may also consider changes in other external factors which impact value including, but not limited to: various changes in the federal and state legislative and regulatory environments for financial institutions, the stock market and the market for thrift stocks, and interest rates. Should any such new developments or changes be material, in our opinion, to the valuation of the shares, appropriate adjustments to the estimated pro forma market value will be made. The reasons for any such adjustments will be explained in the update at the date of the release of the update.

Respectfully submitted,

RP ^® FINANCIAL, LC.

/s/ James P. Hennessey

James P. Hennessey

Director


*RP ^® Financial, LC.*		*TABLE OF CONTENTS*
		i

TABLE OF CONTENTS

FIRST SAVINGS FINANCIAL GROUP, INC.

FIRST SAVINGS BANK, F.S.B.

Clarksville, Indiana


DESCRIPTION		PAGE NUMBER
CHAPTER ONE	OVERVIEW AND FINANCIAL ANALYSIS

Introduction		I.1
Plan of Conversion		I.1
Establishment of a Charitable Foundation		I.2
Strategic Overview		I.2
Balance Sheet Trends		I.6
Income and Expense Trends		I.10
Impact of Freeze/Termination of Defined Benefit Pension Plan		I.15
Interest Rate Risk Management		I.16
Lending Activities and Strategy		I.17
Asset Quality		I.21
Funding Composition and Strategy		I.22
Subsidiaries		I.23
Legal Proceedings		I.23

CHAPTER TWO	MARKET AREA

Introduction		II.1
National Economic Factors		II.2
Market Area Demographics		II.4
Local Economy		II.6
Unemployment Trends		II.8
Market Area Deposit Characteristics and Competition		II.9

CHAPTER THREE	PEER GROUP ANALYSIS

Peer Group Selection		III.1
Financial Condition		III.7
Income and Expense Components		III.10
Loan Composition		III.13
Credit Risk		III.15
Interest Rate Risk		III.17
Summary		III.19


*RP ^® Financial, LC.*		*TABLE OF CONTENTS*
		ii

TABLE OF CONTENTS

FIRST SAVINGS FINANCIAL GROUP, INC.

FIRST SAVINGS BANK, F.S.B.

Clarksville, Indiana

(continued)


DESCRIPTION		PAGE NUMBER
CHAPTER FOUR	VALUATION ANALYSIS
Introduction		IV.1
Appraisal Guidelines		IV.1
RP Financial Approach to the Valuation		IV.1
Valuation Analysis		IV.2
1. Financial Condition		IV.3
2. Profitability, Growth and Viability of Earnings		IV.4
3. Asset Growth		IV.6
4. Primary Market Area		IV.6
5. Dividends		IV.8
6. Liquidity of the Shares		IV.9
7. Marketing of the Issue		IV.9
A. The Public Market		IV.10
B. The New Issue Market		IV.17
C. The Acquisition Market		IV.18
8. Management		IV.21
9. Effect of Government Regulation and Regulatory Reform		IV.22
Summary of Adjustments		IV.22
Valuation Approaches		IV.22
1. Price-to-Earnings ("P/E")		IV.24
2. Price-to-Book ("P/B")		IV.25
3. Price-to-Assets ("P/A")		IV.26
Comparison to Recent Offerings		IV.26
Valuation Conclusion		IV.27


*RP ^® Financial, LC.*		*LIST OF TABLES*
		*iii*

LIST OF TABLES

FIRST SAVINGS FINANCIAL GROUP, INC.

FIRST SAVINGS BANK, F.S.B.

Clarksville, Indiana


TABLE NUMBER	DESCRIPTION	PAGE
1.1	Historical Balance Sheet Data	I.7
1.2	Historical Income Statements	I.11

2.1	Summary Demographic Data	II.5
2.2	Southern Indiana Major Employers	II.7
2.3	Primary Market Area Employment Sectors	II.8
2.4	Unemployment Trends	II.9
2.5	Deposit Summary	II.10
2.6	Market Area Deposit Competitors	II.11

3.1	Peer Group of Publicly-Traded Thrifts	III.4
3.2	Balance Sheet Composition and Growth Rates	III.8
3.3	Income as a Pct. of Avg. Assets and Yields, Costs, Spreads	III.11
3.4	Loan Portfolio Composition and Related Information	III.14
3.5	Credit Risk Measures and Related Information	III.16
3.6	Interest Rate Risk Measures and Net Interest Income Volatility	III.18

4.1	Peer Group Market Area Comparative Analysis	IV.7
4.2	Pricing Characteristics and After-Market Trends	IV.19
4.3	Market Pricing Comparatives	IV.20
4.4	Public Market Pricing	IV.29


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.1*

I. OVERVIEW AND FINANCIAL ANALYSIS

Introduction

The background of First Savings Bank, F.S.B. (“First Savings” or the “Bank”) dates back to 1937 when First Savings was organized as a federal chartered savings and loan association with the name First Federal Savings and Loan Association of Jeffersonville. The Bank changed its name to First Savings Bank, F.S.B. in 1996, and changed its charter from a federal savings and loan association to a federal savings bank. With the mutual to stock conversion in 2008, the Bank will organize a holding company to be named First Savings Financial Group, Inc. (“FSFG” or the “Company”). In addition to the Bank’s main office, the Bank operates two branch offices in Jeffersonville, and single office locations in Charlestown, Sellersburg, Floyds Knobs and Georgetown, Indiana. The main office and 4 of the Bank’s branches are located in Clark County and 2 branches are located in Floyd County. Located along the northern shore of the Ohio River, Clark and Floyd Counties are situated across the Ohio River from Louisville, Kentucky, and are within the Louisville metropolitan area. A map of the Bank’s branch offices is provided in the analysis of the Bank’s market area. First Savings is a member of the Federal Home Loan Bank ("FHLB") system, and its deposits are insured up to the regulatory maximums by the Federal Deposit Insurance Corporation ("FDIC"). At March 31, 2008, First Savings had $212.6 million in assets, $174.1 million in deposits and total equity of $29.4 million equal to 13.8% of total assets. First Savings’ audited financial statements are included by reference as Exhibit I-1.

Plan of Conversion

The Board of Directors of the Bank adopted a plan to reorganize from the mutual form of organization to the stock form of organization within a holding company structure (the “Plan”) on April 30, 2008. As part of the reorganization, the Bank will become a wholly-owned subsidiary of FSFG, an Indiana Corporation which will be formed as part of the Conversion. FSFG will issue all of its common stock to the public. Concurrent with the Conversion, the Company will retain up to 50% of the net offering


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.2*

proceeds and infuse the balance of the net proceeds into the Bank. It is not anticipated that the Company will initially engage in any business activity other than ownership of the Bank subsidiary.

Pursuant to the Plan, the Company will offer the public shares of common stock in a subscription offering to Eligible Account Holders, Tax-Qualified Employee Benefit Plans, Supplemental Eligible Account Holders, and other members of the Bank. Upon completion of the subscription offering, any shares of common stock not subscribed for in the subscription offering will be offered in a direct community offering and potentially a syndicated community offering.

Establishment of a Charitable Foundation

In order to enhance the historically strong community service and reinvestment activities of the Bank, the Company will establish the First Savings Charitable Foundation, Inc. (the “Foundation”), a private charitable foundation, in connection with the Offering. The Company will make a contribution to the Foundation equal to $1.2 million, consisting of $100,000 of cash plus 110,000 shares of conversion stock with a value of $1.1 million based on the $10.00 per share IPO price. The Foundation’s charitable giving is intended to complement the Bank’s existing community reinvestment activities, and will be dedicated to help fund local projects and to support certain civic, charitable and cultural organizations within the communities served by the Bank. The Bank believes the Foundation will enhance its already strong reputation for community service. The Foundation’s ownership of the Company’s stock will enable the local community served to share in the potential increase in market value and dividends over time.

Strategic Overview

Throughout much of its corporate history, the Bank’s strategic focus has been that of a community oriented financial institution with a primary focus on meeting the borrowing, savings and other financial needs of its local customers in Clark and Floyd counties, and other nearby areas in southern Indiana and northern Kentucky, generally


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.3*

within the Louisville metropolitan area. In this regard, the Bank has historically pursued a portfolio residential lending strategy typical of a thrift institution, with the primary avenue of loan diversification being construction lending.

Commencing early in the current decade, the Bank sought to mitigate the balance sheet and earnings impact of loan runoff which resulted from high prepayment rates within the fixed rate 1-4 family mortgage loan portfolio by undertaking greater investment in commercial real estate lending. Additionally, in an effort to further stem the impact of loan portfolio shrinkage, First Savings also originated 1-4 mortgage loans to investors secured by properties in the local market. While the loans to investors typically carried relatively strong interest yields and short-to-intermediate term repricing structures, they have also had a relatively high rate of delinquency and chargeoff as the Bank’s market has been impacted by a weak residential housing market, particularly in the low-to-moderate income segment which characterized the collateral properties within the investor loan portfolio. Management estimates that approximately 28.0% of the residential mortgage loan portfolio is non-owner occupied as of March 31, 2008.

Commencing with the employment of the current managing officer in fiscal 2006, the Bank sought to gradually reorient the Bank’s business plan to one more reflective of a full service community banking organization. Such efforts were intensified with the employment of the current chief lending officer (“CLO”) in latter half of 2006 who also possessed substantial commercial lending experience within a commercial banking environment in the Bank’s Louisville area markets. Reflecting the reorientation of the Bank’s operations, the Bank’s lending operations consist of two principal segments as follows: (1) residential mortgage lending; and (2) commercial and construction lending in conjunction with the intensified efforts to become a full-service community bank. In this regard, the Bank has emphasized high quality and flexible service, capitalizing on its local orientation and expanded array of products and services.

With this transition in recent years, the Bank has sought to develop the infrastructure to undertake the broad-based community banking strategy it is seeking to implement. In this regard, management has revamped the policies and procedures pertaining to credit standards and the administration of commercial accounts.


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.4*

Additionally, the Bank employs a total of four loan officers including the CLO who have local mortgage lending experience (including several with commercial lending experience) to conduct the broad-based lending operations while also developing the appropriate support functions in the loan underwriting, credit administration and loan servicing functions. Concurrent with the revamping of the lending function, the Bank has also been seeking to develop a more effective sales culture with respect to all key customer contact points within First Savings while it has also been evaluating potential de novo branching opportunities for the future, to more fully exploit the potential of its market and to provide superior access and service to its targeted customers.

In summary, the post-offering business plan of the Bank is expected to continue to focus on products and services which have been the Bank’s traditional emphasis. Specifically, the Bank will continue to be an independent community-oriented financial institution with a commitment to local real estate mortgage financing with operations funded by retail deposits, borrowings, equity capital and internal cash flows. In addition, the Bank will seek to continue to develop the infrastructure management believes First Savings requires in order to be an effective competitor in the commercial and retail banking arena locally. Accordingly, First Savings will continue to employ additional staff as needed to support growth of its commercial and consumer banking products and services. Additionally, First Savings plans to continue to make additional capital investments in its retail branch network, both in terms of its existing 7 retail banking offices as well as de novo branch offices. In this regard, the Bank is planning to purchase or construct up to two branches over the next three to four years. While specific locations have yet to be identified, new branches will generally be located in First Savings’ existing market in Clark and Floyd Counties and will result in a significant capital outlay (in the general range of $2.0 million for the two planned offices) and increased expense related to staffing and operating the new offices.

First Savings will be seeking to leverage its infrastructure investments in office facilities and technology through balance sheet and fee income growth and on-going development of strong customer relationships, as it seeks to become a leading community bank in the markets served. In the near term, the Bank will continue to incur substantial costs which may negatively impact profitability.


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.5*

The Bank’s Board of Directors has elected to convert to the stock form of ownership to improve the competitive position of the Bank. The capital realized from the Conversion will increase the operating flexibility and overall financial strength of the Bank, as well as support the expansion of the Bank’s strategic focus of providing competitive community banking services in its local market area as described above. The additional capital realized from stock proceeds will increase liquidity to support funding of future loan growth and other interest-earning assets. The Bank’s higher capital position resulting from the infusion of stock proceeds will also serve to reduce interest rate risk, through enhancing the Bank’s interest-earning-assets-to-interest-bearing-liabilities (“IEA/IBL”) ratio. The additional funds realized from the Conversion will provide an alternative funding source to deposits and borrowings in meeting the Bank’s future funding needs. Additionally, the Bank’s higher equity-to-assets ratio will also better position the Bank to take advantage of expansion opportunities as they arise. Such expansion would most likely occur through growth at existing offices as well as through targeted branching. The Bank will also be better positioned to pursue growth through acquisition of other financial service providers following the Conversion, given its strengthened capital position and status as a stock company. At this time, the Bank has no specific plans for expansion other than through establishing additional branches. The projected use of proceeds has been highlighted below.

•

Company . The Company is expected to retain up to 50% of the net offering proceeds. At present, Company funds, net of the loan to the ESOP, are expected to be placed into short-term investment securities. Over time, Company funds are anticipated to be utilized for various corporate purposes, possibly including acquisitions, infusing additional equity into the Bank, repurchases of common stock, and the payment of regular and/or special cash dividends.

•

Bank . The balance of the net offering proceeds will be infused into the Bank in exchange for all of the Bank’s newly-issued stock. The increase in the Bank’s capital will be less, as the amount to be borrowed by the ESOP to fund an 8% stock purchase will be accounted for as a contra-equity. Cash proceeds (i.e., net proceeds


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.6*

less deposits withdrawn to fund stock purchases) infused into the Bank are anticipated to become part of general operating funds, and are expected to initially be invested in short-term investments pending longer term deployment, i.e., funding lending activities and for general corporate purposes.

Balance Sheet Trends

Growth Trends

Table 1.1 shows the Bank’s historical balance sheet data for the past five and one-half years. From September 30, 2003 through March 31, 2008, First Savings’ assets shrank modestly at a 1.15% compounded annual rate. Within the asset base, cash and equivalents declined, while investment securities and loans receivable reported modest annual increases. In this regard, the Bank had very high liquidity levels in 2003 and 2004 reflecting the impact of heavy loan prepayments in the residential mortgage portfolio. The cash has subsequently been redeployed into investment securities and whole loans as reflected in their modest positive long-term growth rates. Total assets have diminished, however, as the reduction of excess cash assets coupled with the increase in borrowings has been utilized to fund deposit outflows; deposits have diminished at a compounded annual rate of 2.60% since September 2003.

Annual equity growth equaled 2.5% since the end of fiscal 2003, with the modest growth rate reflecting the Bank’s moderate return on equity (“ROE”), particularly as the Bank incurred additional expenses associated with the build-up of its infrastructure as well as relatively high loan loss provisions in connection with its portfolio of investor loans secured by 1-4 family properties. The post-offering equity growth rate may likely continue to be modest given the increased equity, the initial anticipated low return on the net offering proceeds in the current interest rate environment, the cost of the stock benefit plans, public company reporting and the expense of targeted branching. Over the longer term, as the new equity is leveraged through growth, the return on equity may improve. A summary of First Savings’ key operating ratios for the past five and one-half years is presented in Exhibit I-2.


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.7*

Table 1.1

First Savings Bank, F.S.B.

Historical Balance Sheet Data


	As of September 30,																				As of March 31 2008				9/30/03-3/31/08 Annual. Growth Rate
	2003				2004				2005				2006				2007				As of March 31 2008				9/30/03-3/31/08 Annual. Growth Rate
	Amount		Pct(1)		Amount		Pct(1)		Amount		Pct(1)		Amount		Pct(1)		Amount		Pct(1)		Amount		Pct(1)		Pct
	($000)		(%)		($000)		(%)		($000)		(%)		($000)		(%)		($000)		(%)		($000)		(%)		(%)
Total Amount of:
Assets	$	223,940	100.00	%	$	216,529	100.00	%	$	205,796	100.00	%	$	206,399	100.00	%	$	203,321	100.00	%	$	212,624	100.00	%	-1.15	%
Cash and cash equivalents		56,084	25.04	%		21,904	10.12	%		14,651	7.12	%		15,223	7.38	%		10,395	5.11	%		9,233	4.34	%	-33.03	%
Securities available for sale		0	0.00	%		7,534	3.48	%		7,039	3.42	%		5,897	2.86	%		8,260	4.06	%		10,424	4.90	%	N.M.
Securities held-to-maturity		3,091	1.38	%		14,650	6.77	%		11,602	5.64	%		8,219	3.98	%		7,422	3.65	%		9,100	4.28	%	27.12	%
FHLB stock		1,419	0.63	%		1,419	0.66	%		1,464	0.71	%		1,379	0.67	%		1,336	0.66	%		1,336	0.63	%	-1.33	%
Loans receivable, net		155,644	69.50	%		163,305	75.42	%		163,676	79.53	%		166,695	80.76	%		167,371	82.32	%		171,018	80.43	%	2.12	%
Deposits		195,979	87.51	%		187,516	86.60	%		175,451	85.25	%		175,891	85.22	%		168,782	83.01	%		174,085	81.87	%	-2.60	%
FHLB advances		0	0.00	%		0	0.00	%		0	0.00	%		0	0.00	%		3,000	1.48	%		8,000	3.76	%	N.M.
Equity	$	26,353	11.77	%	$	27,245	12.58	%	$	28,487	13.84	%	$	28,850	13.98	%	$	29,662	14.59	%	$	29,399	13.83	%	2.46	%
Loans/Deposits			79.42	%			87.09	%			93.29	%			94.77	%			99.16	%			98.24	%
Offices Open		7				7				7				7				7				7

(1)	Ratios are as a percent of ending assets.

Sources: First Savings’ prospectus, audited and unaudited financial statements and RP Financial calculations.


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.8*

Loans Receivable

Loans receivable totaled $171.0 million, or 80.4% of total assets, as of March 31, 2008, and reflects modest growth since the end of fiscal 2003 approximating 2.1% on a compounded annual basis. Over this period, the proportion of loans to total assets has increased modestly as the rate of loan growth exceeded the asset growth rate. Additionally, the composition of the loan portfolio has gradually shifted to include a higher proportion of 1-4 family mortgage loans and commercial loans including both commercial mortgage and non-mortgage commercial and industrial (“C&I”) loans. The growth of commercial mortgage and C&I loans reflecting the Bank’s current strategic emphasis on commercial lending and management’s efforts to build the Bank’s capabilities in this regard. Growth in the commercial loan portfolio has been partially offset by First Savings’ diminished construction lending, which is reflective of the weak housing market which has resulted in lower demand and more restrictive lending terms on the part of First Savings.

As referenced above, the balance of the 1-4 family mortgage loan portfolio has increased over the last five years, notwithstanding management’s recent efforts to focus on commercial lending. Specifically, permanent 1-4 family residential mortgage loans have increased modestly in proportion to total loans (from 59.1% of total loans in fiscal 2003, to 63.0% of total loans as of March 31, 2008. Likewise, commercial mortgage and C&I loans have increased in recent years to equal 8.8% and 6.0% of total loans, respectively, but nonetheless remain a modest part of the loan portfolio overall. Commercial mortgage loans are generally secured by office buildings and retail structures and mixed-use buildings while C&I loans generally consist of lines of credit and business term loans, frequently with non-mortgage collateral. Over the corresponding timeframe, construction and land loans have diminished from 15.0% as of the end of fiscal 2003, to 9.6% as of March 31, 2008.

Cash, Investments and Mortgage-Backed Securities

The intent of the Bank’s investment policy is to provide adequate liquidity, to generate a favorable return on excess investable funds and to support the established


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.9*

credit and interest rate risk objectives. The ratio of cash and investments including MBS has fluctuated based primarily on loan demand and cash inflows from deposits and borrowings and has declined modestly since the end of fiscal 2003, from 27.1% of assets to 14.2% as of March 31, 2008. The comparatively modest level of cash and investments currently is reflective of the Bank’s general preference to invest in whole loans.

The Bank’s investment securities and MBS equaled $20.9 million, or 9.8% of total assets, as of March 31, 2008, while cash and interest bearing deposits and term deposits totaled $9.2 million, or 4.3% of assets. As of March 31, 2008, the cash and investments portfolio consisted of cash, interest-earning deposits in other financial institutions, mortgage-backed securities issued by Ginnie Mae, Fannie Mae or Freddie Mac, U.S. government agency obligations and other high quality investments, including those issued by municipalities. Additionally, the Bank maintains permissible equity investments such as FHLB stock with a fair value of $1.3 million as of March 31, 2008. The Bank’s investment securities are classified both as held-to-maturity (“HTM”) and available for sale (“AFS”), with the HTM portfolio primarily comprised of MBS (see Exhibit I-3 for the investment portfolio composition).

No major changes to the composition and practices with respect to the management of the investment portfolio are anticipated over the near term, except that it is expected that the Bank will generally classify securities as AFS at the time of purchase (including MBS). The level of cash and investments is anticipated to increase initially following the Conversion, pending gradual redeployment into higher yielding loans.

Funding Structure

Retail deposits have consistently been the substantial portion of balance sheet funding. Since fiscal year-end 2003, deposits have diminished at a 2.6% compounded annual rate. Over this time frame, the composition of deposits has remained relatively stable with the largest portion in certificates of deposits, which have constituted in excess of two-thirds of total deposits over the last three fiscal years. As of


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.10*

March 31, 2008, certificates of deposit totaled $124.3 million, equal to 71.4% of total deposits while savings and transaction accounts totaled $49.8 million, equal to 28.6% of total deposits.

The Bank has recently commenced utilizing borrowed funds, consisting of FHLB advances. As of March 31, 2008, borrowed funds in the form of FHLB advances totaled $8.0 million, representing 3.8% of total assets. The Bank typically utilizes borrowings: (1) when such funds are priced attractively relative to deposits; (2) to lengthen the duration of liabilities; (3) to enhance earnings when attractive revenue enhancement opportunities arise; and (4) to generate additional liquid funds, if required. Recent growth in borrowings was primarily due to the attractive rate on term funds relative to deposits with comparable maturities and the need for additional liquidity to fund loan growth.

Capital

Annual capital growth for the Bank has been moderate since the end of 2003, equal to 2.5% on a compounded annual basis, in part reflecting the Bank’s moderate earnings and strong pre-Conversion equity levels. As of March 31, 2008, the Bank’s equity totaled $29.4 million, or 13.8% of total assets. The Bank maintained capital surpluses relative to its regulatory capital requirements at March 31, 2008, and thus qualified as a “well capitalized” institution. The offering proceeds will serve to further strengthen the Bank’s regulatory capital position and support further growth. The equity growth rate is expected to slow for the Bank on a post-offering basis given the pro forma increase in equity, low reinvestment yields currently available, the potential dividend policy, and branching and other growth-related expenses.

Income and Expense Trends

Table 1.2 shows the Bank’s historical income statements for the past five years and for the 12 months ended March 31, 2008. The Bank reported positive earnings over the past five and one-half years, but with significant year-to-year fluctuations such that earnings trends over the period are difficult to discern. Earnings fluctuated between


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.11*

Table 1.2

First Savings Bank, F.S.B.

Historical Income Statements


	For the Fiscal Year Ended September 30,																									For the 12 Mths Ended, March 31, 2008
	2003					2004					2005					2006					2007					For the 12 Mths Ended, March 31, 2008
	Amount			Pct(1)		Amount			Pct(1)		Amount			Pct(1)		Amount			Pct(1)		Amount			Pct(1)		Amount			Pct(1)
	($000)			(%)		($000)			(%)		($000)			(%)		($000)			(%)		($000)			(%)		($000)			(%)
Interest income	$	11,931		5.31	%	$	10,552		4.77	%	$	10,874		5.15	%	$	12,223		5.85	%	$	13,078		6.43	%	$	12,818		6.39	%
Interest expense		(6,166	)	-2.74	%		(4,496	)	-2.03	%		(4,255	)	-2.01	%		(5,250	)	-2.51	%		(6,183	)	-3.04	%		(6,188	)	-3.08	%

Net interest income	$	5,765		2.56	%	$	6,056		2.74	%	$	6,619		3.13	%	$	6,973		3.34	%	$	6,895		3.39	%	$	6,630		3.30	%
Provision for loan losses		(131	)	-0.06	%		(226	)	-0.10	%		(336	)	-0.16	%		(813	)	-0.39	%		(758	)	-0.37	%		(1,541	)	-0.77	%

Net interest income after provisions	$	5,634		2.51	%	$	5,830		2.64	%	$	6,283		2.97	%	$	6,160		2.95	%	$	6,137		3.02	%	$	5,089		2.54	%
Other operating income	$	837		0.37	%	$	679		0.31	%	$	961		0.45	%	$	889		0.43	%	$	841		0.41	%	$	953		0.47	%
Operating expense		(4,644	)	-2.06	%		(5,047	)	-2.28	%		(5,601	)	-2.65	%		(6,129	)	-2.94	%		(5,737	)	-2.82	%		(5,936	)	-2.96	%

Net operating income	$	1,827		0.81	%	$	1,462		0.66	%	$	1,643		0.78	%	$	920		0.44	%	$	1,241		0.61	%	$	106		0.05	%
Employee severance expense	$	0		0.00	%	$	0		0.00	%	$	0		0.00	%	$	(324	)	-0.16	%	$	0		0.00	%	$	0		0.00	%
Gain(loss) on sale of stock		0		0.00	%		0		0.00	%		345		0.16	%		0		0.00	%		0		0.00	%		0		0.00	%
Net income before tax	$	1,827		0.81	%	$	1,462		0.66	%	$	1,988		0.94	%	$	596		0.29	%	$	1,241		0.61	%	$	106		0.05	%
Income tax provision		(725	)	-0.32	%		(578	)	-0.26	%		(784	)	-0.37	%		(241	)	-0.12	%		(427	)	-0.21	%		34		0.02	%

Net income (loss)	$	1,102		0.49	%	$	884		0.40	%	$	1,204		0.57	%	$	355		0.17	%	$	814		0.40	%	$	140		0.07	%
Adjusted Earnings
Net income	$	1,102		0.49	%	$	884		0.40	%	$	1,204		0.57	%	$	355		0.17	%	$	814		0.40	%	$	140		0.07	%
Add(Deduct): Net gain/(loss) on sale		0		0.00	%		0		0.00	%		(345	)	-0.16	%		324		0.16	%		0		0.00	%		0		0.00	%
Tax effect (2)		0		0.00	%		0		0.00	%		137		0.06	%		(128	)	-0.06	%		0		0.00	%		0		0.00	%

Adjusted earnings	$	1,102		0.49	%	$	884		0.40	%	$	996		0.47	%	$	551		0.26	%	$	814		0.40	%	$	140		0.07	%
Expense Coverage Ratio (3)		124.1	%				120.0	%				118.2	%				113.8	%				120.2	%				111.7	%
Efficiency Ratio (4)		70.3	%				74.9	%				73.9	%				78.0	%				74.2	%				78.3	%
Effective Tax Rate		39.7	%				39.5	%				39.4	%				40.4	%				34.4	%				-32.1	%

(1)	Ratios are as a percent of average assets.

(2)	Assumes a 39.6% effective tax rate for federal & state income taxes.

(3)	Expense coverage ratio calculated as net interest income before provisions for loan losses divided by operating expenses.

(4)	Efficiency ratio calculated as operating expenses divided by the sum of net interest income before provisions for loan losses plus other income (excluding net gains).

Sources: First Savings’ prospectus, audited & unaudited financial statements and RP Financial calculations.


*RP ^® Financial, LC.*		*OVERVIEW AND FINANCIAL ANALYSIS*
		*I.12*

0.40% of average assets and 0.57% of average assets for the fiscal 2003 through fiscal 2005 period, and for fiscal 2007. Earnings were comparatively modest in fiscal 2006 (0.17% of average assets) and for the 12 months ended March 31, 2008 (0.07% of average assets), reflecting the impact of higher loan loss provisions and management severance-related costs (reflects a non-recurring expense for fiscal 2006 only). In general, the Bank’s profitability ratios have been comparatively modest, even after excluding several one-time non-recurring expenses, as a result of balance sheet shrinkage and a high operating expenses ratio which has been trending upward. These and other trends with respect to First Savings’ income and expenses will be discussed in the balance of this section.

Net Interest Income

Over the past five and one-half years, the Bank’s net interest income to average assets ratio generally reflects a positive trend, increasing from 2.56% of average assets in fiscal 2003, to a peak level of 3.39% of average assets in fiscal 2007, before declining modestly to 3.30% of average assets for the 12 months ended March 31, 2008. The increase in the net interest income ratio since 2005 reflects a modest widening of the Bank’s interest rate spread, attributable to a greater increase in the overall yield on interest-earnings assets, offset in part by a higher average cost of interest-bearing liabilities. During the six months ended March 31, 2008, the Bank’s interest spread decreased modestly to 2.94%, compared to 3.15% during the six months ended March 31, 2007, with the decline attributable to declining asset yields. At March 31, 2008, First Savings’ interest rate spread equaled 2.95%. The Bank’s net interest rate spreads and yields and costs for the past three and one-half years are set forth in Exhibits I-4.

Loan Loss Provisions

Provisions for loan losses have typically been limited reflecting the Bank’s relatively strong asset quality historically and the secured nature of the loan portfolio; the majority of the loan portfolio is secured by real estate collateral in the Bank’s local market area, which traditionally represents a relatively strong real estate market.


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		*I.13*

However, loan loss provisions have recently been subject to increase as a result of deterioration of the portfolio of investor loans commencing in fiscal 2006, which caused loan loss provisions to increase to a level of $813,000 (0.39% of average assets) in fiscal 2006, $758,000 (0.37% of average assets) in fiscal 2007 and $1.5 million (0.77% of average assets) for the 12 months ended March 31, 2008.

As previously discussed, the increase in loan loss provisions for the most recent 12 month period is attributable to the Bank’s portfolio of investor loans secured by single family properties, typically in low to moderate income areas in southern Indiana. In particular, First Savings established additional allowances for loan and lease losses (“ALLLs”) against 35 loans to one borrower with a principal balance of $2.0 million where the Bank’s perceives the market value has deteriorated significantly since the loans were originated. The additional ALLLs established for this one group of loans totaled $969,000 for the 12 months ended March 31, 2008.

Going forward, the Bank will continue to evaluate the adequacy of the level of general valuation allowances (“GVAs”) on a regular basis, and establish additional loan loss provisions in accordance with the Bank’s asset classification and loss reserve policies. However, management expects that loan loss provisions may likely be lower than the 0.77% of average assets level reported for the 12 months ended March 31, 2008.

Non-Interest Income

Other non-interest income has generally been rising, and increased to a level of $953,000, equal to 0.47% of average assets for the 12 months ended March 31, 2008, which is the peak level reported by the Bank over the prior five and one-half fiscal years. The bulk of First Savings’ fee income is comprised of fees related to its depository activities, lending, mortgage servicing and debit and credit interchange activities. Additionally, non-interest income was further enhanced by the purchase of BOLI, wherein the income from the increase in the cash surrender value of the policies is reflected as non-interest income. The ratio of non-interest income to average assets is moderate in comparison to many community banks due in part to competitive


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		*I.14*

conditions prevailing locally and the owing to the fact the First Savings’ fee generating commercial deposit relationships and other fee generating activities are currently limited. Management will seek to increase the level of non-interest fee income by continuing to expand fee generating commercial loan and deposit relationships and other non-interest sources of income. However, growth in the level of non-interest operating income is expected to be gradual.

Operating Expenses

The Bank’s operating expenses have increased in modestly in recent years, notwithstanding modest asset shrinkage which would otherwise tend to limit the growth of operating costs, as a result of growth in compensation and benefits and other factors related to posturing First Savings’ commercial lending operations. Additionally, health and benefits costs have continued to spiral upward. Overall, operating expenses have increased from $4.6 million in fiscal 2003, equal to 2.06% of average assets, to $5.9 million, equal to 2.96% of average assets for the 12 months ended March 31, 2008.

Operating expenses are expected to increase following the Conversion as a result of the expense of the stock-related benefit plans, the cost related to operating as a public company and as a result of long-term plans to continue to expand the branch network. With regard to this latter factor, the Bank plans to establish two or more new branches over the next three to four years which will entail additional expenses related to staffing and operating costs as well as depreciation expense on the fixed asset investment. Furthermore, First Savings expects to continue to gradually build its commercial lending staffing levels take advantage of the expanded branch coverage. The Bank will be seeking to offset such costs over time through growth and increased efficiency.

Non-Operating Income/Expense

Non-operating income and expenses have had a limited impact on earnings over the last five fiscal years, and have primarily consisted of gains on the sale of loans and investments. Non-operating income totaled $345,000, equal to 0.16% of assets, in


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		*I.15*

fiscal 2004, which was attributable to a gain on the sale of the Bank’s equity investment in its electronic data processor. In the following year, the Bank incurred non-operating severance costs related to the termination of the Bank’s managing officer. The Bank did not have any non-operating income or expense for the 12 months ended March 31, 2008.

Taxes

The Bank’s average tax rate generally has ranged from 34% to 40% over the last five fiscal years. The Bank’s tax rate was skewed to a negative rate for the 12 months ended March 31, 2008, as a result of a the low level of net income overall and the tax benefit recorded for the most recent six month period. In the future, the Bank’s tax rate is expected to approximate the long-term average rate in the range of 34% to 40%.

Efficiency Ratio

The Bank’s efficiency ratio reflects an adverse trend since the end of fiscal 2003 largely due to (1) the increase in the operating expense ratio as the Bank’s asset base shrank modestly while operating costs to continued to grow and (2) the benefits related to an expanding level of non-interest income and net interest income were comparatively modest. As a result of the foregoing, the efficiency ratio increased from 70.3% in fiscal 2003 to 78.3% for the 12 months ended March 31, 2008, which represents the highest ratio reported by First Savings over the last five fiscal years. On a post-offering basis, the efficiency ratio is expected to show some improvement as the net interest ratio increases with the reinvestment of proceeds, although the increased operating expenses (reflecting the costs of building and staffing new branches as well as public company and stock plans expenses) may limit the improvement.

Impact of Freeze/Termination of Defined Benefit Pension Plan

First Savings has taken steps to freeze the defined benefit pension plan in place for employees which is expected to occur in the quarter ended June 30, 2008,


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		*I.16*

subsequent to the date of financial data herein. As a result, each active participant’s pension benefit will be determined based on the participant’s compensation and duration of Employment as of June 30, 2008, and compensation and employment after that date will not be taken into account in determining pension benefits under the pension plan. Based on information from First Savings’ actuaries, the Bank estimates it will record a one-time gain from the curtailment of the pension plan which will be reported in the June 30, 2008 quarter. The pre-tax gain on curtailment is estimated to total $615,000 which will result in an after-tax gain of $371,000. The Bank intends to replace this management benefit with the stock-based benefit plans established in connection with the Conversion.

Interest Rate Risk Management

The primary aspects of the Bank’s interest rate risk management include:

•

Emphasizing the origination of adjustable rate 1-4 family residential mortgage loans and selling a portion of the longer-term fixed-rate loans (i.e., maturities in excess of 15 years dependent upon the rate environment) originated to the secondary market;

•

Diversifying portfolio loans into other types of shorter-term or adjustable rate lending, including commercial and construction lending;

•

Maintaining an investment portfolio, comprised of high quality, liquid securities and maintaining an ample balance of securities classified as available for sale;

•

Promoting transaction accounts and, when appropriate, longer term CDs;

•

Utilizing longer-term borrowing when such funds are attractively priced relative to deposits and prevailing reinvestment opportunities;

•

Maintaining a strong capital level; and

•

Increasing non-interest income within constraints imposed by the local market and product mix.

The rate shock analysis as of March 31, 2008 (see Exhibit I-5) shows that the expected change in the net portfolio value (“NPV”) as a percent of the portfolio value of assets under a 200 basis point increase in interest rates was negative 42 basis points (with a 12.99% NPV ratio) while a 100 basis point decrease in interest rates resulted in


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		*I.17*

a change of negative 23 basis points (with a 13.18% post-shock NPV ratio, suggesting that the Company’s economic value would be adversely impacted under both rising and falling interest rate scenarios. At the same time, the change in either a rising or declining rate environment is limited and the post-shock NPV ratio is very strong suggesting limited interest rate risk exposure overall.

Importantly, there are numerous limitations inherent in such analyses, such as the credit risk of Company’s adjustable rate loans in a rising interest rate environment. Moreover, the Company’s interest rate risk exposure is projected to be further reduced following the completion of the Conversion and reinvestment of the net conversion proceeds into interest-earning assets.

Lending Activities and Strategy

First Savings’ lending activities have traditionally emphasized 1-4 family permanent mortgage loans (including second mortgage and home equity lines of credit) and such loans continue to comprise the largest component of the Bank’s loan portfolio. Beyond 1-4 family loans, lending diversification by the Bank has emphasized construction/land loans and commercial real estate loans. Non-mortgage lending, in the form of commercial business and consumer loans, have also been a moderate area of lending diversification for the Bank. Going forward, the Bank’s lending strategy is expected to remain fairly consistent with recent historical trends, with the origination of 1-4 family permanent mortgage loans remaining as the largest source of loan originations and construction/land and commercial real estate loans remaining as the primary area of lending diversification. Over time, the Bank is expecting to continue to build its ability to service commercial account relationships through the employment of additional experienced commercial loan officers as well as by promoting strong internally generated loan officer candidates from within the Bank. Details regarding the Company’s loan portfolio composition and characteristics are included in Exhibits I-6, I-7 and I-8.


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		*I.18*

Residential Lending

As of March 31, 2008, residential mortgage loans equaled $109.9 million, or 63.0% of total loans. Adjustable rate residential mortgage loans comprise approximately one-half of the residential mortgage portfolio as it has been the Bank’s practice to sell a portion of the longer term fixed rate loans (i.e., with maturities greater than 15 years) into the secondary market on a servicing released basis with the timing and magnitude of sales dependent upon market and interest rate conditions. Thus, the balance of the permanent residential mortgage loan portfolio generally consists of fixed rate loans with maturities of 15 years or less.

ARM loans offered by the Bank include loans with one, three and five year repricing periods for the initial period and which adjust annually thereafter. Fixed rate 1-4 family mortgage loans offered by the Bank have terms of up to 30 years. A portion of the residential loans originated are not saleable in the conforming secondary market due to various underwriting characteristics (i.e. loan size, nature of collateral, etc.). Other loans are generally underwritten to secondary market standards specified. All loans in excess of an 80% loan-to-value (“LTV”) ratio must have private mortgage insurance. The Bank’s underwriting policies permit originations of LTVs of up to 97%, with an LTV limit of 75% on non-owner occupied property. As previously discussed, the Bank had previously developed a niche in financing non-owner occupied residential properties and estimates that 28.0% of its residential mortgage loans are to real estate investors based on financial data as of March 31, 2008. The current focus of permanent 1-4 family lending is to owner occupants.

As a complement to the 1-4 family permanent mortgage lending activities, the Bank also offers home equity loans. Such loans typically have shorter maturities and higher interest rates than traditional 1-4 family lending. Home equity loans and lines of credit totaled $10.5 million, equal to 6.0% of total loans as of March 31, 2008.

Construction Loans

Construction lending has diminished modestly over the last several years which is reflective of the current weak housing market, particularly for new homes.


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		*I.19*

Accordingly, First Savings has retrenched from construction lending by limiting its lending to the strongest projects and borrowers. As a result, construction and land loans have diminished from 15.0% as of the end of fiscal 2003, to 9.6% as of March 31, 2008.

The Bank originates residential and, to a lesser extent, commercial construction loans. Such lending shortens the average duration of assets and support asset yields. The Bank generally limits such loans to known builders and developers with established lending relationships with the Bank. In the case where the Bank is making a construction loan to the owner of the structure, First Savings typically structures the loan as a construction loan which converts to a permanent loan upon completion of the construction phase. Substantially all of the Bank’s construction lending is in markets served by a First Savings branch or a contiguous area. Construction loans generally have terms of up to 12 months and LTV ratios up to 97% for a residential property (with PMI for the portion over 80%) and 80% for a commercial property.

Multi-Family and Commercial Mortgage Lending

Multi-family and commercial mortgage lending has been an area of portfolio diversification for the Bank, and totaled $15.3 million (8.8% of total loans) and $5.2 million (3.0% of total loans) as of March 31, 2008. Such loans are typically secured by properties in the Bank’s market area and are generally originated by the Bank but may include participation interests purchased from other local lenders. The substantial majority of such mortgage loans originated by the Bank are secured by properties in southern Indiana or nearby northern Kentucky.

Multi-family and commercial mortgage loans are typically adjustable over a five year period and or fixed rate loans with a five year balloon term such that the loan effectively reprices within a five year timeframe. Balloon loans are frequently renegotiated as the loan approaches its maturity with new terms and conditions which take into account the then prevailing conditions of the market, borrower and collateral property. Such loans typically possess amortization periods of 15 to 20 years, and loan-to-value ratios of up to 80%, and target a debt-coverage ratio of at least 1.2 times.


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		*I.20*

The typical commercial or multi-family loans that the Bank will be seeking to make will have a principal balance in the range of $250,000 to $2.5 million, but may be larger, particularly if the loan is well-collateralized or extended to a very credit-worthy borrower. Multi-family and commercial real estate loans are secured by office buildings, retail and industrial use buildings, apartments and other structures such as strip shopping centers, retail shops and various other properties. Most income producing property loans originated by the Bank are for the purpose of financing existing structures rather than new construction. Such loans will generally be collateralized by local properties.

Non-Mortgage Lending

The Bank’s efforts to increase commercial lending have included mortgage lending as well as C&I non-mortgage lending. As of March 31, 2008, commercial business loans totaled $10.4 million, equal to 6.0% of total loans. The Bank offers commercial loans to sole proprietorships, professional partnerships and various other small businesses. The types of commercial loans offered include lines of credit and business term loans. Most lines of credit and business term loans are secured by real estate and other assets such as equipment, inventory and accounts receivable.

Consumer loans are generally offered to provide a full line of loan products to customers and typically include student loans, loans on deposits, auto loans, and unsecured personal loans. As of March 31, 2008, consumer loans totaled $16.7 million, equal to 9.6% of total loans. Excluding home equity loans which are secured by a mortgage, the consumer loan balance totaled $6.2 million, equal to 3.6% of loans.

Loan Originations, Purchases and Sales

Exhibit I-9, which shows the Bank’s loan originations/purchases, repayments and sales over the past three fiscal years, highlights the Bank’s emphasis on residential mortgage lending with a modest level of diversification in other loan types, including


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		*I.21*

commercial mortgage and construction loans, as well as non-mortgage loans. Total loan originations were relatively consistent over the last three fiscal years, reflecting the limited growth trends for the portfolio overall, and ranged from $83.5 million to $91.7 million, and totaled $91.4 million for the 12 months ended March 31, 2008. Recent trends with respect to loan portfolio balances, including growth in the permanent 1-4 family loan portfolio and shrinkage of the construction loan portfolio, are evidenced by the underlying origination volumes. The Bank is primarily a portfolio lender as loan sales have been limited since the end of fiscal 2005.

Asset Quality

The Bank has typically operated with a higher level of NPAs relative to many thrifts in the Midwest, which reflected asset quality problems in the portfolio of residential mortgage loans (primarily including investor loans) , which also translated into a higher level of foreclosure activity with a relatively significant balance of real estate owned (“REO”) and other foreclosed assets. The level of NPAs increased over the six months ended March 31, 2008, reflecting the deterioration of a group of residential mortgage loans to one investor as more fully described below.

As shown in Exhibit I-10, the balance of NPAs has fluctuated at levels above 1% of total assets, from a low of 1.15% as of the end of fiscal 2003, to a high of 2.50% as of March 31, 2008. As of March 31, 2008, NPAs were comprised of $3.6 million of non-accruing loans, $418,000 of accruing loans 90 days or more past due, and $1.3 million of REO and other foreclosed assets. Importantly, approximately $2.0 million of the increase over the six months ended March 31, 2008, was attributable to a group of 35 residential mortgage loans to one borrower secured by investment properties in southern Indiana. In this regard, the Bank’s perceives the market value has deteriorated significantly since the loans were originated and as a result, First Savings established $867,000 of additional ALLLs for this one group of loans for the most recent six month period.

To track the Bank’s asset quality and the adequacy of valuation allowances, First Savings has established detailed asset classification policies and procedures which are


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		*I.22*

consistent with regulatory guidelines. Detailed asset classifications are reviewed quarterly by senior management and the Board. Pursuant to these procedures, when needed, the Bank establishes additional valuation allowances to cover anticipated losses in classified or non-classified assets. As of March 31, 2008, the Bank maintained valuation allowances of $2.5 million, equal to 1.43% of total loans, and 47.05% of non-performing assets (see Exhibit I-11 for details).

Funding Composition and Strategy

Deposits have consistently accounted for the major portion of the Bank’s interest-bearing funding composition and at March 31, 2008 deposits equaled 95.6% of First Savings’ interest-bearing funding composition. Exhibit I-12 sets forth the Bank’s deposit composition for the past three and one-half years and Exhibit I-13 provides the interest rate and maturity composition of the CD portfolio at March 31, 2008. Certificates of deposit constitute the largest portion of the Bank’s deposit base, and recent trends in the Bank’s deposit composition show that the composition of the deposit base has remained relatively stable. Transaction and savings account deposits equaled $49.8 million or 28.6% of total deposits at March 31, 2008, versus $62.5 million or 35.6% of total deposits as of March 31, 2008.

The balance of the Bank’s deposits consists of CDs, with First Savings’ current CD composition reflecting a higher concentration of short-term CDs (maturities of one year or less). As of March 31, 2008, the CD portfolio totaled $124.3 million, or 71.4% of total deposits as of March 31, 2008 and 67.5% of the CDs were scheduled to mature in one year or less. As of March 31, 2008, jumbo CDs (CD accounts with balances of $100,000 or more) amounted to $31.9 million or 25.7% of total CDs. First Savings does not maintain any brokered CDs.

As of March 31, 2008, borrowed funds totaled $8.0 million and consisted solely of FHLB advances. Recent growth in borrowings was primarily due to the attractive rate on term funds and the need for additional liquidity in the absence of deposit growth. It is management’s current intention to focus on deposit growth to fund future operations but it will continue to evaluate the use of borrowings when the perceived cost relative to deposits is favorable and potentially for wholesale leverage purposes on a post-Conversion basis.


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		*I.23*

Subsidiaries

First Savings has two subsidiaries, Southern Indiana Financial Corporation and FFCC, Inc., both of which are organized as Indiana corporations. Southern Indiana Financial Corporation is an independent insurance agency, offering various types of annuities and life insurance policies. FFCC, Inc. was organized for the purposes of purchasing, holding and disposing of real estate owned.

In addition, the Bank has plans to form one or more additional wholly-owned subsidiaries to hold investment securities in order to take advantage of certain favorable income tax treatment afforded under Indiana law.

Legal Proceedings

The Bank is not involved in any pending legal proceedings other than routine legal proceedings occurring in the ordinary course of business which, in the aggregate, are believed by management to have a material adverse effect on the Bank’s financial condition. First Savings is involved in litigation seeking restitution from a former fee appraiser related to appraisals obtained on 1-4 family loans to investors. At this point, it is difficult for the Bank to quantify the amount and timing of any damage award which may be forthcoming, if any.


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		*II.1*

II. MARKET AREA

Introduction

First Savings conducts operations out of the main office and six branch offices in southern Indiana. The Bank’s main office is located in Clarksville, two offices are located in Jeffersonville, and single office locations are maintained in Charlestown, Sellersburg, Floyds Knobs and Georgetown, Indiana. The main office and four of the Bank’s branches are located in Clark County and the remaining two branches are located in Floyd County. Located along the northern shore of the Ohio River, both Clark and Floyd Counties are situated along the banks of the Ohio River within the Louisville, Kentucky metropolitan area as reflected in the map below. Exhibit II-1 provides additional information on the Bank’s office properties.

First Savings Bank, F.S.B.

Branch Network

LOGO

The Bank’s markets in southern Indiana are part of the Greater Louisville metropolitan area (“MSA”) which is a mid-sized metropolitan area with a total population


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		*II.2*

approximating 1.2 million. The numerous bridges that connect Indiana and Kentucky’s interstate system provide easy and convenient access to either side of the river for all residents of the Louisville metropolitan area.

The Bank’s competitive environment includes a large number of thrifts, commercial banks and other financial service providers, including credit unions, some of which have a regional or national presence. The primary market area economy is fairly diversified, although manufacturing businesses remain the cornerstone of the regional economy. Major employment sectors in the regional economy include services, wholesale/retail trade and manufacturing.

Future growth opportunities for the Bank depend on the future growth and stability of the regional economy, demographic growth trends, and the nature and intensity of the competitive environment. These factors have been briefly examined to help determine the growth potential that exists for the Bank and the relative economic health of the Bank’s market area.

National Economic Factors

The future success of the Bank’s operations is partially dependent upon various national and local economic trends. Signs of the economy potentially slipping into a recession continued to emerge in 2008, with January employment data showing a drop in payrolls for the first time since 2003. The January unemployment rate dipped to 4.9%, as the civilian labor force shrank slightly. January economic data also showed retailers continuing to experience a decline in sales. New home sales fell in January for a third straight month, pushing activity down to the slowest pace in nearly 13 years. Due to the ongoing housing slump, the Federal Reserve cut its economic growth forecast for 2008. Consumer confidence dropped sharply in February amid growing concerns of a forthcoming recession. Other data that indicated the economy was heading towards a recession included a decline in February manufacturing activity to a five year low, and the number of homes entering foreclosure hit a record in the fourth quarter of 2007. February employment data showed a loss of jobs, although the unemployment rate dipped to 4.8%. Falling home prices spurred an increase in


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		*II.3*

February existing home sales, although new home sales continued to decline in February. The weak housing market was further evidenced by a decrease in residential construction activity during February, which pushed the mark for decreased residential construction activity to a record 24 consecutive months. Manufacturing activity edged up slightly in March 2008, although the March reading still signaled that the manufacturing sector was still in contraction. March employment data showed a third straight month of job losses, with the unemployment rate increasing from 4.8% to 5.1%. The prolonged housing slump continued into March, with sales of new homes plunging to the slowest pace in over 16 years despite sharply lower prices. Sales and prices of existing homes were also down in March. Orders for durable goods dropped for the third consecutive month in March, providing further evidence that the economy was sliding into recession.

In terms of interest rates trends over the past few quarters, the downward trend in long-term Treasury yields continued to prevail in early 2008, as economic data generally pointed towards an economy growing weaker. Interest rates declined further on news of a surprise 0.75% rate cut by the Federal Reserve a week before its scheduled rate meeting at the end of January, with the yield on the 10-year Treasury note dipping below 3.50%. Treasury yields edged slightly higher in the week before the Federal Reserve meeting. The Federal Reserve meeting at the end of January concluded with a second rate cut over a nine day period, as the target rate was cut by 0.5% to 3.0%. Interest rates stabilized during the first half of February, with more economic data pointing towards a recession, and then edged higher going into late-February on inflation worries fueled by a 0.4% jump in January consumer prices. More signs of a softening U.S. economy and renewed worries of the deepening credit crisis highlighted by the collapse of investment banking firm Bear Stearns pushed bond yields lower at the end of February and the first half of March, with the yield on the 10-year Treasury dipping below 3.5% in mid-March. The Federal Reserve cut its target rate by 0.75% to 2.25% at its mid-March meeting, which along with renewed worries about the economy pushed Treasury yields lower heading into the second half of March. Treasury yields edged higher at the end of the first quarter, with the 10-year Treasury yield stabilizing around 3.5%.


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		*II.4*

Interest rates were fairly stable during the first half of April 2008, as economic data pointed towards the U.S. economy going into recession. Most notably, March employment data showed job losses for a third consecutive month and April consumer confidence dropped to a new low for the fourth month in a row. Economic data showing higher wholesale and consumer prices in March, along with an unexpected drop in weekly unemployment claims in late –April, push long-term Treasury yields higher in the second half of April. At the end of April, the Federal Reserve lowered its target rate by a quarter point to 2%. The rate cut was the seventh in eight months, although the Federal Reserve signaled that it may be ready for a pause. Long-term Treasury yields stabilized during the first couple of weeks of May. As of May 16, 2008, the bond equivalent yields for U.S. Treasury bonds with terms of one and ten years equaled 2.09% and 3.85%, respectively, versus comparable year ago yields of 4.82% and 4.71%. Exhibit II-2 provides historical interest rate trends.

Market Area Demographics

Demographic and economic growth trends, measured by changes in population, number of households, age distribution and median household income, provide key insights into the health of the market area served by the Bank (see Table 2.1 for detailed demographic data). The demographic data reveals that Clark County has a modestly larger population base with favorable growth trends in comparison to Floyd County. Specifically, the population of Clark and Floyd Counties were estimated to total 106,000 and 73,000 people, respectively as of 2007. With respect to population growth trends, Clark County’s annual population growth rate of 1.4% from 2000 through 2007 was above the Floyd County growth rate of 0.5%, as well as the state of Indiana and the U.S. growth rates of 0.8% and 1.2%. Growth in households mirrored the population growth rates, with the rate of household growth in Clark County outpacing Floyd County’s household growth rate during the 2000 to 2007 period with such trends projected to remain in place over the five year period through 2012.

Income levels in First Savings’ market area are roughly comparable to the state and national averages with higher incomes reported in Floyd County. Both the


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		*II.5*

Table 2.1

First Savings Bank, F.S.B.

Summary Demographic Data


	Year									Annual Growth Rate
	2000			2007			2012			2000-2007		2007- 2012
Population (000)
United States		281,422			306,348			325,526		1.2	%	1.2	%
Indiana		6,080			6,413			6,668		0.8	%	0.8	%
Clark County		96			106			114		1.4	%	1.4	%
Floyd County		71			73			75		0.5	%	0.5	%

Households (000)
United States		105,480			115,337			122,831		1.3	%	1.3	%
Indiana		2,336			2,508			2,622		1.0	%	0.9	%
Clark County		39			44			48		1.8	%	1.6	%
Floyd County		28			29			30		0.7	%	0.6	%

Median Household Income ($)
United States	$	42,164		$	53,154		$	62,503		3.4	%	3.3	%
Indiana		41,671			52,632			61,929		3.4	%	3.3	%
Clark County		40,102			50,398			58,650		3.3	%	3.1	%
Floyd County		44,080			55,405			64,835		3.3	%	3.2	%

Per Capita Income ($)
United States	$	21,587		$	27,916		$	33,873		3.7	%	3.9	%
Indiana		20,397			26,366			31,936		3.7	%	3.9	%
Clark County		19,936			25,668			30,880		3.7	%	3.8	%
Floyd County		21,852			27,884			33,613		3.5	%	3.8	%

	$0 to $25,000			$25,000- $50,000			$50,000- $100,000			$100,000+
2007 HH Net Income Dist. (%)
United States		21.91	%		25.02	%		32.32	%	20.75	%
Indiana		20.82	%		26.32	%		35.58	%	17.28	%
Clark County		20.62	%		28.90	%		35.84	%	14.64	%
Floyd County		19.30	%		24.48	%		35.96	%	20.26	%

	0-14 Yrs.			15-34 Yrs.			35-54 Yrs.			55-69 Yrs.		70+ Yrs.
2007 Age Distribution(%)
United States		20.26	%		27.33	%		29.07	%	14.30	%	9.04	%
Indiana		20.40	%		27.43	%		28.91	%	14.39	%	8.86	%
Clark County		19.17	%		25.92	%		29.88	%	15.85	%	9.18	%
Floyd County		19.18	%		25.88	%		30.40	%	15.59	%	8.95	%

Source: SNL Financial, LC.


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.6*

presence of higher paying manufacturing jobs and more residential developments have attracted upper middle and upper income residents. In this regard, median household income and per capita income for Floyd County exceeded the comparable measures for the state of Indiana, while Clark County’s income measures were below the state and national averages.

Household income distribution measures further underscore the greater affluence of the Floyd County market as compared to Clark County, as well as the state of Indiana. Floyd County’s greater affluence is attributable to the fact that one-half of the residents of Floyd County commute outside of the county for work, with many commuting to white collar jobs in Louisville.

Local Economy

The Bank’s market area is within the Louisville metropolitan area and as such, Clark and Floyd Counties are integrally linked to other areas of the metropolitan area while also drawing workers from a larger regional area within southern Indiana and nearby northern Kentucky. The business environment in the Bank’s market is relatively favorable given the existing transportation infrastructure (i.e., highways, freight railroads, location along the Ohio and availability of barge transportation and presence of UPS’ largest distribution center at the nearby Louisville airport, etc.) Other factors impacting the local economy include Louisville’s location near many of the Midwest’s major markets, stable workforce and relatively modest cost of living in comparison to larger nearby Midwestern cities.

The economy of the Bank’s market has become increasingly diversified over the last several years, although the overall health of the regional economy remains somewhat dependent on the strength of the manufacturing sector and manufacturing related business. In fact, while other areas of Indiana seek ways to replace a large number of manufacturing jobs lost over the past ten years, Clark and Floyd Counties largely have maintained their manufacturing employment base and are looking to increase such employment in the future through a proactive economic development effort. Table 2.2 below lists southern Indiana’s major employers in the region and


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.7*

reflects that while the manufacturing sector continues to be well represented among the market area’s largest employers, there are several large healthcare and government –related entities among the top ten employers. Moreover, large Louisville employers such as UPS and Humana are also evidence of the changing regional employment base.

Table 2.2

First Savings Bank, F.S.B.

Southern Indiana Major Employers


Company	Employment	Sector
American Commercial Lines LLC	2,000	Manufacturing
New Albany/Floyd County Schools	1,612	Local Government
Greater Clark County Schools	1,600	Local Government
US Bureau of Census	1,550	Federal Government
Floyd Memorial Hospital	1,409	Health Care
Clark Memorial Hospital	1,060	Health Care
Gohmann Asphalt & Construction	1,000	Manufacturing
Wal-Mart	865	Retail
RR Donnelley	800	Printing
Hitachi Cable Indiana, Inc.	600	Manufacturing

Source: One Southern Indiana.

As shown in Table 2.3, employment in services, wholesale/retail trade and manufacturing comprise the largest sectors of the local economy. The service sector represents the largest segment of the economy in both Floyd and Clark Counties reflecting a significant contribution from healthcare services. Wholesale and retail trade comprise the second largest economic sector followed by manufacturing. Louisville has traditionally been a manufacturing center for durable goods including appliances, cars and trucks. More recently, the area's economy has diversified, bringing with it more skilled and high-tech employment opportunities. Table 2.3 shows employment by sector for Clark and Floyd Counties, as well as for the state of Indiana.


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.8*

Table 2.3

Primary Market Area Employment Sectors

(Percent of Labor Force) (1)


Employment Sectors	Indiana		Clark		Floyd		Avg (2)
Services	36.5	%	31.4	%	35.6	%	33.5	%
Manufacturing	15.9		13.3		16.3		14.9
Wholesale/Ret. Trade	14.9		16.8		13.7		15.3
Government	11.9		13.1		14.5		13.8
Fin. Ins. Real Estate	6.8		6.4		7.7		7.1
Construction	6.0		7.3		8.2		7.8
Transportation/Utility	4.2		9.5		2.0		5.8
Farming	1.9		1.2		0.8		1.0
Mining	0.2		0.0		0.0		0.0
Other	1.7		1.0		1.2		1.0

Total	100.0	%	100.0	%	100.0	%	100.0	%

(1)	As of 2005

(2)	Average based on Clark and Floyd Counties.

Source: REIS DataSource.

Unemployment Trends

Comparative unemployment rates for Clark and Floyd Counties, as well as for the U.S. and Indiana, are shown in Table 2.4. March 2008 unemployment rates for Clark and Floyd Counties equaled 4.7% and 4.4%, respectively, versus a U.S. and Indiana unemployment rate of 5.1%. Unemployment rates for Clark and Floyd Counties were slightly higher in March 2008 compared to a year ago, which was consistent with the state and national trend. While the local economy has been impacted by the slowdown of the regional and national economy, unemployment remains low in comparison to the state and national rate. The two counties continue to add manufacturing jobs, building on its central location in the Midwest and available workforce. Job creation has also been fueled by the growth of the retail sector and the success of several industrial/office parks in attracting new tenants.


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.9*

Table 2.4

First Savings Bank, F.S.B.

Unemployment Trends (1)


Region	March 2007 Unemployment		March 2008 Unemployment
United States	4.4	%	5.1	%
Indiana	4.6		5.1
Clark County	4.5		4.7
Floyd County	4.2		4.4

(1)	Unemployment rates have not been seasonally adjusted.

Source: U.S. Bureau of Labor Statistics.

Market Area Deposit Characteristics and Competition

The Bank’s retail deposit base is closely tied to the economic fortunes of southern Indiana and, in particular, the markets that are proximate to the Bank’s office locations. Table 2.5 displays deposit market trends from June 30, 2004 through June 30, 2007 for the branches that were maintained by the Bank during that period. Additional data is also presented for the state of Indiana for comparative purposes. The data indicates that Clark County’s larger population base translated into a slightly higher balance of total bank and thrift deposits compared to Floyd County. Moreover, Clark County’s relatively strong demographic growth translated into favorable deposit growth for the three year period covered in Table 2.5. Consistent with the state of Indiana, commercial banks maintained a larger market share of deposits in comparison to savings institutions in both the Clark and Floyd County markets, where savings institutions held 18% and 12% of the deposit market, respectively. For the three year period covered in Table 2.5, deposit market share for savings institutions declined in both Clark and Floyd Counties. First Savings held the substantial majority of savings institution deposits in Clark County and its shrinkage over the period impacted the shrinking savings institution market share.

The Bank maintains its largest balance and largest market share of deposits in Clark County. Based on data as of June 30, 2007, the Bank’s $160.2 million of deposits in Clark County represented a 13.3% market share of thrift and bank deposits.


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.10*

Table 2.5

First Savings Bank, F.S.B.

Deposit Summary


	As of June 30,										Deposit Growth Rate 2004-2007
	2004					2007
	Deposits		Market Share		Number of Branches	Deposits		Market Share		No. of Branches
	(Dollars in Millions)										(%)
Indiana	$	81,097	100.0	%	2,275	$	88,569	100.0	%	2,390	3.0	%
Commercial Banks		70,135	86.5	%	1,991		80,059	90.4	%	2,149	4.5	%
Savings Institutions		10,962	13.5	%	284		8,511	9.6	%	241	-8.1	%

Clark County	$	1,038	100.0	%	43	$	1,205	100.0	%	46	5.1	%
Commercial Banks		851	82.0	%	36		1,031	85.5	%	38	6.6	%
Savings Institutions		187	18.0	%	7		174	14.5	%	8	-2.3	%
First Savings Bank, FSB		180	17.3	%	5		160	13.3	%	5	-3.8	%

Floyd County	$	1,047	100.0	%	41	$	1,102	100.0	%	42	1.7	%
Commercial Banks		927	88.5	%	34		991	90.0	%	35	2.3	%
Savings Institutions		121	11.5	%	7		110	10.0	%	7	-2.9	%
First Savings Bank, FSB		12	1.2	%	2		13	1.2	%	2	2.5	%

Source: FDIC.

Comparatively, First Savings had a comparatively small share of the Floyd County deposit market with total deposits of $13.0 million at June 30, 2007, which represented a 1.2% market share. As noted previously, limited growth or even shrinkage reported by First Savings reflected the Bank’s inability to expand the asset side of the balance sheet through lending. The Bank is seeking to put in place a growth oriented business plan and in the future expects that deposit growth may exceed the recent historical trend for the 2004 to 2007 period.

The Bank faces notable competition in both deposit gathering and lending activities, including direct competition with several financial institutions that primarily have a local or regional presence. With regard to lending competition, the Bank encounters the most significant competition from the same institutions providing deposit


*RP ^® Financial, LC.*		*MARKET AREA*
		*II.11*

services. In addition, the Bank competes with mortgage companies and independent mortgage brokers for mortgage loan market share. Table 2.6 lists the largest competitors in Clark and Floyd Counties, based on deposit market share as noted parenthetically. As of June 30, 2007, the Bank’s deposit market share of 13.3% for Clark County represented the third largest market share of deposits in Clark County and deposit market share of 1.2% for Floyd County represented the twelfth largest market share of deposits in Floyd County.

Table 2.6

First Savings Bank, F.S.B.

Market Area Deposit Competitors


Location		Name
Clark County		JPMorgan Chase Bank (25.2%)
		New Washington State Bk (15.1%)
		First Savings, F.S.B. (13.3%) Rank - 3
		Your Community Bank (12.7%)

Floyd County		Your Community Bank (19.78%)
		National City Bank (18.6%)
		PNC Bank NA (15.2%)
		First Savings, F.S.B. (1.2%) Rank - 12

Source: FDIC.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.1*

III. PEER GROUP ANALYSIS

This chapter presents an analysis of First Savings’ operations versus a group of comparable savings institutions (the “Peer Group”) selected from the universe of all publicly-traded savings institutions in a manner consistent with the regulatory valuation guidelines. The basis of the pro forma market valuation of First Savings is derived from the pricing ratios of the Peer Group institutions, incorporating valuation adjustments for key differences in relation to the Peer Group. Since no Peer Group can be exactly comparable to First Savings, key areas examined for differences are: financial condition; profitability, growth and viability of earnings; asset growth; primary market area; dividends; liquidity of the shares; marketing of the issue; management; and effect of government regulations and regulatory reform.

Peer Group Selection

The Peer Group selection process is governed by the general parameters set forth in the regulatory valuation guidelines. Accordingly, the Peer Group is comprised of only those publicly-traded savings institutions whose common stock is either listed on a national exchange (NYSE or AMEX), or is NASDAQ listed, since their stock trading activity is regularly reported and generally more frequent than non-publicly traded and closely-held institutions. Institutions that are not listed on a national exchange or NASDAQ are inappropriate, since the trading activity for thinly-traded or closely-held stocks is typically highly irregular in terms of frequency and price and thus may not be a reliable indicator of market value. We have also excluded from the Peer Group those companies under acquisition or subject to rumored acquisition, mutual holding companies and recent conversions, since their pricing ratios are subject to unusual distortion and/or have limited trading history. A recent listing of the universe of all publicly-traded savings institutions is included as Exhibit III-1.

Ideally, the Peer Group, which must have at least 10 members to comply with the regulatory valuation guidelines, should be comprised of locally or regionally-based institutions with comparable resources, strategies and financial characteristics. There


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.2*

are approximately 125 publicly-traded institutions nationally and, thus, it is typically the case that the Peer Group will be comprised of institutions with relatively comparable characteristics. To the extent that differences exist between the converting institution and the Peer Group, valuation adjustments will be applied to account for the differences. Since First Savings will be a fully converted public thrift within a holding company structure upon completion of the offering, we considered only full stock companies to be viable candidates for inclusion in the Peer Group. From the universe of publicly-traded thrifts, we selected ten institutions with characteristics similar to those of First Savings. In the selection process, we applied two “screens” to the universe of all public companies:

•

Screen #1. Indiana thrifts with total assets of less than $1 billion. Six companies met the criteria for Screen #1 and four were included in the Peer Group: First Capital, Inc., Ameriana Bancorp, Inc., River Valley Bancorp, and LSB Financial Corp. of IN. MutualFirst Financial Inc. was excluded from the Peer Group, as the result of its recent announcement that it had entered into an agreement to acquire MFB Corp. of Mishawaka, IN. Likewise, MFB Corp has been excluded from the Peer Group since it is a target of an announced acquisition. In both cases, we believe that the announced acquisition has impacted the respective pricing ratios of MutualFirst Financial and MFB Corp. and we have excluded these companies from the Peer Group. Exhibit III-2 provides financial and public market pricing characteristics of all publicly-traded Midwest thrifts.

•

Screen #2. Midwest institutions with total assets of less than $500 million and tangible equity-to-assets ratios of greater than 10%. Seven companies met the criteria for Screen #2 and five were included in the Peer Group: Citizens Community Bancorp of WI, Liberty Bancorp, Inc. of MO, FFD Financial Corp. of OH, First Bancshares, Inc. of MO, and Park Bancorp of IL. First Cloverleaf Financial of IL was excluded owing to its recent announcement of its pending acquisition of a commercial bank and First Federal of Northern Michigan Bancorp was excluded owing to its recent history of operating losses.

In order to round out the Peer Group to a total of ten institutions, we also included Central Federal Corp. of OH. Central Federal Corp. would have otherwise met the selection criteria for Screen #2 above except that its tangible equity/assets ratio equaled 9.97% as of March 31, 2008, which falls slightly below the Screen #2 threshold of 10.00%.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.3*

Table 3.1 shows the general characteristics of each of the 10 Peer Group companies. While there are expectedly some differences between the Peer Group companies and First Savings, we believe that the Peer Group companies, on average, provide a good basis for valuation subject to valuation adjustments. The following sections present a comparison of First Savings’ financial condition, income and expense trends, loan composition, interest rate risk and credit risk versus the Peer Group as of the most recent publicly available date.

A summary description of the key characteristics of each of the Peer Group companies is detailed below.

•

First Capital, Inc. of IN. First Capital has $456 million of total assets, being the largest of the Peer Group institutions, and operates through 12 offices in southern Indiana. Thus, First Capital operates in the same general market area as the Bank. First Capital’s overall balance sheet composition is relatively similar to the Peer Group average while its loan portfolio composition reflects a relatively high proportion of residential mortgage loans. Operating returns are above the Peer Group average primarily reflecting First Capital’s comparatively lower operating expense ratio. Asset quality is similar to the Peer Group overall, in terms of the level of NPAs, while reserve coverage is comparatively modest.

•

Ameriana Bancorp of IN. Ameriana Bancorp reported total assets of $427 million and operates through a total of 10 branch offices in central Indiana. Ameriana Bancorp’s equity is more leveraged than the Bank’s pro forma ratios and its ROA is modestly below the Peer Group average. Ameriana Bancorp’s loan and MBS portfolio was broadly diversified with 1-4 family residential mortgage loans comprising the largest element of the portfolio. Non-performing loans exceeded the Peer Group average and Ameriana Bancorp’s reserve coverage in relation to total loans fell just outside the range of the Peer Group average and median.

•

Citizens Community Bancorp, Inc. of WI. Citizens Community Bancorp reported total assets of $426 million and operates through a total of 12 branch offices in western Wisconsin. Citizens Community Bancorp completed its second step conversion in November 2006, enhancing the overall comparability to the Bank. The recent capital raising transaction also provided Citizens Community Bancorp with the


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.4*

Table 3.1

Peer Group of Publicly-Traded Thrifts

May 16, 2008(1)


Ticker	Financial Institution	Exchange	Primary Market	Operating Strategy(2)	Total Assets			Offices	Fiscal Year	Conv. Date	Stock Price		Market Value
											($)		($Mil)
FCAP	First Capital, Inc. of IN	NASDAQ	Corydon, IN	Thrift	$	456		12	12-31	01/99	$	14.15	$	40
ASBI	Ameriana Bancorp of New Castle IN	NASDAQ	New Castle, IN	Thrift	$	427	D	10	12-31	03/87	$	9.05	$	27
CZWI	Citizens Community Bancorp Inc. of WI	NASDAQ	Eau Claire, WI	Thrift	$	426		12	09-30	11/06	$	8.35	$	56
LSBI	LSB Financial Corp. of Lafayette IN	NASDAQ	Lafayette, IN	Thrift	$	354		5	12-31	02/95	$	18.50	$	29
RIVR	River Valley Bancorp of IN	NASDAQ	Madison, IN	Thrift	$	350	D	8	12-31	12/96	$	15.54	$	25
LBCP	Liberty Bancorp, Inc. of MO	NASDAQ	Liberty, MO	Thrift	$	339	D	6	09-30	07/06	$	10.20	$	45
CFBK	Central Federal Corp. of OH	NASDAQ	Fairlawn, OH	Thrift	$	276		4	12-31	12/98	$	4.72	$	21
FBSI	First Bancshares, Inc. of MO	NASDAQ	Mtn. Grove, MO	Thrift	$	249		11	06-30	12/93	$	13.52	$	21
PFED	Park Bancorp of Chicago IL	NASDAQ	Chicago, IL	Thrift	$	224		4	12-31	08/96	$	19.70	$	24
FFDF	FFD Financial Corp. of Dover OH	NASDAQ	Dover, OH	Thrift	$	180		4	06-30	04/96	$	13.65	$	15


NOTES:		(1) Or most recent date available (M=March, S=September, D=December, J=June, E=Estimated, and P=Pro Forma).
		(2) Operating strategies are: Thrift=Traditional Thrift, M.B.=Mortgage Banker, R.E.=Real Estate Developer, Div.=Diversified and Ret.=Retail Banking.
		(3) BIF-insured savings bank institution.

Source:		Corporate offering circulars, data derived from information published in SNL Securities Quarterly Thrift Report, and financial reports of publicly-traded thrifts.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.5*

highest capital ratio of any of the Peer Group companies (but which still falls short of First Savings pro forma capital ratio). Citizens Community Bancorp operates with a loan portfolio which is comprised of a high level of consumer loans reflecting its credit union roots. NPAs are comparatively modest notwithstanding the heavy concentration of consumer loans. Earnings approximate the Peer Group average notwithstanding the very strong level of capitalization, as its cost of funds was high and non-interest income was modest in comparison to the Peer Group average.

•

LSB Financial Corp. of IN . LSB Financial reported total assets equal to $354 million and operates through a total of 5 branches in central Indiana. ROA is comparable to the Peer Group average while the loan portfolio reflects a broad mix of mortgage loans primarily, including both mortgage loans secured by single family residential, multi-family and commercial properties. Asset quality compares less favorably to the Peer Group average, as NPAs are higher and reserve coverage is lower.

•

River Valley Bancorp of IN. River Valley Bancorp reported total assets of $350 million and operates through a total of 8 branch offices. Moreover, River Valley Bancorp’s branches are in southern Indiana in the same or contiguous markets as the Bank enhance the comparability to the Bank for valuation purposes. River Valley Bancorp is significantly more leverage than the Bank and reported the lowest tangible equity/assets ratio of any of the Peer Group companies. Additionally, River Valley Bancorp has the highest utilization of borrowed funds of any of the Peer Group institutions. Earnings are above the Peer Group average reflecting the benefit of its favorable level of fee income and moderate operating expense ratio.

•

Liberty Bancorp, Inc. of MO. Liberty Bancorp reported total assets equal to $339 million and operates through a total of 6 branch offices in western Missouri, some of which are in the Kansas City metropolitan area. ROA is comparable to the Peer Group average supported by Liberty Bancorp’s strong capital ratio, which ranks as the second highest of all the Peer Group companies. The loan portfolio composition reflects comparatively greater diversification into construction and commercial mortgage loans in relation to the Peer Group. Key asset quality ratios reflect a relatively high balance of NPAs in comparison to the Peer Group average, while reserve coverage is strong in relation to total loans but reserve coverage in relation to total NPAs falls below the Peer Group average and median.

•

Central Federal Corp. of OH. Central Federal Corp reported total assets of $276 million and operates through 4 branch offices in central and northern Ohio. Central Federal Corp.’s balance sheet reflected its orientation toward commercial lending as commercial mortgage and


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.6*

non-mortgage loans predominated the portfolio. Earnings were near a breakeven level reflecting in part, non-operating losses on asset sales. Asset quality ratios were favorable in comparison to the Peer Group average, both in terms of the NPA/Assets ratio and the reserve coverage ratio.

•

First Bancshares, Inc. of MO . First Bancorp, Inc. has $249 million of total assets and operates through 11 offices in southern Missouri. First Bancorp was selected for the Peer Group owing to its location in the Midwest, modest level of profitability, and relatively similar balance sheet composition. Moreover, asset quality ratios are relatively comparable to the Peer Group averages.

•

Park Bancorp, Inc. of Chicago, IL. Park Bancorp reported $224 million of total assets generated through a branch network of 4 offices, all within the Chicago metropolitan area. Earnings fell below the Peer Group average and median reflecting a comparatively modest level of net interest income and non-interest fee income. The balance sheet composition is relatively similar to the Peer Group average and the loan portfolio primarily reflects an orientation toward mortgages, including both residential and commercial mortgages. NPAs are slightly below the Peer Group average but reserve coverage is also lower, both as a percent of loans and NPAs.

•

FFD Financial Corp. of OH. FFD Financial Corp. reported total assets of $180 million and operates through a total of 4 branch offices in central Ohio. FFD reported the highest profitability (ROA) of any of the Peer Group companies reflecting its very strong level of net interest income and moderate operating expense ratio. The balance sheet reflects a relatively high proportion of loans and deposits in comparison to the Peer Group, while the equity/assets ratio approximated the Peer Group average and median.

In aggregate, the Peer Group companies maintain a modestly lower level of capital as the industry average (11.13% of assets versus 12.17% for all public companies), generate a slightly higher level of core earnings as a percent of average assets (0.37% core ROAA versus 0.19% for all public companies), and generate a higher ROE based on core earnings (3.63% ROE versus 2.59% for all public companies). Overall, the Peer Group’s average P/B and P/TB ratios were below the respective averages for all publicly traded thrifts while the P/E multiple based on core earnings approximated the average for all publicly-traded thrifts.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.7*


	All Publicly-Traded			Peer Group
Financial Characteristics (Averages)
Assets ($Mil)	$	3,289		$	328
Market Capitalization ($Mil)	$	339		$	30
Equity/Assets (%)		12.17	%		11.13	%
Core Return on Average Assets (%)		0.19			0.37
Core Return on Average Equity (%)		2.59			3.63

Pricing Ratios (Averages) (1)
Core Price/Earnings (x)		20.65	x		21.43	x
Price/Book (%)		108.34	%		83.22	%
Price/Tangible Book(%)		120.80			85.43
Price/Assets (%)		13.77			9.20

__________

(1)

Based on market prices as of May 16, 2008.

Ideally, the Peer Group companies would be comparable to First Savings in terms of all of the selection criteria, but the universe of publicly-traded thrifts does not provide for an appropriate number of such companies. However, in general, the companies selected for the Peer Group were fairly comparable to First Savings, as will be highlighted in the following comparative analysis.

Financial Condition

Table 3.2 shows comparative balance sheet measures for First Savings and the Peer Group, reflecting the expected similarities and some differences given the selection procedures outlined above. The Bank’s and the Peer Group’s ratios reflect balances as of March 31, 2008, unless indicated otherwise for the Peer Group companies. First Savings’ equity-to-assets ratio of 13.8% was above the Peer Group’s average net worth ratio of 11.1%. All of the Bank’s equity consisted of tangible equity while intangibles maintained by the Peer Group equaled 0.3% of assets, translating into a tangible equity-to-assets ratio of 8.1% on average for the Peer Group. The Bank’s pro forma tangible capital position will increase with the addition of stock proceeds. The increase in First Savings’ pro forma capital position will be favorable from a risk perspective and in terms of future earnings potential that may be realized through


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.8*

Table 3.2

Balance Sheet Composition and Growth Rates

Comparable Institution Analysis

As of March 31, 2008


		Balance Sheet as a Percent of Assets																				Balance Sheet Annual Growth Rates														Regulatory Capital
		Cash & Equi- valents		MBS & Invest		Loans		Deposits		Bor- rowed Funds		Subd. Debt		Net Worth		Good- will & Intang		Tng Net Worth		ME- MO: Pref. Stock		Assets		MBS, Cash & Invest- ments		Loans		Deposits		Borrows. & Subdebt		Net Worth		Tng Net Worth		Tangible		Core		Reg. Cap.
First Savings Bank, F.S.B.
March 31, 2008		7.3	%	9.2	%	80.4	%	81.9	%	3.8	%	0.0	%	13.8	%	0.0	%	13.8	%	0.0	%	2.00	%	-1.36	%	1.72	%	-0.69	%	NM		1.26	%	1.26	%	13.77	%	13.77	%	23.81	%

All Public Companies
Averages		4.2	%	20.2	%	69.9	%	66.7	%	19.3	%	0.6	%	12.2	%	1.0	%	11.2	%	0.0	%	8.30	%	0.98	%	8.85	%	3.50	%	14.66	%	-2.41	%	-3.05	%	10.51	%	10.46	%	17.06	%
Medians		2.9	%	17.6	%	71.5	%	67.3	%	18.1	%	0.0	%	10.3	%	0.1	%	9.1	%	0.0	%	5.55	%	0.95	%	7.93	%	2.41	%	10.86	%	-0.67	%	-0.89	%	8.72	%	8.70	%	13.87	%

State of IN
Averages		4.5	%	15.3	%	73.1	%	71.6	%	16.2	%	0.7	%	10.3	%	0.7	%	9.6	%	0.0	%	9.97	%	-5.11	%	3.73	%	6.01	%	3.29	%	-0.09	%	0.09	%	10.04	%	10.04	%	14.80	%
Medians		3.9	%	16.8	%	73.1	%	71.8	%	17.2	%	0.0	%	10.0	%	0.2	%	9.3	%	0.0	%	-0.44	%	-0.50	%	-0.22	%	-1.33	%	4.44	%	1.06	%	1.12	%	9.80	%	9.80	%	13.69	%

Comparable Group
Averages		4.4	%	14.2	%	75.3	%	69.5	%	17.8	%	0.6	%	11.1	%	0.3	%	10.8	%	0.0	%	8.04	%	-3.68	%	8.90	%	5.34	%	16.00	%	-0.08	%	0.06	%	10.06	%	10.06	%	14.89	%
Medians		4.1	%	16.8	%	73.1	%	69.2	%	18.1	%	0.0	%	10.2	%	0.0	%	10.0	%	0.0	%	2.68	%	0.84	%	7.98	%	3.29	%	7.35	%	-0.69	%	-0.63	%	9.86	%	9.86	%	14.01	%

Comparable Group
ASBI	Ameriana Bancorp of New Castle IN(1)	4.0	%	16.9	%	69.0	%	73.7	%	13.6	%	2.4	%	7.9	%	0.2	%	7.7	%	0.0	%	-2.39	%	-39.32	%	18.15	%	-2.38	%	-8.26	%	1.58	%	1.62	%	NA		NA		NA
CFBK	Central Federal Corp. of OH	2.5	%	10.7	%	82.0	%	67.4	%	20.0	%	1.9	%	10.0	%	0.0	%	10.0	%	0.0	%	14.81	%	-0.50	%	18.40	%	12.59	%	39.19	%	-4.55	%	-4.55	%	8.70	%	8.70	%	11.40	%
CZWI	Citizens Community Bancorp Inc. of WI	4.2	%	11.8	%	80.1	%	58.6	%	22.8	%	0.0	%	17.7	%	1.6	%	16.1	%	0.0	%	40.91	%	NM		21.76	%	24.99	%	NM		-3.00	%	-2.87	%	10.70	%	10.70	%	17.00	%
FFDF	FFD Financial Corp. of Dover OH	5.3	%	4.1	%	88.6	%	77.7	%	11.5	%	0.0	%	10.1	%	0.0	%	10.1	%	0.0	%	6.11	%	3.89	%	6.08	%	4.89	%	23.78	%	2.74	%	2.74	%	9.67	%	9.67	%	12.85	%
FBSI	First Bancshares, Inc. of MO	6.8	%	19.0	%	67.5	%	79.6	%	9.0	%	0.0	%	11.0	%	0.1	%	10.9	%	0.0	%	3.07	%	-7.74	%	8.92	%	5.34	%	-14.26	%	3.12	%	3.34	%	10.05	%	10.05	%	16.42	%
FCAP	First Capital, Inc. of IN	5.5	%	16.7	%	72.1	%	72.9	%	16.2	%	0.0	%	10.3	%	1.2	%	9.0	%	0.0	%	1.14	%	0.84	%	-0.21	%	0.61	%	1.53	%	5.27	%	6.24	%	8.40	%	8.40	%	13.20	%
LSBI	LSB Financial Corp. of Lafayette IN	3.8	%	4.8	%	85.8	%	67.9	%	21.8	%	0.0	%	9.6	%	0.0	%	9.6	%	0.0	%	-2.01	%	9.79	%	-2.68	%	-5.35	%	10.18	%	-2.96	%	-2.96	%	9.49	%	9.49	%	13.32	%
LBCP	Liberty Bancorp, Inc. of MO(1)	3.2	%	19.8	%	69.9	%	70.5	%	14.9	%	0.0	%	14.1	%	0.0	%	14.1	%	0.0	%	14.91	%	2.69	%	14.47	%	11.31	%	78.66	%	-4.09	%	-4.09	%	10.80	%	10.80	%	14.70	%
PFED	Park Bancorp of Chicago IL	6.3	%	20.2	%	64.3	%	63.7	%	21.4	%	0.0	%	13.4	%	0.0	%	13.4	%	0.0	%	1.53	%	8.86	%	-2.93	%	1.69	%	5.85	%	-5.24	%	-5.24	%	12.70	%	12.70	%	20.20	%
RIVR	River Valley Bancorp of IN(1)	2.3	%	18.2	%	74.0	%	62.8	%	27.1	%	2.1	%	7.3	%	0.0	%	7.3	%	0.0	%	2.28	%	-11.64	%	7.05	%	-0.25	%	7.35	%	6.34	%	6.34	%	NA		NA		NA

(1)	Financial information is for the quarter ending December 31, 2007.


Source:		Audited and unaudited financial statements, corporate reports and offering circulars, and RP ^® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.9*

leverage and lower funding costs. At the same time, the Bank’s higher pro forma capitalization will also result in a lower return on equity. Both the Bank’s and the Peer Group’s capital ratios reflected capital surpluses with respect to the regulatory capital requirements.

The Bank’s asset composition reflects a moderately higher concentration of loans to assets, at 80.4% versus a 75.3% average for the Peer Group. Comparatively, the ratio of cash, investments, and MBS for the Bank was lower than for the Peer Group (16.5% of assets versus 18.6% for the Peer Group). Overall, the Bank’s interest-earning assets (“IEA”) approximated 96.9% of assets, which was above the comparative Peer Group ratio of 93.9%. On a pro forma basis, the Bank’s IEA advantage is expected to increase as the net proceeds are reinvested into IEA.

First Savings’ funding liabilities reflected a funding strategy that was somewhat similar to that of the Peer Group. The Bank’s deposits equaled 81.9% of assets, which was above the Peer Group average of 69.5%. Comparatively, borrowings accounted for a lower portion of the Bank’s interest-bearing funding composition, as reflected by borrowings-to-assets ratios of 3.8% and 17.8% for First Savings and the Peer Group, respectively. Total interest-bearing liabilities maintained as a percent of assets equaled 85.7% for the Bank, versus 87.9% for the Peer Group.

A key measure of balance sheet strength for a thrift institution is its IEA/IBL ratio. Presently, the Peer Group’s IEA/IBL ratio of 106.8% is below the Bank’s IEA/IBL ratio of 113.1%. The additional capital realized from stock proceeds should support an increase in First Savings’ IEA/IBL ratio, as the capital realized from First Savings’ stock offering will be primarily deployed into interest-earning assets.

The growth rate section of Table 3.2 shows annual growth rates for key balance sheet items, based on the Bank’s and the Peer Group’s annual growth for the 18 months ended March 31, 2008, for the Bank and the 12 months ended March 31, 2008, unless indicated otherwise for the Peer Group companies. First Savings posted lower annual asset growth than the Peer Group, at 2.00% and 8.04%, respectively. The Bank’s total assets shrank in the face of limited loan growth (positive growth of 1.72%) and modest shrinkage of the cash and investments portfolio equal to 1.36%. Comparatively, the Peer Group’s loan portfolio increased at an 8.90% rate on average which supported their relatively stronger asset growth.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.10*

Deposit growth for the Peer Group averaged 5.34%, as compared to shrinkage of less than 1% for the Bank. Borrowed funds remained at nominal levels for the Bank while expanded utilization of borrowings was at a 16.00% rate for the Peer Group. Capital growth rates posted by the Bank and the Peer Group equaled 1.26% and negative 0.08%, respectively. The Bank’s comparatively modest capital growth rate is reflective of its moderate ROA and ROE measures. The Peer Group’s more limited equity growth, notwithstanding favorable profitability, reflects the adoption of dividend and capital management strategies. On a post-offering basis, the Bank’s capital growth rate is expected to remain modest over the near term due to the increased equity level and marginal short-term net proceeds reinvestment benefit.

Income and Expense Components

First Savings and the Peer Group reported net income to average assets ratios of 0.07% and 0.37%, respectively (see Table 3.3), based on earnings for the 12 months ended March 31, 2008, unless indicated otherwise for the Peer Group companies. The Bank maintained earnings advantages in the area of net interest income, which was more than offset by the higher level of loan loss provisions reported by First Savings.

The Bank’s interest income ratio exceeded the Peer Group average while First Savings also benefitted from a lower ratio of interest expense as a percent of average assets. The Bank’s higher interest income ratio was the result of its higher yield on interest-earning assets (7.01% versus 6.60% for the Peer Group) and is partially attributable to the relatively high ratio of loans in the portfolio. The Bank’s favorable interest expense ratio as a percent of average assets, 3.08% versus 3.28% of average assets for the Peer Group, reflects the Bank’s stronger capital ratio (i.e., the Peer Group funds operations out of IBL to a greater extent than cost-free capital), even on a pre-offering basis as the Bank’s cost of funds approximated the Peer Group median. First Savings’ interest expense ratio is expected to diminish on a pro forma basis, as the Conversion proceeds will represent interest-free funds for the Bank. Overall, the Bank’s net interest income ratio of 3.30% compared favorably to the Peer Group average of 2.91% as previously noted.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.11*

Table 3.3

Income as Percent of Average Assets and Yields, Costs, Spreads

Comparable Institution Analysis

For the 12 Months Ended March 31, 2008


		Net Income		Net Interest Income								NII After Provis.		Other Income						Total Other Income		G&A/Other Exp.				Non-Op. Items				Yields, Costs, and Spreads						MEMO: Assets/ FTE Emp.		MEMO: Effective Tax Rate
		Net Income		Income		Expense		NII		Loss Provis. on IEA		NII After Provis.		Loan Fees		R.E. Oper.		Other Income		Total Other Income		G&A Expense		Goodwill Amort.		Net Gains		Extrao. Items		Yield On Assets		Cost Of Funds		Yld-Cost Spread		MEMO: Assets/ FTE Emp.		MEMO: Effective Tax Rate
First Savings Bank, F.S.B.
March 31, 2008		0.07	%	6.39	%	3.08	%	3.30	%	0.77	%	2.54	%	0.00	%	0.00	%	0.47	%	0.47	%	2.96	%	0.00	%	0.00	%	0.00	%	7.01	%	3.67	%	3.34	%	$	3,173	32.08	%

All Public Companies
Averages		0.35	%	5.82	%	3.15	%	2.68	%	0.28	%	2.39	%	0.03	%	-0.01	%	0.44	%	0.45	%	2.54	%	0.05	%	0.24	%	0.00	%	6.19	%	3.66	%	2.53	%	$	5,918	32.27	%
Medians		0.44	%	5.76	%	3.16	%	2.69	%	0.11	%	2.49	%	0.00	%	0.00	%	0.50	%	0.51	%	2.52	%	0.00	%	0.01	%	0.00	%	6.08	%	3.66	%	2.53	%	$	5,028	32.63	%

State of IN
Averages		0.33	%	5.99	%	3.24	%	2.74	%	0.24	%	2.50	%	0.01	%	-0.06	%	0.99	%	0.94	%	2.79	%	0.02	%	-0.10	%	0.00	%	6.43	%	3.66	%	2.77	%	$	3,662	27.10	%
Medians		0.42	%	5.94	%	3.30	%	2.80	%	0.20	%	2.63	%	0.00	%	0.00	%	0.85	%	0.87	%	2.68	%	0.00	%	0.03	%	0.00	%	6.34	%	3.71	%	2.77	%	$	3,655	28.36	%

Comparable Group
Averages		0.39	%	6.19	%	3.28	%	2.91	%	0.18	%	2.73	%	0.01	%	-0.03	%	0.67	%	0.67	%	2.82	%	0.01	%	0.02	%	0.00	%	6.60	%	3.76	%	2.84	%	$	3,622	35.11	%
Medians		0.38	%	6.18	%	3.26	%	3.01	%	0.20	%	2.70	%	0.00	%	0.00	%	0.65	%	0.65	%	2.65	%	0.00	%	0.04	%	0.00	%	6.66	%	3.68	%	2.88	%	$	3,821	31.34	%

Comparable Group
ASBI	Ameriana Bancorp of New Castle IN(1)	0.28	%	5.57	%	3.28	%	2.29	%	-0.38	%	2.67	%	0.02	%	-0.13	%	1.17	%	1.06	%	3.52	%	0.00	%	0.02	%	0.00	%	6.17	%	3.63	%	2.54	%	$	2,635	NM
CFBK	Central Federal Corp. of OH	0.01	%	6.75	%	3.75	%	3.00	%	0.27	%	2.73	%	0.00	%	0.01	%	0.41	%	0.42	%	2.75	%	0.00	%	-0.18	%	0.00	%	7.12	%	4.23	%	2.89	%	$	4,531	NM
CZWI	Citizens Community Bancorp Inc. of WI	0.38	%	6.25	%	3.20	%	3.06	%	0.17	%	2.88	%	0.08	%	0.00	%	0.39	%	0.47	%	2.65	%	0.08	%	0.00	%	0.00	%	6.52	%	4.09	%	2.43	%	$	3,461	38.91	%
FFDF	FFD Financial Corp. of Dover OH	0.78	%	6.83	%	3.06	%	3.77	%	0.39	%	3.38	%	0.00	%	0.00	%	0.32	%	0.32	%	2.57	%	0.00	%	0.06	%	0.00	%	6.98	%	3.46	%	3.52	%	$	3,748	34.20	%
FBSI	First Bancshares, Inc. of MO	0.12	%	6.10	%	3.23	%	2.87	%	0.30	%	2.57	%	0.00	%	0.00	%	0.96	%	0.96	%	3.44	%	0.02	%	0.09	%	0.00	%	6.80	%	3.65	%	3.15	%	$	2,184	26.10	%
FCAP	First Capital, Inc. of IN	0.79	%	5.99	%	2.97	%	3.02	%	0.12	%	2.90	%	0.00	%	0.00	%	0.70	%	0.70	%	2.52	%	0.02	%	0.09	%	0.00	%	6.33	%	3.33	%	3.01	%	$	3,302	31.57	%
LSBI	LSB Financial Corp. of Lafayette IN	0.37	%	6.40	%	3.32	%	3.08	%	0.45	%	2.63	%	0.00	%	-0.29	%	1.41	%	1.41	%	3.27	%	0.00	%	0.05	%	0.00	%	6.81	%	3.70	%	3.11	%	$	3,894	30.87	%
LBCP	Liberty Bancorp, Inc. of MO(1)	0.60	%	6.63	%	3.48	%	3.15	%	0.24	%	2.92	%	0.03	%	-0.10	%	0.60	%	0.60	%	2.65	%	0.00	%	0.08	%	0.00	%	7.02	%	4.15	%	2.86	%	$	4,136	31.10	%
PFED	Park Bancorp of Chicago IL	-0.07	%	5.37	%	2.93	%	2.45	%	0.03	%	2.41	%	0.00	%	0.18	%	-0.10	%	-0.10	%	2.62	%	0.00	%	-0.04	%	0.00	%	5.89	%	3.47	%	2.42	%	$	4,311	62.27	%
RIVR	River Valley Bancorp of IN(1)	0.64	%	5.99	%	3.59	%	2.40	%	0.16	%	2.23	%	0.00	%	0.00	%	0.83	%	0.83	%	2.22	%	0.00	%	0.02	%	0.00	%	6.34	%	3.91	%	2.44	%	$	4,024	25.85	%

(1)	Financial information is for the quarter ending December 31, 2007.


Source:		Audited and unaudited financial statements, corporate reports and offering circulars, and RP ^® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.12*

Non-interest operating income is a slightly lower contributor to First Savings’ earnings relative to the Peer Group, at 0.47% and 0.65%, respectively, in part reflecting competitive conditions which have limited the Bank’s ability to expand fee income and a deposit composition which is heavily weighted towards CDs which generate little in the way of non-interest income.

In another key area of core earnings, the Bank maintained a higher level of operating expenses than the Peer Group. For the period covered in Table 3.3, the Bank and the Peer Group recorded operating expense to average assets ratios of 2.96% and 2.82%, respectively. The Bank’s higher level of operating expenses can in part be attributed to the additional staff the Bank has added to support implementation of business plan growth strategies, including the commercial lending initiatives. Additionally, modest assets shrinkage over the last five fiscal years has exacerbated the increase in First Savings’ operating expense ratio as the Bank’s expenses, many of which are fixed, are spread over a diminishing base of assets. Consistent with the Bank’s higher operating expense ratio, First Savings maintained a comparatively higher number of employees relative to its asset size. Assets per full time equivalent employee equaled $3.2 million for the Bank, versus a comparable measure of $3.6 million for the Peer Group.

First Savings’ efficiency ratio (operating expenses as a percent of the sum of non-interest operating income and net interest income) of 78.3% is slightly below the Peer Group’s efficiency ratio of 79.5%. While the favorable efficiency ratio would typically imply stronger core earnings for the Bank, loan loss provisions have more than offset the Bank’s advantage in this regard. The Bank’s comparatively lower ROA is the result of its significantly higher level of loan loss provisions which results from its higher NPAs and efforts to maintain ALLLs at levels required pursuant to its policies and procedures. On a post-conversion basis, the Bank’s efficiency ratio may improve marginally over the short term while management expects more significant long-term improvement as the proceeds and infrastructure investments are leveraged.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.13*

As noted above, loan loss provisions had a more significant impact on First Savings’ earnings in comparison to the Peer Group, with loan loss provisions established by the Bank and the Peer Group equaling 0.77% and 0.18% of average assets, respectively. Importantly, approximately 57% of the Bank’s loan loss provisions for the 12 months ended March 31, 2008, reflect a loan losses established for a specific group of loans to a real estate investor. Such provisions may likely be non-recurring nature and excluding this one-time provision, the Bank’s loan loss provision equals 0.33% of assets which remains modestly above the Peer Group average notwithstanding the adjustment.

Gains and losses from the sale of assets had a limited impact on earnings for both the Bank and the Peer Group for the 12 month period shown in Table 3.3. Specifically, the Bank did not report any net non-operating income while net gains average 0.03% of average assets for the Peer Group. The limited level of non-operating income for both the Bank and the Peer Group enhances their overall comparability for valuation purposes.

The Bank recorded a tax benefit for the 12 months ended March 31, 2008, compared to the Peer Group’s average tax rate of 36.40%. However, First Savings’ tax rate for fiscal 2007 equaled 34.41% which more closely approximated the Peer Group average. The Bank expects that its effective tax rate will continue to approximate the recent historical level reported over the last several fiscal years which approximates the average tax rate of the Peer Group.

Loan Composition

Table 3.4 presents data related to the Bank’s and the Peer Group’s loan portfolio compositions, as well as data pertaining to investment in mortgage-backed securities, loans serviced for other and risk weighted assets. The information presented for the Bank reflects financial data as of March 31, 2008, while the Peer Group reflects data as of December 31, 2007 or March 31, 2008. In comparison to the Peer Group, the Bank maintained a relatively similar investment in MBS based on a ratio of 5.1% of assets for the Bank and 5.9% for the Peer Group on average. However, the Bank was more


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.14*

Table 3.4

Loan Portfolio Composition and Related Information

Comparable Institution Analysis

As of March 31, 2008


Institution		Portfolio Composition as a Percent of Assets												RWA/ Assets		Serviced For Others		Servicing Assets
Institution		MBS		1-4 Family		Constr. & Land		5+Unit Comm RE		Commerc. Business		Consumer		RWA/ Assets		Serviced For Others		Servicing Assets
		(%)		(%)		(%)		(%)		(%)		(%)		(%)		($000)		($000)
First Savings Bank, F.S.B.		5.07	%	56.65	%	7.91	%	9.65	%	4.90	%	2.91	%	60.38	%	$	11,690	$	0

All Public Companies
Averages		11.40	%	36.55	%	6.84	%	19.07	%	4.34	%	2.87	%	64.33	%	$	1,704,944	$	21,074
Medians		8.49	%	35.33	%	4.96	%	17.54	%	2.80	%	0.64	%	64.96	%	$	30,250	$	98

State of IN
Averages		5.56	%	37.12	%	6.49	%	20.78	%	5.27	%	4.00	%	69.36	%	$	80,259	$	517
Medians		5.60	%	36.68	%	6.78	%	21.16	%	5.23	%	1.83	%	72.22	%	$	68,910	$	348

Comparable Group
Averages		5.94	%	33.71	%	8.30	%	22.18	%	5.52	%	5.62	%	71.65	%	$	45,956	$	308
Medians		6.07	%	34.61	%	6.87	%	21.16	%	5.00	%	2.68	%	72.22	%	$	17,225	$	80

Comparable Group
ASBI	Ameriana Bancorp of New Castle IN(1)	7.38	%	32.74	%	11.01	%	19.65	%	3.75	%	1.16	%	72.17	%	$	134,000	$	866
CFBK	Central Federal Corp. of OH	7.38	%	20.27	%	6.68	%	41.56	%	12.94	%	3.19	%	85.39	%	$	26,340	$	157
CZWI	Citizens Community Bancorp Inc. of WI	10.90	%	45.14	%	0.05	%	0.04	%	0.00	%	33.53	%	63.16	%	$	0	$	0
FFDF	FFD Financial Corp. of Dover OH	0.18	%	35.33	%	3.92	%	34.94	%	9.75	%	4.01	%	77.27	%	$	79,790	$	641
FBSI	First Bancshares, Inc. of MO	12.94	%	31.52	%	8.20	%	17.27	%	3.69	%	4.57	%	65.37	%	$	0	$	0
FCAP	First Capital, Inc. of IN	5.35	%	42.55	%	6.50	%	13.70	%	6.02	%	5.03	%	64.09	%	$	550	$	3
LSBI	LSB Financial Corp. of Lafayette IN	1.37	%	40.10	%	7.39	%	31.07	%	5.35	%	0.69	%	73.74	%	$	132,760	$	1,131
LBCP	Liberty Bancorp, Inc. of MO(1)	5.38	%	14.83	%	27.21	%	23.33	%	4.65	%	0.41	%	79.03	%	$	8,110	$	0
PFED	Park Bancorp of Chicago IL	6.75	%	40.68	%	5.02	%	17.55	%	0.00	%	2.18	%	64.04	%	$	0	$	0
RIVR	River Valley Bancorp of IN(1)	1.81	%	33.90	%	7.06	%	22.68	%	9.10	%	1.44	%	72.27	%	$	78,010	$	284

(1)	Financial information is for the quarter ending December 31, 2007.


Source:		SNL Financial LC. and RP ^® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.15*

heavily invested in 1-4 family whole mortgage loans than the Peer Group based on their respective ratios equal to 56.7% and 33.7% of total assets. Taken together, permanent 1-4 family residential mortgage loans and MBS equaled 61.7% and 39.7% of assets for the Bank and the Peer Group, respectively.

Importantly, we believe that the high level of residential mortgage loans secured by investment properties (estimated at 28.0% of the residential mortgage portfolio) may be a risk factor in First Savings residential mortgage portfolio in comparison to the Peer Group. At the same time, the level of lending to investors by the Peer Group companies is uncertain as it is not a required disclosure item for public companies.

Diversification into high risk-weight loans was not as significant for the Bank in comparison to the Peer Group. In this regard, the ratio of construction, commercial real estate/multi-family, C&I and consumer non-mortgage loans as a percent of assets all exceeded the Bank’s level of investment. Accordingly, the Bank’s ratio or risk-weighted assets /assets equal 60.38% was below the Peer Group’s average ratio of 71.65%. The Peer Group’s loan servicing portfolio was relatively modest and averaged $49.6 million, but nonetheless exceeded the Bank’s portfolio of loans serviced for others which equaled $11.7 million.

Credit Risk

The ratio of NPAs/assets equaled 2.50% for the Bank versus an average of 1.46% for the Peer Group and an average of 1.25% for all publicly traded thrifts as shown in Table 3.5. The Bank’s NPAs included REO equal to 0.53% of assets (versus 0.28% of assets for the Peer Group) and non-performing loans equal to 2.32% of loans versus an average of 1.03% of loans for the Peer Group. The Bank maintained a similar level of loss reserves as a percent of non-performing assets (47.05% versus 48.76% for the Peer Group, although complete financial data was available for only 8 of the 10 Peer Group companies in this regard). Chargeoffs were lower for the Bank in comparison to the Peer Group although First Savings expects that its level of chargeoffs may be subject to increase in the future as the non-performing investor loans secured by residential properties are foreclosed with the assets written down with the reduction charged to ALLLs.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.16*

Table 3.5

Credit Risk Measures and Related Information

Comparable Institution Analysis

As of March 31, 2008 or Most Recent Date Available


Institution		REO/ Assets		NPAs & 90+Del/ Assets		NPLs/ Loans		Rsrves/ Loans		Rsrves/ NPLs		Rsrves/ NPAs & 90+Del		Net Loan Chargoffs			NLCs/ Loans
		(%)		(%)		(%)		(%)		(%)		(%)		($000)			(%)
First Savings Bank, F.S.B.		0.53	%	2.50	%	2.32	%	1.43	%	61.83	%	47.05	%	$	(273	)	-0.16	%

All Public Companies
Averages		0.16	%	1.25	%	1.27	%	1.00	%	177.33	%	138.96	%	$	486		0.13	%
Medians		0.04	%	0.60	%	0.68	%	0.88	%	128.21	%	90.12	%	$	114		0.05	%

State of IN
Averages		0.22	%	2.16	%	1.85	%	0.94	%	60.65	%	44.18	%	$	274		0.24	%
Medians		0.13	%	2.05	%	1.37	%	0.97	%	60.90	%	35.39	%	$	172		0.20	%

Comparable Group
Averages		0.36	%	1.41	%	1.08	%	0.89	%	95.15	%	63.10	%	$	207		0.31	%
Medians		0.15	%	1.37	%	1.16	%	0.93	%	69.98	%	47.29	%	$	181		0.21	%

Comparable Group
ASBI	Ameriana Bancorp of New Castle IN(1)	0.00	%	NA		1.39	%	0.97	%	69.98	%	NA		$	139		0.19	%
CFBK	Central Federal Corp. of OH	0.00	%	0.58	%	0.71	%	1.19	%	168.15	%	168.15	%	$	179		0.31	%
CZWI	Citizens Community Bancorp Inc. of WI	0.04	%	0.50	%	0.56	%	0.31	%	55.39	%	50.50	%	$	111		0.13	%
FFDF	FFD Financial Corp. of Dover OH	0.00	%	0.72	%	0.81	%	0.80	%	98.38	%	98.38	%	$	208		0.52	%
FBSI	First Bancshares, Inc. of MO	0.40	%	1.56	%	1.16	%	1.35	%	NA		59.17	%	$	228		0.56	%
FCAP	First Capital, Inc. of IN	0.25	%	1.41	%	1.33	%	0.69	%	51.82	%	35.39	%	$	182		0.22	%
LSBI	LSB Financial Corp. of Lafayette IN	0.93	%	3.26	%	2.15	%	1.07	%	49.71	%	28.37	%	$	675		0.89	%
LBCP	Liberty Bancorp, Inc. of MO(1)	0.77	%	1.95	%	1.34	%	1.22	%	NA		44.07	%	$	275		0.12	%
PFED	Park Bancorp of Chicago IL	1.17	%	1.33	%	0.25	%	0.43	%	172.63	%	20.75	%	$	22		0.06	%
RIVR	River Valley Bancorp of IN(1)	0.00	%	NA		NA		0.89	%	NA		NA		$	53		0.08	%

(1)	Financial information is for the quarter ending December 31, 2007.


Source:		Audited and unaudited financial statements, corporate reports and offering circulars, and RP ^® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.17*

The Bank maintains allowances for loan and lease losses (“ALLL”) to total loans which exceeded the Peer Group average. Specifically, the ratio of reserves to total loans equaled 1.43% for the Bank versus an average and median ratio for the Peer Group equal to 0.86% and 0.89%, respectively. However, as noted above, reserve coverage in relation to NPAs is similar and the higher reserves in relation to total loans are warranted by the recent increase in NPAs.

Interest Rate Risk

Table 3.6 reflects various key ratios highlighting the relative interest rate risk exposure. From a balance sheet perspective, First Savings’ higher pre-conversion capital position and stronger IEA/IBL ratio suggest lower interest rate risk exposure. On a post-conversion basis, these ratios will improve increasing their overall favorability in relation to the Peer Group. In the absence of comparability in timely interest rate risk reporting and methodology, we reviewed quarterly changes in the net interest income ratio.

To analyze interest rate risk associated with the net interest margin, we also reviewed quarterly changes in net interest income as a percent of average assets for First Savings and the Peer Group. In general, the recent relative fluctuations in the Bank’s net interest income to average assets ratios were considered to be more than the Peer Group, and thus, based on the interest rate environment that prevailed during the period analyzed in Table 3.6, First Savings was viewed as maintaining a higher degree of interest rate risk exposure in the net interest margin. At the same time, the Bank’s net interest income ratio should stabilize to some degree following the conversion stock offering, given the initial expected proceeds reinvestment strategy (primarily short-to-intermediate term investment securities).


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.18*

Table 3.6

Interest Rate Risk Measures and Net Interest Income Volatility

Comparable Institution Analysis

As of March 31, 2008 or Most Recent Date Available


Institution		Balance Sheet Measures						Quarterly Change in Net Interest Income
		Equity/ Assets		IEA/ IBL		Non-Earn. Assets/ Assets		Quarterly Change in Net Interest Income
		Equity/ Assets		IEA/ IBL		Non-Earn. Assets/ Assets		3/31/2008	12/31/2007	9/30/2007	6/30/2007	3/31/2007	12/31/2006
		(%)		(%)		(%)		(change in net interest income is annualized in basis points)
First Savings Bank, F.S.B.		13.8	%	113.1	%	3.1	%	-30	-23	18	2	6	5

All Public Companies		11.1	%	109.4	%	5.7	%	-1	-2	-1	2	0	-7
State of IN		9.6	%	105.0	%	7.1	%	1	5	-3	9	6	-3

Comparable Group
Averages		10.8	%	107.0	%	6.0	%	-7	0	-2	2	-1	-8
Medians		10.1	%	106.3	%	5.6	%	-9	2	2	3	0	-7

Comparable Group
ASBI	Ameriana Bancorp of New Castle IN(1)	7.7	%	100.2	%	10.0	%	NA	15	0	16	22	12
CFBK	Central Federal Corp. of OH	10.0	%	106.7	%	4.7	%	-11	7	4	-8	-3	-7
CZWI	Citizens Community Bancorp Inc. of WI	16.1	%	118.1	%	3.9	%	-9	-16	-28	-9	5	NA
FFDF	FFD Financial Corp. of Dover OH	10.1	%	109.9	%	2.0	%	-10	-11	21	-9	-18	-7
FBSI	First Bancshares, Inc. of MO	10.9	%	105.4	%	6.7	%	8	22	4	16	-23	-4
FCAP	First Capital, Inc. of IN	9.0	%	105.9	%	5.6	%	10	2	0	7	3	-1
LSBI	LSB Financial Corp. of Lafayette IN	9.6	%	105.2	%	5.6	%	-4	-30	4	-2	10	-23
LBCP	Liberty Bancorp, Inc. of MO(1)	14.1	%	108.7	%	7.1	%	NA	-1	-23	-8	-16	-24
PFED	Park Bancorp of Chicago IL	13.4	%	106.7	%	9.3	%	-30	9	-8	7	14	-29
RIVR	River Valley Bancorp of IN(1)	7.3	%	102.8	%	5.5	%	NA	1	7	10	-9	14

(1)	Financial information is for the quarter ending December 31, 2007.

NA=Change is greater than 100 basis points during the quarter.


Source:		Audited and unaudited financial statements, corporate reports and offering circulars, and RP ^® Financial, LC. calculations. The information provided in this table has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*PEER GROUP ANALYSIS*
		*III.19*

Summary

Based on the above analysis and the criteria employed in the selection of the companies for the Peer Group, RP Financial concluded that the Peer Group forms a reasonable basis for determining the pro forma market value of First Savings. Such general characteristics as asset size, capital position, interest-earning asset composition, funding composition, core earnings measures, loan composition, credit quality and exposure to interest rate risk all tend to support the reasonability of the Peer Group from a financial standpoint. Those areas where differences exist will be addressed in the form of valuation adjustments to the extent necessary.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.1*

IV. VALUATION ANALYSIS

Introduction

This chapter presents the valuation analysis and methodology, prepared pursuant to the regulatory valuation guidelines, and valuation adjustments and assumptions used to determine the estimated pro forma market value of the common stock to be issued in conjunction with the Bank’s conversion transaction. The valuation incorporates the appraisal methodology promulgated by the Federal and state banking agencies for standard conversions and mutual holding Bank offerings, particularly regarding selection of the Peer Group, fundamental analysis on both the Bank and the Peer Group, and determination of the Bank’s pro forma market value utilizing the market value approach.

Appraisal Guidelines

The OTS written appraisal guidelines specify the market value methodology for estimating the pro forma market value of an institution pursuant to a mutual-to-stock conversion. Pursuant to this methodology: (1) a peer group of comparable publicly-traded institutions is selected; (2) a financial and operational comparison of the subject company to the peer group is conducted to discern key differences; and (3) a valuation analysis in which the pro forma market value of the subject company is determined based on the market pricing of the peer group as of the date of valuation, incorporating valuation adjustments for key differences. In addition, the pricing characteristics of recent conversions, both at conversion and in the aftermarket, must be considered.

RP Financial Approach to the Valuation

The valuation analysis herein complies with such regulatory approval guidelines. Accordingly, the valuation incorporates a detailed analysis based on the Peer Group, discussed in Chapter III, which constitutes “fundamental analysis” techniques. Additionally, the valuation incorporates a “technical analysis” of recently completed


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.2*

stock conversions, including closing pricing and aftermarket trading of such offerings. It should be noted that these valuation analyses cannot possibly fully account for all the market forces which impact trading activity and pricing characteristics of a particular stock on a given day.

The pro forma market value determined herein is a preliminary value for the Company’s to-be-issued stock. Throughout the conversion process, RP Financial will: (1) review changes in First Savings’ operations and financial condition; (2) monitor First Savings’ operations and financial condition relative to the Peer Group to identify any fundamental changes; (3) monitor the external factors affecting value including, but not limited to, local and national economic conditions, interest rates, and the stock market environment, including the market for thrift stocks; and (4) monitor pending conversion offerings (including those in the offering phase), both regionally and nationally. If material changes should occur during the conversion process, RP Financial will evaluate if updated valuation reports should be prepared reflecting such changes and their related impact on value, if any. RP Financial will also prepare a final valuation update at the closing of the offering to determine if the prepared valuation analysis and resulting range of value continues to be appropriate.

The appraised value determined herein is based on the current market and operating environment for the Bank and for all thrifts. Subsequent changes in the local and national economy, the legislative and regulatory environment, the stock market, interest rates, and other external forces (such as natural disasters or major world events), which may occur from time to time (often with great unpredictability) may materially impact the market value of all thrift stocks, including First Savings’ value, or First Savings’ value alone. To the extent a change in factors impacting the Bank’s value can be reasonably anticipated and/or quantified, RP Financial has incorporated the estimated impact into the analysis.

Valuation Analysis

A fundamental analysis discussing similarities and differences relative to the Peer Group was presented in Chapter III. The following sections summarize the key


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.3*

differences between the Bank and the Peer Group and how those differences affect the pro forma valuation. Emphasis is placed on the specific strengths and weaknesses of the Bank relative to the Peer Group in such key areas as financial condition, profitability, growth and viability of earnings, asset growth, primary market area, dividends, liquidity of the shares, marketing of the issue, management, and the effect of government regulations and/or regulatory reform. We have also considered the market for thrift stocks, in particular new issues, to assess the impact on value of the Bank coming to market at this time.

1.	Financial Condition

The financial condition of an institution is an important determinant in pro forma market value because investors typically look to such factors as liquidity, capital, asset composition and quality, and funding sources in assessing investment attractiveness. The similarities and differences in the Bank’s and the Peer Group’s financial strengths are noted as follows:

•

Overall A/L Composition . Loans and investments funded by retail deposits were the primary components of the Bank’s and Peer Group’s balance sheets. The Bank’s interest-earning asset composition exhibited a higher concentration of loans with a greater concentration of residential mortgage loans while the Peer Group’s balance sheet was included greater diversification into high risk weight loans. First Savings’ funding composition reflected a modestly higher level of deposits and a lower level of borrowings than the comparable Peer Group ratios. Overall, as a percent of assets, the Bank maintained a slightly higher level of interest-earning assets and a lower level of interest-bearing liabilities compared to the Peer Group, which provided for a higher IEA/IBL ratio for the Bank, even on a pre-conversion basis.

•

Credit Quality . Based on the level of NPAs and reserves, the Bank’s credit quality seems to be less favorable than the Peer Group. NPAs/Assets exceeded the Peer Group average. Loss reserves as a percent of loans were higher for the Bank while loss reserves as a percent of NPAs were comparable. Chargeoffs were lower for the Bank in comparison to the Peer Group although First Savings expects its chargeoffs to increase in the future as the non-performing investor loans secured by residential properties are taken into REO. Additionally, the high level of investor loans securing the residential mortgage loan portfolio may pose another risk factor relative to the Peer Group.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.4*

•

Balance Sheet Liquidity . The Bank operated with a lower level of cash and investment securities relative to the Peer Group (16.5% of assets versus 18.6% for the Peer Group). Following the infusion of stock proceeds, the Bank’s cash and investments ratio is expected to increase as the proceeds retained at the holding company level will be initially deployed into investments. The Bank’s future borrowing capacity was considered to be slightly greater than the Peer Group’s, given the lower level of borrowings currently maintained by the Bank

•

Funding Liabilities . Retail deposits served as the primary interest-bearing source of funds for the Bank and the Peer Group, with the Bank maintaining a higher deposits-to-assets ratio than the Peer Group while the ratio of borrowings was lower. In total, the Bank maintained a lower level of interest-bearing liabilities than the Peer Group which, coupled with its relatively lower cost of funds, translated into a comparatively lower ratio of net interest expense to average assets. Following the stock offering, the infusion of stock proceeds can be expected to support an increase in the Bank’s capital ratio and a resulting decline in the level of interest-bearing liabilities maintained as a percent of assets.

•

Capital . The Bank maintains an equity-to-assets ratio which exceeds the Peer Group average even on a pre-conversion basis. Accordingly, following the stock offering, First Savings’ pro forma capital position will well exceed the Peer Group's equity-to-assets ratio. The increase in the Bank’s pro forma capital position will result in greater leverage potential and reduce the level of interest-bearing liabilities utilized to fund assets. At the same time, the Bank’s more significant capital surplus will likely suppress the pro forma ROE over the short to intermediate term.

On balance, First Savings’ balance sheet strength was comparable to the Peer Group and, thus, no adjustment was applied for the Bank’s financial condition.

2.	Profitability, Growth and Viability of Earnings

Earnings are a key factor in determining pro forma market value, as the level and risk characteristics of an institution’s earnings stream and the prospects and ability to generate future earnings heavily influence the multiple that the investment community will pay for earnings. The major factors considered in the valuation are described below.

•

Reported Earnings . The Bank reported lower profitability than the Peer Group for the most recent 12 months due to relatively high loan loss provisions and operating expense ratio. While profitability is expected to improve on a pro forma basis over the long term, pro forma ROA is expected


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.5*

to remain at a disadvantage initially. In addition, there remain certain unknown aspects of future earnings, such as the ability to realize profitable growth objectives that cover the anticipated investments in branches and personnel.

•

Core Earnings . Non-operating items are limited for both the Bank and the Peer Group. Thus, First Savings’ core earnings are expected to remain below the Peer Group’s on a pro forma basis over the near term following the Conversion. While we have not made an explicit adjustment to core earnings for the current level of loan loss provision which is above the historical average, the valuation analysis takes into consideration the fact that approximately 63% of the Bank’s loan loss provisions for the 12 months ended March 31, 2008, are attributable to loan losses established for a specific group of loans to a real estate investor.

•

Interest Rate Risk . Quarterly changes in the Bank’s and the Peer Group’s net interest income to average assets ratios indicated that a slightly higher degree of volatility was associated with the Bank’s net interest margin. First Savings’ capital ratios, IEA/IBL ratios and level of non-interest earning assets were favorable even on a pre-Conversion basis and will improve with the infusion of the Conversion proceeds.

•

Credit Risk . The Bank’s credit risk exposure was comparatively greater than the Peer Group’s based on its higher ratio of NPAs, which included a comparatively greater level of both REO and non-performing loans. While the ratio of ALLLs to total loans is greater for the Bank, the ratio in comparison to NPAs is similar to the Peer Group’s ratio. While chargeoffs were lower for the Bank in comparison to the Peer Group, First Savings expects its chargeoffs to increase in the future as the non-performing investor loans secured by residential properties are taken into REO. Furthermore, the Bank is believed to have a relatively high proportion of investor loan securing its 1-4 family residential mortgage loan portfolio in comparison to the Peer Group.

•

Earnings Growth Potential . The Bank’s total assets and deposits have been shrinking over the last five fiscal years in contrast to modest growth reported by the Peer Group companies. The Bank’s strong equity/assets ratio currently in comparison to the Peer Group coupled with the capital to be raised will provide an ample ability to expand the balance sheet. Moreover, management expects that on-going infrastructure investments (i.e., in fixed assets, personnel, etc.) and the building of commercial account relationships may enhance the long-term earnings growth potential. At the same time, such expenditures may depress near-term earnings growth potential and involve execution risk that management may not achieve the targeted portfolio goals for the Bank or that such activities may not be as profitable as currently anticipated.

•

Return on Equity . Bank’s pro forma capital position will exceed the Peer Group average. Coupled with its lower pro forma ROA, the Bank’s pro forma core ROE is anticipated to be lower than the Peer Group average over the near term.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.6*

Overall, we concluded that a moderate downward adjustment for profitability, growth and viability of earnings was appropriate, in view of First Savings lower pro forma ROA and ROE, as well as the factors relating to the Bank’s credit risk and interest rate exposure and earnings growth potential.

3.	Asset Growth

First Savings’ asset growth rate was modestly below the Peer Group average and balance sheet growth has been limited over the last five fiscal years. At the same time, several senior management officers are relatively new to the Bank and are seeking to implement a more growth oriented business plan. On a pro forma basis, the Bank’s tangible equity-to-assets ratio will exceed the Peer Group's tangible equity-to-assets ratio, indicating greater leverage capacity for the Bank. On balance, we concluded that a slight upward adjustment was warranted for asset growth.

4.	Primary Market Area

The general condition of an institution’s market area has an impact on value, as future success is in part dependent upon opportunities for profitable activities in the local market served. The Bank’s primary market area is in southern Indiana within the Louisville metropolitan area. The region served by the Bank’s branches continues to transform from a manufacturing based economy to a more services oriented economic base. The moderate economic growth in the primary market area has provided for slow to moderate demographic growth trends.

In general the Peer Group companies also operate in slow to moderate growth markets which are generally similar to those served by the Bank Specifically, growth trends for Clark County were generally favorable in relation to the Peer Group average and median while growth trends in Floyd County were generally at the lower end of the Peer Group range (see Table 4.1).


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.7*

Table 4.1

First Savings Bank, F.S.B.

Peer Group Market Area Comparative Analysis


									Per Capita Income
	Headquarters City	Estimated Population		Projected Population 2012	Estimated 2000-2007 % Change		Projected 2007-2012 % Change		Amount		% State Average		6/30/07 Deposit Market Share(1)		Unemployment Rate 3/31/2008
Institution	Headquarters City	2000	2007	Projected Population 2012	Estimated 2000-2007 % Change		Projected 2007-2012 % Change		Amount		% State Average		6/30/07 Deposit Market Share(1)		Unemployment Rate 3/31/2008
		(000)	(000)	(000)
Ameriana Bncp of New Castle IN	Henry	49	47	46	-2.66	%	-2.44	%	$	24,316	92.22	%	37.80	%	7.0	%
Central Federal Corp. of OH	Summit	543	548	550	0.90	%	0.42	%	$	28,918	107.63	%	0.76	%	5.8	%
Citizens Comm Bncorp Inc of WI	Eau Claire	93	98	100	4.93	%	2.61	%	$	25,684	93.10	%	8.49	%	4.8	%
FFD Financial Corp of Dover OH	Tuscarawas	91	93	94	2.08	%	1.33	%	$	21,262	79.14	%	10.39	%	6.4	%
First Bancshares, Inc. of MO	Wright	18	18	18	0.83	%	0.34	%	$	16,270	63.87	%	24.15	%	7.2	%
First Capital, Inc. of IN	Harrison	34	37	40	8.86	%	5.87	%	$	24,068	91.28	%	38.56	%	5.6	%
LSB Fin. Corp. of Lafayette IN	Tippecanoe	149	161	169	7.96	%	5.14	%	$	25,857	98.07	%	13.88	%	4.9	%
Liberty Bancorp, Inc. of MO	Clay	184	206	224	12.18	%	8.57	%	$	29,677	116.49	%	4.49	%	4.8	%
Park Bancorp of Chicago IL	Cook	5,377	5,407	5,407	0.57	%	-0.01	%	$	29,578	100.27	%	0.05	%	5.6	%
River Valley Bancorp of IN	Jefferson	32	33	33	3.05	%	2.33	%	$	23,042	87.39	%	49.38	%	5.8	%

	Averages:	657	665	668	3.87	%	2.42	%	$	24,867	92.95	%	18.80	%	5.8	%
	Medians:	92	95	97	2.57	%	1.83	%	$	25,000	92.66	%	12.14	%	5.7	%

First Savings Bank, F.S.B.	Clark	96	106	114	10.07	%	6.98	%	$	25,668	97.35	%	13.29	%	4.7	%
	Floyd	71	73	75	3.66	%	2.40	%	$	27,884	105.76	%	1.18	%	4.4	%

(1)	Total institution deposits in headquarters county as percent of total county deposits (banks and thrifts only).

Sources: SNL.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.8*

Per capita income measures for Clark and Floyd Counties were slightly higher than the comparable median and average income measures for the Peer Group’s markets. In this regard, most of the Peer Group companies are based in Midwestern markets outside of the largest metropolitan areas (i.e., similar to the Bank’s mid-sized metropolitan market). To the extent unemployment rates provide an indicator into the strength of a local economy, the Bank’s market was favorable with both Clark and Floyd Counties posting unemployment rates below the average and medians for the Peer Group’s market areas.

In general, with several exceptions, the Peer Group companies operate in small to mid-sized markets in the Midwest. Given the selection criteria which emphasized institutions with less than $1 billion of total assets, the Peer Group institutions necessarily hold a relatively small market share of their respective markets overall. Thus, the Banks deposit market share of 13.3% of the Clark County market falls between the average and median ratios for the Peer Group companies.

On balance, we concluded that a slight upward adjustment was appropriate for the Bank market area in comparison to the Peer Group’s markets.

Dividends

At this time the Bank has not established a dividend policy. Future declarations of dividends by the Board of Directors will depend upon a number of factors, including investment opportunities, growth objectives, financial condition, profitability, tax considerations, minimum capital requirements, regulatory limitations, stock market characteristics and general economic conditions.

Nine of the ten of the Peer Group companies pay regular cash dividends, with implied dividend yields ranging from 0.98% to 5.41%. The average dividend yield on the stocks of the Peer Group institutions equaled 1.60% as of May 16, 2008. As of May 16, 2008, approximately 77% of all publicly-traded thrifts had adopted cash dividend policies (see Exhibit IV-1), exhibiting an average yield of 2.59%. The dividend paying thrifts generally maintain higher than average profitability ratios, facilitating their ability to pay cash dividends.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.9*

While the Bank has not established a definitive dividend policy prior to converting, the Bank will have the capacity to pay a dividend comparable to the Peer Group’s average dividend yield based on its weaker pro forma earnings and stronger pro forma capitalization. On balance, we concluded that no adjustment was warranted for this factor.

6.	Liquidity of the Shares

The Peer Group is by definition composed of companies that are traded in the public markets. All 10 of the Peer Group members trade on the NASDAQ Market. Typically, the number of shares outstanding and market capitalization provides an indication of how much liquidity there will be in a particular stock. The market capitalization of the Peer Group companies ranged from $14.8 million to $56.5 million as of May 16, 2008, with average and median market values of $30.4 million and $26.2 million, respectively. The shares issued and outstanding to the public shareholders of the Peer Group members ranged from 1.1 million to 6.8 million, with average and median shares outstanding of 2.9 million and 2.2 million, respectively. The Bank’s stock offering is expected to have a pro forma market value that will be fairly comparable to the average and median market values indicated for the Peer Group, while shares outstanding for the Bank will be in the upper end of the range of shares outstanding indicated for Peer Group companies. Like the large majority of the Peer Group companies, the Bank’s stock will be quoted on the NASDAQ Capital Market following the stock offering. Overall, we anticipate that the Bank’s public stock will have a comparable trading market as the Peer Group companies on average and, therefore, concluded no adjustment was necessary for this factor.

7.	Marketing of the Issue

We believe that three separate markets exist for thrift stocks, including those coming to market such as First Savings: (1) the after-market for public companies, in which trading activity is regular and investment decisions are made based upon financial condition, earnings, capital, ROE, dividends and future prospects; (2) the new issue market in which converting thrifts are evaluated on the basis of the same factors,


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.10*

but on a pro forma basis without the benefit of prior operations as a fully-converted publicly-held company and stock trading history; and (3) the acquisition market for thrift franchises in Indiana. All three of these markets were considered in the valuation of the Bank’s to-be-issued stock.

The Public Market

The value of publicly-traded thrift stocks is easily measurable, and is tracked by most investment houses and related organizations. Exhibit IV-1 provides pricing and financial data on all publicly-traded thrifts. In general, thrift stock values react to market stimuli such as interest rates, inflation, perceived industry health, projected rates of economic growth, regulatory issues and stock market conditions in general. Exhibit IV-2 displays historical stock market trends for various indices and includes historical stock price index values for thrifts and commercial banks. Exhibit IV-3 displays historical stock price indices for thrifts only.

In terms of assessing general stock market conditions, the performance of the overall stock market has been mixed over the past year. Stocks rallied higher in mid-May 2007, with the upturn being supported by a new wave of corporate deals, lower oil prices and a stronger than expected reading for May consumer confidence. Comparatively, profit taking and concerns about a pullback in China’s stock market caused stocks to head lower in late-May. Inflation worries and higher rates pushed stocks lower in early-June, while a strong retail sales report for May triggered a rebound in the stock market in mid-June. Stocks generally traded lower in the second half of June on continued inflation concerns, as well as higher oil prices and weakness in the housing market.

The broader stock market showed a positive trend at the start of third quarter of 2007, with the DJIA closing at record highs in mid-July. A positive report on manufacturing activity in June, healthy job growth reflected in the June employment report and merger news contributed to the stock market rally. A favorable second quarter earnings report by IBM helped the DJIA close above the 14000 mark heading into late-July, which was followed a general downturn in stocks during late-July and early-August. Stocks were driven lower by fears that the housing slump was spreading


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.11*

to the broader economy and concerns of a widening credit crunch prompted by home mortgage lenders cutting off credit or raising rates for a growing number of borrowers. The stock market turned highly volatile in mid-August, reflecting mixed economic news and the ongoing fallout from the credit crisis. Volatility in the stock market continued to prevail through the end of August, based on concerns about the impact of the credit crunch on the economy and speculation about whether or not the Federal Reserve would cut rates at its September meeting. A disappointing employment report for August, which showed a drop in jobs for the first time in four years, caused stocks to plummet in early-September. However, upbeat news about consumer demand boosted stocks in mid-September ahead of the Federal Reserve meeting. Stocks soared on news of the Federal Reserve’s decision to cut the federal funds rate by a half of percentage point rate, which exceeded the quarter point rate cut most economists had expected. The larger than expected rate cut generally sustained the positive trend in the broader stock market through the end of the third quarter.

The DJIA started the fourth quarter of 2007 soaring to a record high, which was followed by an uneven market for stocks going into mid-October amid uncertainty over forthcoming third quarter earnings reports. Lackluster earnings and credit concerns sparked a mid-October sell-off, as Standard & Poor’s reduced its rating on more than 1,400 types of residential mortgage-backed securities. Stocks rebounded somewhat in late-October, supported by some good third quarter earnings in the technology sector and the Federal Reserve’s decision to cut rates by a quarter point as expected. Fresh concerns about problems in the credit markets becoming worse, fears of soaring energy prices and the dollar falling caused stocks to plummet in early-November. Following a close below 13000, the DJIA had a one day rebound of over 300 points on bargain hunting. Stocks pulled back heading into the second half of November, reflecting concerns that the weak housing market would depress consumer spending and expectations of more write-downs to be taken on risky debt. Stocks rebounded in late-November and early-December, amid growing expectations that the Federal Reserve would cut rates at its mid-December meeting. News of a 0.25% rate cut by the Federal Reserve sent stocks sharply lower in mid-December 2007, as some investors had hoped for a more significant rate cut. Credit worries and downgrades of


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.12*

several bellwether stocks also contributed to the mid-December pullback in the broader stock market. Weak economic data and expectations that fourth quarter earnings would reflect more large write-downs of subprime mortgage debt by some of the world’s largest banks weighed on stocks in year end trading.

The downward trend in stocks continued at the start of 2008, as mounting concerns about the economy, higher oil prices and news of more large write-downs taken on subprime mortgages and debt all contributed to the negative sentiment in the stock market. IBM’s strong earnings report for the fourth provided a boost to the stock market in mid-January. Stocks tumbled sharply lower heading into the second half of January on investors’ fears of more damage to come from the subprime mortgage crisis following huge fourth quarter losses reported by Citigroup and Merrill Lynch. A surprise 0.75% rate cut by the Federal Reserve on January 22, 2008 helped to limit damage from the prior day’s sell-off in the global markets, which was spurred by fears that a U.S. recession would slow economic growth in the foreign markets as well. News of a possible bond-insurance bailout triggered a sharp mid-day rebound in the DJIA the day following the rate cut, as the DJIA recovered almost 600 points from morning lows and closed up almost 300 points for the day. Following three consecutive sessions of gains, stocks closed lower at the end of the week on profit taking. Some positive economic data and a second rate cut by the Federal Reserve in nine days helped the broader stock market to close out January on an upbeat note.

Recession fears, fueled by a decline in January service-sector activity, triggered a broad based sell-off in the stock market in early-February 2008. A favorable retail sales report for January helped stocks to rebound in mid-January, which was followed by a downward trend heading into late-February amid higher oil prices, more weak economic data and signs of stagflation. Following a brief rally, stocks plunged at the end of February on concerns about the ongoing credit crisis and rising oil prices. Escalating problems in the bond market and weak economic data, which included job losses in the February employment report and a record number of homes entering foreclosure in the fourth quarter, extended the downturn in the broader stock market during the first part of March. Stocks soared higher heading into mid-March after the


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.13*

Federal Reserve said it would lend Wall Street $200 billion in a move aimed at taking difficult to trade securities temporarily out of circulation. The stock market experienced heightened volatility in mid-March, with the DJIA swinging significantly higher or lower on a daily basis. Stocks declined sharply on news of Bear Stearns’ collapse, which was followed by a more than 400 point increase in the DJIA. The surge in stocks was supported by the Federal Reserve cutting its target rate by 0.75% to 2.25% and Goldman Sachs and Lehman Brothers reporting better than expected earnings. Stocks tumbled the following day, with the DJIA declining by almost 300 points on renewed worries about the economy. Led by financial stocks, the stock market rebounded strongly heading into late-March. Major contributors to the rally in financial stocks were Fannie Mae and Freddie Mac, which rebounded on easing of regulatory constraints, and J.P. Morgan’s increased bid for Bear Stearns from $2 a share to $10 a share. Concerns about the broader economy pressured stocks lower at the close of the first quarter. Overall, the first quarter of 2008 was the worst quarter for the DJIA in five and one-half years, as a 7.6% decline was recorded in the DJIA for the first quarter.

Stocks surged higher at the start of the second quarter of 2008, with the DJIA posting a gain of almost 400 points on news that two major financial firms with significant credit risk issues took steps with to shore up their capital. Uncertainty over first quarter earnings reports provided for a narrow trading range heading in mid-April, which was followed by a downturn in the broader stock market. Stocks retreated after a disappointing first quarter earnings report from General Electric stoked concerns about the health of both corporate profits and the economy in general. Some better-than-expected first quarter earnings reports provided a boost to stocks in mid-April, which was followed by a narrow trading range through the end of April amid mixed earnings reports and the Federal Reserve’s decision to cut its target rate by 0.25% as expected. The broader stock market started May on a positive note, but then led by a sell-off in financial stocks reversed course heading into mid-May. Higher oil prices and ongoing concerns of eroding credit quality contributed to the decline in financial stocks. The broader stock market showed a positive trend heading into mid-May, which was supported by a slight decline in oil prices and encouraging inflation numbers reflected in the April data for consumer prices. On May 16, 2008, the DJIA closed at 12986.80, a


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.14*

decrease of 4.2% from one year ago and a decrease of 2.1% year-to-date, and the NASDAQ closed at 2528.85, a decrease of 1.2% from one year ago and a decrease of 4.7% year-to-date. The Standard & Poor’s 500 Index closed at 1425.35 on May 16, 2008, a decrease of 6.4% from one year ago and a decrease of 2.9% year-to-date.

The market for thrift stocks has been mixed during the past 12 months, but, in general, thrift stocks have underperformed the broader stock market. A disappointing report on the outlook for the housing market weighed on the thrift sector in mid-May 2007, with the National Association of Home Builders report projecting that home sales and housing production would not begin to improve until late in 2007. Merger news provided a boost to thrift stocks heading into late-May, but the gains were not sustained as thrift stocks traded lower on news of stronger than expected economic data and higher interest rates. A favorable employment report for May boosted thrift stocks at the start of June, which was followed by a general downturn in thrift stocks going into mid-June on higher interest rates. Higher interest rates and lackluster housing data furthered the downward trend in thrift stocks during the second half of June.

The thrift sector continued to struggle at the beginning of the third quarter of 2007 on earnings worries and the widening meltdown in the subprime market as Standard & Poor’s and Moody’s announced plans to downgrade securities backed by subprime mortgages. Bargain hunting and strength in the broader market supported a brief rebound in thrift stocks in mid-July, which was followed a sharp sell off on fears of spreading subprime problems and some second quarter earnings reports showing deterioration in credit quality. A disappointing second quarter earnings report by Countrywide Financial and a larger-than-expected decline in new home sales knocked thrift equities lower in late-July. The downturn in thrift stocks continued into the beginning of August on news that American Home Mortgage Investment Corp. was shutting down operations due to liquidity problems. Thrift stocks participated in the volatility exhibited in the broader stock market in mid-August, but, in general, the downward trend in thrift equities continued during the first half of August. Thrift equities benefited from the mid-August discount rate cut by the Federal Reserve and then


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.15*

fluctuated along with the broader market through the end of August based on speculation over the outcome of the Federal Reserve’s next meeting. The weaker-than-expected employment report for August depressed thrift issues in early-September, but thrift stocks bounced back in mid-September. The recovery in thrift stocks was aided by news that Countrywide Financial had arranged for an additional $12 billion of secured borrowings. Thrift stocks rallied on news of the larger than expected 50 basis rate cut by the Federal Reserve, although the positive trend in thrift stocks was not sustained through the end of the third quarter. The pull back in thrift stocks reflected ongoing concerns over the weak housing market and the anticipated rise in credit quality related losses that were expected to be seen in third quarter earnings reports.

Thrift stocks traded in a narrow range at the start of the fourth quarter, but then headed lower in mid-October. The downturn was led by thrifts with exposure to the subprime market, as those institutions reported larger than expected credit losses for the third quarter. The as expected quarter point rate cut by the Federal Reserve helped thrift stocks to stabilize in late-October, although the sell-off in thrift equities resumed in early-November. Institutions with exposure to the subprime mortgage market continued to lead the downturn, as Washington Mutual’s stock plunged on expectations that it would continue to experience significant credit losses in 2008. Beaten down thrift stocks recovered modestly going into mid-November, but the downturn resumed on worries over further deterioration in the subprime market and the depressed housing market. Freddie Mac’s significantly larger-than-expected loss for the third quarter prompted further selling in thrift stocks heading into late-November. Hopes for a rate cut at the next Federal Reserve meeting boosted the thrift sector in late-November. Thrift stocks traded in narrow range in the first week of December, as investors awaited the outcome of the forthcoming Federal Reserve meeting. The mid-December downturn in the broader market following the Federal Reserve’s decision to lower rates a quarter point was evidenced in the thrift sector as well. In contrast to the broader stock market, thrift stocks continued to trade lower the day following the rate cut. The weak housing market, as reflected by a sharp drop in home prices and a drop-off in mortgage application volume, along with inflation worries and predictions of massive write-downs that would be recorded in the fourth quarter were noted factors that depressed thrift stocks through the end of December.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.16*

The downward spiral in thrift stocks continued at the beginning of 2008, particularly the stocks of those institutions with significant exposure to the subprime mortgage market such as Countrywide and Washington Mutual. Thrift stocks in general were also hurt by weak housing data and the growing prospects that the housing slump would continue throughout 2008. News of a rise in mortgage delinquencies at Countrywide and rumors of Countrywide going into bankruptcy further contributed to the slide in thrift stocks heading into mid-January. The announced acquisition of Countrywide by Bank of America had little impact on thrift stocks in general. Earnings related worries depressed thrift stocks heading into the second half of January, reflecting expectations that more significant credit quality related losses would be a widespread factor in the fourth quarter earnings reports for thrift institutions in general. Thrift stocks moved higher on the surprise rate cut by the Federal and then spiked higher along with the broader stock market the day following the rate cut. Consistent with the broader stock market, thrift stocks traded lower at the end of the week. For the balance of January and through most of February, thrift stocks generally paralleled trends in the broader market. Financial stocks led the broader market lower at the end of February and into the first part of March, as worries about the health of key financial companies escalated. Shares of thrift stocks were among the hardest hit, as investors dumped thrift stocks in conjunction with a sharp sell-off in the stocks of Fannie Mae and Freddie Mac amid fears that defaults would force them to raise more capital. News of the Federal Reserve’s $200 billion liquidity program sent thrift stocks sharply higher heading into mid-March. Thrift stocks participated in the day-to-day swings experienced in the broader stock market during mid-March, as investors assessed the outlook for mortgage lenders in a slumping market for housing and the possibility of the economy going into recession. The rebound in the stocks of Fannie Mae and Freddie Mac provided a healthy boost to thrift stocks heading into late-March, while troubling economic data and warnings of further write downs pulled thrift stocks lower along with the broader stock market at the close of the first quarter.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.17*

Thrift stocks surged higher in conjunction with the broader stock market at the start of the second quarter of 2008, as UBS and Lehman Brothers announced plans to bolster their capital to offset huge losses recorded from writing down troubled investments. A weaker-than-expected employment report for March depressed thrift stocks in early-April, although thrift stocks bounced back on news that Washington Mutual was in discussions to raise $5 billion from private equity-led investors. Thrift stocks drifted lower heading into mid-April in anticipation of first quarter earnings remaining depressed by more write downs on mortgages and mortgage-related securities. Bargain hunting and some positive first quarter earnings events provided a modest boost to thrift stocks in late-April, while thrift stocks edged lower on news of the Federal Reserve rate cut at the end of April. Calmer credit markets and a better-than-expected employment report for April were somewhat offset by a cut in Countrywide’s credit rating, as thrift stocks traded unevenly at the beginning of May. Higher oil prices and more negative news reported by financial institutions pressured thrift stocks lower going into mid-May. Thrift stocks edged higher along with the broader stock market heading into mid-May. On May 16, 2008, the SNL Index for all publicly-traded thrifts closed at 978.4, a decrease of 43.0% from one year ago and a decrease of 7.5% year-to-date.

The New Issue Market

In addition to thrift stock market conditions in general, the new issue market for converting thrifts is also an important consideration in determining the Bank’s pro forma market value. The new issue market is separate and distinct from the market for seasoned thrift stocks in that the pricing ratios for converting issues are computed on a pro forma basis, specifically: (1) the numerator and denominator are both impacted by the conversion offering amount, unlike existing stock issues in which price change affects only the numerator; and (2) the pro forma pricing ratio incorporates assumptions regarding source and use of proceeds, effective tax rates, stock plan purchases, etc. which impact pro forma financials, whereas pricing for existing issues are based on reported financials. The distinction between pricing of converting and existing issues is perhaps no clearer than in the case of the price/book (“P/B”) ratio in that the P/B ratio of


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.18*

a converting thrift will typically result in a discount to book value whereas in the current market for existing thrifts the P/B ratio often reflects a premium to book value. Therefore, it is appropriate to also consider the market for new issues, both at the time of the conversion and in the aftermarket.

The market for recent conversions has pulled back along with the thrift sector in general, with a number of the recent offerings being undersubscribed and typically reflecting only modest price appreciation or, in some cases, trading below their IPO prices in initial after market trading activity. As shown in Table 4.2, one second-step conversion and one mutual holding company offering were completed during the past three months. Both offerings were closed at the minimum of their respective valuation ranges. Baltimore County’s second-step conversion offering closed at a pro forma P/TB of 63.6% and William Penn’s mutual holding company offering closed at a pro forma P/TB ratio of 56.5%. Based on closing stock market prices as of May 16, 2008, Baltimore County’s and William Penn’s stock prices were 13.5% and 37.5% above their respective IPO prices.

Shown in Table 4.3 are the current pricing ratios for the one company that has completed a fully-converted offering during the past three months and is traded on NASDAQ or an Exchange. Based on its closing stock price as of May 16, 2008, Baltimore County was trading at a P/TB ratio of 77.50%.

The Acquisition Market

Also considered in the valuation was the potential impact on First Savings’ stock price of recently completed and pending acquisitions of other thrift institutions operating in Indiana. As shown in Exhibit IV-4, there were ten Indiana thrift acquisitions completed from the beginning of 2004 through May 16, 2008, and there is currently one acquisition pending of an Indiana savings institution. The recent acquisition activity involving Indiana savings institutions may imply a certain degree of acquisition speculation for the Bank’s stock. To the extent that acquisition speculation may impact the Bank’s offering, we have largely taken this into account in selecting companies for the Peer Group which operate in markets that have experienced a comparable level of acquisition activity as the Bank’s market and, thus, are subject to the same type of


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.19*

Table 4.2

Pricing Characteristics and After-Market Trends

Recent Conversions Completed (Last Three Months)


Institutional Information	Pre-Conversion Data									Offering Information											Contribution to Charitable Found.					Insider Purchases
	Financial Info.					Asset Quality																				% Off Incl. Fdn.
																										Benefit Plans
Institution Conver. Date Ticker	Assets			Equity/ Assets		NPAs/ Assets		Res. Cov.		Gross Proc.			% Offered		% of Mid.			Exp./ Proc.			Form		% of Offering			ESOP		Recog. Plans			Stk Option		Mgmt.& Dirs.			Initial Dividend Yield
	($Mil)			(%)		(%)		(%)		($Mil.)			(%)		(%)			(%)					(%)			(%)		(%)			(%)		(%)(2)			(%)
*Standard Conversions*

Averages—Standard Conversions:
Medians—Standard Conversions:

*Second Step Conversions*
BCSB Bancorp, Inc., MD 4/11/08 BCSB-NASDAQ	$	623		5.73	%	0.49	%	89	%	$	19.8		63	%		85	%		12.2	%	N.A.			N.A.		6.2	%		2.3	%	9.7	%		3.3	%	0.00	%
Averages—Second Step Conversions:	$	623		5.73	%	0.49	%	89	%	$	19.8		63	%		85	%		12.2	%	N.A.			N.A.		6.2	%		2.3	%	9.7	%		3.3	%	0.00	%
Medians—Second Step Conversions:	$	623		5.73	%	0.49	%	89	%	$	19.8		63	%		85	%		12.2	%	N.A.			N.A.		6.2	%		2.3	%	9.7	%		3.3	%	0.00	%

*Mutual Holding Company Conversions*
William Penn Bancorp, Inc., PA* 4/16/08 WMPN-NASDAQ	$	269		12.54	%	0.28	%	246	%	$	10.3		28	%		85	%		6.0	%	C/S			150K/ 6.54	%	8.0	%		6.5	%	16.3	%		9.5	%	0.00	%
Averages—Mutual Holding Company Conversions:	$	269		12.54	%	0.28	%	246	%	$	10.3		28	%		85	%		6.0	%	NA			NA		8.0	%		6.5	%	16.3	%		9.5	%	0.00	%
Medians—Mutual Holding Company Conversions:	$	269		12.54	%	0.28	%	246	%	$	10.3		28	%		85	%		6.0	%	NA			NA		8.0	%		6.5	%	16.3	%		9.5	%	0.00	%

Averages—All Conversions:	$	446		9.14	%	0.39	%	168	%	$	15.0		46	%		85	%		9.1	%	NA			NA		7.1	%		4.4	%	13.0	%		6.4	%	0.00	%
Medians—All Conversions:	$	446		9.14	%	0.39	%	168	%	$	15.0		46	%		85	%		9.1	%	NA			NA		7.1	%		4.4	%	13.0	%		6.4	%	0.00	%

Institutional Information	Pro Forma Data																	Post-IPO Pricing Trends
	Pricing Ratios(3)							Financial Charac.										Closing Price:

Institution Conver. Date Ticker	P/TB			Core P/E		P/A		Core ROA		TE/A			Core ROE		IPO Price			First Trading Day			% Change		After First Week(4)			% Change		After First Month(5)			% Change		Thru 5/16/08			% Change
	(%)			(x)		(%)		(%)		(%)			(%)		($)			($)			(%)		($)			(%)		($)			(%)		($)			(%)
*Standard Conversions*

Averages—Standard Conversions:
Medians—Standard Conversions:

*Second Step Conversions*
BCSB Bancorp, Inc., MD 4/11/08 BCSB-NASDAQ		63.6	%	NM		4.9	%	NM			7.7	%	NM		$	10.00		$	11.04		10.4	%	$	11.35		13.5	%	$	11.35		13.5	%	$	11.35		13.5	%
Averages—Second Step Conversions:		63.6	%	NM		4.9	%	NM			7.7	%	NM		$	10.00		$	11.04		10.4	%	$	11.35		13.5	%	$	11.35		13.5	%	$	11.35		13.5	%
Medians—Second Step Conversions:		63.6	%	NM		4.9	%	NM			7.7	%	NM		$	10.00		$	11.04		10.4	%	$	11.35		13.5	%	$	11.35		13.5	%	$	11.35		13.5	%

*Mutual Holding Company Conversions*
William Penn Bancorp, Inc., PA* 4/16/08 WMPN-NASDAQ		56.5	%	18.0x		12.2	%	0.7	%		15.1	%	4.5	%	$	10.00		$	11.75		17.5	%	$	13.25		32.5	%	$	13.75		37.5	%	$	13.75		37.5	%
Averages—Mutual Holding Company Conversions:		56.5	%	18.0x		12.2	%	0.7	%		15.1	%	4.5	%	$	10.00		$	11.75		17.5	%	$	13.25		32.5	%	$	13.75		37.5	%	$	13.75		37.5	%
Medians—Mutual Holding Company Conversions:		56.5	%	18.0x		12.2	%	0.7	%		15.1	%	4.5	%	$	10.00		$	11.75		17.5	%	$	13.25		32.5	%	$	13.75		37.5	%	$	13.75		37.5	%

Averages—All Conversions:		60.0	%	18.0x		8.5	%	0.7	%		11.4	%	4.5	%	$	10.00		$	11.40		14.0	%	$	12.30		23.0	%	$	12.55		25.5	%	$	12.55		25.5	%
Medians—All Conversions:		60.0	%	18.0x		8.5	%	0.7	%		11.4	%	4.5	%	$	10.00		$	11.40		14.0	%	$	12.30		23.0	%	$	12.55		25.5	%	$	12.55		25.5	%

Note:

* - Appraisal performed by RP Financial; BOLD =RP Financial did the Conversion Business Plan. "NT"—Not Traded; "NA"—Not Applicable, Not Available; C/S-Cash/Stock.

(1)	Non-OTS regulated thrift.

(2)	As a percent of MHC offering for MHC transactions.

(3)	Does not take into account the adoption of SOP 93-6.

(4)	Latest price if offering is less than one week old.

(5)	Latest price if offering is more than one week but less than one month old.

(6)	Mutual holding company pro forma data on full conversion basis.

(7)	Simultaneously completed acquisition of another financial institution.

(8)	Simultaneously converted to a commercial bank charter.

(9)	Former credit union.

May 16, 2008


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.20*

Table 4.3

Market Pricing Comparatives

Prices As of May 16, 2008


	Market Capitalization				Per Share Data					Pricing Ratios(3)								Dividends(4)						Financial Characteristics(6)
	Market Capitalization				Core 12 Month EPS(2)			Book Value/ Share		Pricing Ratios(3)								Amount/ Share		Yield		Payout Ratio(5)		Total Assets		Equity/ Assets		NPAs/ Assets		Reported				Core
Financial Institution	Price/ Share(1)		Market Value		Core 12 Month EPS(2)			Book Value/ Share		P/E	P/B		P/A		P/TB		P/Core	Amount/ Share		Yield		Payout Ratio(5)		Total Assets		Equity/ Assets		NPAs/ Assets		ROA		ROE		ROA		ROE
	($)		($Mil)		($)			($)		(x)	(%)		(%)		(%)		(x)	($)		(%)		(%)		($Mil)		(%)		(%)		(%)		(%)		(%)		(%)
All Public Companies	$	14.80	$	361.58	$	0.71		$	13.53	20.53x	117.66	%	15.21	%	133.26	%	21.00x	$	0.39	2.53	%	33.73	%	$	3,173	12.75	%	0.65	%	0.52	%	4.65	%	0.48	%	4.44	%
Converted Last 3 Months (no MHC)	$	12.19	$	38.04	$	(0.06	)	$	16.53	NM	73.74	%	5.96	%	77.50	%	NM	$	0.00	0.00	%	NM		$	638	8.08	%	0.49	%	-0.38	%	-4.72	%	-0.03	%	-0.36	%

Converted Last 3 Months (no MHC)
BCSB BCSB Bancorp, Inc. of MD	$	12.19	$	38.04	$	(0.06	)	$	16.53	NM	73.74	%	5.96	%	77.50	%	NM	$	0.00	0.00	%	NM		$	638	8.08	%	0.49	%	-0.38	%	-4.72	%	-0.03	%	-0.36	%

(1)	Average of High/Low or Bid/Ask price per share.

(2)	EPS (estimate core basis) is based on actual trailing 12 month data, adjusted to omit non-operating items on a tax-effected basis.

(3)	P/E = Price to earnings; P/B = Price to book; P/A = Price to assets; P/TB = Price to tangible book value; and P/Core = Price to core earnings.

(4)	Indicated 12 month dividend, based on last quarterly dividend declared.

(5)	Indicated 12 month dividend as a percent of trailing 12 month estimated core earnings.

(6)	ROA (return on assets) and ROE (return on equity) are indicated ratios based on trailing 12 month common earnings and average common equity and total assets balances.

(7)	Excludes from averages and medians those companies the subject of actual or rumored acquisition activities or unusual operating characteristics.


Source:		Corporate reports, offering circulars, and RP ^® Financial, LC. calculations. The information provided in this report has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.21*

acquisition speculation that may influence First Savings’ stock. However, since converting thrifts are subject to a three-year regulatory moratorium from being acquired, acquisition speculation in First Savings’ stock would tend to be less compared to the stocks of the Peer Group companies.

* * * * * * * * * * *

In determining our valuation adjustment for marketing of the issue, we considered trends in both the overall thrift market, the new issue market including the new issue market for thrift conversions and the local acquisition market for thrift stocks. Taking these factors and trends into account, RP Financial concluded that a moderate downward adjustment was appropriate in the valuation analysis for purposes of marketing of the issue.

8.	Management

The Bank’s management team appears to have experience and expertise in all of the key areas of the Bank’s operations. Exhibit IV-5 provides summary resumes of the Bank’s Board of Directors and senior management. While the Bank has recently been impacted by asset quality issues which have resulted in loan loss provisions which have impaired earnings, many of the loans were originated prior to the arrival of the current managing officer and CLO. Moreover, management has been working to resolve the asset quality issues and posture the Bank for future growth consistent with a well-managed financial institution. The Bank currently does not have any senior management positions that are vacant.

The returns, equity positions and other operating measures of the Peer Group companies are indicative of well-managed financial institutions, which have Boards and management teams that have been effective in implementing competitive operating strategies. Therefore, on balance, we concluded no valuation adjustment relative to the Peer Group was appropriate for this factor.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.22*

9.	Effect of Government Regulation and Regulatory Reform

In summary, as a fully-converted OTS regulated institution, First Savings will operate in substantially the same regulatory environment as the Peer Group members — all of whom are adequately capitalized institutions and are operating with no apparent restrictions. Exhibit IV-6 reflects the Bank’s pro forma regulatory capital ratios. On balance, no adjustment has been applied for the effect of government regulation and regulatory reform.

Summary of Adjustments

Overall, based on the factors discussed above, we concluded that the Bank’s pro forma market value should reflect the following valuation adjustments relative to the Peer Group:


Key Valuation Parameters:		Valuation Adjustment
Financial Condition		No Adjustment
Profitability, Growth and Viability of Earnings		Moderate Downward
Asset Growth		Slight Upward
Primary Market Area		Slight Upward
Dividends		No Adjustment
Liquidity of the Shares		No Adjustment
Marketing of the Issue		Moderate Downward
Management		No Adjustment
Effect of Govt. Regulations and Regulatory Reform		No Adjustment

Valuation Approaches

In applying the accepted valuation methodology promulgated by the OTS and adopted by the FDIC, i.e., the pro forma market value approach, including the fully-converted analysis described above, we considered the three key pricing ratios in valuing the Bank’s to-be-issued stock — price/earnings (“P/E”), price/book (“P/B”), and price/assets (“P/A”) approaches — all performed on a pro forma basis including the effects of the stock proceeds. In computing the pro forma impact of the conversion and the related pricing ratios, we have incorporated the valuation parameters disclosed in the Bank’s prospectus for reinvestment rate, effective tax rate, stock benefit plan assumptions and expenses (summarized in Exhibits IV-7 and IV-8).


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.23*

In our estimate of value, we assessed the relationship of the pro forma pricing ratios relative to the Peer Group and recent conversion offerings.

RP Financial’s valuation placed an emphasis on the following:

•

P/E Approach . The P/E approach is generally the best indicator of long-term value for a stock. Given the similarities between the Bank’s and the Peer Group’s earnings composition and overall financial condition, the P/E approach was carefully considered in this valuation. At the same time, given the current low level of earnings within both the industry, the Peer Group and the Bank, we have also considered alternative valuation approaches as described below.

•

P/B Approach . P/B ratios have generally served as a useful benchmark in the valuation of thrift stocks, particularly in the context of an initial public offering, as the earnings approach involves assumptions regarding the use of proceeds. RP Financial considered the P/B approach to be a valuable indicator of pro forma value taking into account the pricing ratios under the P/E and P/A approaches. We have also modified the P/B approach to exclude the impact of intangible assets (i.e., price/tangible book value or “P/TB”), in that the investment community frequently makes this adjustment in its evaluation of this pricing approach.

•

P/A Approach . P/A ratios are generally a less reliable indicator of market value, as investors typically assign less weight to assets and attribute greater weight to book value and earnings. Furthermore, this approach as set forth in the regulatory valuation guidelines does not take into account the amount of stock purchases funded by deposit withdrawals, thus understating the pro forma P/A ratio. At the same time, the P/A ratio is an indicator of franchise value, and, in the case of highly capitalized institutions, high P/A ratios may limit the investment community’s willingness to pay market multiples for earnings or book value when ROE is expected to be low.

The Bank will adopt Statement of Position (“SOP”) 93-6, which will cause earnings per share computations to be based on shares issued and outstanding excluding unreleased ESOP shares. For purposes of preparing the pro forma pricing analyses, we have reflected all shares issued in the offering, including all ESOP shares, to capture the full dilutive impact, particularly since the ESOP shares are economically dilutive, receive dividends and can be voted. However, we did consider the impact of the adoption of SOP 93-6 in the valuation.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.24*

Based on the application of the three valuation approaches, taking into consideration the valuation adjustments discussed above, RP Financial concluded that the pro forma market value of the Bank’s conversion stock as of May 16, 2008, was $32,000,000 at the midpoint, inclusive of 110,000 shares issued to the Foundation for a value of $1,100,000 based on a per share value of $10.00 at issuance. The offering amount at the midpoint is equivalent to $30,900,000 or 3,090,000 shares at $10.00 per share. The following sections describe the application of the valuation methodology.

1. Price-to-Earnings (“P/E”) . The application of the P/E valuation method requires calculating the Bank’s pro forma market value by applying a valuation P/E multiple (fully-converted basis) to the pro forma earnings base. In applying this technique, we considered both reported earnings and a recurring earnings base, that is, earnings adjusted to exclude any one-time non-operating items, plus the estimated after-tax earnings benefit of the reinvestment of the net proceeds. The Bank’s reported earnings and core earnings both equaled $140,000 for the 12 months ended March 31, 2008. Importantly, with a valuation earnings base at this low level coupled with the low reinvestment yields available in the current market and the expense of the employee stock benefit plans, the Bank is in a pro forma loss position and the pro forma P/E multiple is not meaningful.

We have also considered the pro forma earnings multiple based on earnings adjusted to exclude loan loss provisions related to the large group of investor loans to a single borrower. Even adding the loan loss provisions which could be construed as non-recurring results in a pre-conversion adjusted earnings base of $725,000. At the midpoint of the offering range, the pro forma P/E multiple equals 65.74 times, which is at a 206.8% premium to Peer Group’s average P/E multiple based on core earnings of 21.43 times.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.25*


	Amount (1)
	($000)
Net income	$	140
Plus: Loan Loss Provisions Attributable to One Borrower — Investor Loans		969
Less: Tax Effect		(384	)

Adjusted Earnings Estimate	$	725

(1)	Adjustment was tax effected at 39.6% which approximates the Bank’s effective marginal tax rate.

2. Price-to-Book (“P/B”) . The application of the P/B valuation method requires calculating the Bank’s pro forma market value by applying a valuation P/B ratio, as derived from the Peer Group’s P/B ratio, to the Bank’s pro forma book value. Based on the $32.0 million midpoint valuation, the Bank’s pro forma P/B and P/TB ratios both equaled 57.61%. In comparison to the average P/B and P/TB ratios for the Peer Group of 83.22% and 85.43%, the Bank’s ratios reflected a discount of 30.8% on a P/B basis and a discount of 32.6% on a P/TB basis. In comparison to the Peer Group’s median P/B and P/TB ratios of 80.79% and 82.51%, respectively, the Bank’s pro forma P/B and P/TB ratios at the midpoint value reflected discounts of 28.7% and 30.2%, respectively. At the top of the super range, the Bank’s P/B and P/TB ratios both equaled 65.34%. In comparison to the Peer Group’s average P/B and P/TB ratios, the Bank’s P/B and P/TB ratios at the top of the super range reflected discounts of 21.5% and 23.5%, respectively. RP Financial considered the discounts under the P/B approach to be reasonable, given the nature of the calculation of the P/B ratio which mathematically results in a ratio discounted to book value while the resulting pricing ratios indicated under the earnings approach were not meaningful (i.e., a pro forma loss was calculated).

With regard to the discounted P/B and P/TB ratio, RP Financial also gave consideration to the Company’s lack of a meaningful P/E ratio. In this regard, there were three companies in the Peer Group reporting P/E multiples which were not meaningful (i.e., these Peer Group companies were either reporting trailing 12 month losses or had a high P/E multiple in excess of 50 times earnings). The average P/TB ratios for these three companies reporting either low or negative earnings equaled


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.26*

77.61% based on the average and 77.04% based on the median. Compared to the average P/TB ratio for these three companies with low or negative earnings, the Bank’s pro forma P/TB ratio was discounted by 25.8% at the midpoint and by 15.8% at the super maximum of the valuation range.

3. Price-to-Assets (“P/A”) . The P/A valuation methodology determines market value by applying a valuation P/A ratio to the Bank’s pro forma asset base, conservatively assuming no deposit withdrawals are made to fund stock purchases. In all likelihood there will be deposit withdrawals, which results in understating the pro forma P/A ratio which is computed herein. At the $32.0 million midpoint of the valuation range, the Bank’s value equaled 13.40% of pro forma assets. Comparatively, the Peer Group companies exhibited an average P/A ratio of 9.20%, which implies a premium of 45.7% has been applied to the Bank’s pro forma P/A ratio. In comparison to the Peer Group’s median P/A ratio of 8.32%, the Bank’s pro forma P/A ratio at the midpoint value reflects a premium of 61.1%.

Comparison to Recent Offerings

As indicated at the beginning of this chapter, RP Financial’s analysis of recent conversion offering pricing characteristics at closing and in the aftermarket has been limited to a “technical” analysis and, thus, the pricing characteristics of recent conversion offerings can not be a primary determinate of value. Particular focus was placed on the P/TB approach in this analysis, since the P/E multiples do not reflect the actual impact of reinvestment and the source of the stock proceeds (i.e., external funds vs. deposit withdrawals). The most recent standard conversion offering completed, which did not include a simultaneous acquisition, was completed by Danvers Bancorp of Massachusetts on January 10, 2008. Danvers Bancorp’s closing P/TB was 82.3%. In comparison to Danvers Bancorp’s closing pro forma P/TB ratio, the Bank’s P/TB ratio of 57.6% at the midpoint value reflects an implied discount of 30.0% and at the top of the super range the discount narrows to 20.7% based on the Bank’s pro forma P/TB ratio of 65.3%. As of May 16, 2008, Danvers Bancorp’s stock closed 17.5% above its IPO price.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.27*

The most recent conversion completed which was similar to the Bank in terms of asset size, profitability and market area, was First Advantage Bancorp of Tennessee, which completed its standard conversion offering as of November 20, 2007. First Advantage Bancorp’s closing P/TB was 68.3% and the closing P/E was over 40 times reflecting a closing between the midpoint and the maximum of the offering range. In comparison to First Advantage Bancorp’s closing pro forma P/TB ratio, the Bank’s P/TB ratio of 57.6% at the midpoint value reflects an implied discount of 15.7% and, at the top of the super range, the discount narrows to 4.4% based on the Bank’s pro forma P/TB ratio of 65.3%. As of May 16, 2008, First Advantage Bancorp’s stock closed 19.2% above its IPO price and was trading at approximately 70% of its reported book value per share as of March 31, 2008.

Valuation Conclusion

Based on the foregoing, it is our opinion that, as of May 16, 2008, the aggregate pro forma market value of the Bank’s common stock, including the stock portion of the contribution to the Foundation immediately following the offering, is $32,000,000 at the midpoint, equal to 32,000,000 shares issued at a per share value of $10.00. The resulting range of value pursuant to regulatory guidelines and the corresponding number of shares based on the Board approved $10.00 per share offering price is set forth below. The pro forma valuation calculations relative to the Peer Group are shown in Table 4.4 and are detailed in Exhibit IV-7 and Exhibit IV-8.


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.28*


Valuation Range	Offering Amount		Foundation Shares		Total Issued
Shares
Minimum		2,626,500		110,000		2,736,500
Midpoint		3,090,000		110,000		3,200,000
Maximum		3,553,500		110,000		3,663,500
Supermaximum		4,086,525		110,000		4,196,525
Value
Minimum	$	26,265,000	$	1,100,000	$	27,365,000
Midpoint	$	30,900,000	$	1,100,000	$	32,000,000
Maximum	$	35,535,000	$	1,100,000	$	36,635,000
Supermaximum	$	40,865,250	$	1,100,000	$	41,965,250


*RP ^® Financial, LC.*		*VALUATION ANALYSIS*
		*IV.29*

Table 4.4

Public Market Pricing

First Savings Bank, F.S.B.

As of May 16, 2008


	Market Capitalization				Per Share Data					Pricing Ratios(3)								Dividends(4)						Financial Characteristics (6)
	Market Capitalization				Core 12 Month EPS(2)			Book Value/ Share		Pricing Ratios(3)								Amount/ Share		Yield		Payout Ratio(5)								Reported				Core				Offering Size
	Price/ Share(1)		Market Value		Core 12 Month EPS(2)			Book Value/ Share		P/E	P/B		P/A		P/TB		P/ Core	Amount/ Share		Yield		Payout Ratio(5)		Total Assets		Equity/ Assets		NPAs/ Assets		ROA		ROE		ROA		ROE		Offering Size
	($)		($Mil)		($)			($)		(x)	(%)		(%)		(%)		(x)	($)		(%)		(%)		($Mil)		(%)		(%)		(%)		(%)		(%)		(%)		($Mil)
First Savings Bank, F.S.B.
Superrange	$	10.00	$	41.97	$	(0.04	)	$	15.30	NM	65.34	%	16.96	%	65.34	%	NM	$	0.00	0.00	%	0.00	%	$	247	25.95	%	2.15	%	-0.07	%	-0.26	%	-0.07	%	-0.26	%	40.87
Maximum	$	10.00	$	36.64	$	(0.04	)	$	16.26	NM	61.49	%	15.09	%	61.49	%	NM	$	0.00	0.00	%	0.00	%	$	243	24.54	%	2.19	%	-0.05	%	-0.22	%	-0.05	%	-0.22	%	35.54
Midpoint	$	10.00	$	32.00	$	(0.03	)	$	17.36	NM	57.61	%	13.40	%	57.61	%	NM	$	0.00	0.00	%	0.00	%	$	239	23.26	%	2.22	%	-0.04	%	-0.18	%	-0.04	%	-0.18	%	30.90
Minimum	$	10.00	$	27.37	$	(0.02	)	$	18.82	NM	53.13	%	11.66	%	53.13	%	NM	$	0.00	0.00	%	0.00	%	$	235	21.94	%	2.26	%	-0.03	%	-0.13	%	-0.03	%	-0.13	%	26.27

All Public Companies(7)
Averages	$	13.02	$	339.09	$	0.13		$	13.22	20.47x	108.34	%	13.77	%	120.80	%	20.65x	$	0.37	2.59	%	36.50	%	$	3,289	12.17	%	1.25	%	0.34	%	2.66	%	0.19	%	2.59	%
Medians		11.50		70.50		0.36			11.76	19.12x	98.98	%	10.60	%	108.91	%	19.59x	$	0.30	2.67	%	23.81	%	$	845	10.11	%	0.60	%	0.43	%	3.69	%	0.43	%	3.41	%

All Non-MHC State of IN(7)
Averages	$	16.31	$	56.83	$	0.92		$	18.98	18.47x	86.71	%	8.26	%	92.66	%	18.75x	$	0.63	1.60	%	23.46	%	$	649	9.41	%	2.19	%	0.47	%	5.10	%	0.47	%	4.97	%
Medians	$	14.37	$	40.85	$	0.88		$	18.69	17.79x	76.08	%	6.66	%	86.45	%	15.54x	$	0.70	1.66	%	18.61	%	$	731	8.81	%	1.47	%	0.40	%	4.55	%	0.43	%	4.95	%
Comparable Group Averages
Averages	$	12.74	$	30.35	$	0.54		$	15.29	20.23x	83.22	%	9.20	%	85.43	%	21.43x	$	0.46	1.60	%	23.46	%	$	328	11.13	%	1.46	%	0.38	%	3.84	%	0.37	%	3.63	%
Medians	$	13.59	$	26.23	$	0.38		$	16.16	22.02x	80.79	%	8.32	%	82.51	%	24.34x	$	0.43	1.66	%	18.61	%	$	345	10.19	%	1.37	%	0.38	%	3.72	%	0.36	%	3.40	%

State of Indiana (7)
ASBI Ameriana Bncp of New Castle IN	$	9.05	$	27.05	$	0.37		$	11.26	22.63x	80.37	%	6.34	%	82.50	%	24.46x	$	0.16	1.77	%	43.24	%	$	427	7.89	%	NA		0.28	%	3.64	%	0.26	%	3.37	%
CITZ CFS Bancorp, Inc of Munster IN	$	14.59	$	155.82	$	0.71		$	12.34	19.45x	118.23	%	13.05	%	119.30	%	20.55x	$	0.48	3.29	%	67.61	%	$	1,194	11.04	%	2.62	%	0.67	%	6.16	%	0.64	%	5.83	%
FCAP First Capital, Inc. of IN	$	14.15	$	39.82	$	1.17		$	16.62	11.14x	85.14	%	8.74	%	96.98	%	12.09x	$	0.72	5.09	%	61.54	%	$	456	10.26	%	1.41	%	0.79	%	7.90	%	0.73	%	7.28	%
LSBI LSB Fin. Corp. of Lafayette IN	$	18.50	$	28.84	$	0.76		$	21.93	22.02x	84.36	%	8.14	%	84.36	%	24.34x	$	1.00	5.41	%	NM		$	354	9.65	%	3.26	%	0.37	%	3.79	%	0.34	%	3.43	%
MFBC MFB Corp. of Mishawaka IN(7)	$	30.17	$	41.88	$	1.54		$	31.00	24.73x	97.32	%	8.36	%	106.46	%	19.59x	$	0.76	2.52	%	49.35	%	$	501	8.59	%	NA		0.33	%	4.08	%	0.42	%	5.15	%
MFSF MutualFirst Fin. Inc. of IN	$	11.38	$	47.57	$	0.99		$	20.75	10.84x	54.84	%	4.95	%	66.43	%	11.49x	$	0.64	5.62	%	64.65	%	$	960	9.03	%	1.47	%	0.46	%	5.02	%	0.43	%	4.74	%
RIVR River Valley Bancorp of IN	$	15.54	$	25.41	$	1.32		$	15.70	11.51x	98.98	%	7.26	%	99.04	%	11.77x	$	0.84	5.41	%	63.64	%	$	350	7.33	%	NA		0.64	%	8.95	%	0.63	%	8.75	%

Comparable Group
ASBI Ameriana Bncp of New Castle IN	$	9.05	$	27.05	$	0.37		$	11.26	22.63	80.37	%	6.34	%	82.50	%	24.46x	$	0.16	1.77	%	43.24	%	$	427	7.89	%	NA		0.28	%	3.64	%	0.26	%	3.37	%
CFBK Central Federal Corp. of OH	$	4.72	$	21.09	$	0.07		$	6.17	NM	76.50	%	7.63	%	76.50	%	NM	$	0.20	4.24	%	NM		$	276	9.97	%	NA		0.00	%	0.00	%	0.12	%	1.13	%
CZWI Citizens Comm Bncorp Inc of WI	$	8.35	$	56.47	$	0.21		$	11.13	39.76	75.02	%	13.27	%	82.51	%	39.76x	$	0.20	2.40	%	NM		$	426	17.68	%	0.50	%	0.38	%	1.85	%	0.38	%	1.85	%
FFDF FFD Financial Corp of Dover OH	$	13.65	$	14.77	$	1.19		$	16.81	10.83	81.20	%	8.21	%	81.20	%	11.47x	$	0.66	4.84	%	55.46	%	$	180	10.11	%	0.72	%	0.78	%	7.51	%	0.74	%	7.10	%
FBSI First Bancshares, Inc. of MO	$	13.52	$	20.97	$	0.03		$	17.71	NM	76.34	%	8.42	%	77.04	%	NM	$	0.00	0.00	%	0.00	%	$	249	11.03	%	1.56	%	0.15	%	1.36	%	0.02	%	0.17	%
FCAP First Capital, Inc. of IN	$	14.15	$	39.82	$	1.17		$	16.62	11.14	85.14	%	8.74	%	96.98	%	12.09x	$	0.72	5.09	%	61.54	%	$	456	10.26	%	1.41	%	0.79	%	7.90	%	0.73	%	7.28	%
LSBI LSB Fin. Corp. of Lafayette IN	$	18.50	$	28.84	$	0.76		$	21.93	22.02	84.36	%	8.14	%	84.36	%	24.34x	$	1.00	5.41	%	NM		$	354	9.65	%	3.26	%	0.37	%	3.79	%	0.34	%	3.43	%
LBCP Liberty Bancorp, Inc. of MO	$	10.20	$	45.30	$	0.39		$	10.74	23.72	94.97	%	13.36	%	94.97	%	26.15x	$	0.10	0.98	%	25.64	%	$	339	14.06	%	NA		0.60	%	3.89	%	0.54	%	3.53	%
PFED Park Bancorp of Chicago IL	$	19.70	$	23.74	$	(0.07	)	$	24.85	NM	79.28	%	10.59	%	79.28	%	NM	$	0.72	3.65	%	NM		$	224	13.36	%	1.33	%	-0.07	%	-0.47	%	-0.04	%	-0.27	%
RIVR River Valley Bancorp of IN	$	15.54	$	25.41	$	1.32		$	15.70	11.51	98.98	%	7.26	%	99.04	%	11.77x	$	0.84	5.41	%	63.64	%	$	350	7.33	%	NA		0.64	%	8.95	%	0.63	%	8.75	%

(1)	Average of High/Low or Bid/Ask price per share.

(2)	EPS (estimate core basis) is based on actual trailing 12 month data, adjusted to omit non-operating items on a tax-effected basis, and is shown on a pro forma basis where appropriate.

(3)	P/E = Price to earnings; P/B = Price to book; P/A = Price to assets; P/TB = Price to tangible book value; and P/Core = Price to core earnings.

(4)	Indicated 12 month dividend, based on last quarterly dividend declared.

(5)	Indicated 12 month dividend as a percent of trailing 12 month estimated core earnings.

(6)	ROA (return on assets) and ROE (return on equity) are indicated ratios based on trailing 12 month common earnings and average common equity and total assets balances.

(7)	Excludes from averages and medians those companies the subject of actual or rumored acquisition activities or unusual operating characteristics.


Source:		Corporate reports, offering circulars, and RP Financial, LC. calculations. The information provided in this report has been obtained from sources we believe are reliable, but we cannot guarantee the accuracy or completeness of such information.

EXHIBITS

NUMERICAL EXHIBITS

OMITTED

IN ACCORDANCE WITH RULE 202 OF REGULATION S-T, THESE EXHIBITS ARE BEING FILED IN PAPER PURSUANT TO A CONTINUING HARDSHIP EXEMPTION.

Exhibit 99.2

, 2008

Dear Friend:

We are pleased to announce that First Savings Bank, F.S.B. is converting from the mutual to the stock form of ownership. First Savings Bank will be the wholly-owned subsidiary of a newly formed stock holding company to be known as First Savings Financial Group, Inc. In connection with the conversion, First Savings Financial Group is offering shares of its common stock in a subscription and community offering pursuant to a Plan of Conversion. First Savings Financial Group also intends to establish a charitable foundation in connection with the stock offering to which it will contribute 110,000 shares of its common stock and $100,000 in cash.

Because we believe you may be interested in learning more about an investment in the common stock of First Savings Financial Group, we are sending you the following materials which describe the conversion and stock offering.

PROSPECTUS : This document provides detailed information about First Savings Bank’s operations and the proposed conversion and offering of First Savings Financial Group common stock.

STOCK ORDER AND CERTIFICATION FORM : This form is used to purchase stock by returning it with your payment in the enclosed business reply envelope. The deadline for ordering stock is , Eastern time, on , 2008.

As a friend of First Savings Bank, you will have the opportunity to buy common stock directly from First Savings Financial Group in the offering without paying a commission or fee, subject to our members’ priority subscription rights. If you have questions regarding the conversion and the stock offering, please call us at (XXX) XXX-XXXX, Monday, 11:00 a.m. to 4:30 p.m., Tuesday through Thursday, 8:30 a.m. to 4:30 p.m. and Friday, 8:30 a.m. to 2:00 p.m., or stop by our Stock Information Center located at 501 East Lewis & Clark Parkway, Clarksville, Indiana.

We are pleased to offer you this opportunity to become a shareholder of First Savings Financial Group.

Sincerely,

Larry W. Myers

President and Chief Executive Officer

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

, 2008

Dear Member:

To accomplish the conversion and establishment and funding of the charitable foundation, we need your participation in an important vote. Enclosed is a proxy statement and a prospectus describing the Plan of Conversion and your voting and subscription rights. YOUR VOTE IS VERY IMPORTANT .

Enclosed, as part of the proxy materials, is your proxy card, the detachable section on top of the order form bearing your name and address. This proxy card should be signed, dated and returned to us prior to the Special Meeting of Members to be held on , 2008. Please take a moment now to sign and date the enclosed proxy card and return it to us in the postage-paid envelope provided. FAILURE TO VOTE HAS THE SAME EFFECT AS VOTING AGAINST THE CONVERSION AND AGAINST ESTABLISHMENT AND FUNDING OF THE CHARITABLE FOUNDATION.

The Board of Directors believes the conversion will offer a number of advantages, such as an opportunity for depositors of First Savings Bank to become shareholders of First Savings Financial Group. Please remember:

•

Your deposit accounts will continue to be insured up to the maximum legal limit by the Federal Deposit Insurance Corporation (“FDIC”).

•

There will be no change in the balance, interest rate or maturity of any deposit account or loan because of the conversion.

•

Members have a right, but not an obligation, to buy First Savings Financial Group common stock and may do so without the payment of a commission or fee before it is offered to the general public.

•

Like all stock, shares of First Savings Financial Group’s common stock issued in this offering will not be insured by the FDIC.

The enclosed prospectus contains a complete discussion of the conversion and stock offering. We urge you to read this material carefully. If you are interested in purchasing the common stock of First Savings Financial Group, you must submit your Stock Order and Certification Form and payment prior to , Eastern time, on , 2008.

If you have additional questions regarding the offering, please call us at (XXX) XXX-XXXX, Monday, 11:00 a.m. to 4:30 p.m., Tuesday through Thursday, 8:30 a.m. to 4:30 p.m. and Friday, 8:30 a.m. to 2:00 p.m., or stop by our Stock Information Center located at 501 East Lewis & Clark Parkway, Clarksville, Indiana.

Sincerely,

Larry W. Myers

President and Chief Executive Officer

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

, 2008

Dear Prospective Investor:

We have enclosed the following materials that will help you learn more about an investment in the common stock of First Savings Financial Group. Please read and review the materials carefully.

PROSPECTUS : This document provides detailed information about the operations at First Savings Bank and a complete discussion on the proposed conversion and stock offering.

We invite you and other local community members to become shareholders of First Savings Financial Group. Through this offering, you have the opportunity to buy stock directly from First Savings Financial Group without paying a commission or a fee.

If you have additional questions regarding the conversion, please call us at (XXX) XXX-XXXX, Monday, 11:00 a.m. to 4:30 p.m., Tuesday through Thursday, 8:30 a.m. to 4:30 p.m. and Friday, 8:30 a.m. to 2:00 p.m., or stop by our Stock Information Center located at 501 East Lewis & Clark Parkway, Clarksville, Indiana.

Sincerely,

Larry W. Myers

President and Chief Executive Officer

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

LOGO

, 2008

To Members and Friends

of First Savings Bank

Keefe, Bruyette & Woods, Inc., a member of the Financial Industry Regulatory Authority, is assisting First Savings Bank, F.S.B. in converting from the mutual to the stock form of ownership. Upon completion of the conversion, First Savings Bank will be a wholly-owned subsidiary of the newly formed stock holding company, First Savings Financial Group, Inc. In connection with the conversion, First Savings Financial Group is offering shares of its common stock in a subscription and community offering pursuant to a Plan of Conversion.

At the request of First Savings Financial Group, we are enclosing materials explaining this process and your options, including an opportunity to invest in the shares of First Savings Financial Group common stock being offered to customers of First Savings Bank and various other persons until , Eastern time, on , 2008. Please read the enclosed prospectus carefully for a complete description of the stock offering. First Savings Financial Group has asked us to forward the prospectus and accompanying documents to you in view of certain requirements of the securities laws in your state.

Very truly yours,

Keefe, Bruyette & Woods, Inc.

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

F ACTS A BOUT C ONVERSION

The Board of Directors of First Savings Bank, F.S.B. unanimously adopted a Plan of Conversion (the “Plan”) to convert from the mutual to the stock form of ownership.

This brochure answers some of the most frequently asked questions about the conversion and about your opportunity to invest in the common stock of First Savings Financial Group, Inc. (“First Savings Financial Group”), the newly-formed corporation that will become the holding company for First Savings Bank following the conversion.

Investment in the common stock of First Savings Financial Group involves certain risks. For a discussion of these risks and other factors, including a complete description of the offering, investors are urged to read the accompanying prospectus , especially the discussion under the heading “Risk Factors.”

W HY IS F IRST S AVINGS B ANK CONVERTING TO THE STOCK FORM OF ORGANIZATION ?

A conversion to the stock form of organization will enable First Savings Bank to access additional capital through the sale of common stock by First Savings Financial Group. This additional capital will support future lending and operational growth, enhance profitability and earnings through reinvesting and leveraging the proceeds, support future expansion of operations through the establishment or acquisition of banking offices or other financial service providers and implement equity compensation plans to retain and attract qualified directors and employees. In connection with the conversion and stock offering, First Savings Financial Group also intends to establish a charitable foundation to which it will contribute 110,000 shares of its common stock and $100,000 in cash.

W HAT EFFECT WILL THE CONVERSION HAVE ON EXISTING DEPOSIT AND LOAN ACCOUNTS AND CUSTOMER RELATIONSHIPS ?

The conversion will have no effect on existing deposit or loan accounts and customer relationships. Deposits will continue to be federally insured by the Federal Deposit Insurance Corporation to the maximum legal limit. Interest rates and existing terms and conditions on deposit accounts will remain the same upon completion of the conversion. Contractual obligations of borrowers of First Savings Bank will not change and there will be no change in the amount, interest rate, maturity, security or any other condition relating to the respective loans of customers.

A RE F IRST S AVINGS B ANK ’ S DEPOSITORS REQUIRED TO PURCHASE STOCK IN THE CONVERSION ?

No depositor or other person is required to purchase stock. However, depositors and other eligible persons will be provided the opportunity to purchase stock consistent with the established priority of subscription rights, should they so desire. The decision to purchase stock will be exclusively that of each person. Whether an individual decides to purchase stock or not will have no positive or negative impact on his or her standing as a customer of First Savings Bank. The conversion will allow depositors of First Savings Bank an opportunity to buy common stock and become shareholders of First Savings Financial Group.

W HO IS ELIGIBLE TO PURCHASE COMMON SHARES IN THE SUBSCRIPTION OFFERING ?

Certain past and present depositors of First Savings Bank are eligible to purchase common stock in the subscription offering.

H OW MANY COMMON SHARES ARE BEING OFFERED AND AT WHAT PRICE ?

First Savings Financial Group is offering up to 3,553,500 shares of common stock, subject to adjustment as described in the prospectus, at a price of $10.00 per share, through the prospectus.

W HAT IS A CHARITABLE FOUNDATION AND WHY IS F IRST S AVINGS B ANK PROPOSING TO ESTABLISH ONE IN ITS CONVERSION ?

The Plan provides for the establishment and funding of a charitable foundation in connection with the conversion. The foundation, to be known as the “First Savings Charitable Foundation”, is intended to be a tax-exempt private foundation. We intend to make an initial contribution of 110,000 shares of First Savings Financial Group common stock and $100,000 in cash to the Foundation. We anticipate the establishment of the foundation will enable us to increase our annual charitable giving to the communities we serve. This foundation will provide financial support that is consistent with First Savings Bank’s values, is a reflection of First Savings Bank’s heritage as a community-based enterprise, and is a tangible expression of First Savings Bank’s commitment to its community.

H OW MANY SHARES MAY I BUY ?

The minimum order is 25 shares. The maximum individual purchase is 20,000 shares. No person, together with associates of, and persons acting in concert with such person, may purchase more than 35,000 shares of common stock, as further discussed in the prospectus.

W ILL THE COMMON STOCK BE INSURED ?

No. Like any other common stock, First Savings Financial Group’s common stock will not be insured.

H OW DO I ORDER THE COMMON STOCK ?

You must complete the enclosed Stock Order and Certification Form. Instructions for completing your Stock Order and Certification Form are contained on the back of the stock order form. Your order must be received by , Eastern time, on , 2008.

H OW MAY I PAY FOR MY COMMON STOCK ?

First, you may pay for common stock by check or money order made payable to First Savings Financial Group. Interest will be paid by First Savings Financial Group on these funds at First Savings Bank’s passbook savings rate from the day the funds are received until the completion or termination of the conversion. Second, you may authorize us to withdraw funds from your deposit account or certificate of deposit at First Savings Bank for the amount of funds you specify for payment. You will not have access to these funds from the day we receive your order until completion or termination of the conversion. There is no penalty for early withdrawal from a certificate of deposit.

C AN I PURCHASE STOCK USING FUNDS IN MY F IRST S AVINGS B ANK IRA ACCOUNT ?

Yes, to do so, however, you must first establish a self-directed IRA account at an unaffiliated brokerage firm or trust department and transfer a portion or all of the funds in your IRA account at First Savings Bank. Please contact your broker or self-directed IRA provider as soon as possible if you want to explore this option, as these transactions take time.

W ILL DIVIDENDS BE PAID ON THE COMMON STOCK ?

Following the offering, First Savings Financial Group’s board of directors will consider a policy of paying regular cash dividends. However whether or not dividends will be paid, and the timing and amount of such dividends is currently undetermined.

H OW WILL THE COMMON STOCK BE TRADED ?

First Savings Financial Group’s stock is expected to trade on the Nasdaq Capital Market under the ticker symbol “FSFG.” However, no assurance can be given that an active and liquid market will develop.

A RE EXECUTIVE OFFICERS AND DIRECTORS OF F IRST S AVINGS B ANK PLANNING TO PURCHASE STOCK ?

Yes! The executive officers and directors of First Savings Bank plan to purchase, in the aggregate, $1,920,000 worth of stock or approximately 5.4% of the common stock offered at the maximum of the offering range.

M UST I PAY A COMMISSION ?

No. You will not be charged a commission or fee on the purchase of common stock in the conversion.

S HOULD I VOTE TO APPROVE THE P LAN OF C ONVERSION AND ESTABLISHMENT OF THE CHARITABLE FOUNDATION ?

Your Board of Directors unanimously recommends a vote “FOR” the Plan of Conversion and “FOR” the establishment and funding of the charitable foundation. Your “YES” vote is very important!

PLEASE VOTE, SIGN, DATE AND RETURN ALL PROXY CARDS!

W HY DID I GET SEVERAL PROXY CARDS ?

If you have more than one account, you could receive more than one proxy card, depending on the ownership structure of your accounts. Please vote all of the proxy cards you receive.

H OW MANY VOTES DO I HAVE ?

Every depositor is entitled to cast one vote for each $100, or fraction thereof, on deposit as of the voting record date, up to 1,000 votes.

M AY I VOTE IN PERSON AT THE SPECIAL MEETING ?

Yes, but we would still like you to sign, date and mail your proxy today. If you decide to revoke your proxy, you may do so at any time before such proxy is exercised by executing and delivering a later dated proxy or by giving notice of revocation in writing or by voting in person at the special meeting. Attendance at the special meeting will not, of itself, revoke a proxy.

For additional information you may visit or call our stock information center Monday, 11:00 a.m. to 4:30 p.m., Tuesday through Thursday, 8:30 a.m. to 4:30 p.m. and Friday, 8:30 a.m. to 2:00 p.m., located in First Savings Bank’s office at 501 East Lewis & Clark Parkway, Clarksville, Indiana.

(XXX) XXX-XXXX

501 East Lewis & Clark Parkway

Clarksville, Indiana 47129

QUESTIONS

AND

ANSWERS

{Holding Company Logo}

Holding Company for

First Savings Bank, F.S.B.

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

What Investors Need to Know

Key concepts for investors to bear in mind when considering whether to participate in a conversion offering, or a stock offering by a subsidiary of a mutual holding company, include the following:

•

Know the Rules By law, accountholders cannot sell or transfer their priority subscription rights, or the stock itself, prior to the completion of a financial institution’s conversion. Moreover, accountholders cannot enter into agreements or arrangements to sell or transfer either their subscription rights or the underlying conversion stock.

•

“Neither a Borrower nor a Lender Be” If someone offers to lend you money so that you can participate or participate more fully in a conversion, be extremely wary. Be even more wary if the source of the money is someone you do not know. The loan agreement may make you unable to certify truthfully that you are the true holder of the subscription rights and the true purchaser of the stock and that you have no agreements regarding the sale or transfer of the stock.

•

Watch Out for Opportunists The opportunist may tell you that he or she is a lawyer or a consultant or a professional investor or some similarly impressive tale who has experience with similar mutual conversion transactions. The opportunist may go to extreme lengths to assure you that the arrangement you are entering into is legitimate. They might tell you that they have done scores of these transactions and that this is simply how they work. Or they might downplay the warnings or restrictions in the prospectus or order form, telling you that “everyone” enters into such agreements or that the deal they are offering is legitimate. They may also tell you that you have no risk in the transaction. The cold, hard truth is that these are lies, and if you participate, you are breaking the law.

•

Get the Facts from the Source If you have any questions about the securities offering, ask the savings bank or savings association for more information. If you have any doubts about a transaction proposed to you by someone else, ask the financial institution whether the proposed arrangement is proper. You may be able to find helpful resources on the institution’s website or by visiting a branch office.

The bottom line for investors is always to remember that if an opportunity sounds too good to be true, it probably is too good to be true.

Read This First

Office of Thrift Supervision Guidance for Accountholders

Your financial institution is in the process of selling stock to the public, in either a mutual-to-stock conversion or a stock issuance by a subsidiary of a mutual holding company. As an accountholder at this institution, you have certain priority subscription rights to purchase stock in the offering. These priority subscription rights are non-transferable. If you subscribe for stock, you will be asked to sign a statement that the purchase is for your own account, and that you have no agreement or understanding regarding the subsequent sale or transfer of any shares you receive.

On occasion, unscrupulous people attempt to persuade accountholders to transfer subscription rights, or to purchase shares in the offering based on the understanding that the shares will subsequently be transferred to others. Such arrangements violate federal regulations. If you participate in these schemes, you are breaking the law and may be subject to prosecution. If someone attempts to persuade you to participate in such a scheme, please contact Office of Thrift Supervision (OTS) at (312) 917-5000. OTS is very interested in ensuring that the prohibitions on transfer of subscription rights are not violated.

How will you know if you are being approached illegally? Typically, a fraudulent opportunist will approach you and offer to “loan” you money to purchase a significant amount of stock in the offering. In exchange for that “loan” you most likely will be asked either to transfer control of any stock purchased with that money to an account the other person controls, or sell the stock and give the majority of the profits to the other person. You may be told, untruthfully, that there is no risk to you, that the practice is common, and even if you are caught, that your legal expenses will be covered.

On the back of this page is a list of some key concepts that you should keep in mind when considering whether to participate in a mutual-to-stock conversion. If you have questions, please contact the stock information center listed elsewhere in the literature you are receiving. Alternatively, you can contact us at: ombudsman@ots.treas.gov.

PROXY GRAM

PLEASE VOTE TODAY...

We recently sent you a proxy statement and related materials regarding a proposal to convert First Savings Bank from a mutual to a stock form of ownership and a proposal to establish and fund a charitable foundation in connection with the conversion.

Your vote on the Plan of Conversion and establishment and funding of the charitable foundation

has not yet been received.

Voting for the Conversion and for the establishment and funding of the charitable

foundation does not obligate you to purchase stock and will not affect your

accounts or FDIC Insurance Coverage.

Not Returning Your Proxy Cards has the Same Effect as Voting

“Against” the Conversion and “Against” the establishment and

funding of the charitable foundation…and

Your Board of Directors Unanimously Recommends a Vote “FOR” the Conversion and “FOR” the establishment and funding of the charitable foundation.

Your Vote Is Important To Us!

Please sign and date the enclosed proxy card and return it in the postage-paid envelope provided TODAY ! If you received more than one proxy card, please be sure to sign, date and return all cards you received.

Thank you,

Larry W. Myers

President and Chief Executive Officer

First Savings Bank, F.S.B.

Clarksville, Indiana

If you have already mailed your proxy card(s), please accept our thanks and disregard this notice.

For further information call (XXX) XXX-XXXX.

The shares of common stock being offered are not deposits or savings accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

PROXY GRAM II

PLEASE VOTE TODAY.

Your vote on the Plan of Conversion and establishment and funding of the charitable foundation

has not yet been received.

Voting for the Conversion and for the establishment and funding of a

charitable foundation does not obligate you to purchase stock and will not

affect your accounts or FDIC Insurance Coverage.

Not Returning Your Proxy Cards has the Same Effect as Voting “Against”

the Conversion and “Against” the establishment and funding of the

charitable foundation…and

Your Board of Directors Unanimously Recommends a Vote “FOR” the Conversion and “For” the establishment and funding of the charitable foundation.

Our Reasons for the Corporate Change

As a Stock Institution we will be able to :

•

Increase the capital of First Savings Bank to support future lending and operational growth.

•

Enhance profitability and earnings through reinvesting and leveraging the proceeds, primarily through traditional funding and lending activities.

•

Support future branching activities and/or the acquisition of other financial institutions or financial services companies.

•

Implement equity compensation plans to retain and attract qualified directors, officers and staff to enhance current incentive-based compensation programs.

•

Increase our philanthropic endeavors to the community we serve through the formation and funding of First Savings Charitable Foundation.

Your Vote Is Important To Us!

Thank you,

Larry W. Myers

President and Chief Executive Officer

First Savings Bank, F.S.B

Clarksville, Indiana

If you have already mailed your proxy card(s), please accept our thanks and disregard this notice.

For further information call (XXX) XXX-XXXX.

The shares of common stock being offered are not deposits or savings accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

{logo} First Savings Bank

, 2008

Dear Valued First Savings Bank Member:

We recently forwarded you a proxy statement and related materials regarding a proposal to convert First Savings Bank from the mutual to the stock form of ownership and a proposal to establish and fund a charitable foundation in connection with the conversion. This conversion will allow us to operate in essentially the same manner as we currently operate, but provides us with the flexibility to add capital, continue to grow and expand our operations by adding new products and services and increasing our lending capability, and the opportunity to increase our philanthropic endeavors to the community we serve through the establishment and funding of a charitable foundation.

As of today, your vote on our Plan of Conversion and establishment and funding of the charitable foundation has not yet been received. Your Board of Directors unanimously recommends a vote “FOR” the Plan of Conversion and “FOR” establishment and funding of the charitable foundation. If you mailed your proxy, please accept our thanks and disregard this request.

We would sincerely appreciate you signing and dating the enclosed proxy card and returning it promptly in the enclosed postage-paid envelope or dropping it off at your First Savings Bank office. Our meeting on , 2008 is fast approaching and we’d like to receive your vote as soon as possible.

Voting “FOR” the conversion and “FOR” establishment and funding of the charitable foundation does not affect the terms or insurance on your accounts. For further information, call our Stock Information Center at (XXX) XXX-XXXX.

Best regards and thank you,

Larry W. Myers

President and Chief Executive Officer

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

First Savings Bank, F.S.B. Website Message:

Plan of Conversion

and

Stock Offering

Information

First Savings Bank, F.S.B. is pleased to announce that materials were mailed on , 2008 regarding its Plan of Conversion, including the stock offering by First Savings Financial Group, Inc. and establishment and funding of a charitable foundation in connection with the conversion. If you were a depositor as of March 31, 2007 or June 30, 2008, you should be receiving a packet of materials soon. We encourage you to read the information carefully.

If you were a Depositor of First Savings Bank as of the Voting Record Date, , 2008, a proxy card(s) is included. We encourage you to sign, date and return ALL proxy cards as promptly as possible… and THANK YOU!

Information, including a prospectus, regarding First Savings Financial Group’s stock offering was also enclosed. The subscription offering has commenced and continues until , Eastern time, on , 2008, at which time your order must be received if you want to subscribe for stock.

Depending upon the outcome of the Subscription Offering expiring on , 2008 our best estimate at this time for trading of the First Savings Financial Group stock on the NASDAQ Capital Market is late . As described in the prospectus, it could be later. The stock will trade under the ticker symbol “FSFG”. We will keep you as informed as possible on this site.

Our telephone number at the Stock Information Center is (XXX) XXX-XXXX.

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

End of Offering First Savings Bank, F.S.B. Website Message

Stock Issuance Information

The First Savings Financial Group, Inc. stock offering closed on , 2008. The results of the offering are as follows: .

Interest and refund checks [if applicable] will be mailed to subscribers on , 2008 by regular mail to the name and address provided on the Stock Order Form submitted. No special mailing instructions will be accepted.

Allocations will be made available beginning at on , 2008. [If applicable] You can view your allocation online by visiting https://allocations.kbw.com and typing in your order number and the last four digits of your social security number.

Notice to Subscribers not receiving all shares: Please be aware that while we believe this to be a final allocation, we reserve the right to amend this amount up to the time of trading and recommend you verify the number of shares you received on the face of the certificate you will receive prior to trading your shares. [if applicable]

The transfer agent for First Savings Financial Group will be and the phone number for its Investor Relations Department is (XXX) XXX-XXXX.

We anticipate trading to begin on , 2008 on the Nasdaq Capital Market under the symbol “FSFG.”

The shares of common stock being offered are not deposits or savings accounts and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This is not an offer to sell or a solicitation of an offer to buy common stock. The offer is made only by the prospectus.

Exhibit 99.3


FIRST SAVINGS BANK, F.S.B.		REVOCABLE PROXY

Any member giving a proxy may revoke it at any time before it is voted by delivering to the Secretary of First Savings Bank, F.S.B. either a written revocation of the proxy, or a duly executed proxy bearing a later date, or by voting in person at the Special Meeting.

The undersigned hereby acknowledges receipt of a Notice of Special Meeting of Members to be held on the __th day of _________, 2008 and a Proxy Statement for the Special Meeting prior to signing this proxy.

Signature:___________________________________ Date:___________

NOTE: Please sign exactly as your name(s) appear(s) on this Proxy. Only one signature is required in the case of a joint account. When signing in a representative capacity, please give title.

IMPORTANT: Please Detach, Sign and Return ALL proxies from ALL packets received in the enclosed postage paid envelope. FAILURE TO VOTE HAS THE SAME EFFECT AS A VOTE AGAINST THE PLAN AND AGAINST THE ESTABLISHMENT AND FUNDING OF THE CHARITABLE FOUNDATION.

COMPANY

LOGO

SEND OVERNIGHT PACKAGES TO:

Attn: Stock Information Center

501 East Lewis & Clark Parkway

Clarksville, IN 47129

(XXX) XXX-XXXX

(1) Number of Shares

Price Per Share

(2) Total Amount Due

ORDER DEADLINE: The Subscription Offering ends at _____, Eastern time, on _____ __, 2008. Your original Stock Order and Certification Form, properly executed and with the correct payment, must be received (not postmarked) at the address on the top of this form by the deadline, or it will be considered void. Faxes or copies of this form will not be accepted. First Savings Financial Group reserves the right to accept or reject improper order forms.

x $10.00 =

$ .00

Minimum Number of Shares: 25 ($250). Maximum Number of Shares: 20,000 ($200,000). See instructions on Reverse Side

(3a) Method of Payment- Check or Money Order Enclosed is a personal check, bank check or money order made payable to First Savings Financial Group, Inc.

$ .00


(3b) Method of Payment- Deposit Account Withdrawal			(4) Purchaser Information (check one) a. ¨ Eligible Account Holder - Check here if you were a depositor with at least $50 on deposit with First Savings Bank as of March 31, 2007. Enter information in Section 9 for all deposit accounts that you had at First Savings Bank on March 31, 2007. b. ¨ Supplemental Eligible Account Holder - Check here if you were a depositor with at least $50 on deposit with First Savings Bank as of June 30, 2008 but not an Eligible Account Holder. Enter information in Section 9 for all deposit accounts that you had at First Savings Bank as of June 30, 2008. c. ¨ Other Members - Check here if you were a depositor of First Savings Bank as of ____ __, 2008, who were not able to subscribe for shares under the Eligible or Supplemental Account Holders Categories. d. ¨ Local Community - People or trusts for the benefit of people who are residents of Clark, Floyd, Harrison, Jefferson, Scott and Washington Counties in Indiana and Bullitt, Henry, Jefferson, Meade, Nelson, Oldham, Shelby, Spencer and Trimble Counties in Kentucky. e. ¨ General Public
First Savings Bank Deposit Account Number(s)		Withdrawal Amount(s)
MARK THE	Savings ¨
ACCOUNT
TYPE	CD ¨	$ .00
MARK THE	Savings ¨
ACCOUNT
TYPE	CD ¨	$ .00
MARK THE	Savings ¨
ACCOUNT
TYPE	CD ¨	$ .00
	Total Withdrawal	$ .00

(5) Check if you (or a household family member) are a: ¨ Director or Officer of First Savings Bank or First Savings Financial ¨ Employee of First Savings Bank or First Savings Financial

(6) Maximum Purchaser Identification: ¨ Check here if you, individually or together with others (see section 7), are subscribing for the maximum purchase allowed and are interested in purchasing more shares if the two maximum purchase limitations are increased. See Section 1 of the Stock Order Form Instructions on the reverse side.

(7) Associates/Acting in Concert: ¨ Check here if you, or any associates or persons acting in concert with you, have submitted other orders for shares. If you check this box, list below all other orders submitted by you or your associates or by persons acting in concert with you .

Name(s) listed in Section 8 on other Order Forms

Number of Shares Ordered

Name(s) listed in Section 8 on other Order Forms

Number of Shares Ordered

(8) Stock Registration - Please Print Legibly and Fill Out Completely: (Note: The stock certificate and all correspondence related to this stock order will be mailed to the address provided below.)


¨ Individual	¨ Individual Retirement Account	¨ Corporation
¨ Joint Tenants	¨ Uniform Transfer to Minors Act	¨ Partnership
¨ Tenants in Common	¨ Uniform Gift to Minors Act	¨ Trust - Under Agreement Dated


Name				SS# or Tax ID


Name				SS# or Tax ID


Address				Daytime Telephone #


City	State	Zip Code	County	Evening Telephone #

(9) Qualifying Accounts: You should list any accounts that you may have or had with First Savings Bank in the box below. SEE THE STOCK ORDER FORM INSTRUCTION GUIDE ON THE REVERSE SIDE OF THE ORDER FORM FOR FURTHER DETAILS. All subscription orders are subject to the provisions of the stock offering.


*NAMES ON ACCOUNTS*		*ACCOUNT NUMBER*

Please Note: Failure to list all of your accounts may result in the loss of part or all of your subscription rights.

(10) Acknowledgment and Signature : I understand that this Order Form, with full payment and properly executed, must be received by First Savings Financial Group, Inc. no later than , Eastern time, on , 2008, otherwise, this Order Form will be voidable. I agree that after receipt by First Savings Financial Group, Inc., this Order Form may not be modified or cancelled without First Savings Financial Group, Inc.’s consent, and that if withdrawal from a deposit account has been authorized above, the amount will not otherwise be available for withdrawal by me. Under penalty of perjury, I certify that (1) the Social Security or Tax ID information and all other information provided hereon are true, correct and complete, (2) I am purchasing solely for my own account, and there is no agreement or understanding regarding the sale or transfer of the shares, or my right to subscribe for shares, and (3) I am not subject to backup withholding tax [cross out (3) if you have been notified by the IRS that you are subject to backup withholding.] I acknowledge that this security is not a deposit or savings account, is not federally insured, and is not guaranteed by First Savings Financial Group, Inc., First Savings Bank, F.S.B. or by the federal government. If anyone asserts that the shares of common stock are federally insured or guaranteed, or are as safe as an insured deposit, I should call Thomas A. Barnes at the Office of Thrift Supervision’s Central Regional Office at (312) 917-5000. I further certify that, before purchasing the common stock of First Savings Financial Group, Inc., that I received the Prospectus dated , 2008.

The Prospectus that I received, dated , 2008 contains disclosure concerning the nature of the common stock being offered by First Savings Financial Group, Inc. and describes, in the Risk Factors section beginning on page of the Prospectus, the risks involved in the investment in this common stock, including, but not limited to, the following:

1. Our concentration in non-owner occupied real estate loans may expose us to increase credit risk.

2. Our recent emphasis on commercial real estate lending and commercial business lending may expose us to increased lending risks.

3. Our unseasoned commercial real estate loan and commercial business loan portfolios may expose us to increased lending risks.

4. Our construction loan and land development loan portfolios may expose us to increased credit risk.

5. Changing interest rates may hurt our earnings and asset value.

6. A downturn in the local economy or a decline in real estate values could hurt our profits.

7. Strong competition within our primary market area could hurt our profits and slow growth.

8. We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations.

9. Our stock price may decline when trading commences.

10. There may be a limited market for our common stock, which may adversely affect our stock price.

11. Additional expenses following the offering from operating as a public company and from new equity benefit plans will adversely affect our profitability.

12. Our low return on equity may negatively impact the value of our common stock.

13. We have broad discretion in allocating the proceeds of the offering. Our failure to effectively utilize such proceeds would reduce our profitability.

14. Issuance of shares for benefit programs may dilute your ownership interest.

15. The contribution to First Savings Charitable Foundation will decrease the ownership interest and voting interest in the shares issued to the public by __% after the contribution.

16. Our contribution to First Savings Charitable Foundation may not be tax deductible, which could hurt our profits.

17. Establishment of First Savings Charitable Foundation will hurt our profits for fiscal year 2008.

g YOUR ORDER IS NOT VALID UNLESS SIGNED f

ONE SIGNATURE REQUIRED, UNLESS SECTION 3b OF THIS FORM INCLUDES ACCOUNTS REQUIRING MORE THAN ONE SIGNATURE TO AUTHORIZE WITHDRAWAL.

IF SIGNING AS A CUSTODIAN, CORPORATE OFFICER, ETC., PLEASE INCLUDE YOUR FULL TITLE

Signature (title, if applicable) (Date) Signature (title, if applicable) (Date)

For Internal Use Only

REC’D / CHECK# $ CHECK# $ BATCH # ORDER # CATEGORY


FIRST SAVINGS BANK, F.S.B.		REVOCABLE PROXY

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF FIRST SAVINGS BANK, F.S.B. FOR USE AT A SPECIAL MEETING OF MEMBERS TO BE HELD ON , 2008, AND ANY ADJOURNMENTS OF THAT MEETING, FOR THE PURPOSES SET FORTH IN THE FOREGOING NOTICE OF SPECIAL MEETING. YOUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS YOU TO VOTE “FOR” THE APPROVAL OF THE PLAN OF CONVERSION.

The undersigned, being a member of First Savings Bank, F.S.B., hereby authorizes the Board of Directors of First Savings Bank or any successors in their respective positions, as proxy, with full powers of substitution, to represent the undersigned at the Special Meeting of Members of First Savings Bank to be held at , on , 2008 at , Eastern time, and at any adjournment of said meeting, to act with respect to all votes that the undersigned would be entitled to cast, if then personally present, as set forth below:

(1)

Approval of the Plan of Conversion. The approval of the Plan of Conversion (the “Plan”) to convert First Savings Bank from a federal mutual savings bank to a federal stock savings bank, including the adoption of a Federal Stock Charter and By-Laws, with the simultaneous issuance of its common stock to First Savings Financial Group, Inc., an Indiana corporation (the “Company”) and sale by Company of shares of its common stock.

¨ FOR ¨ AGAINST

(2)

The establishment of First Savings Charitable Foundation and the contribution to it of 110,000 shares of common stock of First Savings Financial Group and $100,000 in cash.

¨ FOR ¨ AGAINST

(3)

To vote, in its discretion, upon such other business as may properly come before the Special Meeting or any adjournment thereof. Management is not aware of any other such business that may come before the Special Meeting.

¨ FOR ¨ AGAINST

This proxy, if properly executed, will be voted in accordance with your instructions. If no instructions are given, this proxy, properly signed and dated, will be voted “FOR” adoption of the plan of conversion and “FOR” establishment and funding of the charitable foundation, and if necessary, for adjournment of the Special Meeting. Please date and sign this proxy on the reverse side and return it in the enclosed envelope.

First Savings Financial Group, Inc.

Order Form Instructions

Item 1 and 2 - Fill in the number of shares that you wish to purchase and the total payment due. The amount due is determined by multiplying the number of shares ordered by the subscription price of $10.00 per share. The minimum purchase is 25 shares. Generally, the maximum purchase for any person is 20,000 shares (20,000 shares x $10.00 per share = $200,000). No person, together with “associates”, as defined in the prospectus, and persons “acting in concert”, as defined in the prospectus, may purchase more than 35,000 shares (35,000 shares x $10.00 per share = $350,000) of the common stock offered in the stock offering. For additional information, see “The Conversion and Stock Offering- Limitations on Stock Purchases” in the prospectus.

Item 3a - Payment for shares may be made in cash (only if delivered by you in person, although we request you to exchange the cash for a check with any of the tellers at our First Savings Bank branch) or by check, bank draft or money order payable to First Savings Financial Group. DO NOT MAIL CASH. Your funds will earn interest at First Savings Bank’s passbook savings rate until the stock offering is completed.

Item 3b - To pay by withdrawal from a deposit account or certificate of deposit at First Savings Bank insert the account number(s) and the amount(s) you wish to withdraw from each account. If more than one signature is required for a withdrawal, all signatories must sign in the signature box on the front of the Stock Order form. To withdraw from an account with checking privileges, please write a check. First Savings Bank will waive any applicable penalties for early withdrawal from certificate of deposit accounts (CDs). A hold will be placed on the account(s) for the amount(s) you indicate to be withdrawn. Payments will remain in account(s) until the Stock Offering closes and earn their respective rate of interest, but will not be available for your use until the completion of the transaction.

Item 4 - Please check the appropriate box to tell us the earliest of the three dates that applies to you, or the local or general public boxes if you were not a depositor on any of the key dates.

Item 5 - Please check one of these boxes if you are a director, officer or employee of First Savings Bank or First Savings Financial Group, or a member of such person’s household.

Item 6 - Please check the box, if applicable. If you check the box but have not subscribed for the maximum amount and did not complete Item 7, you may not be eligible to purchase more shares.

Item 7 - Check the box, if applicable, and provide the requested information. Attach a separate page, if necessary. In the Prospectus dated _____ __, 2008, please see the section entitled “The Conversion and Stock Offering - Limitations on Purchases of Shares” for more information regarding the definition of “associate” and “acting in concert”

Item 8 - The stock transfer industry has developed a uniform system of shareholder registrations that we will use in the issuance of First Savings Financial Group common stock. Please complete this section as fully and accurately as possible, and be certain to supply your social security or Tax I.D. number(s) and your daytime and evening phone numbers. We will need to call you if we cannot execute your order as given. If you have any questions regarding the registration of your stock, please consult your legal advisor or contact the Stock Information Center at (XXX) XXX-XXXX. Subscription rights are not transferable. If you are an eligible or supplemental eligible account holder or other depositor, to protect your priority over other purchasers as described in the prospectus, you must take ownership in at least one of the account holder’s names.

Individual - The stock is to be registered in an individual’s name only. You may not list beneficiaries for this ownership.

Joint Tenants - Joint tenants with rights of survivorship identifies two or more owners. When stock is held by joint tenants with rights of survivorship, ownership automatically passes to the surviving joint tenant(s) upon the death of any joint tenant. You may not list beneficiaries for this ownership.

Tenants in Common - Tenants in common may also identify two or more owners. When stock is to be held by tenants in common, upon the death of one co-tenant, ownership of the stock will be held by the surviving co-tenant(s) and by the heirs of the deceased co-tenant. All parties must agree to the transfer or sale of shares held by tenants in common. You may not list beneficiaries for this ownership.

Individual Retirement Account - Individual Retirement Account (“IRA”) holders may only make stock purchases from their existing IRA if it is a self-directed IRA or through a prearranged “trustee-to-trustee” transfer if their IRA is currently at First Savings Bank. The stock cannot be held in your First Savings Bank account. Please contact your broker or self-directed IRA account provider as quickly as possible to explore this option, as it may take several days to complete a trustee-to-trustee transfer .


Registration for IRA’s:		On Name Line 1 - list the name of the broker or trust department followed by CUST or TRUSTEE.
		On Name Line 2 - FBO (for benefit of) YOUR NAME [IRA a/c #______].
		Address will be that of the broker / trust department to where the stock certificate will be sent.
		The Social Security / Tax I.D. number(s) will be either yours or your trustee’s, as the trustee directs .
		Please list your phone numbers.

Uniform Transfers To Minors Act - For residents of Indiana and most states, stock may be held in the name of a custodian for the benefit of a minor under the Uniform Transfers to Minors Act . For residents of California, Delaware, Puerto Rico, South Carolina and Vermont, stock may be held in a similar type of ownership under the Uniform Gifts to Minors Act of the individual state. For either ownership, the minor is the actual owner of the stock with the adult custodian being responsible for the investment until the child reaches legal age. Only one custodian and one minor may be designated.


Registration for UTMA or UGMA:		On Name Line 1 - print the name of the custodian followed by the abbreviation “CUST”
		On Name Line 2 - FBO (for benefit of) followed by the name of the minor, followed by UTMA-IN
		(or your state’s abbreviation) or UGMA-CA (or your state’s abbreviation)
		List only the minor’s social security number on the form.

Corporation/Partnership - Corporations/Partnerships may purchase stock. Please provide the Corporation/Partnership’s legal name and Tax I.D. To have priority subscription rights, the Corporation/Partnership must have an account in the legal name. Please contact the Stock Information Center to verify subscription rights and purchase limitations.

Fiduciary/Trust - Generally, fiduciary relationships (such as Trusts, Estates, Guardianships, etc.) are established under a form of trust agreement or a court order. Without a legal document establishing a fiduciary relationship, your stock may not be registered in a fiduciary capacity.

Instructions: On the first name line, print the first name, middle initial and last name of the fiduciary if the fiduciary is an individual. If the fiduciary is a corporation, list the corporate title on the first name line. Following the name, print the fiduciary title, such as trustee, executor, personal representative, etc. On the second name line, print the name of the maker, donor or testator or the name of the beneficiary. Following the name, indicate the type of legal document establishing the fiduciary relationship (agreement, court order, etc.). In the blank after “Under Agreement Dated,” fill in the date of the document governing the relationship. The date of the document need not be provided for a trust created by a will.

Item 9 - You should list any qualifying accounts that you have or may have had with First Savings Bank in the box located under the heading “Qualifying Accounts”. For example, if you are ordering stock in just your name, you should list all of your account numbers as of the earliest of the three dates that you were a depositor. Similarly, if you are ordering stock jointly with another depositor, you should list all account numbers under which either of you are owners, i.e. individual accounts, joint accounts, etc. If you are ordering stock in your minor child’s or grandchild’s name under the Uniform Transfers to Minors Act , the minor must have had an account number on one of the three dates and you should list only their account number(s). If you are ordering stock as a corporation, you need to list just that corporation’s account number, as your individual account number(s) do not qualify. Failure to list all of your qualifying deposit account numbers may result in the loss of part or all of your subscription rights.

Item 10 - Sign and date the form where indicated. Before you sign please read carefully and review the information which you have provided and read the acknowledgement. Only one signature is required, unless any account listed in section 3b of this form requires more than one signature to authorize a withdrawal. Please review the Prospectus dated _____ __, 2008 carefully before making an investment decision.

Should you have any questions, please call our Stock Information Center at (XXX) XXX-XXXX, Monday, 11:00 a.m. to 4:30 p.m., Tuesday through Thursday, 8:30 a.m. to 4:30 p.m. and Friday, from 8:30 a.m. to 2:00 p.m., Eastern time, except bank holidays

Exhibit 99.4

GIFT INSTRUMENT

CHARITABLE GIFT TO

FIRST SAVINGS CHARITABLE FOUNDATION

First Savings Financial Group, Inc. (the “Company”), desires to make a gift of its common stock and cash to First Savings Charitable Foundation (the “Foundation”), a nonprofit corporation organized under the laws of the State of Delaware. The purpose of the donation is to establish a bond between the Company and the communities in which it and its affiliates operate and to enable the community to share in the potential growth and success of the Company and its affiliates over the long term. To that end, the Company now gives, transfers, and delivers to the Foundation 110,000 shares of its common stock and $100,000 in cash, subject to the following conditions:

1. The Foundation’s primary purpose is to serve and make grants in the Company’s local community in accordance with the provisions of the Foundation’s Certificate of Incorporation.

2. As long as the Foundation controls shares of Company common stock, it must vote those shares in the same ratio as all other shares voted on each proposal considered by the stockholders of the Company.

3. For at least five years after the organization of the Foundation: (a) one seat on the Foundation’s board of directors shall be reserved for an independent director from the Company’s local community who is not an officer, director or employee of the Company or First Federal Savings Bank (the “Bank”) or an officer, director or employee of the Company’s or the Bank’s affiliates who has experience with local community charitable organizations and grant making; and (b) one seat on the Foundation’s board of directors shall be reserved for a director from the board of directors of the Company or the Bank or the board of directors of an acquiror or resulting institution in the event of a merger or acquisition of the Company or the Bank.

4. The Foundation shall comply with the following regulatory requirements imposed by the Office of Thrift Supervision (“OTS”):

(a)

the OTS may examine the Foundation at the Foundation’s expense;

(b)

the Foundation must comply with all supervisory directives that the OTS imposes;

(c)

the Foundation must annually provide to the OTS a copy of the annual report that is submitted to the Internal Revenue Service;

(d)

the Foundation must operate according to written policies adopted by its board of directors, including a conflict of interest policy; and

(e)

the Foundation may not engage in self-dealing, and must comply with all laws necessary to maintain its tax exempt status under the Internal Revenue Code.


Dated: , 2008		FIRST SAVINGS FINANCIAL GROUP, INC.

		By:

Agreed and Accepted


FIRST SAVINGS CHARITABLE FOUNDATION



By: