UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q


[ X ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                       OF THE SECURITIES EXCAHNGE ACT 1934

For the quarterly period ended June 30, 2001

OR

[    ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                      OF THE SECURITIES EXCHANGE ACT OF 1934

                         Commission File Number 0-11132

                           FIRST BANKING CENTER, INC.
             (Exact name of registrant as specified in its charter)

              Wisconsin                                 39-1391327
      (State or other jurisdiction of                 (I.R.S.Employer
       incorporation or organization)                  Identification No.)



           400 Milwaukee Ave., Burlington, WI              53105
          (Address of principal executive offices)       (Zip Code)



                                 (262) 763-3581
              (Registrant's telephone number, including area code)

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

Yes     [ X ]     No [   ]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock,  as of August 3, 2001.  Common stock,  $1.00 par value,  1,470,793
shares outstanding.
<PAGE>
                    FIRST BANKING CENTER, INC AND SUBSIDIARY
                                      INDEX
                                  June 30, 2001



Part I   Financial Information

         Item 1       Consolidated Financial Statements

                      Unaudited Consolidated Balance Sheets,
                      June 30, 2001 and December 31, 2000

                      Unaudited Consolidated Statements of Income, For the
                      three months ended June 30, 2001 and 2000

                      Unaudited Consolidated Statements of Cash Flows, For
                      the three months ended June 30, 2001 and 2000

                      Notes to Unaudited Consolidated Financial Statements

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

         Item 3       Quantitative and Qualitative Disclosures about Market Risk

Part II  Other Information

         Item 1       Legal Proceedings

         Item 2       Changes in Securities and Use of Proceeds

         Item 3       Defaults upon Senior Securities

         Item 4       Submission of Matters to a Vote of Security Holders

         Item 5       Other Information

         Item 6       Exhibits and Reports on Form 8-K

         Signature
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
<TABLE>
                                    FIRST BANKING CENTER, INC. AND SUBSIDIARY
                                      UNAUDITED CONSOLIDATED BALANCE SHEETS

<CAPTION>
                                                                                         June 30,    December 31,
ASSETS                                                                                     2001          2000
                                                                                      -----------------------------
                                                                                             (In thousands)
<S>                                                                                   <C>            <C>
  Cash and due from banks                                                                    $12,742       $29,287
  Federal funds sold                                                                           8,129             0
  Interest-bearing deposits in banks                                                             673           696
  Available for sale securities                                                               47,386        65,189
  Loans, less allowance for loan losses of $4,003 and
    $3,927 in 2001 and 2000, respectively                                                    339,532       316,641
  Office buildings and equipment, net                                                         10,180         9,825
  Other assets                                                                                10,301         9,220
                                                                                      -----------------------------

      TOTAL ASSETS                                                                          $428,943      $430,858
                                                                                      =============================

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
  Deposits
    Demand                                                                                   $52,417       $59,602
    Savings and NOW accounts                                                                 154,338       150,438
    Time                                                                                     125,513       124,900
                                                                                      -----------------------------
      Total Deposits                                                                         332,268       334,940
  Securities sold under agreements to repurchase
      and federal funds purchased                                                             16,446        17,299
  Short-term borrowings                                                                       15,640        26,168
  Long-term borrowings                                                                        19,526         9,876
  Other liabilities                                                                            4,754         4,627
                                                                                      -----------------------------

      TOTAL LIABILITIES                                                                     $388,634      $392,910
                                                                                      -----------------------------

STOCKHOLDERS' EQUITY
  Common Stock, $1.00 par value 3,000,000 shares authorized; 1,489,380 shares
    issued as of June 30, 2001 and
    December 31, 2000, respectively                                                            1,489         1,489
  Surplus                                                                                      4,177         4,178
  Retained Earnings                                                                           34,650        32,525
                                                                                      -----------------------------
                                                                                              40,316        38,192
  Common stock in treasury, at cost-18,587 and 12,358 shares
   for June 30, 2001 and December 31, 2000, respectively                                       ($680)        ($452)
  Accumulated other comprehensive income                                                         673           208
                                                                                      -----------------------------

      TOTAL STOCKHOLDERS' EQUITY                                                             $40,309       $37,948
                                                                                      -----------------------------

      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                            $428,943      $430,858
                                                                                      =============================



                                 "See accompanying notes to financial statements"
</TABLE>
<PAGE>
<TABLE>
                                        FIRST BANKING CENTER, INC. AND SUBSIDIARY
                                       UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

<CAPTION>
                                                                      Three months ended            Six months ended
                                                                           June 30,                     June 30,
                                                                     2001           2000           2001          2000
                                                                 ----------------------------------------------------------
                                                                           (In thousands, except per share data)
<S>                                                              <C>            <C>            <C>            <C>
INTEREST INCOME
  Interest and fees on loans                                            $7,443         $6,804        $14,820       $13,215
  Interest and dividends on securities
    Taxable                                                                303            493            717         1,004
    Non-taxable                                                            348            332            674           653
  Interest on federal funds sold                                            81             16            160            56
  Interest on interest-bearing deposits in banks                            60              0             71             1
                                                                 ----------------------------------------------------------
      TOTAL INTEREST INCOME                                              8,235          7,645         16,442        14,929
                                                                 ----------------------------------------------------------

INTEREST EXPENSE
  Interest on deposits                                                   3,040          2,982          6,330         5,779
  Interest on securities sold under agreements to repurchase
    and federal funds purchased                                            183            237            476           498
  Interest on other borrowings                                             445            422            819           814
                                                                 ----------------------------------------------------------
      TOTAL INTEREST EXPENSE                                             3,668          3,641          7,625         7,091
                                                                 ----------------------------------------------------------
      NET INTEREST INCOME BEFORE PROVISION FOR
         LOAN LOSSES                                                     4,567          4,004          8,817         7,838
  Provision for loan losses                                                 90             90            180           180
                                                                 ----------------------------------------------------------
      NET INTEREST INCOME AFTER PROVISION FOR
        LOAN LOSSES                                                      4,477          3,914          8,637         7,658
                                                                 ----------------------------------------------------------

NON-INTEREST INCOME
  Trust                                                                    137            125            275           225
  Service charges on deposit accounts                                      398            334            719           647
  Investment securities gains (losses)                                       0              0              0            (5)
  Other income                                                             289            372            586           654
                                                                 ----------------------------------------------------------
      TOTAL NON-INTEREST INCOME                                            824            831          1,580         1,521
                                                                 ----------------------------------------------------------

NON-INTEREST EXPENSE
  Salary and employee benefits                                           1,870          1,691          3,723         3,347
  Occupancy                                                                222            222            473           440
  Equipment                                                                345            372            673           689
  Data Processing services                                                 191            154            383           308
  Goodwill amortization                                                     26             25             51            51
  Other                                                                    726            642          1,383         1,247
                                                                 ----------------------------------------------------------
      TOTAL NON-INTEREST EXPENSE                                         3,380          3,106          6,686         6,082
                                                                 ----------------------------------------------------------

      INCOME BEFORE INCOME TAXES                                         1,921          1,639          3,531         3,097
  Income taxes                                                             501            462            906           847
                                                                 ----------------------------------------------------------
      NET INCOME                                                        $1,420         $1,177         $2,625        $2,250
                                                                 ==========================================================

        Basic earnings per share                                         $0.96          $0.79          $1.78         $1.52
        Diluted earnings per share                                       $0.96          $0.79          $1.77         $1.51
        Dividends per share                                              $0.34          $0.32          $0.34         $0.32



                                     "See accompanying notes to financial statements"
</TABLE>
<PAGE>
<TABLE>
                                 FIRST BANKING CENTER, INC. AND SUBSIDIARY
                              UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

<CAPTION>
                                                                                       Six months ended
                                                                                           June 30,
                                                                                      2001         2000
                                                                                  ---------------------------
                                                                                        (In thousands)
<S>                                                                               <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                                                                          $2,625        $2,250
    Depreciation                                                                           411           434
    Provision for loan losses                                                              180           180
    Loans originated for sale                                                          (52,080)      (16,281)
    Proceeds from sale of loans                                                         50,126        18,095
    Gain on sale of loans                                                                    0            (9)
    Gain on disposal of office building and equipment                                        0           104
    Amortization of premiums and accretion of discounts
      on securities, net                                                                    23            28
    Amortization                                                                            51            52
    Loss on sale of investment securities                                                    0             5
    Decrease in other assets                                                            (1,372)         (111)
    Decrease in accrued expenses and other liabilities                                     127           216
                                                                                  ---------------------------
        NET CASH PROVIDED BY OPERATING ACTIVITIES                                           91         4,963
                                                                                  ---------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Net increase in interest-bearing deposits in banks                                      23             9
    Net (increase) decrease in federal funds sold                                       (8,129)        4,242
    Activity in available for sale securities:
       Proceeds from sales of available for sale securities                              2,786         8,669
       Proceeds from maturities of available for sale securities                        61,116         8,471
       Purchase of available for sale securities                                       (45,417)      (20,058)
    Net increase in loans                                                              (21,117)      (14,377)
    Purchase of office buildings and equipment, net                                       (766)         (672)
                                                                                  ---------------------------
        NET CASH USED IN INVESTING ACTIVITIES                                          (11,504)      (13,716)
                                                                                  ---------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Net increase (decrease) in deposits                                                 (2,672)        4,573
    Dividends paid                                                                        (500)         (474)
    Proceeds from other borrowings                                                      10,000         2,000
    Payments on other borrowings                                                       (10,878)         (206)
    Net decrease in securities sold under agreements
      to repurchase and federal funds purchased                                           (853)       (2,667)
    Purchase of treasury stock                                                            (231)          (34)
    Proceeds from reissuance of treasury stock under
       stock option plan                                                                     2            38
                                                                                  ---------------------------
        NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                             (5,132)        3,230
                                                                                  ---------------------------
    Net decrease in Cash and Due From Banks                                            (16,545)       (5,523)
Cash and Due From Banks-Beginning of Period                                             29,287        19,123
                                                                                  ---------------------------
                                                                                  ---------------------------
    Cash and Due From Banks-End of Period                                              $12,742       $13,600
                                                                                  ===========================

Supplemental disclosures of cash flow information: Cash paid during the period
    for:
    Interest                                                                            $7,839        $7,117
    Income taxes                                                                        $1,060          $500
Supplemental schedule of non-cash investing and financing activities:
           Net change in unrealized gain on available for sale securities                 $465           $11



                              "See accompanying notes to financial statements"
</TABLE>
<PAGE>
                    FIRST BANKING CENTER, INC AND SUBSIDIARY
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30,2001

NOTE 1 - Basis of Presentation

The unaudited  consolidated  financial  statements include the accounts of First
Banking  Center,  Inc. and its  subsidiary  (the  "Company").  In the opinion of
management,  all adjustments  (consisting only of normal recurring  adjustments)
necessary  for a  fair  presentation  of  the  financial  position,  results  of
operation and cash flows for the interim  periods have been made. The results of
operations for the three and six months ended June 30, 2001 are not  necessarily
indicative of the results to be expected for the entire fiscal year.

The unaudited interim financial statements have been prepared in conformity with
generally  accepted  accounting   principles  and  industry  practice.   Certain
information in footnote  disclosure  normally  included in financial  statements
prepared  in  accordance  with  generally  accepted  accounting  principles  and
industry   practice  has  been  condensed  or  omitted  pursuant  to  rules  and
regulations  of  the  Securities  and  Exchange   Commission.   These  financial
statements  should  be read  in  conjunction  with  the  consolidated  financial
statements and notes thereto included in the Company's December 31, 2000 audited
financial statements.

The preparation of financial  statements in conformity  with generally  accepted
accounting  principles  requires  management to make  estimates and  assumptions
which affect the reported  amounts of assets and  liabilities  and disclosure of
contingent assets and liabilities as of the date of the financial statements, as
well as the reported amounts of income and expenses during the reported periods.
Actual results could differ from those estimates.

NOTE 2 - Earnings Per Share

The following information  calculates the computation of earnings per share on a
basic and diluted basis.
<TABLE>
<CAPTION>
                                                                          Three Months Ended                 Six Months Ended
                                                                                June 30,                          June 30,
                                                                         2001             2000             2001             2000
                                                                --------------------------------------------------------------------
                                                                          (In thousands, except per share data)
<S>                                                             <C>                 <C>              <C>              <C>
Basic
Net income                                                                $1,420           $1,177           $2,625           $2,250
Weighted average shares outstanding                                        1,471            1,480            1,471            1,480
Basic earnings per share                                                   $0.96            $0.79            $1.78            $1.52
                                                                ====================================================================

Diluted
Net income                                                                $1,420           $1,177           $2,625           $2,250
Weighted average shares outstanding                                        1,471            1,480            1,471            1,480
Effect of dilutive stock options outstanding                                  16               12               16               12
                                                                --------------------------------------------------------------------
Diluted weighted average shares outstanding                                1,487            1,492            1,487            1,492
Diluted earnings per share                                                 $0.96            $0.79            $1.77            $1.51
                                                                ====================================================================
</TABLE>
NOTE 3-Comprehensive Income

The following table presents our comprehensive income.
<TABLE>
<CAPTION>

                                                                                Three Months Ended             Six Months Ended
                                                                                       June 30,                    June 30,
                                                                                  2001          2000          2001          2000
                                                                         -----------------------------------------------------------
                                                                                  (In thousands)                    (In thousands)
<S>                                                                      <C>                <C>           <C>           <C>
Net income                                                                         $1,420        $1,177        $2,625        $2,250
Other comprehensive income
  Net change in unrealized gain (loss) on available for sale securities                $2          $102          $465           $11
                                                                         -----------------------------------------------------------
Total comprehensive income                                                         $1,422        $1,279        $3,090        $2,261
                                                                         ===========================================================
</TABLE>
<PAGE>

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

                    FIRST BANKING CENTER, INC AND SUBSIDIARY
                       MANAGEMENTS DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                               As of June 30, 2001

The following discussion provides additional analysis of the financial condition
and results of operations of the Company for the six months ended June 30, 2001.
This discussion  focuses on the significant  factors that affected the Company's
earnings so far in 2001,  with  comparisons to 2000. As of June 30, 2001,  First
Banking  Center (the "Bank") was the only direct  subsidiary  of the Company and
its operations  contributed  nearly all of the revenue for the year. The Company
provides  various support  functions for the Bank and receives  payment from the
Bank for these  services.  These  intercompany  payments are  eliminated for the
purpose  of these  consolidated  financial  statements.  The Bank has two wholly
owned  subsidiaries,  FBC Financial  Services,  Corp., a brokerage and financial
services subsidiary, and FBC-Burlington,  Inc., an investment subsidiary located
in Nevada.

Overview

As of June 30, 2001,  total Company assets were $428.9 million  decreasing  .44%
from $430.9 million as of December 31, 2000. Total income,  as of June 30, 2001,
was $2.6 million or $1.78 per share, increasing 16.7% from $2.3 million or $1.52
per  share in 2000.  The  significant  items  resulting  in the  above-mentioned
results are discussed below.

Financial Condition

Loans

Loans  outstanding  were $343.5  million and $320.6 million on June 30, 2001 and
December 31, 2000 respectively.  This represents an increase of $23.0 million or
7.2%.  The  following  table  summarizes  the  changes to date in the major loan
classifications.
<TABLE>
<CAPTION>

                                                                                                 As a % of Total Loans
                                              June 30,     December 31,     Change in          June 30,     December 31,
                                                2001           2000          Balance             2001           2000
                                            --------------------------------------------     ------------------------------
                                            --------------------------------------------     ------------------------------
                                                         (Amounts in million)
<S>                                         <C>          <C>             <C>                 <C>          <C>
Residential Real Estate                       $150.2          $135.7          $14.5             43.7%          42.3%
Commercial Real Estate                         $86.8           $85.2           $1.6             25.3%          26.6%
Construction and Land Development              $38.5           $42.2          ($3.7)            11.2%          13.2%
Commercial                                     $30.1           $26.2           $3.9              8.8%           8.2%
</TABLE>

Allowance for Loan Losses

The  allowance  for possible loan losses was $4.0 million or 1.2% of gross loans
on June 30, 2001,  compared with $3.9 million or 1.2% of gross loans on December
31, 2000. Net charge-offs were $104 thousand or .03% of gross loans, compared to
net charge-offs of $14 thousand or .004% of gross loans for December 31, 2000.

The allowance for loan losses is established through a provision for loan losses
charged to expense. Loans are charged against the allowance for loan losses when
management  believes that the  collectibility of the principal is unlikely.  The
allowance for loan losses is adequate to cover probable  credit losses  relating
to specifically  identified loans, as well as probable credit losses inherent in
the balance of the loan portfolio. In accordance with FASB Statements 5 and 114,
the  allowance is provided for losses that have been  incurred as of the balance
sheet  date.  The  allowance  is  based  on past  events  and  current  economic
conditions,  and does not include  the  effects of  expected  losses on specific
loans or groups of loans that are related to future  events or expected  changes
in economic  conditions.  Management  reviews a calculation of the allowance for
loan losses on a quarterly  basis.  While  management uses the best  information
available to make its  evaluation,  future  adjustments  to the allowance may be
necessary  if there are  significant  changes in economic  conditions.  Impaired
loans are  measured  based on the present  value of  expected  future cash flows
discounted at the loan's effective  interest rate or, as a practical  expedient,
at the loan's observable market price or the fair value of the collateral if the
loan is  collateral  dependent.  A loan is  impaired  when  it is  probable  the
creditor  will be unable to  collect  all  contractual  principal  and  interest
payments due in accordance with the terms of the loan agreement.

<PAGE>

In addition,  various regulatory agencies  periodically review the allowance for
loan  losses.  These  agencies  may  require the bank to make  additions  to the
allowance for loan losses based on their  judgments of  collectibility  based on
information available to them at the time of their examination.

As of June 30, 2001, $180 thousand was charged to current  earnings and added to
the allowance for loan losses.

Non-accrual, Past Due and Renegotiated Loans
<TABLE>
<CAPTION>
                                                                                 June 30,       December 31,
                                                                                   2001             2000
                                                                             ----------------------------------
                                                                                      (In thousands)
<S>                                                                          <C>                <C>
Non-accrual Loans (a)                                                                  $1,416             $827
Past Due 90 days +                                                                          0                0
Restructured Loans                                                                          0                0
</TABLE>


The  policy of the  Company  is to place a loan on  non-accrual  status  if: (a)
payment in full of interest and principal is not  expected,  or (b) principal or
interest  has  been in  default  for a  period  of 90 days  or more  unless  the
obligation is both in the process of collection  and well secured.  Well secured
is defined as collateral with sufficient market value to repay principal and all
accrued  interest.  A debt is in the process of  collection if collection of the
debt  is  proceeding  in due  course  either  through  legal  action,  including
judgement  enforcement  procedures,  or in  appropriate  circumstances,  through
collection  efforts not involving legal action which are reasonably  expected to
result in repayment of the dept or in its  restoration  to current  status.  The
non-accrual  loans  consisted  primarily of $789  thousand of  residential  real
estate  loans,  $377 thousand of  commercial  real estate,  and $120 thousand of
construction  and  land  development  loans.  On June  30,  2001,  the  ratio of
non-accrual  loans to the allowance for loan losses was 35.4%  compared to 21.1%
on December 31, 2000.

As of June 30, 2001, the Company had loans  totaling  $23,581,000 in addition to
those listed as non-accrual,  past due or  renegotiated  that were identified by
the Banks'  internal asset rating  systems as classified  assets and loans which
management has determined  require  additional  monitoring.  This  represents an
increase of $5,669,000 or 31.6% from December 31, 2000.  Management is not aware
of any significant  loans,  group of loans or segments of the loan portfolio not
included  above,  where  full  collectibility  cannot  reasonably  be  expected.
Management  has  committed  resources  and is  focusing  on efforts  designed to
control the amount of classified assets. The company does not have a substantial
portion of its loans  concentrated  in one or a few  industries nor does it have
any foreign  loans  outstanding  as of June 30, 2001.  The  company's  loans are
concentrated  geographically  in the  Wisconsin  counties  of Racine,  Walworth,
Kenosha, Lafayette and Green.

Investments securities - Available for Sale

The securities available-for-sale portfolio decreased $17.8 million or 27.3%, as
of June 30, 2001.  The decrease came from four areas of the security  portfolio.
Commercial  paper had $2.6 million in  maturities.  $4.2 million of money market
mutual  funds  were  transferred  to  Fed  Funds.  Due to  regulatory  reporting
purposes,  $2.3 million of equity  securities were  transferred to other assets.
U.S.  Government Agency Securities had $9.0 million in calls, due to a declining
rate environment, and $3.3 million in maturities.

Deposits and Borrowed Funds

Total  deposits and borrowed funds were $383.9 million on June 30, 2001 compared
to $388.3  million on December 31,  2000.  This is a decrease of $4.4 million or
1.1%. The decrease is due in part to normal  seasonal  decline in the collection
and  distribution  of tax funds by  municipal  customers.  The  following  table
summarizes  the changes in the major  classifications  of deposits  and borrowed
funds.

<PAGE>
<TABLE>
<CAPTION>

                                                         June 30,      December 31,                  Change in
                                                           2001            2000                       Balance
                                                       --------------------------------             ------------
                                                                        (Amounts in millions)
<S>                                                    <C>             <C>                          <C>
Money Market and Savings                                      $132.9            $121.8                 $11.1
Demand  Deposits                                               $52.4             $59.6                ($7.2)
Time Deposits less than $100,000                               $91.2             $86.6                 $4.6
Time Deposits equal or greater than $100,000                   $34.3             $38.3                ($4.0)
Securities sold under agreement to repurchase                  $16.4             $17.3                ($0.9)
Federal Home Loan Borrowings                                   $34.5             $35.3                ($0.9)
</TABLE>

Capital resources

As of June 30, 2001, the Company's  stockholders'  equity increased $2.4 million
or 6.2%. Net income of $2.6 million was the primary  reasons for the increase in
equity.  The company  purchased  $231 thousand of treasury stock so far in 2001.
Unrealized  gains on available for sale  securities  increased  $465 thousand to
$673 thousand.

In December 1990,  the Federal  Reserve  Board's  risk-based  guidelines  became
effective.  Under these  guidelines  capital is measured  against the  Company's
subsidiary  bank's  risk-weighted  assets.  The Company's tier 1 capital (common
stockholders'  equity less goodwill) to  risk-weighted  assets was 11.5% at June
30, 2001,  well above the 4% minimum  required.  Total capital to  risk-adjusted
assets was 12.7%, also well above the 8% minimum requirement. The leverage ratio
was at 9.4%  compared to the 4% minimum  requirement.  According to FDIC capital
guidelines,   the   Company's   subsidiary   bank  is  considered  to  be  "well
capitalized."

Results of operations

Net Interest Income

Net interest income is the difference  between interest income and fees on loans
and interest expense,  and is the largest  contributing factor to net income for
the  Company.  All  discussions  of rate are on a  tax-equivalent  basis,  which
accounts for income earned on  securities  that are not fully subject to federal
taxes.  Net interest  income was $8.8 million and $7.8 million for June 30, 2001
and June 30, 2000  respectively.  Net interest income as a percentage of average
earning assets (net interest  margin) was 4.8% and 4.5% for the first six months
of 2001 and 2000 respectively.

The  following  table  summarizes  the  changes  and  reasons for the changes in
interest income and fees on loans during 2001 and 2000. The increase in interest
income and fees on loans as of June 30, 2001 was due to both increased yields on
earning assets and increased  average earning  assets.  The increase in interest
income  and fees on loans as of June 30,  2000 was due  primarily  to  increased
average earning assets.
<TABLE>
<CAPTION>
                                                                                                      Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
<S>                                               <C>                   <C>                 <C>                 <C>
Interest income                                        $16.8                 $15.3              $1.5                  $1.8
Earning assets (Average balances)                     $384.3                $364.5             $19.8                 $26.0
Yield on earning assets                                8.77%                 8.42%             0.35%                 0.23%
</TABLE>

The  following  table  summarizes  the  changes  and  reasons for the changes in
interest  expense for the six months ended June 30, 2001 and 2000.  The increase
in  interest  expense  as of June  30,  2001 was a result  of  average  balances
outstanding increasing. The increase in interest expense as of June 30, 2000 was
due to increased  rates paid for  liabilities  and  increased  average  balances
outstanding.
<TABLE>
<CAPTION>
                                                                                                      Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
<S>                                               <C>                    <C>                <C>                 <C>
Interest expense                                        $7.6                  $7.1              $0.5                  $1.0
Interest bearing liabilities (Average balances)       $320.7                $304.1             $16.7                 $20.3
Cost of interest bearing liabilities                   4.75%                 4.66%             0.09%                 0.39%
</TABLE>


<PAGE>


The major component of interest income and fees on loans is the income generated
by loans.  The table below  summarizes the income,  average balance and yield on
loans for 2001 and 2000.
<TABLE>
<CAPTION>

                                                                                                     Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
<S>                                               <C>                    <C>                <C>                   <C>
Interest income                                        $14.8                 $13.2              $1.6                  $1.5
Loans (Average balances)                              $323.9                $303.9             $20.0                 $34.5
Yield on loans                                         9.15%                 8.70%             0.45%                 0.04%
</TABLE>

The major  components of interest  expense are interest paid on  Certificates of
Deposit (Time Deposits) and on Money Market Deposits. The tables below summarize
the expense,  average  balance and rates on these  components for 2001 and 2000.
The increase in interest expense on Time Deposits was a result of an increase in
both rate and average balance, as of June 30, 2001. The increase in Money Market
Deposits was a result of an increase in average balance, as of June 30, 2001.

Non-interest income
<TABLE>
<CAPTION>
                                                                                                     Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
     Time deposits                                    2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
<S>                                               <C>                    <C>                <C>                   <C>
Interest expense                                        $4.1                  $3.7              $0.4                  $0.3
Time deposits (Average balances)                      $172.4                $170.3              $2.1                  $4.3
Cost of time deposits                                  4.76%                 4.38%             0.38%                 0.22%


                                                                                                     Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
     Money Market deposits                                 2001                2000            2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest expense                                         $2.2                 $2.1              $0.2                  $0.6
Money Market deposits (Average balances)               $100.2                $85.5             $14.7                 $15.2
Cost of Money Market deposits                           4.45%                4.80%            -0.35%                 0.81%
</TABLE>

Non-interest  income  increased  $59 thousand or 3.9% as of June 30,  2001.  The
increase  came in  primarily  two areas.  Service  charges  on deposit  accounts
increased  $72  thousand  as the number of  accounts  grew and  charges for some
services  were  increased.  Trust income  increased $50 thousand as that line of
business continues to grow.

Non-interest expense

Non-interest  expense  increased  $604  thousand  or 9.9% as of June  30,  2001.
Salaries and benefits  accounted for $376 thousand of the increase due to normal
wage increases and increased  health  insurance  costs.  Data  processing  costs
increased $75 thousand due to increased  volumes and  additional  services used.
Occupancy  expense  increased  $33 thousand  due  primarily to increases in real
estate and personal property taxes.

Asset/liability management

The principal  function of  asset/liability  management is to manage the balance
sheet mix,  maturities,  repricing  characteristics  and pricing  components  to
provide an adequate and stable net interest  margin with an acceptable  level of
risk over time and through interest rate cycles.

Interest-sensitive  assets  and  liabilities  are  those  that  are  subject  to
repricing   within  a  specific   relevant  time  horizon.   The  Bank  measures
interest-sensitive  assets and  liabilities,  and their  relationship  with each
other at terms of immediate, quarterly intervals up to 1 year, and over 1 year.

Changes in net interest income,  other than volume related,  arise when interest
rates on assets  reprice in a time frame or interest  rate  environment  that is
different  from the repricing  period for  liabilities.  Changes in net interest
income  also  arise  from  changes  in the mix of  interest  earning  assets and
interest-bearing liabilities.

<PAGE>

The Bank's  strategy with respect to  asset/liability  management is to maximize
net  interest  income  while  limiting  its  exposure  to a  potential  downward
movement.  Strategy is implemented by the Bank's management,  which takes action
based upon its analysis of the Bank's  present  positioning,  its desired future
positioning,  economic  forecasts,  and its goals.  It is the  Bank's  desire to
maintain a cumulative GAP of positive or negative 15% of rate  sensitive  assets
at the 1-year  time  frame.  The  current  percentage  is a positive  7%,  which
compares to a positive 2% as of December 31, 2000.

Liquidity

Liquidity  measures  the  ability  of  First  Banking  Center  to meet  maturing
obligations and its existing commitments,  to withstand  fluctuations in deposit
levels, to fund its operations,  and to provide for customers' credit needs. One
source of  liquidity is cash and  short-term  assets,  such as  interest-bearing
deposits in other banks and federal  funds sold,  which totaled $21.5 million at
June 30, 2001,  compared with $30.0 million at December 31, 2000. The Bank has a
variety of sources of short-term  liquidity  available to it, including  federal
funds  purchased from  correspondent  banks,  sales of securities  available for
sale, FHLB advances,  lines of credit and loan  participations  or sales.  First
Banking Center also generates  liquidity from the regular principal payments and
prepayments made on its portfolio of loans and mortgage-backed securities.

The   liquidity  of  First   Banking   Center  is  comprised  of  three  primary
classifications: cash flows from operating activities, cash flows from investing
activities,  and cash flows from  financing  activities.  Net cash  provided  by
operating activities was $91 thousand. Net cash used in investing activities was
$11.5 million. Net cash used in financing activities was $5.1 million.

As of June 30, 2000, net cash provided by operating activities was $5.0 million.
Net cash used in investing  activities was $13.7  million.  Net cash provided by
financing activities was $3.2 million.

Impact of Inflation and Changing Prices

The  consolidated  financial  statements  and the  accompanying  notes have been
prepared in accordance  with generally  accepted  accounting  principles,  which
require the measurement of financial  position and operating results in terms of
historical  dollar  amounts  without  considering  the  changes in the  relative
purchasing power of money over time due to inflation. The impact of inflation is
reflected in the increased  cost of First Banking  Center's  operations.  Unlike
industrial companies,  nearly all of the assets and liabilities of First Banking
Center are monetary in nature. As a result, interest rates have a greater impact
on First Banking  Center's  performance than do the effects of general levels of
inflation.  Interest rates do not  necessarily  move in the same direction or to
the same extent as the price of goods and services.

Forward Looking  Statements- Safe Harbor Statement under the Private  Securities
Litigation Reform Act of 1995

This report contains certain  forward-looking  statements  within the meaning of
Section  27A of the  Securities  Act of 1933,  as amended and Section 21E of the
Securities  Exchange Act of 1934, as amended.  First Banking Center intends such
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking  statements  contained in the Private  Securities  Reform Act of
1995,  and is  including  this  statement  for  purposes  of these  safe  harbor
provisions.  Forward-looking statements,  which are based on certain assumptions
and describe First Banking  Center's future plans,  strategies and  expectations
are generally  identifiable by use of the words "believe,"  "expect,"  "intend,"
"anticipate,"  "estimate,"  "project"  or  similar  expressions.  First  Banking
Center's  ability to predict  results  or the actual  effect of future  plans or
strategies is inherently uncertain.  Factors which could have a material adverse
affect on First Banking Center's  operations and future prospects  include,  but
are not limited to, changes in: interest  rates,  general  economic  conditions,
legislative/regulatory  changes,  monetary  and  fiscal  policies  of  the  U.S.
Government,  including  policies of the U.S.  Treasury  and the Federal  Reserve
Board, the quality or composition of the loan or investment  portfolios,  demand
for loan products, deposit flows, competition,  demand for financial services in
our market area, our implementation of new technologies,  First Banking Center's
ability to develop  and  maintain  secure and  reliable  electronic  systems and
accounting  principles,  policies and guidelines.  These risks and uncertainties
should be considered in evaluating forward-looking statements and undue reliance
should not be placed on such statements.

<PAGE>

Current Accounting Developments

The  Financial  Accounting  Standards  Board (FASB)  issued  Statement  No. 133,
Accounting for Derivative Instruments and Hedging Activities, which is effective
for all fiscal  quarters of fiscal years  beginning  after June 15,  2001.  This
Statement,  as  amended  by FASB  Statement  No.  137 and No.  138,  establishes
accounting and reporting standards for derivative instruments, including certain
derivative  instruments  embedded in other contracts and for hedging activities.
It  requires  that an entity  recognize  all  derivatives  as  either  assets or
liabilities in the statement of financial position and measure those instruments
at fair value.  The  accounting  for  changes in the fair value of a  derivative
depends on the intended use of the  derivative  and the  resulting  designation.
Management  believes  adoption  of this  Statement  will  have no  effect on the
consolidated financial statements.

The Financial  Accounting  Standards Board (FASB) has issued  Statement No. 140,
Accounting for Transfers and Servicing of Financial  Assets and  Extinguishments
of Liabilities.  This Statement replaces FASB Statement No. 125 in its entirety.
It revises the standards for accounting for  securitizations and other transfers
of financial assets and collateral and requires certain disclosures, but carries
over  most of  Statement  No.  125's  provisions  without  reconsideration.  The
Statement is  effective  for  transfers  and  servicing of financial  assets and
extinguishments  of liabilities  occurring after March 31, 2001. The adoption of
this Statement had no material effect on the consolidated financial statements.

In July 2001, the FASB issued  Statement of Financial  Accounting  Standards No.
141, Business  Combinations (SFAS No. 141) and Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangible Assets (SFAS No. 142). SFAS No.
141 addresses financial  accounting and reporting for business  combinations and
is effective for all business  combinations  initiated after June 30, 2001. SFAS
No. 142 addresses  financial  accounting and reporting for acquired goodwill and
other  intangible  assets and is  effective  for fiscal  years  beginning  after
December 15,  2001.  The Company has not yet  completed  its  assessment  of the
effects  of these  new  pronouncements  on its  financial  statements  and so is
uncertain  as  to  the  impact.  The  standards  generally  are  required  to be
implemented by the Company in its 2002 financial statements.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

The company has not experienced any material changes to its market risk position
since  December 31, 2000,  from that  disclosed in the company's  2000 Form 10-K
Annual Report.  First Banking  Center,  like other  financial  institutions,  is
subject to direct and  indirect  market  risk.  Direct  market  risk exists from
changes in interest rates. First Banking Center's net income is dependent on its
net interest income. Net interest income is susceptible to interest rate risk to
the degree that  interest-bearing  liabilities  mature or reprice on a different
basis than interest-earning assets. When interest-bearing  liabilities mature or
reprice  more  quickly  than  interest-earning  assets  in  a  given  period,  a
significant  increase in market  rates of interest  could  adversely  affect net
interest income.

Similarly,  when  interest-earning  assets  mature or reprice  more quickly than
interest-bearing liabilities,  falling interest rates could result in a decrease
in net income.

In an attempt to manage its  exposure to changes in interest  rates,  management
monitors  First  Banking  Center's  interest  rate  risk.  The   Asset/Liability
Committee  meets quarterly to review First Banking  Center's  interest rate risk
position  and   profitability,   and  to  make  or  recommend   adjustments  for
consideration  by the Board of  Directors.  Management  also  reviews the Bank's
securities portfolio,  formulates investment strategies, and oversees the timing
and   implementation  of  transactions  to  assure  attainment  of  the  Board's
objectives in the most effective manner.  Notwithstanding First Banking Center's
interest rate risk management  activities,  the potential for changing  interest
rates is an uncertainty that can have an adverse effect on net income.

In adjusting  First Banking  Center's  asset/liability  position,  the Board and
management  attempt to manage First  Banking  Center's  interest rate risk while
maintaining or enhancing net interest margins. At times,  depending on the level
of general  interest rates, the  relationship  between  long-term and short-term
interest  rates,  market  conditions  and  competitive  factors,  the  Board and
management  may decide to increase  First  Banking  Center's  interest rate risk
position  somewhat in order to increase its net interest  margin.  First Banking
Center's  results of operations  and net portfolio  values remain  vulnerable to
increases  in  interest  rates and to  fluctuations  in the  difference  between
long-term and short-term interest rates.

<PAGE>

One approach  used to quantify  interest  rate risk is the net  portfolio  value
("NPV") analysis.  In essence,  this analysis  calculates the difference between
the present  value of  liabilities  and the present value of expected cash flows
from assets and off-balance-sheet contracts. The most recent NPV analysis, as of
June 30, 2001, projects that net portfolio value would decrease by approximately
10.3% if  interest  rates  would  rise 200 basis  points and would  decrease  by
approximately  5.3% if interest  rates would rise 100 basis points over the next
year. It projects an increase in net portfolio value of  approximately  12.3% if
interest  rates would drop 200 basis points and  approximately  5.8% if interest
rates would drop 100 basis points. Both simulations are within board-established
policy  limits.  First Banking  Center's  policy is to limit the effect of a 200
basis point rate shock to plus or minus 20% of projected net interest income and
to minus 35% of the market value of portfolio equity.

First  Banking  Center does not  currently  engage in trading  activities or use
derivative   instruments  to  control  interest  rate  risk.  Even  though  such
activities may be permitted  with the approval of the Board of Directors,  First
Banking  Center does not intend to engage in such  activities  in the  immediate
future.

Interest rate risk is the most  significant  market risk affecting First Banking
Center.  Other types of market risk, such as foreign currency exchange rate risk
and  commodity  price risk,  do not arise in the normal  course of First Banking
Center's business activities.


<PAGE>


Part II-OTHER INFORMATION
Item 1.  Legal Proceedings

              None

Item 2.  Changes in Securities

             None

Item 3.  Defaults upon Senior Securities

             None

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

A.    The Corporation held its Annual Meeting of Shareholders on April 17, 2001.

B.    Votes cast for  the election  of  three directors to serve  until the 2004
      Annual Meeting of Shareholders are as follow

 Director                         For                Withhold            Against

 David Boilini                  886,746                1,117                0
 Thomas Laken, Jr.              885,768                2,095                0
 Daniel T. Jacobson             885,429                2,434                0

      The continuing Directors of the Corporation are as follows:

 John S. Smith
 John M. Ernster
 Richard McKinney
 Keith Blumer
 Brantly Chappell
 Melvin W. Wendt
 Charles R. Wellington
 Robert Fait

      Votes cast to amend the 1994 Incentive Stock Plan are as follows:

                                  For                Against           Abstained

                                817,761               55,103              14,999

Item 5.  Other Information

             None

Item 6.  Exhibits and Reports on Form 8-K

             None


<PAGE>


                   FIRST BANKING CENTER, INC AND SUBSIDIARIES


                                   SIGNATURES





Pursuant to the requirements of the Securities Exchange Act of 1943, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.










                           First Banking Center, Inc.





August 14, 2001                                      __________________________
Date                                                 Brantly Chappell
                                                     Chief Executive Officer




August 14, 2001                                       __________________________
Date                                                  James Schuster
                                                      Chief Financial Officer
[{"type": "10-Q", "sequence": "1", "filename": "jun200110q.txt", "description": "10Q FOR THE QUATER ENDED JUNE 30, 2001", "secsgml_size_bytes": 62782}]
{"company-data": {"conformed-name": "FIRST BANKING CENTER INC", "cik": "0000356858", "assigned-sic": "6022", "irs-number": "391391327", "state-of-incorporation": "WI", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "10-Q", "act": "34", "file-number": "000-11132", "film-number": "1713619"}, "business-address": {"street1": "400 MILWAUKEE AVE", "street2": "P O BOX 660", "city": "BURLINGTON", "state": "WI", "zip": "53105", "phone": "4147633581"}, "mail-address": {"street1": "567 BROAD ST", "street2": "PO BOX 970", "city": "LAKE GENEVA", "state": "WI", "zip": "53147"}, "former-company": {"former-conformed-name": "FIRST COMMUNITY BANK GROUP INC", "date-changed": "19850312"}}
UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q

[ X ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                       OF THE SECURITIES EXCAHNGE ACT 1934

For the quarterly period ended June 30, 2001

OR

[    ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
                      OF THE SECURITIES EXCHANGE ACT OF 1934

                         Commission File Number 0-11132

                           FIRST BANKING CENTER, INC.
             (Exact name of registrant as specified in its charter)

              Wisconsin                                 39-1391327
      (State or other jurisdiction of                 (I.R.S.Employer
       incorporation or organization)                  Identification No.)

           400 Milwaukee Ave., Burlington, WI              53105
          (Address of principal executive offices)       (Zip Code)

                                 (262) 763-3581
              (Registrant's telephone number, including area code)

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

Yes     [ X ]     No [   ]

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock,  as of August 3, 2001.  Common stock,  $1.00 par value,  1,470,793
shares outstanding.
FIRST BANKING CENTER, INC AND SUBSIDIARY
                                      INDEX
                                  June 30, 2001

Part I   Financial Information

         Item 1       Consolidated Financial Statements

                      Unaudited Consolidated Balance Sheets,
                      June 30, 2001 and December 31, 2000

                      Unaudited Consolidated Statements of Income, For the
                      three months ended June 30, 2001 and 2000

                      Unaudited Consolidated Statements of Cash Flows, For
                      the three months ended June 30, 2001 and 2000

                      Notes to Unaudited Consolidated Financial Statements

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

         Item 3       Quantitative and Qualitative Disclosures about Market Risk

Part II  Other Information

         Item 1       Legal Proceedings

         Item 2       Changes in Securities and Use of Proceeds

         Item 3       Defaults upon Senior Securities

         Item 4       Submission of Matters to a Vote of Security Holders

         Item 5       Other Information

         Item 6       Exhibits and Reports on Form 8-K

         Signature
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements

                                    FIRST BANKING CENTER, INC. AND SUBSIDIARY
                                      UNAUDITED CONSOLIDATED BALANCE SHEETS
June 30,    December 31,
ASSETS                                                                                     2001          2000
                                                                                      -----------------------------
                                                                                             (In thousands)
Cash and due from banks                                                                    $12,742       $29,287
  Federal funds sold                                                                           8,129             0
  Interest-bearing deposits in banks                                                             673           696
  Available for sale securities                                                               47,386        65,189
  Loans, less allowance for loan losses of $4,003 and
    $3,927 in 2001 and 2000, respectively                                                    339,532       316,641
  Office buildings and equipment, net                                                         10,180         9,825
  Other assets                                                                                10,301         9,220
                                                                                      -----------------------------

      TOTAL ASSETS                                                                          $428,943      $430,858
                                                                                      =============================

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
  Deposits
    Demand                                                                                   $52,417       $59,602
    Savings and NOW accounts                                                                 154,338       150,438
    Time                                                                                     125,513       124,900
                                                                                      -----------------------------
      Total Deposits                                                                         332,268       334,940
  Securities sold under agreements to repurchase
      and federal funds purchased                                                             16,446        17,299
  Short-term borrowings                                                                       15,640        26,168
  Long-term borrowings                                                                        19,526         9,876
  Other liabilities                                                                            4,754         4,627
                                                                                      -----------------------------

      TOTAL LIABILITIES                                                                     $388,634      $392,910
                                                                                      -----------------------------

STOCKHOLDERS' EQUITY
  Common Stock, $1.00 par value 3,000,000 shares authorized; 1,489,380 shares
    issued as of June 30, 2001 and
    December 31, 2000, respectively                                                            1,489         1,489
  Surplus                                                                                      4,177         4,178
  Retained Earnings                                                                           34,650        32,525
                                                                                      -----------------------------
                                                                                              40,316        38,192
  Common stock in treasury, at cost-18,587 and 12,358 shares
   for June 30, 2001 and December 31, 2000, respectively                                       ($680)        ($452)
  Accumulated other comprehensive income                                                         673           208
                                                                                      -----------------------------

      TOTAL STOCKHOLDERS' EQUITY                                                             $40,309       $37,948
                                                                                      -----------------------------

      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                            $428,943      $430,858
                                                                                      =============================

                                 "See accompanying notes to financial statements"
FIRST BANKING CENTER, INC. AND SUBSIDIARY
                                       UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
Three months ended            Six months ended
                                                                           June 30,                     June 30,
                                                                     2001           2000           2001          2000
                                                                 ----------------------------------------------------------
                                                                           (In thousands, except per share data)
INTEREST INCOME
  Interest and fees on loans                                            $7,443         $6,804        $14,820       $13,215
  Interest and dividends on securities
    Taxable                                                                303            493            717         1,004
    Non-taxable                                                            348            332            674           653
  Interest on federal funds sold                                            81             16            160            56
  Interest on interest-bearing deposits in banks                            60              0             71             1
                                                                 ----------------------------------------------------------
      TOTAL INTEREST INCOME                                              8,235          7,645         16,442        14,929
                                                                 ----------------------------------------------------------

INTEREST EXPENSE
  Interest on deposits                                                   3,040          2,982          6,330         5,779
  Interest on securities sold under agreements to repurchase
    and federal funds purchased                                            183            237            476           498
  Interest on other borrowings                                             445            422            819           814
                                                                 ----------------------------------------------------------
      TOTAL INTEREST EXPENSE                                             3,668          3,641          7,625         7,091
                                                                 ----------------------------------------------------------
      NET INTEREST INCOME BEFORE PROVISION FOR
         LOAN LOSSES                                                     4,567          4,004          8,817         7,838
  Provision for loan losses                                                 90             90            180           180
                                                                 ----------------------------------------------------------
      NET INTEREST INCOME AFTER PROVISION FOR
        LOAN LOSSES                                                      4,477          3,914          8,637         7,658
                                                                 ----------------------------------------------------------

NON-INTEREST INCOME
  Trust                                                                    137            125            275           225
  Service charges on deposit accounts                                      398            334            719           647
  Investment securities gains (losses)                                       0              0              0            (5)
  Other income                                                             289            372            586           654
                                                                 ----------------------------------------------------------
      TOTAL NON-INTEREST INCOME                                            824            831          1,580         1,521
                                                                 ----------------------------------------------------------

NON-INTEREST EXPENSE
  Salary and employee benefits                                           1,870          1,691          3,723         3,347
  Occupancy                                                                222            222            473           440
  Equipment                                                                345            372            673           689
  Data Processing services                                                 191            154            383           308
  Goodwill amortization                                                     26             25             51            51
  Other                                                                    726            642          1,383         1,247
                                                                 ----------------------------------------------------------
      TOTAL NON-INTEREST EXPENSE                                         3,380          3,106          6,686         6,082
                                                                 ----------------------------------------------------------

      INCOME BEFORE INCOME TAXES                                         1,921          1,639          3,531         3,097
  Income taxes                                                             501            462            906           847
                                                                 ----------------------------------------------------------
      NET INCOME                                                        $1,420         $1,177         $2,625        $2,250
                                                                 ==========================================================

        Basic earnings per share                                         $0.96          $0.79          $1.78         $1.52
        Diluted earnings per share                                       $0.96          $0.79          $1.77         $1.51
        Dividends per share                                              $0.34          $0.32          $0.34         $0.32

                                     "See accompanying notes to financial statements"
FIRST BANKING CENTER, INC. AND SUBSIDIARY
                              UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended
                                                                                           June 30,
                                                                                      2001         2000
                                                                                  ---------------------------
                                                                                        (In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                                                                          $2,625        $2,250
    Depreciation                                                                           411           434
    Provision for loan losses                                                              180           180
    Loans originated for sale                                                          (52,080)      (16,281)
    Proceeds from sale of loans                                                         50,126        18,095
    Gain on sale of loans                                                                    0            (9)
    Gain on disposal of office building and equipment                                        0           104
    Amortization of premiums and accretion of discounts
      on securities, net                                                                    23            28
    Amortization                                                                            51            52
    Loss on sale of investment securities                                                    0             5
    Decrease in other assets                                                            (1,372)         (111)
    Decrease in accrued expenses and other liabilities                                     127           216
                                                                                  ---------------------------
        NET CASH PROVIDED BY OPERATING ACTIVITIES                                           91         4,963
                                                                                  ---------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Net increase in interest-bearing deposits in banks                                      23             9
    Net (increase) decrease in federal funds sold                                       (8,129)        4,242
    Activity in available for sale securities:
       Proceeds from sales of available for sale securities                              2,786         8,669
       Proceeds from maturities of available for sale securities                        61,116         8,471
       Purchase of available for sale securities                                       (45,417)      (20,058)
    Net increase in loans                                                              (21,117)      (14,377)
    Purchase of office buildings and equipment, net                                       (766)         (672)
                                                                                  ---------------------------
        NET CASH USED IN INVESTING ACTIVITIES                                          (11,504)      (13,716)
                                                                                  ---------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Net increase (decrease) in deposits                                                 (2,672)        4,573
    Dividends paid                                                                        (500)         (474)
    Proceeds from other borrowings                                                      10,000         2,000
    Payments on other borrowings                                                       (10,878)         (206)
    Net decrease in securities sold under agreements
      to repurchase and federal funds purchased                                           (853)       (2,667)
    Purchase of treasury stock                                                            (231)          (34)
    Proceeds from reissuance of treasury stock under
       stock option plan                                                                     2            38
                                                                                  ---------------------------
        NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES                             (5,132)        3,230
                                                                                  ---------------------------
    Net decrease in Cash and Due From Banks                                            (16,545)       (5,523)
Cash and Due From Banks-Beginning of Period                                             29,287        19,123
                                                                                  ---------------------------
                                                                                  ---------------------------
    Cash and Due From Banks-End of Period                                              $12,742       $13,600
                                                                                  ===========================

Supplemental disclosures of cash flow information: Cash paid during the period
    for:
    Interest                                                                            $7,839        $7,117
    Income taxes                                                                        $1,060          $500
Supplemental schedule of non-cash investing and financing activities:
           Net change in unrealized gain on available for sale securities                 $465           $11

                              "See accompanying notes to financial statements"
FIRST BANKING CENTER, INC AND SUBSIDIARY
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30,2001

NOTE 1 - Basis of Presentation

The unaudited  consolidated  financial  statements include the accounts of First
Banking  Center,  Inc. and its  subsidiary  (the  "Company").  In the opinion of
management,  all adjustments  (consisting only of normal recurring  adjustments)
necessary  for a  fair  presentation  of  the  financial  position,  results  of
operation and cash flows for the interim  periods have been made. The results of
operations for the three and six months ended June 30, 2001 are not  necessarily
indicative of the results to be expected for the entire fiscal year.

The unaudited interim financial statements have been prepared in conformity with
generally  accepted  accounting   principles  and  industry  practice.   Certain
information in footnote  disclosure  normally  included in financial  statements
prepared  in  accordance  with  generally  accepted  accounting  principles  and
industry   practice  has  been  condensed  or  omitted  pursuant  to  rules  and
regulations  of  the  Securities  and  Exchange   Commission.   These  financial
statements  should  be read  in  conjunction  with  the  consolidated  financial
statements and notes thereto included in the Company's December 31, 2000 audited
financial statements.

The preparation of financial  statements in conformity  with generally  accepted
accounting  principles  requires  management to make  estimates and  assumptions
which affect the reported  amounts of assets and  liabilities  and disclosure of
contingent assets and liabilities as of the date of the financial statements, as
well as the reported amounts of income and expenses during the reported periods.
Actual results could differ from those estimates.

NOTE 2 - Earnings Per Share

The following information  calculates the computation of earnings per share on a
basic and diluted basis.
Three Months Ended                 Six Months Ended
                                                                                June 30,                          June 30,
                                                                         2001             2000             2001             2000
                                                                --------------------------------------------------------------------
                                                                          (In thousands, except per share data)
Basic
Net income                                                                $1,420           $1,177           $2,625           $2,250
Weighted average shares outstanding                                        1,471            1,480            1,471            1,480
Basic earnings per share                                                   $0.96            $0.79            $1.78            $1.52
                                                                ====================================================================

Diluted
Net income                                                                $1,420           $1,177           $2,625           $2,250
Weighted average shares outstanding                                        1,471            1,480            1,471            1,480
Effect of dilutive stock options outstanding                                  16               12               16               12
                                                                --------------------------------------------------------------------
Diluted weighted average shares outstanding                                1,487            1,492            1,487            1,492
Diluted earnings per share                                                 $0.96            $0.79            $1.77            $1.51
                                                                ====================================================================
NOTE 3-Comprehensive Income

The following table presents our comprehensive income.
Three Months Ended             Six Months Ended
                                                                                       June 30,                    June 30,
                                                                                  2001          2000          2001          2000
                                                                         -----------------------------------------------------------
                                                                                  (In thousands)                    (In thousands)
Net income                                                                         $1,420        $1,177        $2,625        $2,250
Other comprehensive income
  Net change in unrealized gain (loss) on available for sale securities                $2          $102          $465           $11
                                                                         -----------------------------------------------------------
Total comprehensive income                                                         $1,422        $1,279        $3,090        $2,261
                                                                         ===========================================================
Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

                    FIRST BANKING CENTER, INC AND SUBSIDIARY
                       MANAGEMENTS DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                               As of June 30, 2001

The following discussion provides additional analysis of the financial condition
and results of operations of the Company for the six months ended June 30, 2001.
This discussion  focuses on the significant  factors that affected the Company's
earnings so far in 2001,  with  comparisons to 2000. As of June 30, 2001,  First
Banking  Center (the "Bank") was the only direct  subsidiary  of the Company and
its operations  contributed  nearly all of the revenue for the year. The Company
provides  various support  functions for the Bank and receives  payment from the
Bank for these  services.  These  intercompany  payments are  eliminated for the
purpose  of these  consolidated  financial  statements.  The Bank has two wholly
owned  subsidiaries,  FBC Financial  Services,  Corp., a brokerage and financial
services subsidiary, and FBC-Burlington,  Inc., an investment subsidiary located
in Nevada.

Overview

As of June 30, 2001,  total Company assets were $428.9 million  decreasing  .44%
from $430.9 million as of December 31, 2000. Total income,  as of June 30, 2001,
was $2.6 million or $1.78 per share, increasing 16.7% from $2.3 million or $1.52
per  share in 2000.  The  significant  items  resulting  in the  above-mentioned
results are discussed below.

Financial Condition

Loans

Loans  outstanding  were $343.5  million and $320.6 million on June 30, 2001 and
December 31, 2000 respectively.  This represents an increase of $23.0 million or
7.2%.  The  following  table  summarizes  the  changes to date in the major loan
classifications.
As a % of Total Loans
                                              June 30,     December 31,     Change in          June 30,     December 31,
                                                2001           2000          Balance             2001           2000
                                            --------------------------------------------     ------------------------------
                                            --------------------------------------------     ------------------------------
                                                         (Amounts in million)
Residential Real Estate                       $150.2          $135.7          $14.5             43.7%          42.3%
Commercial Real Estate                         $86.8           $85.2           $1.6             25.3%          26.6%
Construction and Land Development              $38.5           $42.2          ($3.7)            11.2%          13.2%
Commercial                                     $30.1           $26.2           $3.9              8.8%           8.2%
Allowance for Loan Losses

The  allowance  for possible loan losses was $4.0 million or 1.2% of gross loans
on June 30, 2001,  compared with $3.9 million or 1.2% of gross loans on December
31, 2000. Net charge-offs were $104 thousand or .03% of gross loans, compared to
net charge-offs of $14 thousand or .004% of gross loans for December 31, 2000.

The allowance for loan losses is established through a provision for loan losses
charged to expense. Loans are charged against the allowance for loan losses when
management  believes that the  collectibility of the principal is unlikely.  The
allowance for loan losses is adequate to cover probable  credit losses  relating
to specifically  identified loans, as well as probable credit losses inherent in
the balance of the loan portfolio. In accordance with FASB Statements 5 and 114,
the  allowance is provided for losses that have been  incurred as of the balance
sheet  date.  The  allowance  is  based  on past  events  and  current  economic
conditions,  and does not include  the  effects of  expected  losses on specific
loans or groups of loans that are related to future  events or expected  changes
in economic  conditions.  Management  reviews a calculation of the allowance for
loan losses on a quarterly  basis.  While  management uses the best  information
available to make its  evaluation,  future  adjustments  to the allowance may be
necessary  if there are  significant  changes in economic  conditions.  Impaired
loans are  measured  based on the present  value of  expected  future cash flows
discounted at the loan's effective  interest rate or, as a practical  expedient,
at the loan's observable market price or the fair value of the collateral if the
loan is  collateral  dependent.  A loan is  impaired  when  it is  probable  the
creditor  will be unable to  collect  all  contractual  principal  and  interest
payments due in accordance with the terms of the loan agreement.
In addition,  various regulatory agencies  periodically review the allowance for
loan  losses.  These  agencies  may  require the bank to make  additions  to the
allowance for loan losses based on their  judgments of  collectibility  based on
information available to them at the time of their examination.

As of June 30, 2001, $180 thousand was charged to current  earnings and added to
the allowance for loan losses.

Non-accrual, Past Due and Renegotiated Loans
June 30,       December 31,
                                                                                   2001             2000
                                                                             ----------------------------------
                                                                                      (In thousands)
Non-accrual Loans (a)                                                                  $1,416             $827
Past Due 90 days +                                                                          0                0
Restructured Loans                                                                          0                0
The  policy of the  Company  is to place a loan on  non-accrual  status  if: (a)
payment in full of interest and principal is not  expected,  or (b) principal or
interest  has  been in  default  for a  period  of 90 days  or more  unless  the
obligation is both in the process of collection  and well secured.  Well secured
is defined as collateral with sufficient market value to repay principal and all
accrued  interest.  A debt is in the process of  collection if collection of the
debt  is  proceeding  in due  course  either  through  legal  action,  including
judgement  enforcement  procedures,  or in  appropriate  circumstances,  through
collection  efforts not involving legal action which are reasonably  expected to
result in repayment of the dept or in its  restoration  to current  status.  The
non-accrual  loans  consisted  primarily of $789  thousand of  residential  real
estate  loans,  $377 thousand of  commercial  real estate,  and $120 thousand of
construction  and  land  development  loans.  On June  30,  2001,  the  ratio of
non-accrual  loans to the allowance for loan losses was 35.4%  compared to 21.1%
on December 31, 2000.

As of June 30, 2001, the Company had loans  totaling  $23,581,000 in addition to
those listed as non-accrual,  past due or  renegotiated  that were identified by
the Banks'  internal asset rating  systems as classified  assets and loans which
management has determined  require  additional  monitoring.  This  represents an
increase of $5,669,000 or 31.6% from December 31, 2000.  Management is not aware
of any significant  loans,  group of loans or segments of the loan portfolio not
included  above,  where  full  collectibility  cannot  reasonably  be  expected.
Management  has  committed  resources  and is  focusing  on efforts  designed to
control the amount of classified assets. The company does not have a substantial
portion of its loans  concentrated  in one or a few  industries nor does it have
any foreign  loans  outstanding  as of June 30, 2001.  The  company's  loans are
concentrated  geographically  in the  Wisconsin  counties  of Racine,  Walworth,
Kenosha, Lafayette and Green.

Investments securities - Available for Sale

The securities available-for-sale portfolio decreased $17.8 million or 27.3%, as
of June 30, 2001.  The decrease came from four areas of the security  portfolio.
Commercial  paper had $2.6 million in  maturities.  $4.2 million of money market
mutual  funds  were  transferred  to  Fed  Funds.  Due to  regulatory  reporting
purposes,  $2.3 million of equity  securities were  transferred to other assets.
U.S.  Government Agency Securities had $9.0 million in calls, due to a declining
rate environment, and $3.3 million in maturities.

Deposits and Borrowed Funds

Total  deposits and borrowed funds were $383.9 million on June 30, 2001 compared
to $388.3  million on December 31,  2000.  This is a decrease of $4.4 million or
1.1%. The decrease is due in part to normal  seasonal  decline in the collection
and  distribution  of tax funds by  municipal  customers.  The  following  table
summarizes  the changes in the major  classifications  of deposits  and borrowed
funds.
June 30,      December 31,                  Change in
                                                           2001            2000                       Balance
                                                       --------------------------------             ------------
                                                                        (Amounts in millions)
Money Market and Savings                                      $132.9            $121.8                 $11.1
Demand  Deposits                                               $52.4             $59.6                ($7.2)
Time Deposits less than $100,000                               $91.2             $86.6                 $4.6
Time Deposits equal or greater than $100,000                   $34.3             $38.3                ($4.0)
Securities sold under agreement to repurchase                  $16.4             $17.3                ($0.9)
Federal Home Loan Borrowings                                   $34.5             $35.3                ($0.9)
Capital resources

As of June 30, 2001, the Company's  stockholders'  equity increased $2.4 million
or 6.2%. Net income of $2.6 million was the primary  reasons for the increase in
equity.  The company  purchased  $231 thousand of treasury stock so far in 2001.
Unrealized  gains on available for sale  securities  increased  $465 thousand to
$673 thousand.

In December 1990,  the Federal  Reserve  Board's  risk-based  guidelines  became
effective.  Under these  guidelines  capital is measured  against the  Company's
subsidiary  bank's  risk-weighted  assets.  The Company's tier 1 capital (common
stockholders'  equity less goodwill) to  risk-weighted  assets was 11.5% at June
30, 2001,  well above the 4% minimum  required.  Total capital to  risk-adjusted
assets was 12.7%, also well above the 8% minimum requirement. The leverage ratio
was at 9.4%  compared to the 4% minimum  requirement.  According to FDIC capital
guidelines,   the   Company's   subsidiary   bank  is  considered  to  be  "well
capitalized."

Results of operations

Net Interest Income

Net interest income is the difference  between interest income and fees on loans
and interest expense,  and is the largest  contributing factor to net income for
the  Company.  All  discussions  of rate are on a  tax-equivalent  basis,  which
accounts for income earned on  securities  that are not fully subject to federal
taxes.  Net interest  income was $8.8 million and $7.8 million for June 30, 2001
and June 30, 2000  respectively.  Net interest income as a percentage of average
earning assets (net interest  margin) was 4.8% and 4.5% for the first six months
of 2001 and 2000 respectively.

The  following  table  summarizes  the  changes  and  reasons for the changes in
interest income and fees on loans during 2001 and 2000. The increase in interest
income and fees on loans as of June 30, 2001 was due to both increased yields on
earning assets and increased  average earning  assets.  The increase in interest
income  and fees on loans as of June 30,  2000 was due  primarily  to  increased
average earning assets.
Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest income                                        $16.8                 $15.3              $1.5                  $1.8
Earning assets (Average balances)                     $384.3                $364.5             $19.8                 $26.0
Yield on earning assets                                8.77%                 8.42%             0.35%                 0.23%
The  following  table  summarizes  the  changes  and  reasons for the changes in
interest  expense for the six months ended June 30, 2001 and 2000.  The increase
in  interest  expense  as of June  30,  2001 was a result  of  average  balances
outstanding increasing. The increase in interest expense as of June 30, 2000 was
due to increased  rates paid for  liabilities  and  increased  average  balances
outstanding.
Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest expense                                        $7.6                  $7.1              $0.5                  $1.0
Interest bearing liabilities (Average balances)       $320.7                $304.1             $16.7                 $20.3
Cost of interest bearing liabilities                   4.75%                 4.66%             0.09%                 0.39%
The major component of interest income and fees on loans is the income generated
by loans.  The table below  summarizes the income,  average balance and yield on
loans for 2001 and 2000.
Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
                                                      2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest income                                        $14.8                 $13.2              $1.6                  $1.5
Loans (Average balances)                              $323.9                $303.9             $20.0                 $34.5
Yield on loans                                         9.15%                 8.70%             0.45%                 0.04%
The major  components of interest  expense are interest paid on  Certificates of
Deposit (Time Deposits) and on Money Market Deposits. The tables below summarize
the expense,  average  balance and rates on these  components for 2001 and 2000.
The increase in interest expense on Time Deposits was a result of an increase in
both rate and average balance, as of June 30, 2001. The increase in Money Market
Deposits was a result of an increase in average balance, as of June 30, 2001.

Non-interest income
Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
     Time deposits                                    2001                  2000               2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest expense                                        $4.1                  $3.7              $0.4                  $0.3
Time deposits (Average balances)                      $172.4                $170.3              $2.1                  $4.3
Cost of time deposits                                  4.76%                 4.38%             0.38%                 0.22%

                                                                                                     Dollar/rate change
                                                  For the six months ended:  June 30,       For the six months ended:  June 30,
     Money Market deposits                                 2001                2000            2001                  2000
                                                  ------------------------------------      ------------------------------------
                                                  ------------------------------------      ------------------------------------
                                                                          (Amounts in millions)
Interest expense                                         $2.2                 $2.1              $0.2                  $0.6
Money Market deposits (Average balances)               $100.2                $85.5             $14.7                 $15.2
Cost of Money Market deposits                           4.45%                4.80%            -0.35%                 0.81%
Non-interest  income  increased  $59 thousand or 3.9% as of June 30,  2001.  The
increase  came in  primarily  two areas.  Service  charges  on deposit  accounts
increased  $72  thousand  as the number of  accounts  grew and  charges for some
services  were  increased.  Trust income  increased $50 thousand as that line of
business continues to grow.

Non-interest expense

Non-interest  expense  increased  $604  thousand  or 9.9% as of June  30,  2001.
Salaries and benefits  accounted for $376 thousand of the increase due to normal
wage increases and increased  health  insurance  costs.  Data  processing  costs
increased $75 thousand due to increased  volumes and  additional  services used.
Occupancy  expense  increased  $33 thousand  due  primarily to increases in real
estate and personal property taxes.

Asset/liability management

The principal  function of  asset/liability  management is to manage the balance
sheet mix,  maturities,  repricing  characteristics  and pricing  components  to
provide an adequate and stable net interest  margin with an acceptable  level of
risk over time and through interest rate cycles.

Interest-sensitive  assets  and  liabilities  are  those  that  are  subject  to
repricing   within  a  specific   relevant  time  horizon.   The  Bank  measures
interest-sensitive  assets and  liabilities,  and their  relationship  with each
other at terms of immediate, quarterly intervals up to 1 year, and over 1 year.

Changes in net interest income,  other than volume related,  arise when interest
rates on assets  reprice in a time frame or interest  rate  environment  that is
different  from the repricing  period for  liabilities.  Changes in net interest
income  also  arise  from  changes  in the mix of  interest  earning  assets and
interest-bearing liabilities.
The Bank's  strategy with respect to  asset/liability  management is to maximize
net  interest  income  while  limiting  its  exposure  to a  potential  downward
movement.  Strategy is implemented by the Bank's management,  which takes action
based upon its analysis of the Bank's  present  positioning,  its desired future
positioning,  economic  forecasts,  and its goals.  It is the  Bank's  desire to
maintain a cumulative GAP of positive or negative 15% of rate  sensitive  assets
at the 1-year  time  frame.  The  current  percentage  is a positive  7%,  which
compares to a positive 2% as of December 31, 2000.

Liquidity

Liquidity  measures  the  ability  of  First  Banking  Center  to meet  maturing
obligations and its existing commitments,  to withstand  fluctuations in deposit
levels, to fund its operations,  and to provide for customers' credit needs. One
source of  liquidity is cash and  short-term  assets,  such as  interest-bearing
deposits in other banks and federal  funds sold,  which totaled $21.5 million at
June 30, 2001,  compared with $30.0 million at December 31, 2000. The Bank has a
variety of sources of short-term  liquidity  available to it, including  federal
funds  purchased from  correspondent  banks,  sales of securities  available for
sale, FHLB advances,  lines of credit and loan  participations  or sales.  First
Banking Center also generates  liquidity from the regular principal payments and
prepayments made on its portfolio of loans and mortgage-backed securities.

The   liquidity  of  First   Banking   Center  is  comprised  of  three  primary
classifications: cash flows from operating activities, cash flows from investing
activities,  and cash flows from  financing  activities.  Net cash  provided  by
operating activities was $91 thousand. Net cash used in investing activities was
$11.5 million. Net cash used in financing activities was $5.1 million.

As of June 30, 2000, net cash provided by operating activities was $5.0 million.
Net cash used in investing  activities was $13.7  million.  Net cash provided by
financing activities was $3.2 million.

Impact of Inflation and Changing Prices

The  consolidated  financial  statements  and the  accompanying  notes have been
prepared in accordance  with generally  accepted  accounting  principles,  which
require the measurement of financial  position and operating results in terms of
historical  dollar  amounts  without  considering  the  changes in the  relative
purchasing power of money over time due to inflation. The impact of inflation is
reflected in the increased  cost of First Banking  Center's  operations.  Unlike
industrial companies,  nearly all of the assets and liabilities of First Banking
Center are monetary in nature. As a result, interest rates have a greater impact
on First Banking  Center's  performance than do the effects of general levels of
inflation.  Interest rates do not  necessarily  move in the same direction or to
the same extent as the price of goods and services.

Forward Looking  Statements- Safe Harbor Statement under the Private  Securities
Litigation Reform Act of 1995

This report contains certain  forward-looking  statements  within the meaning of
Section  27A of the  Securities  Act of 1933,  as amended and Section 21E of the
Securities  Exchange Act of 1934, as amended.  First Banking Center intends such
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking  statements  contained in the Private  Securities  Reform Act of
1995,  and is  including  this  statement  for  purposes  of these  safe  harbor
provisions.  Forward-looking statements,  which are based on certain assumptions
and describe First Banking  Center's future plans,  strategies and  expectations
are generally  identifiable by use of the words "believe,"  "expect,"  "intend,"
"anticipate,"  "estimate,"  "project"  or  similar  expressions.  First  Banking
Center's  ability to predict  results  or the actual  effect of future  plans or
strategies is inherently uncertain.  Factors which could have a material adverse
affect on First Banking Center's  operations and future prospects  include,  but
are not limited to, changes in: interest  rates,  general  economic  conditions,
legislative/regulatory  changes,  monetary  and  fiscal  policies  of  the  U.S.
Government,  including  policies of the U.S.  Treasury  and the Federal  Reserve
Board, the quality or composition of the loan or investment  portfolios,  demand
for loan products, deposit flows, competition,  demand for financial services in
our market area, our implementation of new technologies,  First Banking Center's
ability to develop  and  maintain  secure and  reliable  electronic  systems and
accounting  principles,  policies and guidelines.  These risks and uncertainties
should be considered in evaluating forward-looking statements and undue reliance
should not be placed on such statements.
Current Accounting Developments

The  Financial  Accounting  Standards  Board (FASB)  issued  Statement  No. 133,
Accounting for Derivative Instruments and Hedging Activities, which is effective
for all fiscal  quarters of fiscal years  beginning  after June 15,  2001.  This
Statement,  as  amended  by FASB  Statement  No.  137 and No.  138,  establishes
accounting and reporting standards for derivative instruments, including certain
derivative  instruments  embedded in other contracts and for hedging activities.
It  requires  that an entity  recognize  all  derivatives  as  either  assets or
liabilities in the statement of financial position and measure those instruments
at fair value.  The  accounting  for  changes in the fair value of a  derivative
depends on the intended use of the  derivative  and the  resulting  designation.
Management  believes  adoption  of this  Statement  will  have no  effect on the
consolidated financial statements.

The Financial  Accounting  Standards Board (FASB) has issued  Statement No. 140,
Accounting for Transfers and Servicing of Financial  Assets and  Extinguishments
of Liabilities.  This Statement replaces FASB Statement No. 125 in its entirety.
It revises the standards for accounting for  securitizations and other transfers
of financial assets and collateral and requires certain disclosures, but carries
over  most of  Statement  No.  125's  provisions  without  reconsideration.  The
Statement is  effective  for  transfers  and  servicing of financial  assets and
extinguishments  of liabilities  occurring after March 31, 2001. The adoption of
this Statement had no material effect on the consolidated financial statements.

In July 2001, the FASB issued  Statement of Financial  Accounting  Standards No.
141, Business  Combinations (SFAS No. 141) and Statement of Financial Accounting
Standards No. 142, Goodwill and Other Intangible Assets (SFAS No. 142). SFAS No.
141 addresses financial  accounting and reporting for business  combinations and
is effective for all business  combinations  initiated after June 30, 2001. SFAS
No. 142 addresses  financial  accounting and reporting for acquired goodwill and
other  intangible  assets and is  effective  for fiscal  years  beginning  after
December 15,  2001.  The Company has not yet  completed  its  assessment  of the
effects  of these  new  pronouncements  on its  financial  statements  and so is
uncertain  as  to  the  impact.  The  standards  generally  are  required  to be
implemented by the Company in its 2002 financial statements.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk

The company has not experienced any material changes to its market risk position
since  December 31, 2000,  from that  disclosed in the company's  2000 Form 10-K
Annual Report.  First Banking  Center,  like other  financial  institutions,  is
subject to direct and  indirect  market  risk.  Direct  market  risk exists from
changes in interest rates. First Banking Center's net income is dependent on its
net interest income. Net interest income is susceptible to interest rate risk to
the degree that  interest-bearing  liabilities  mature or reprice on a different
basis than interest-earning assets. When interest-bearing  liabilities mature or
reprice  more  quickly  than  interest-earning  assets  in  a  given  period,  a
significant  increase in market  rates of interest  could  adversely  affect net
interest income.

Similarly,  when  interest-earning  assets  mature or reprice  more quickly than
interest-bearing liabilities,  falling interest rates could result in a decrease
in net income.

In an attempt to manage its  exposure to changes in interest  rates,  management
monitors  First  Banking  Center's  interest  rate  risk.  The   Asset/Liability
Committee  meets quarterly to review First Banking  Center's  interest rate risk
position  and   profitability,   and  to  make  or  recommend   adjustments  for
consideration  by the Board of  Directors.  Management  also  reviews the Bank's
securities portfolio,  formulates investment strategies, and oversees the timing
and   implementation  of  transactions  to  assure  attainment  of  the  Board's
objectives in the most effective manner.  Notwithstanding First Banking Center's
interest rate risk management  activities,  the potential for changing  interest
rates is an uncertainty that can have an adverse effect on net income.

In adjusting  First Banking  Center's  asset/liability  position,  the Board and
management  attempt to manage First  Banking  Center's  interest rate risk while
maintaining or enhancing net interest margins. At times,  depending on the level
of general  interest rates, the  relationship  between  long-term and short-term
interest  rates,  market  conditions  and  competitive  factors,  the  Board and
management  may decide to increase  First  Banking  Center's  interest rate risk
position  somewhat in order to increase its net interest  margin.  First Banking
Center's  results of operations  and net portfolio  values remain  vulnerable to
increases  in  interest  rates and to  fluctuations  in the  difference  between
long-term and short-term interest rates.
One approach  used to quantify  interest  rate risk is the net  portfolio  value
("NPV") analysis.  In essence,  this analysis  calculates the difference between
the present  value of  liabilities  and the present value of expected cash flows
from assets and off-balance-sheet contracts. The most recent NPV analysis, as of
June 30, 2001, projects that net portfolio value would decrease by approximately
10.3% if  interest  rates  would  rise 200 basis  points and would  decrease  by
approximately  5.3% if interest  rates would rise 100 basis points over the next
year. It projects an increase in net portfolio value of  approximately  12.3% if
interest  rates would drop 200 basis points and  approximately  5.8% if interest
rates would drop 100 basis points. Both simulations are within board-established
policy  limits.  First Banking  Center's  policy is to limit the effect of a 200
basis point rate shock to plus or minus 20% of projected net interest income and
to minus 35% of the market value of portfolio equity.

First  Banking  Center does not  currently  engage in trading  activities or use
derivative   instruments  to  control  interest  rate  risk.  Even  though  such
activities may be permitted  with the approval of the Board of Directors,  First
Banking  Center does not intend to engage in such  activities  in the  immediate
future.

Interest rate risk is the most  significant  market risk affecting First Banking
Center.  Other types of market risk, such as foreign currency exchange rate risk
and  commodity  price risk,  do not arise in the normal  course of First Banking
Center's business activities.
Part II-OTHER INFORMATION
Item 1.  Legal Proceedings

              None

Item 2.  Changes in Securities

             None

Item 3.  Defaults upon Senior Securities

             None

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

A.    The Corporation held its Annual Meeting of Shareholders on April 17, 2001.

B.    Votes cast for  the election  of  three directors to serve  until the 2004
      Annual Meeting of Shareholders are as follow

 Director                         For                Withhold            Against

 David Boilini                  886,746                1,117                0
 Thomas Laken, Jr.              885,768                2,095                0
 Daniel T. Jacobson             885,429                2,434                0

      The continuing Directors of the Corporation are as follows:

 John S. Smith
 John M. Ernster
 Richard McKinney
 Keith Blumer
 Brantly Chappell
 Melvin W. Wendt
 Charles R. Wellington
 Robert Fait

      Votes cast to amend the 1994 Incentive Stock Plan are as follows:

                                  For                Against           Abstained

                                817,761               55,103              14,999

Item 5.  Other Information

             None

Item 6.  Exhibits and Reports on Form 8-K

             None
FIRST BANKING CENTER, INC AND SUBSIDIARIES

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1943, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                           First Banking Center, Inc.

August 14, 2001                                      __________________________
Date                                                 Brantly Chappell
                                                     Chief Executive Officer

August 14, 2001                                       __________________________
Date                                                  James Schuster
                                                      Chief Financial Officer