PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

		September 30,				December 31,
		2007				2006
(Dollars in thousands)		(UNAUDITED)
Assets
Cash and cash equivalents:
Cash and due from banks		$	1,560			$	1,561
Interest-earning deposits			3,461				2,938
Total cash and cash equivalents			5,021				4,499
Securities available-for-sale			77,406				83,045
Loans, net			186,850				174,718
Federal Home Loan Bank (“FHLB”) stock, at cost			4,536				4,901
Accrued interest receivable — loans			1,022				1,033
Accrued interest receivable — securities			537				559
Premises and equipment, net			3,047				2,162
Bank-owned life insurance			7,471				7,259
Goodwill			1,080				1,080
Real estate owned			1,210				569
Other assets			412				1,165
Deferred tax assets and tax credit carryforwards			2,725				2,527
Total assets		$	291,317			$	283,517
Liabilities and Stockholders’ Equity
Deposits:
Noninterest-bearing			9,212				5,409
Interest-bearing			145,352				138,086
Total deposits			154,564				143,495
Borrowings			87,606				89,323
Advance payments by borrowers for taxes and insurance			211				254
Accrued interest payable — deposits			1,142				1,180
Accrued interest payable — borrowings			356				319
Other liabilities			2,585				2,521
Total liabilities			246,464				237,092
Minority interest in subsidiary			81				79
Stockholders’ equity:
Preferred stock $0.01 par value; 10,000,000 shares authorized; none issued			—				—
Common stock $0.01 par value; 20,000,000 shares authorized; 6,707,500 shares issued			67				67
Additional paid-in-capital			29,001				28,787
Retained earnings — substantially restricted			19,101				20,475
Accumulated other comprehensive loss, net of deferred taxes of $(113) and $(475)			(176	)			(737	)
Unearned Employee Stock Ownership Plan (“ESOP”)			(2,117	)			(2,246	)
Common stock held in treasury, at cost (118,700 and 0 shares)			(1,104	)			—
Total stockholders’ equity			44,772				46,346
Total liabilities and stockholders’ equity		$	291,317			$	283,517

See Notes to the Unaudited Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF (LOSS) INCOME (UNAUDITED)

		For the Three Months								For the Nine Months
		Ended September 30,								Ended September 30,
(Dollars in thousands, except per share data)		2007				2006				2007				2006
Interest income:
Loans		$	2,689			$	2,497			$	7,764			$	7,436
Securities			1,005				800				2,999				2,394
Other interest-earning assets			131				141				408				330
Total interest income			3,825				3,438				11,171				10,160
Interest expense:
Deposits			1,372				1,094				3,789				2,843
Borrowings			804				831				2,569				2,668
Total interest expense			2,176				1,925				6,358				5,511
Net interest income			1,649				1,513				4,813				4,649
Provision for loan losses			395				29				470				69
Net interest income after provision for loan losses			1,254				1,484				4,343				4,580
Noninterest income:
Fees and service charges			108				90				304				273
Insurance commissions			397				343				1,328				1,223
Income from bank-owned life insurance			70				68				212				206
Net loss on sales of securities			(2	)			—				(1,412	)			—
Net gain on sales of real estate owned			—				—				—				33
Other			2				2				9				35
Total noninterest income			575				503				441				1,770
Noninterest expense:
Compensation and employee benefits			1,485				1,191				4,278				3,518
Occupancy			301				217				832				622
FDIC insurance premiums			6				5				17				37
Data processing			94				73				279				225
Other			440				401				1,339				1,225
Total noninterest expense			2,326				1,887				6,745				5,627
Minority interest in net income of consolidated subsidiary			15				10				53				47
(Loss) income before income tax (benefit) expense			(512	)			90				(2,014	)			676
Income tax (benefit) expense			(165	)			35				(640	)			233
Net (loss) income		$	(347	)		$	55			$	(1,374	)		$	443
Earnings per share:
Basic and diluted		$	(0.05	)		$	0.01			$	(0.21	)		$	0.07
Weighted-average shares outstanding:
Basic			6,438,228				6,381,371				6,442,220				6,377,051
Diluted			6,438,228				6,430,545				6,442,220				6,424,826

See Notes to the Unaudited Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY AND
COMPREHENSIVE (LOSS) INCOME (UNAUDITED)

														Accumulated								Common
						Additional								Other								Stock				Total
		Common				Paid-in-				Retained				Comprehensive				Unearned				Held in				Stockholders’				Comprehensive
		Stock				Capital				Earnings				Loss				ESOP				Treasury				Equity				Income (Loss)
(Dollars in thousands)
Balance at January 1, 2006		$	66			$	28,648			$	20,131			$	(1,026	)		$	(2,419	)		$	—			$	45,400
Comprehensive income:
Net income			—				—				443				—				—				—				443			$	443
Unrealized gain on securities available-for-sale net of tax of $97			—				—				—				150				—				—				150				150
Issuance of common stock			1				—				—				—				—				—				1
ESOP shares committed to be released			—				(2	)			—				—				129				—				127
Stock-based compensation expense			—				55				—				—				—				—				55
Total comprehensive income																														$	593
Balance at September 30, 2006		$	67			$	28,701			$	20,574			$	(876	)		$	(2,290	)		$	—			$	46,176

														Accumulated								Common
						Additional								Other								Stock				Total
		Common				Paid-in-				Retained				Comprehensive				Unearned				Held in				Stockholders'				Comprehensive
		Stock				Capital				Earnings				Income (Loss)				ESOP				Treasury				Equity				Income (Loss)
Balance at January 1, 2007		$	67			$	28,787			$	20,475			$	(737	)		$	(2,246	)		$	—			$	46,346
Comprehensive income:
Net loss			—				—				(1,374	)			—				—				—				(1,374	)		$	(1,374	)
Transfer of securities held for trading net of tax of $553			—				—				—				857				—				—				857				857
Unrealized loss on securities available-for-sale net of tax of $(191)			—				—				—				(296	)			—				—				(296	)			(296	)
Purchase of treasury stock			—				—				—				—				—				(1,125	)			(1,125	)
ESOP shares committed to be released			—				(10	)			—				—				129				—				119
Stock-based compensation expense			—				246				—				—				—				—				246
Stock awards granted			—				(51	)			—				—				—				51				—
Stock awards forfeited			—				29				—				—				—				(30	)			(1	)
Total comprehensive (loss)																														$	(813	)
Balance at September 30, 2007		$	67			$	29,001			$	19,101			$	(176	)		$	(2,117	)		$	(1,104	)		$	44,772

See Notes to the Unaudited Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

		For the Nine Months
		Ended September 30,
(Dollars in thousands)		2007				2006
Cash flows from operating activities:
Net (loss) income		$	(1,374	)		$	443
Adjustments to reconcile net (loss) income to net cash provided by operating activities
Minority interest in net income of consolidated subsidiary			53				47
Provision for loan losses			470				69
Depreciation			299				212
Net loss on sales of securities			1,412				—
Proceeds from sales of securities held for trading			40,483				—
Proceeds from principal repayments of securities held for trading			638				—
Net gain on sales of real estate owned			—				(33	)
Net gain on sale of student loan portfolio			—				(26	)
Net (amortization) accretion of security premiums and loan costs			(588	)			69
Non cash expense for ESOP			119				127
Non cash expense for stock-based compensation			246				55
Increase in bank-owned life insurance			(212	)			(204	)
Decrease (increase) in other assets			75				(145	)
Decrease in other liabilities			141				207
Net cash provided by operating activities			41,762				821
Cash flows from investing activities:
Net loan originations			(13,281	)			(5,241	)
Proceeds from sale of student loan portfolio			12				1,224
Proceeds from maturities of and principal repayments of securities available-for-sale			13,293				11,654
Proceeds from sales of securities available-for-sale			2,569				—
Purchases of securities available-for-sale			(51,219	)			(12,670	)
Purchases of premises and equipment			(1,184	)			(343	)
Decrease in FHLB stock, at cost			365				403
Proceeds from sales of other real estate owned			—				92
Net cash used in investing activities			(49,445	)			(4,881	)
Cash flows from financing activities:
Net decrease in borrowings			(1,717	)			(15,310	)
Net increase in deposits			11,069				17,804
(Decrease) increase in advance payments by borrowers for taxes and insurance			(43	)			13
Stock awards granted, net of forfeits			21				—
Purchases of treasury stock			(1,125	)			—
Net cash provided by financing activities			8,205				2,507
Net increase (decrease) in cash and cash equivalents			522				(1,553	)
Cash and cash equivalents, beginning of period			4,499				6,346
Cash and cash equivalents, end of period		$	5,021			$	4,793
Supplemental cash flow information:
Cash paid for:
Interest on deposits and borrowings		$	5,844			$	5,306
Income tax expense			36				51
Transfer of securities from available-for-sale to held for trading		$	42,531			$	—
Real estate acquired in settlement of loans		$	641			$	—

See Notes to the Unaudited Consolidated Financial Statements

Notes to the Unaudited Consolidated Financial Statements

Note 1. Basis of Presentation/Nature of Operations

The accompanying Consolidated Financial Statements are unaudited and include the accounts of FedFirst Financial Corporation, a federally chartered holding company (“FedFirst Financial” or the “Company”), whose wholly owned subsidiaries are First Federal Savings Bank (the “Bank”), a federally chartered stock savings bank, and FedFirst Exchange Corporation (“FFEC”). FFEC has an 80% controlling interest in Exchange Underwriters, Inc. Exchange Underwriters, Inc. is a full-service, independent insurance agency that offers property and casualty, life, health, commercial liability, surety and other insurance products. The Company is a majority owned subsidiary of FedFirst Financial Mutual Holding Company (“FFMHC”), a federally chartered mutual holding company. FFMHC has virtually no operations and assets other than an investment in the Company, and is not included in these financial statements. All significant intercompany transactions have been eliminated.

We operate as a community-oriented financial institution offering residential, multi-family and commercial mortgages, consumer loans and commercial business loans to individuals and businesses from nine locations in southwestern Pennsylvania. We conduct insurance brokerage activities through Exchange Underwriters, Inc. The Bank is subject to competition from other financial institutions and to the regulations of certain federal and state agencies and undergoes periodic examinations by those regulatory authorities.

The unaudited consolidated financial statements were prepared in accordance with instructions to Form 10-QSB and, therefore, do not include information or notes necessary for a complete presentation of financial position, results of operations, changes in stockholders’ equity and cash flows in conformity with accounting principles generally accepted in the United States of America (“GAAP”). However, all normal recurring adjustments that, in the opinion of management, are necessary to make the consolidated financial statements not misleading have been included. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto in the Company’s Annual Report on Form 10-KSB for the year ended December 31, 2006. Certain items previously reported have been reclassified to conform with the current reporting period’s format. The results of operations for the three and nine months ended September 30, 2007 are not necessarily indicative of the results that may be expected for the full year or any other interim period.

In preparing financial statements in conformity with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and income and expenses during the reporting period. Actual results could differ significantly from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to determination of the allowance for losses on loans and the valuation of real estate acquired in connection with foreclosures or in satisfaction of loans.

Note 2. Recent Accounting Pronouncements

The Fair Value Option for Financial Assets and Financial Liabilities: In February 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standard (“SFAS”) No. 159, The Fair Value Option for Financial Assets and Financial Liabilities. SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing certain entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provision. SFAS 159 expands the use of fair value accounting but does not affect existing standards which require assets and liabilities to be carried at fair value. This statement, which the Company does not anticipate having a material effect on its financial condition or operations upon adoption, is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007.

Fair Value Measurements: In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. This Statement does not require any new fair value measurements, however, for some entities the application of this Statement will change current practice. This statement, which the Company does not anticipate having a material effect on its financial condition or operations upon adoption, is effective for years beginning after November 15, 2007 and interim periods within those fiscal years.

Note 3. Securities

The following table sets forth the amortized cost and fair value of securities available-for-sale at the dates indicated.

		September 30, 2007								December 31, 2006
		Amortized				Fair				Amortized				Fair
(Dollars in thousands)		Cost				Value				Cost				Value
Securities available-for-sale:
Government-Sponsored Enterprises		$	25,070			$	25,056			$	30,475			$	30,036
Mortgage-backed			24,686				24,636				14,892				14,885
REMICs			23,892				23,766				34,831				34,121
Corporate debt			3,998				3,899				4,010				3,954
Equities			49				49				49				49
Total securities available-for-sale		$	77,695			$	77,406			$	84,257			$	83,045

Note 4. Loans

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

		September 30, 2007								December 31, 2006
(Dollars in thousands)		Amount				Percent				Amount				Percent
Real estate-mortgage
One-to-four family residential		$	136,237				71.9	%		$	133,821				75.2	%
Multi-family			13,138				6.9				18,410				10.3
Commercial			14,092				7.4				5,437				3.1
Total real estate-mortgage loans			163,467				86.2				157,668				88.6
Real estate-construction
Residential			4,127				2.2				5,021				2.8
Commercial			—				—				1,750				1.0
Total real estate-construction			4,127				2.2				6,771				3.8
Consumer
Home equity			15,713				8.3