8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported)  August 25, 2009       

CFS BANCORP, INC.
(Exact Name of Registrant as Specified in Its Charter)
INDIANA
(State or Other Jurisdiction of Incorporation)
000-24611	35-2042093
(Commission File Number)	(IRS Employer Identification No.)
707 Ridge Road, Munster, Indiana	46321
(Address of Principal Executive Offices)	(Zip Code)
(219) 836-5500
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01        Regulation FD Disclosure

Attached are PowerPoint slides that the Company may from time to time send to certain persons considering a significant investment in the Company.  The financial information presented is through June 30, 2009.

Item 9.01        Financial Statements and Exhibits

(a)        Not applicable.

(b)        Not applicable.

(c)        Not applicable.

(d)        Exhibits.

The following exhibits are furnished herewith.

Exhibit Number	Description
99.1	PowerPoint slides dated August 25, 2009

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.

		CFS BANCORP, INC.
Date: August 25, 2009	By:	/s/ Joyce M. Fabisiak
		Joyce M. Fabisiak
		Vice President

EX-99.1

Corporate Profile

Forward Looking Statement

•This presentation contains certain forward-looking statements and
information relating to the Company that are based on the beliefs of
management as well as assumptions made by and information currently
available to management. In addition, the words “anticipate,” “believe,”
“estimate,” “expect,” “intend,” “should” and similar expressions, or the
negative thereof, as they relate to the Company or the Company’s
management, are intended to identify forward-looking statements. Such
statements reflect the current views of the Company with respect to future
events and are subject to certain risks, uncertainties, changes in circumstances
and assumptions. Should one or more of these risks, uncertainties or changes
in circumstances materialize or should underlying assumptions prove
incorrect, actual results or outcomes may vary materially from those described
herein as anticipated, believed, estimated, expected or intended. Forward -
looking statements are not assurances of future results, performance or
outcomes.The Company does not intend to update these forward-looking
statements.

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Why Invest in CITZ?

•We have a strong retail franchise and an emerging business banking operation located
in one of the Country’s premier markets for small and middle-market businesses

•We are a community-oriented financial institution which is well positioned to benefit
from ongoing Chicago area market disruption due to:

•Bank failures

•Capital challenges and growth limitations

•Mergers

•Changes in large bank lending practices

•Capital base and liquidity allow us to pursue opportunities for high quality relationship-
based loan growth

•Over the past few years, we have invested heavily in different aspects of our core
franchise, including our physical (branch) delivery system, information technology
infrastructure, retail and business banking personnel and brand positioning, and are
poised to capitalize on that investment as the economy recovers

2

About CFS Bancorp, Inc.

•CFS Bancorp, Inc is incorporated under the laws of the State of Indiana, headquartered in
Munster, IN

•Company was formed in 1998 in conjunction with the conversion of its principal
subsidiary from a mutual to a stock savings bank; Bank originally founded in 1934

•As of June 30, 2009, assets of $1.1 billion and 318 (FTE) employees

•Operates a single subsidiary bank, Citizens Financial Bank, with 22 full service banking
centers spread across five counties in Indiana (Porter, Lake) and Illinois (Will, Cook,
DuPage), all of which are part of the Chicago metropolitan statistical area

•Operations center located in Highland, IN (relocating to existing bank-owned facilities in 2009)

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•Strong retail and emerging business banking franchise

•Legacy of returning excess capital to shareholders in the form of dividends and stock
repurchases

•From 1998 to mid-2008, repurchased nearly 60 percent of shares originally issued in public
offering, totaling in excess of 12 million shares

•Experienced management team

•Thomas Prisby, Chairman & CEO

•Daryl Pomranke, President

•Charles Cole, CFO

•Dale Clapp, Executive VP, Business Banking

•Daniel Zimmer, Sr. VP & Chief Credit Officer

About CFS Bancorp, Inc. (cont.)

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Capital Adequacy

5

Strategic Growth and Diversification Plan

In early 2008, we began executing our Strategic Growth and Diversification Plan, which
has four key objectives:

Decrease nonperforming loans

The Company’s delinquency rates and nonperforming loan ratios exceed that of its peers.This is
partly attributable to the Company’s prior utilization of syndications and participations to supplement
the direct origination of its commercial loan portfolio.The utilization of participations to achieve
commercial loan growth was ended when the Company adopted its relationship-based business
banking strategy in mid-2007.Our last participation loan was originated in June, 2007.Commencing
in 2007, and running through today, the Bank has experienced significant credit quality issues in this
segment of the loan portfolio.Nonperforming loan ratios of direct origination loans are more in line
with peers.

Bring costs in line with our anticipated future asset base

A significant proportion of the Company’s investments in technology, people and brand positioning,
impact the Company’s earnings through the income statement as expenses.As a result, during a
period of heavy investment (such as when the Company began to upgrade its retail delivery sales and
service capabilities in 2007, orwhen it rapidly expanded its relationship-based business banking
activities in early 2008), the Company’s earning asset and income growth lags its expense growth.

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Strategic Growth and Diversification Plan (cont.)

Targeting small to mid-size business owners

Since early 2008, we have focused on building and enhancing our capabilities to serve the small- to
mid-sized business market.We believe that the breadth and diversity of the financial service needs of
these business owners presents an ideal match for a financial institution of our size with our
capabilities.We have an experienced chief credit officer (Sr. VP Daniel Zimmer), strengthened our
credit team, revised our loan policy and underwriting standards to ensure that all loans originated
meet stringent underwriting standards.We have a seasoned team of 16 business banking relationship
managers, led by Executive VP Dale Clapp; 10 of these bankers have joined us since the start of 2008.
Our suite of deposit, cash management and lending products, targeted to this market’s needs, give us
a competitive advantage.Within each sub-market we serve, our banking center managers work
closely with our business bankers, our micro business lenders, our cash management team, and our
senior personal bankers (who are responsible for mortgage origination and consumer lending), to
design solutions which meet the needs of that market.

Meeting a greater number of our clients’ financial service needs

The Chicago area, while attractive from a demographic perspective, is relatively slow growing.As a
result, our ability to grow disproportionately to the market is, and will for the foreseeable future, be
contingent upon our ability to gain market share.There are two basic strategies through which we
can accomplish this:obtain new client relationships from other institutions, and meet a higher
percentage of the financial service needs of our current clients.Of these, the latter is a relatively more
cost efficient means through which we can grow our franchise.Two main areas of focus are:(1)
selling a higher number of loan and deposit products and services to our retail clients and (2)
obtaining the personal banking relationships of our small and middle-market business banking clients.

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Credit Quality

8

Our Approach to the Market

•Our network of Banking Centers serves a wide variety of market areas

•Each Banking Center focuses on meeting the financial service needs of specific niches
within in its uniquely defined market area (generally, an geographically delineated area
of 10-15 square miles immediately surrounding the banking center location)

•Banking Center Managers are responsible for developing and executing sales and
marketing action plans, with specific goals and objectives

•These plans, which are reviewed and approved by senior management, target specific
client segments or niches within each market area, and leverage specific marketing
capabilities and campaigns to pursue the niche

•Business development and calling efforts are integrated across multiple lines of
business, encompassing business banking, cash management specialists,microlending
(small business lenders), personal banking (including mortgage origination),
community development, High Life (banking for those aged 50 and up) and marketing

•“Total relationship”-based goals and incentive compensation plans ensure that groups
function as a team focused on identifying and fulfilling clients’ needs

9

What We’ve Been Focused On

•Proactively assessed and took action to mitigate portfolio credit risks

•Eliminated syndication / participation originations

•Implemented “exit strategy” on loans not meeting our risk tolerances

•Invested significantly in our core retail and small- and middle-market business banking
franchises

•Invested in our human capital

•Upgraded banking center managers (2007/2008)

•Added experienced chief credit officer and upgraded credit team (2007/2008)

•Upgraded business banking franchise (2008)

–Hired “seasoned” C&I team

–Introduced sophisticated cash management/business deposits product suite,
staffed with cash management sales team to support business bankers

•Enhanced retail sales and service, performance management culture and performance
tracking in retail delivery network (ongoing)

•Introduced banking center market-specific sales plan approach (2008/2009)

•Segmented client base into key niches for business development, marketing and retention
purposes (e.g., Chairman’s Club, High Life) (ongoing)

•Invested in communicating and increasing awareness of our brand in retail and business
banking

10

What We’ve Been Focused On

•Enhanced and upgraded IT capabilities to support cash management strategies

•Upgraded and expanded physical delivery network (ongoing)

•Planning/developing additional locations in St. John (2009), Crown Point (2010) and
Bolingbrook (2011)

•New locations planned in Olympia Fields (to replace Flossmoor, 2010) and Harvey (2010)

11

Key Challenges

•Economy

•Credit quality

•Improving NPA ratios

•Mitigating potential impacts on brand, reputation

•Opportunistically reducing overall costs in light of higher FDIC assessments & credit
collection related costs

•Achieving targeted earning asset growth levels

•Retaining talented individuals to carry out our relationship banking strategies

12

Opportunities:Going Forward

•Position CFS Bancorp, Inc. to capitalize on opportunities that will emerge as economy
commences recovery

•Leverage capital strength and “personal” service orientation to differentiate us from
the competition and capture greater market and relationship share

•Selectively expand geographic footprint through:

•Branching

•Opportunistic acquisitions

•Examine wealth management opportunities

•Good “fit” with small- and middle-market business owner/operator niche

•Sizeable base of large depositors

•Market opportunity for moderately sized relationships (e.g., $500,000 to $750,000 in
investable assets) common in this niche

13

Key Takeaways

•Strong, stable institution with solid capital levels and ample liquidity

•Right strategy and infrastructure in place to address current challenges and position for
future growth

•Emerging from period of heavy investment well positioned to take advantage of
opportunities presented by economic recovery

•Management team focused on executing strategy:

•Addressing credit issues

•Aligning costs

•Developing business banking franchise

•Capitalizing on retail franchise

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Supplemental
Information

Mission & Vision

Citizens Financial Bank Mission

To become the leading banking institution in our markets by providing extraordinary
service and personalized financial solutions for our clients, resulting in superior value
creation for our communities, clients, shareholders and employees

Vision

To be a high-performing independent community bank focused on the financial needs
of businesses and individuals

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Our Market Area

Measure	Five County Area*	Banking Center Defined Market Areas (22)**
		Composite	Low (Market)	High (Market)
Households	2,869,699	109,049	833 (Willowbrook)	9,523 (Munster HQ)
Businesses	317,191	22,026	133 (Bolingbrook)	2,677 (Merrillville)
HH Pop. By Age
<24	34.9%	34.0%	25.0% (Willowbrook)	44.9% (Harvey)
25-44	29.1%	24.5%	16.6% (Flossmoor)	35.3% (Bolingbrook)
45-64	24.1%	28.0%	20.2% (East Chicago)	34.3% (Flossmoor)
65+	11.8%	13.5%	3.6%(Bolingbrook)	29.3% (Willowbrook)
Avg. HH Income	$78,917	$76,757	$38,247 (East Chicago)	$109,404 (Bolingbrook)
HH Income Dist.
<$25K	19.2%	17.3%	3.4% (Bolingbrook)	43.3% (East Chicago)
$25K-$49K	25.0%	22.6%	7.2% (Bolingbrook)	36.3% (Merrillville)
$50K-$149K	51.3%	52.3%	25.9% (East Chicago)	76.4% (Bolingbrook)
>$150K	4.5%	7.9%	0.8% (Hammond)	25.1% (Willowbrook)

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*Source: Pitney Bowes Business Insight

** Source:BankIntelligence

Citizens Financial Bank Banking Center Network

Location	Owned/ Leased	Deposits ($000) @ 12/31/08	Customer Relationships (HH at 3/31/09, rounded to nearest 10)
			Consumer	Businesses	Both Business & Consumer
Indiana
Munster HQ	Owned	$150,825	4,730	300	280
Crown Point	Owned	$65,962	2,650	100	110
Dyer	Leased	$81,870	950	40	50
East Chicago #1	Owned	$32,829	2,150	40	50
East Chicago Harbor	Leased	$18,188	1,380	20	40
Hammond	Owned	$51,012	2,180	70	70
Highland	Owned	$25,635	1,320	50	50
Merrillville	Owned	$23,690	1,350	70	70
Munster #2	Owned	$87,530	2,270	80	90
Schererville	Owned	$29,453	930	40	50
Valparaiso	Owned	$43,160	1,390	90	90

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Location	Owned/ Leased	Deposits ($000) @ 12/31/08	Customer Relationships (HH at 3/31/09, Rounded to nearest 10)
			Consumer	Businesses	Both Business & Consumer
Illinois
Bolingbrook	Owned	$5,247	330	50	40
Darien	Owned	$13,636	360	50	40
Flossmoor	Leased	$36,883	1,720	110	100
Harvey	Leased	$19,972	1,640	60	70
Hegewisch	Owned	$26,426	1,070	20	30
Orland Park	Leased	$12,986	400	10	20
Palos Heights	Owned	$40,564	1,280	50	70
South Holland	Owned	$42,778	2,290	80	110
South Holland #2	Owned	(Included Above)
Tinley Park	Owned	$3,737	210	10	20
Willowbrook	Leased	$11,687	390	40	50

Citizens Financial Bank Banking Center Network

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Business & Retail Accounts

19

Economic Woes in Chicago & Northwest Indiana

•Employment continues to decline

•Citizens Financial Bank serves a diverse range of market areas, including many areas
dependent upon manufacturing employment

•Hard hit sectors include steelmaking, automotive, and recreational vehicles

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Branding

21

Financial Information

Financial Highlights

22

Financial Highlights

23

Income Statement

Income Statement

Balance Sheet

Balance Sheet

Balance Sheet

Balance Sheet

Balance Sheet

Credit Quality

31

CITZ Stock At a Glance:

At June 30, 2009

Shares Outstanding: 10.8 million

Market Capitalization: $45.5 million

Annual Dividend per share: $0.04

Dividend yield: 0.99%

Average 2009 Daily Volume:17,400

Book Value Per Share (6/30/09):$10.72

Recent Price (July 23, 2009):$4.03

Price/Book: 37.6%

Return on Assets (2Q09): 0.24%

Return on Equity (2Q09): 2.41%

32