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)  November 30, 2010       

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  5.04        Temporary Suspension of Trading Under Registrant’s Employee Benefit Plans.

On November 30, 2010, CFS Bancorp, Inc. (the “Company”) provided a notice to its executive officers and directors informing them of a blackout period for the Company’s Employee Stock Ownership Plan (the “ESOP”) and the trading restrictions that apply to them during the blackout period.  This notice was required pursuant to Section 306 of the Sarbanes-Oxley Act of 2002 and the Securities and Exchange Commission’s Regulation BTR, which prohibit trading in the Company’s securities by executive officers and directors during blackout periods.

The blackout period is required due to the merger of the ESOP into the Citizens Financial Bank 401(k) Retirement Plan.  The blackout period will begin at 3:00 p.m. (Central time) on December 31, 2010 and ends during the week of January 23, 2011. During the blackout period and for a period of two years after the ending date of the blackout period, security holders or other interested persons may obtain, without charge, information about the actual beginning and ending dates of the blackout period by contacting the Company’s Senior Vice President - Human Resources at Citizens Financial Bank, 707 Ridge Road, Munster, IN  46321, (219) 836-5500.

A copy of the notice to executive officers and directors is attached as Exhibit 99.1 hereto and is incorporated herein by reference.

ITEM 7.01        Regulation FD Disclosure.

On November 30, 2010, the Company posted a letter to shareholders on its website.  A copy of the letter is furnished with this report as Exhibit 99.2.

ITEM  9.01        Financial Statements and Exhibits.

(d)           Exhibits

The following exhibits are filed herewith.

Exhibit Number	Description
99.1	Memo to Executive Officers and Directors of CFS Bancorp, Inc. regarding Notice of Blackout Period dated November 30, 2010.
99.2	Letter to Shareholders dated November 30, 2010

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: November 30, 2010	By:	/s/ Joyce M. Fabisiak
		Joyce M. Fabisiak
		Vice President

EX-99.1

Exhibit 99.1

[CFS BANCORP, INC. LETTERHEAD]

Memo

To:           Members of the Board of Directors and Executive Officers

From:       Administration and Human Resources

Date:        November 30, 2010

Re:           CFS Bancorp, Inc. ESOP Blackout Period Notice

______________________________________________________________________________

The current window period under the CFS Bancorp, Inc. Insider Trading Policy (the “Policy”) for members of the Board of Directors and Executive Officers of CFS Bancorp, Inc. (“CITZ”) wishing to conduct transactions in CITZ’s common stock ends Friday, December 10, 2010, and will remain closed until the 4th quarter 2010 earnings press release is issued.

In addition to the normal blackout period identified above, the following notice is provided specifically due to the ESOP merger into the 401(k) Retirement Plan.

Overview of ESOP Blackout Period and This Notice

This memorandum is to notify you of an impending blackout period in connection with the planned merger of the CFS Bancorp, Inc. Employee Stock Ownership Plan (the “ESOP”) into the Citizens Financial Bank 401(k) Retirement Plan (the “401(k) Plan”) effective January 1, 2011. The equity security subject to the blackout period is CITZ common stock.  As a director or executive officer of CITZ, you are subject to Section 306(a) of the Sarbanes-Oxley Act of 2002, which prohibits certain securities transactions during pension plan blackout periods.

ESOP Blackout Period

Please note the following information regarding the upcoming ESOP blackout period:

· The ESOP blackout period is expected to commence at 3:00 p.m. (Central time) on December 31, 2010 and is expected to end the week of January 23, 2011 (the “Blackout Period”).

· During this Blackout Period, participants in the ESOP will be temporarily unable to make an ESOP diversification election, obtain a distribution from an ESOP account, or change the address on an account.

Trading Restrictions

During the Blackout Period, you are prohibited from purchasing, selling, or otherwise acquiring or transferring CITZ common stock or its derivatives, including stock options.1  This prohibition applies to any direct or indirect pecuniary interest you may have in such securities, such as CITZ common stock held by immediate family members living with you, in trust, or by controlled partnerships or corporations.   This prohibition also applies without regard to whether you participate in the ESOP or the 401(k) Plan or your transactions are inside the ESOP or the 401(k) Plan.  If you engage in a transaction that violates these rules, you may be required to disgorge your profits from the transaction , and you may be subject to civil and criminal penalties.

Upon termination of the Blackout Period, you will be permitted to resume transactions in such securities subject to the Policy.  Please be advised that you are still subject to regular blackout periods as imposed under the Policy in correlation with earnings releases and other filings made by CITZ with the Securities and Exchange Commission, as well as “special” blackout periods imposed periodically, as appropriate.

Questions

If you have questions regarding the Blackout Period, its beginning or ending dates, or the trading restrictions, please contact Monica Sullivan (219) 513-5101, via email at msullivan@citz.com, or in writing at Citizens Financial Bank, 707 Ridge Road, Munster, IN 46321.

1           There are limited exceptions to the prohibition including: bona fide gift transactions and purchases and sales under qualified Rule 10b5-1 trading plans.  It is strongly recommended that you consult with CITZ’s CFO, Jerry A. Weberling, prior to entering into a transaction based on any exception.

EX-99.2

THOMAS F. PRISBY, CHAIRMAN

CFS Bancorp, Inc.

707 Ridge Road  —  Munster, Indiana 46321-1678

November 30, 2010

Dear Fellow Shareholders:

With the holiday season in full swing, I felt it appropriate to further update you on our continued progress at CFS Bancorp, Inc. and Citizens Financial Bank.

We were pleased to recently have been named as one of the Chicago area’s Top Workplaces by the Chicago Tribune.  You may recall that in May, we were cited as the Best Bank for Customer Service in the annual Best in Northwest Indiana reader’s survey conducted by the Northwest Indiana Business Quarterly.   We believe that recognition of this nature independently validates our l ong-term commitment to developing strong relationships with our colleagues, clients, and communities.

The economy generally continues to remain a challenge at all levels:  national, regional, and local.  In late October, we reported third quarter 2010 earnings of $863,000, or $0.08 per diluted share, bringing our year to date earnings through three quarters to $2.5 million, or $0.24 per diluted share.  This compares favorably against a net loss of $2.5 million, or $0.24 per share, for the same period in 2009.  While this turnaround is positive, we have not yet achieved the level of performance to which we aspire.

Due to the success of our business banking team’s ongoing market development efforts, we believe the Company remains well positioned to benefit from sustained economic recovery.  In addition to increasing the number of client relationships with targeted small business clients, since January 1, 2010 we have increased our deposit base substantially; however, until such time as business and consumer borrowing resumes at a sustainable pace, we will be hard pressed to translate this success into improved earnings.

In addition, near term earnings performance will continue to be challenged by a number of factors which we experienced during the first three quarters of this year including:  elevated levels of credit- related costs; fee income and expense pressures resulting from recent regulatory developments; and margin pressure due to a continued low interest rate environment and a high level of liquidity.

In light of these challenges, we remain focused on our core strategic growth and diversification plan.  Our Strategic Planning Retreat was held in November with reinforcement by our Directors of the objectives established last year.  There was a strong reiteration of the core plan with continued direction to: anticipate and quickly respond to economic and regulatory changes; seek new lending opportunities; and, seek to further expand client relationships, reduce non-performing assets and work on operational refinements to enhance revenue and reduce costs.

If you have questions, or views you would like to express, feel free to call me at (219) 836-2960 or email me at tfprisby@citz.com.

As always, we thank you for your continued support.

Best regards,

Tom