8-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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): October 31, 2006

COMMUNITY FINANCIAL SHARES, INC.

(Exact name of registrant as specified in its charter)

Illinois	0-51296	36-4387843
(State or other jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

357 Roosevelt Road Glen Ellyn, Illinois	60137
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (630) 545-0900

Not Applicable

(Former name or former address, if changed since last year)

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:

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

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

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

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

TABLE OF CONTENTS

Item 9.01. Financial Statements and Exhibits.

Item 2.02. Results of Operations and Financial Condition.

On October 31, 2006, Community Financial Shares, Inc. provided an interim report to stockholders announcing results for the third quarter ended September 30, 2006. A copy of the letter to stockholders is attached as Exhibit 99.1.

The information in this Form 8-K and the attached Exhibit shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

Exhibit

99.1 Letter to Stockholders dated October 31, 2006.

Signature

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.

COMMUNITY FINANCIAL SHARES, INC. (Registrant)
By:	/s/ Scott W. Hamer
	Scott W. Hamer
	Vice President and Chief Financial Officer

Date: October 31, 2006

EX-99.1

Exhibit 99.1

October 31, 2006

Dear Stockholder:

Enclosed is our 39^th consecutive dividend payable October 31, 2006, to stockholders of record as of October 15, 2006. In view of stockholder interests and our consistent earnings, the board has increased the dividend this quarter from $0.07 per share to $0.12 per share.

Consolidated net-after-tax earnings (un-audited) at the end of the third quarter of 2006 were $1,581,448 or $2.30 per share, a slight improvement over 2005’s performance of $1,509,277 or $2.21 per share. Our nine month net-after-tax profits at the bank level were $1,784,753, an 8.7% increase over 2005’s income of $1,641,353.

Deposits remained flat throughout 2006 at $229 million, reflective of the challenging market conditions of increased competitors and the movement of client cash back into the stock market.

At the October board meeting, the board approved a two-for-one stock split, providing an additional share for each share that you own. To accomplish this, you will be receiving a notice of a special meeting of shareholders which has been called to vote on the issue of increasing the number of authorized shares from 900,000 to 5,000,000. The increase in authorized shares will also provide enough shares for future stock splits, stock dividends and for the sale of additional capital.

Please note this is not a stock dividend. This “split” will double the number of shares you own, halve the book value of each share, and consequently, decrease the market value per share. The lower market price will make the stock available to more investors and provide a better market for the trading of shares. The number of outstanding shares will increase from 687,000 shares to approximately 1,734,000 shares.

Site improvements have begun on our North Wheaton Facility with construction on the building slated to begin later this year.

We have begun the completion of our expansion area on the second floor of our new Glen Ellyn addition. In conjunction with our initiative to expand our mortgage efforts, we are dedicating two-thirds of the second floor to a new residential mortgage division headed up by Flora Diederich, Vice-President and an experienced residential mortgage specialist. This new initiative includes adding residential mortgage consultants at each location and expanding the department’s reach throughout the county. The operations of the mortgage department will move from our Wheaton Facility to Glen Ellyn.

Additionally, we are using the balance of the second floor for a new financial accounting department to consolidate a number of financial activities such as treasury activities, payroll and accounts payable/receivable.

We hope that you will consider favoring us with your business. Our current home equity promotion is well below prime and is the best offered in the Chicagoland market. Additionally, it would be hard to find a rate match for our 8 Month Certificate of Deposit.

Your comments are always appreciated.

ON BEHALF OF

THE BOARD OF DIRECTORS

D. H. Fischer, Chairman, President & CEO