Form  8-K
Page  1  of  3

                       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):  MAY 16, 2003


                              COASTAL BANCORP, INC.
               (Exact name of registrant as specified in charter)

            TEXAS                    0-24526                  76-0428727
            -----                    -------                  ----------
 (State or other jurisdiction  (Commission File Number)      (IRS Employer
     of incorporation)                                    Identification No.)



5718 WESTHEIMER, SUITE 600, HOUSTON, TEXAS                                 77057
------------------------------------------                         -------------
(Address of principal executive offices)                              (Zip Code)


Registrant's  telephone  number  including  area  code:
(713)  435-5000



(Former  name  or  former  address,  if  changed  since  last  report):
NOT  APPLICABLE


Form  8-K
Page  2  of  3

ITEM.  5.     OTHER  EVENTS  AND  REQUIRED  FD  DISCLOSURE.

     On  May 16, 2003, Coastal Bancorp, Inc. and its subsidiary Coastal Banc ssb
("the  Company") requested Moody's Investors Services to withdraw all ratings on
the  Company.  After  reviewing  the  ratings  and  engaging in discussions with
Moody's  Corporation,  it  is  the  belief  of  management  that the ratings are
outdated  and  inaccurate.

     The  Company  expects  that a press release from Moody's Investors Services
withdrawing  these  ratings  will  be  published  in  the  near  future.

     Coastal  Bancorp,  Inc.  owns, through its wholly-owned subsidiary, Coastal
Banc Holding Company, Inc., 100 percent of the voting stock of Coastal Banc ssb,
a  Texas-chartered  FDIC  insured,  state savings bank headquartered in Houston.
Coastal  Banc  ssb currently operates 44 branch offices in metropolitan Houston,
Austin,  Corpus Christi, the Rio Grande Valley and small cities in the southeast
quadrant  of  Texas.





                                   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.



Date:  May  16,  2003          COASTAL  BANCORP,  INC.





  /s/  Catherine  N.  Wylie
---------------------------
By:  Catherine  N.  Wylie
Senior  Executive  Vice  President/
Chief  Financial  Officer