UNITED STATES
SECURITIES AND EXCHANGE COMMITTION
Washington, D.C.   20549
FORM 10-Q
[X]   Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the period ended:          March 31, 2004

Commission file number       000-22103

HEMLOCK FEDERAL FINANCIAL CORP.

(Exact Name of Registrant as Specified In Its Charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)	36-4126192 (IRS Employer Identification No.)
5700 West 159th Street, Oak Forest, IL (Address of Principal Executive Offices)	60452 (Zip Code)

708-687-9400

(Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES

Indicate by check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES

Indicate by check whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

YES

Indicate the number of shares outstanding of each the issuer's classes of common stock, as of the latest practicable date:

Class

Common Stock, par value $.01

Outstanding at April 12, 2004

924,637 shares

UNITED STATES
SECURITIES AND EXCHANGE COMMITTION
Washington, D.C. 20549

INDEX

Part I.		Financial Information

	Item 1.		Financial Statements

		Condensed Consolidated Statements of Condition as of March 31, 2004
			and December 31, 2003		3

		Condensed Consolidated Statements of Income for the three and nine months
			ended March 31, 2004 and 2003		4

		Condensed Consolidated Statements of Cash Flows for the three
			months ended March 31, 2004 and 2003		5

		Condensed Consolidated Statements of Changes in Stockholders' Equity
			for the tjree months ended March 31, 2004 and 2003		6

		Notes to the Condensed Consolidated Financial Statements as of
			March 31, 2004		8

	Item 2.		Management's Discussion and Analysis of Financial Condition
				and Results of Operations	10

	Item 3.		Quantitative and Qualitative Disclosures About Market Risk		14

	Item 4.		Disclosed Controls and Procedures		17

Part II.		Other Information			18

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(In thousands, except share data)
(Unaudited)

			March 31, 2004	December 31, 2003
ASSETS
Cash and cash equivalents			$10,112	$13,980
Securities available-for-sale			70,521	65,355
Securities held-to-maturity			78,491	79,986
Loans receivable, net			135,089	135,655
Loans held for sale			90	-
Federal Home Loan Bank stock, at cost			11,010	10,647
Premises and equipment, net			4,877	4,921
Bank owned life insurance			5,399	5,294
Intangible assets			1,291	1,314
Accrued interest receivable and other assets			1,485	1,622

	Total assets		$318,365	$318,774

LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits			$207,249	$206,672
Federal Home Loan Bank advances			78,897	79,807
Advances from borrowers for taxes and insurance			782	1,097
Note payable			6,500	6,500
Accrued interest payable and other liabilities			2,368	2,355
	Total liabilities		295,796	296,431

Stockholders' equity
	Common stock, $.01 par value; 2,500,000 shares
		authorized; 2,076,325 shares issued	21	21
	Additional Paid In Capital		21,331	21,221
	Treasury stock at cost (2004 - 1,102,157 shares; 2003 -
		1,107,989 shares)	(17,863)	(17,958)
	Unearned ESOP, (2004 - 45,679 shares;
		2003 - 49,830 shares)	(457)	(498)
	Unearned stock awards		(65)	(74)
	Retained earnings		19,689	19,431
	Accumulated other comprehensive income/(loss)		(87)	200

	Total stockholders' equity		22,569	22,343

		Total liabilities and stockholders' equity	$318,365	$318,774

See accompanying notes to condensed consolidated financial statements.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND CASH FLOWS
Three Months Ended March 31, 2004 and 2003
(In thousands, except per share data)
(Unaudited)

			Three Months Ended March 31,
			2004	2003
Interest income
	Loans		$1,960	$2,364
	Securities		1,073	1,063
	Interest bearing deposits		493	301
		Total interest income	3,526	3,728

Interest expense
	Deposits		591	832
	Federal Home Loan Bank advances		1,017	1,110
	Note payable		94	57
		Total interest expense	1,702	1,999

Net interest income			1,824	1,729
Provision for loan losses			-	-

Net interest income after provision
	for loan losses		1,824	1,729

Non-interest income
	Service fees		211	192
	Other income		175	178
	Gain on sale of securities		124	214
		Total non-interest income	510	584

Non-interest expense
	Salaries and employee benefits		943	911
	Occupancy and equipment		260	271
	Data processing		118	108
	Other expenses		428	365
			1,749	1,655

Income before income taxes			585	658

Provision for income taxes			162	212

Net income			$423	$446
Basic earnings per share			$.46	$.50
Diluted earnings per share			$.43	$.46
Comprehensive income			$136	$105

See accompanying notes to condensed consolidated financial statements.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THREE MONTHS ENDED MARCH 31, 2004 AND 2003
(In thousands)
(Unaudited)

				Three Months Ended March 31,
				2004	2003
Cash flows from operating activities
	Net income			$ 423	$ 446
	Adjustments to reconcile net income to net cash from
		operating activities
		Depreciation		73	60
		Amortization of intangibles		23	22
		Net amortization of premiums on securities		355	389
		Change in deferred loan fees		9	29
		Gain on sale of securities		(124)	(214)
		Change in loans held for sale		(90)	(81)
		Federal Home Loan Bank stock dividends		(363)	(97)
		Increase in value of bank-owned life insurance		(105)	(68)
		Change in accrued interest receivable and other assets		137	(74)
		Change in accrued interest payable and other liabilities		222	23
		Stock awards expense		9	9
		ESOP compensation		120	113
			Net cash from operating activities	689	557

Cash flows from investing activities
	Purchase of securities available-for-sale			(12,107)	(18,647)
	Proceeds from sales of securities available-for-sale			720	1,134
	Principal payments of mortgage-backed securities and
		collateralized mortgage obligations		8,206	12,706
	Proceeds from maturities and calls of securities			3,000	2,395
	Net change in loans			557	7,550
	Purchases of securities held-to-maturity			(4,191)	-
	Purchases of premises and equipment, net			(29)	(35)
		Net cash from investing activities		(3,844)	5,103

Cash flows from financing activities
	Net increase in deposits			577	4,474
	Change in advance payments by borrowers for taxes and insurance			(315)	(377)
	Purchase of treasury shares			-	(84)
	Change in Federal Home Loan Bank advances			(910)	-
	Change in note payable			-	(750)
	Exercise of stock options			100	52
	Dividends paid			(165)	(155)
		Net cash from financing activities		(713)	3,160
Net change in cash and cash equivalents				(3,868)	8,820
Cash and cash equivalents at beginning of period				13,980	28,204
Cash and cash equivalents at end of period				$10,112	$37,024

See accompanying notes to condensed consolidated financial statements.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES
IN STOCKHOLDERS' EQUITY
FOR THREE MONTHS ENDED MARCH 2004 AND 2003
(In thousands, except share data)
(Unaudited)

		Common Stock	Additional Paid-In Capital	Treasury Stock	Unearned ESOP	Unearned Stock Awards	Retained Earnings	Accumulated Compre- hensive Income	Total Stockholders' Equity	Compre- hensive Income

Balance at December 31, 2002		$21	$20,838	$(17,788)	$(665)	$(109)	$18,384	$803	$21,484	$ -

Net income for three months
	ended March 31, 2003	-	-	-	-	-	446	-	446	446

ESOP shares earned		-	71	-	42	-	-	-	113	-

Stock awards earned		-	-	-	-	9	-	-	9	-

Change in unrealized gain
	on securities available-for-sale, net	-	-	-	-	-	-	(341)	(341)	(341)

Treasury stock purchase, net		-	-	(84)	-	-	-	-	(84)	-

Exercise of 3,000 options		-	15	48	-	-	-	-	63	-

Dividends declared ($.16 per share)		-	-	-	-	-	(155)	-	(155)	-

Balance at March 31, 2003		$21	$20,924	$(17,824)	$(623)	$ (100)	$18,675	$462	$21,535	$105

Continued

		Common Stock	Additional Paid-In Capital	Treasury Stock	Unearned ESOP	Unearned Stock Awards	Retained Earnings	Accumulated Compre- hensive Income	Total Stockholders' Equity	Compre- hensive Income

Balance at December 31, 2003		$21	$21,221	$(17,958)	$(498)	$(74)	$19,431	$200	$22,343	$ -

Net income for three months
	ended March 31, 2004	-	-	-	-	-	423	-	423	423

ESOP shares earned		-	79	-	41	-	-	-	120	-

Stock awards earned		-	-	-	-	9	-	-	9	-

Change in unrealized gain
	on securities available-for-sale, net	-	-	-	-	-	-	(287)	(287)	(287)

Exercise of 5,832 options		-	31	95	-	-	-	-	126	-

Dividends declared ($.17 per share)		-	-	-	-	-	(165)	-	(165)	-

Balance at March 31, 2004		$21	$21,331	$(17,863)	$(457)	$ (65)	$19,689	$(87)	$22,569	$136

See accompanying notes to condensed consolidated financial statements.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2004
(In thousands, except share data)
(Unaudited)

NOTE 1

Hemlock Federal Financial Corp. (Corporation) is a unitary thrift holding company which owns 100% of the voting stock of Hemlock Federal Bank for Savings (Bank), a federally chartered thrift located in Oak Forest, Illinois. The Corporation was incorporated under Delaware law in December of 1996. The accompanying unaudited interim consolidated financial statements of the Corporation have been prepared in accordance with accounting principles generally accepted in the United States of America and with the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all normal and recurring adjustments which are necessary to fairly present the results for the interim periods presented have been included. The preparation of financial statements requires ma nagement to make estimates and assumptions that affect the recorded amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period reported. Actual results could differ from those estimates. For further information with respect to significant accounting policies followed by the Corporation in the preparation of its consolidated financial statements, refer to the Corporation's Annual Report on Form 10-K for the year ended December 31, 2003. Annualized results of operations during the three months ended March 31, 2004 are not necessarily indicative of results to be expected for the full year of 2004.

NOTE 2

A reconciliation of the numerators and denominators for earnings per common share computations is presented below:

		Three Months Ended March 31,
		2004	2003
Earnings per share
Net income available to common stockholders		$423	$446

Weighted average basic shares outstanding		920	898
	Basic earnings per share	$ .46	$ .50

Weighted average basic shares outstanding		920	898
Dilutive effect of stock options		70	68
Dilutive effect of stock awards		1	1
Weighted average diluted shares outstanding		991	967

	Diluted earnings per share	$ .43	$ .46

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Note 3. Stock Compensation

Employee compensation expense under stock options is reported using the intrinsic value method. No stock-based compensation cost is reflected in net income, as all options granted had an exercise price equal to or greater than the market price of the underlying common stock at date of grant. The following table illustrates the effect on net income and earnings per share if expense was measured using the fair value recognition provisions of FASB Statement No. 123, Accounting for Stock-Based Compensation.

	2004	2003

Net income as reported	$423	$446

Deduct: Stock-based compensation expense determined under fair value based method	2	2

Pro forma net income	$421	$444

Basic earnings per share as reported	$.46	$.50
Pro forma basic earnings per share	.46	.50

Diluted earnings per share as reported	.43	.46
Pro forma diluted earnings per share	.42	.46

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion focuses on the consolidated financial condition of Hemlock Federal Financial Corporation and Subsidiary at March 31, 2004 and the consolidated results of operations for the three months ended March 31, 2004, compared to the same period in 2003. The purpose of this discussion is to provide a better understanding of the condensed consolidated financial statements and the operations of the Corporation and its subsidiary, Hemlock Federal Bank for Savings (Bank). This discussion should be read in conjunction with the interim condensed consolidated financial statements and notes thereto included with this report.

Results of Operations

Consolidated net income of the Corporation for the first quarter of 2004 totaled $423,000, or $.46 per share basic and $.43 per share diluted, as compared to net income of $446,000, or $.50 per share basic and $.46 per share diluted, earned for the first quarter of 2003. The primary reasons for the decrease in net income are a decrease in non-interest income, as well as an increase in non-interest expense, partially offset by an increase in net interest income.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Net Interest Income

Net interest income before provision for loan losses was $1.82 million for the three-month period ended March 31, 2004, as compared to $1.73 million for the same period in 2003. For the three-month period ended March 31, 2004, interest income decreased to $3.53 million, from $3.73 million for the same period ended March 31, 2003. This decrease is due primarily to a decrease in the yield on interest-earning assets as a result of a lower interest rate environment.

The declining interest rate environment had a significant effect on the yield on both loans and securities. The Company experienced large volumes of calls and prepayments during 2003. This resulted in the purchase of securities and origination of loans at significantly lower interest rates, thus reducing both yield and interest income. Interest income on loans decreased $400,000, from $2.36 million as of March 31, 2003, to $1.96 million for the quarter ended March 31, 2004. The decrease in yield on securities was offset by an increase in investment in securities, as cash was reinvested into securities during the past several quarters.

The lower interest rate environment also resulted in a decrease in interest expense, which was $1.70 million for the three months ended March 31, 2004, as compared to $2.00 million for the same period in 2003. Net interest margin increased from 2.29% for the quarter ended March 31, 2003 to 2.41% for the quarter ended March 31, 2004. The increase in net interest margin is due primarily to the reinvestment of cash and cash equivalents into securities. In addition, the increase in interest rates over the past several quarters has resulted in a decrease in the amortization of premium on both securities and loan portfolios. This has had a positive impact on both the securities and loan portfolios.

Provision for Loan Losses

On a quarterly basis, management of the Bank meets to review the allowance for loan losses. Management classifies loans in compliance with regulatory classifications. Classified loans are individually reviewed to arrive at specific reserves for those loans. Once the specific portion of the allowance is calculated, management calculates a historical portion for each loan category based on loan loss history, peer data, current economic conditions and trends in the portfolio, including delinquencies and impairments, as well as changes in the composition of the loan portfolio. Although management believes the allowance for loan losses reflects probable incurred losses on existing loans at March 31, 2004, there can be no assurance that such losses will not exceed estimated amounts.

Changes In Non-Interest Income and Non-Interest Expense

Non-interest income decreased to $510,000 for the three-month period ended March 31, 2004, as compared to $584,000 for the same period ended March 31, 2003. The $74,000 decrease is primarily attributable to a $90,000 decrease in the gain on sale of securities for the three months ended March 31, 2004, as compared to the same period one year ago.

10.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Non-interest expense increased to $1.75 million for the three month period ended March 31, 2004, as compared to $1.66 million for the same period one year ago.

Provision for Income Taxes

The Corporation's federal and state income tax expense decreased to $165,000 for the three month period ended March 31, 2004, from $212,000 for the same period ended March 31, 2003. The decrease in income tax was the result of a decrease in net income.

Financial Condition

Consolidated total assets decreased $400,000 to $318.37 million as of March 31, 2004, from $318.77 million as of December 31, 2003. Cash on hand decreased to $10.11 million as of March 31, 2004, as compared to $13.98 million as of December 31, 2003, a decrease of $3.87 million, due primarily to the redeployment of cash on hand into securities. Loans receivable decreased to $135.09 million as of March 31, 2004 from $135.66 million as of December 31, 2003. Total securities increased by $3.67 million, from $145.34 million as of December 31, 2003, to $149.01 million as of March 31, 2004.

Total liabilities decreased to $295.80 million as of March 31, 2004, from $296.43 million as of December 31, 2003. The $630,000 decrease in liabilities is due primarily to a $910,000 decrease in total borrowings, from $79.81 million as of December 31, 2003, to $78.90 million as of March 31, 2004. This decrease is the result of the maturity of a Federal Home Loan Bank Advance. This was partially offset by an increase of $580,000 in deposits, which grew to $207.25 million as of March 31, 2004 from $206.67 million as of December 31, 2003.

Stockholders' equity increased to $22.57 million as of March 31, 2004 from $22.34 million as of December 31, 2003. The increase of $230,000 is primarily due to the income earned during the quarter, partially offset by dividends paid as well as a decrease in the valuation of the available for sale securities portfolio.

Capital Resources and Commitments

The Bank is subject to two capital requirements in accordance with federal regulations. The following table summarizes the Bank's regulatory capital requirements versus actual capital, as of March 31, 2004 and December 31, 2003.

	Regulatory Requirement To Be Adequately Capitalized	Actual March 31, 2004	Actual December 31, 2003

Core capital	4.0%	6.89%	6.72%
Risk-based capital	8.0%	15.54%	15.13%

11.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Liquidity

Liquidity measures the ability of the Corporation to meet maturing obligations and its existing commitments, to withstand fluctuations in deposit levels, to fund operations, and to provide for customers' credit needs. The liquidity of the Corporation principally depends on cash flows from operating activities, investment in and maturity of assets, changes in balances of deposits and borrowings, and its ability to borrow funds in the money or capital markets.

The Bank's regulatory liquidity ratio at March 31, 2004 was 16.44%, a portion of which includes interest-earning assets with terms of 5 years or less. Loan commitments outstanding totaled $4.08 million at March 31, 2004. Certificates of Deposits, which are scheduled to mature in one year or less from March 31, 2004, total $56.33 million. Based on both historical experience and current market conditions, management believes that a significant portion of these deposits will remain with the bank. In addition, the Bank anticipates it will have sufficient funds available to meet all current loan commitments.

Contractual Obligation, Commitments, Contingent Liabilities and Off-Balance Sheet Arrangements

The following table presents, as of March 31, 2004, the Bank's significant fixed and determinable contractual obligations by payment date. The payment amounts represent those amounts contractually due to the recipient and do not include any unamortized premiums or discounts or other similar carrying amount adjustments.

		In thousands
		One Year or Less	One to Three Years	Over Three Years	Total
Long-Term Debt
	FHLB borrowings	$12,000	$42,422	$24,475	$78,897
Other contractual Obligations
	Non-cancelable operating leases	$66	$133	$14	$235

Forward Looking Statements

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1993 as amended and Section 21E of the Securities Act of 1934 as amended. The Corporation intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995

12.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

and is including this statement for purposes of these safe harbor provisions. Forward-looking statements, which are based on certain assumptions and describe future plans, strategies, and expectations of the Corporation, are generally identified by the use of words "believe," "expect," "intend," "anticipate," "estimate," or "project" or similar expressions. The Corporation's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Corporation and the subsidiary include, but are not limited to, changes in interest rates; general economic conditions; legislative/regulatory changes; monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board; the quality and composition of the loan or securities portfolios; demand for loan products; deposit flows; competition; demand for financial services in the Corporati on's market areas; and accounting principles, policies, and guidelines. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Further information concerning the Corporation's financial results, is included in the Corporation's filings with the Securities and Exchange Commission.

13.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Item 3. Quantitative and Qualitative Disclosures About Market Risk

In an attempt to manage its exposure to changes in interest rates, management monitors the Corporation's interest rate risk. The Board of Directors reviews at least quarterly the Bank's interest rate risk position and profitability. The Board of Directors also reviews the Bank's portfolio, formulates investment strategies and oversees the timing and implementation of transactions to assure attainment of the Bank's objectives in the most effective manner. In addition, the Board anticipates reviewing on a quarterly basis the Bank's asset/liability position, including simulations of the effect on the Bank's capital of various interest rate scenarios.

In managing its asset/liability mix, Hemlock Federal, depending on the relationship between long- and short-term interest rates, market conditions and consumer preference, at times places more emphasis on managing net interest margin than on better matching the interest rate sensitivity of its assets and liabilities in an effort to enhance net interest income. Management believes that the increased net interest income resulting from a mismatch in the maturity of its asset and liability portfolios can, during periods of declining or stable interest rates, provide high enough returns to justify the increased exposure to sudden and unexpected increases in interest rates.

Management utilizes the net portfolio value ("NPV") analysis to quantify interest rate risk. In essence, this approach calculates the difference between the present value of liabilities, expected cash flows from assets and cash flows from off balance sheet contracts. The following table sets forth, at December 31, 2003 (latest information available), an analysis of the Bank's interest rate risk as measured by the estimated changes in NPV resulting from instantaneous and sustained parallel shifts in the yield curve (±300 basis points, measured in 100 basis point increments). As of December 31, 2002, due to the current level of interest rates, the Office of Thrift Supervision no longer provides NPV estimates for decreases in interest rates greater than 100 basis points.

Change in Interest Rates (Basis Points)	Estimated NPV Amount	Ratio of NPV to % of Assets	Estimated Increase (Decrease) in NPV
Change in Interest Rates (Basis Points)	Estimated NPV Amount	Ratio of NPV to % of Assets	Amount	Percent

+300	$17,146	5.63%	$(12,443)	(42)
+200	21,956	7.03	(7,634)	(26)
+100	26,332	8.24	(3,258)	(11)
-	29,590	9.07	-	-
-100	30,088	9.11	498	2
-200	-	-	-	-
-300	-	-	-	-

14.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

For the purposes of comparison, the following table sets forth, as of September 30, 2003, an analysis of the Bank's interest rate risk as measured by the estimated changes in NPV resulting from instantaneous and sustained parallel shifts in the yield curve (±300 basis points, measured in 100 basis point increments) as compared to tolerance limits under the Bank's current policy.

Change in Interest Rates (Basis Points)	Estimated NPV Amount	Ratio of NPV to % of Assets	Estimated Increase (Decrease) in NPV
Change in Interest Rates (Basis Points)	Estimated NPV Amount	Ratio of NPV to % of Assets	Amount	Percent

+300	$19,197	6.19%	$(9,172)	(32)
+200	23,134	7.29	(5,235)	(18)
+100	26,339	8.14	(2,030)	(7)
-	28,369	8.62	-	-
-100	28,264	8.49	(105)	-
-200	-	-	-	-
-300	-	-	-	-

Certain assumptions utilized in assessing the interest rate risk of thrift institutions were employed in preparing the preceding tables. These assumptions relate to interest rates, loan prepayment rates, deposit decay rates, and the market values of certain assets under the various interest rate scenarios. It was also assumed that delinquency rates will not change as a result of changes in interest rates although there can be no assurance that this will be the case. Even if interest rates change in the designated amounts, there can be no assurance that the Bank's assets and liabilities would perform as set forth above. In addition, a change in U.S. Treasury rates in the designated amounts accompanied by a change in the shape of the Treasury yield curve would cause significantly different changes to the NPV than indicated above.

While the March 31, 2004 interest rate risk analysis was not yet available, management believes that the Bank's interest rate risk has not changed significantly from the levels indicated as of December 31, 2003.

15.

HEMLOCK FEDERAL FINANCIAL CORPORATION AND SUBSIDIARY
March 31, 2004

Item 4. Controls and Procedures

An evaluation of the Corporation's disclosure controls and procedures (as defined in Rule 13-a-15(e) under the Securities Exchange Act of 1934, "the Act") as of March 31, 2004, was carried out under the supervision and with the participation of our Chief Executive Officer, Chief Financial Officer and several other members of our senior management. The Chief Executive Officer and Chief Financial Officer concluded that the Corporation's disclosure controls and procedures as currently in effect are effective in ensuring that the information required to be disclosed by the Corporation in the reports it files or submits under the Act is (i) accumulated and communicated to management (including the Chief Executive Officer and Chief Financial Officer) in a timely manner, and (ii) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. There have been no changes in our internal controls over financial reporting (as defined in rule 13a-15(f) under the Act) that occurred during the quarter ended March 31, 2004, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

The Corporation intends to continually review and evaluate the design and effectiveness of its disclosure controls and procedures and assess ways to improve its controls and procedures over time and to correct any deficiencies that it may discover in the future. The goal is to ensure that senior management has timely access to all material financial and non-financial information concerning the Corporation's business. While the Corporation believes the present design of its disclosure controls and procedures is effective to achieve its goal, future events affecting its business may cause the Corporation to modify its disclosure controls and procedures.

Annual Meeting

The Corporation's Annual Meeting for the fiscal year ending December 31, 2003 was held on May 5, 2004 at 10:30 a.m. at the Oak Forest office of the Corporation. See Part II Item 4 for the results.

16.

Part II Other Information

Item 1.	Legal Proceedings None
Item 2.	Changes in Securities and Use of Proceeds None
Item 3.	Defaults upon Senior Securities None
Item 4.	Submission of Matters to a vote of Security Holders The following is a record of the votes cast at the Corporation's Annual Meeting of Stockholders in the election of directors of the Corporation:

	FOR	VOTE WITHHELD
Rosanne Belczak	818,485	79,620
Frank A. Bucz	818,385	79,720
G. Gerald Schiera	818,285	79,820

Accordingly, the individuals named above were declared to be duly elected directors of the Corporation for a term to expire in 2007.

Accordingly, the proposal described above was declared to be duly adopted by the stockholders of the Corporation.

The following is a record of the votes cast in respect of the proposal to ratify the appointment of Crowe, Chizek and Company LLP as the Corporation's auditors for the fiscal year ending December 31, 2004.

	NUMBER OF VOTES	PERCENTAGE OF VOTES
FOR	884,878	98.5%
AGAINST	12,699	1.4%
ABSTAIN	528	0.1%

	Accordingly, the proposal described above was declared to be duly adopted by the stockholders of the Corporation.
Item 5.	Other Information None

17.

Item 6.	Exhibits and Reports on Form 8-K
	(a)	Exhibits
		31.1 Section 13a - 14(a) Certification
		31.2 Section 13a - 14(a) Certification
		31.3 Section 13a - 14(a) Certification
		32.1 Section 1350 Certification of Chief Executive Officer
		32.2 Section 1350 Certification of President
		32.3 Section 1350 Certification of Chief Financial Officer
	(b)	Reports on Form 8-K - none

18.

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, thereunto duly authorized.

HEMLOCK FEDERAL FINANCIAL CORP. (Registrant)

/s/ Maureen G. Partynski

Maureen G. Partynski,
Chief Executive Officer
May 10, 2004

/s/ Michael R. Stevens

Michael R. Stevens,
President
May 10, 2004

/s/ Jean M. Thornton

Jean M. Thornton,
Chief Financial Officer
May 10, 2004

19.

End.