UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                  SCHEDULE 14A

                Proxy Statement Pursuant to Section 14(a) of the
               Securities Exchange Act of 1934 (Amendment No.   )

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_]  Preliminary Proxy Statement          [_]  Soliciting Material Pursuant to
[_]  Confidential, For Use of the              SS.240.14a-11(c) or SS.240.14a-12
     Commission Only (as permitted
     by Rule 14a-6(e)(2))
[X]  Definitive Proxy Statement
[_]  Definitive Additional Materials


                        FIRST MIDWEST FINANCIAL, INC.
--------------------------------------------------------------------------------
                (Name of Registrant as Specified In Its Charter)


--------------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)


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1)   Title of each class of securities to which transaction applies:

________________________________________________________________________________
2)   Aggregate number of securities to which transaction applies:

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     to Exchange  Act Rule 0-11 (set forth the amount on which the filing fee is
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     [_]  Check box if any part of the fee is offset as provided by Exchange Act
          Rule  0-11(a)(2)  and identify the filing for which the offsetting fee
          was paid  previously.  Identify  the previous  filing by  registration
          statement number, or the form or schedule and the date of its filing.

          1)   Amount previously paid:

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________________________________________________________________________________


<PAGE>



                   [FIRST MIDWEST FINANCIAL, INC. LETTERHEAD]


                                                               December 17, 2003


Dear Fellow Shareholders:

     On  behalf  of the  Board of  Directors  and  management  of First  Midwest
Financial,  Inc.,  we  cordially  invite  you to attend  our  Annual  Meeting of
shareholders.  The  meeting  will be held at 1:00  p.m.  local  time on  Monday,
January 26, 2004, at our main office located at Fifth at Erie, Storm Lake, Iowa.

     The attached Notice of Annual Meeting of  Shareholders  and Proxy Statement
discuss the business to be conducted  at the  meeting.  We have also  enclosed a
copy of our Annual  Report to  Shareholders.  At the meeting,  we will report on
First Midwest Financial's operations and outlook for the year ahead.

     We encourage  you to attend the meeting in person.  Whether or not you plan
to attend,  however, please read the enclosed Proxy Statement and then complete,
sign and date the enclosed proxy card and return it in the accompanying postpaid
return  envelope  as  promptly  as  possible.  This will save us the  additional
expense of soliciting  proxies and will ensure that your shares are  represented
at the meeting.  Regardless  of the number of shares you own,  your vote is very
important. Please act today.

     Your Board of Directors  and  management  are  committed  to the  continued
success of First Midwest  Financial and the enhancement of your  investment.  As
Chairman  of the  Board  and  Chief  Executive  Officer,  I want to  express  my
appreciation for your confidence and support.

                                                       Very truly yours,

                                                       /s/ James S. Haahr
                                                       -------------------------
                                                       JAMES S. HAAHR
                                                       Chairman of the Board and
                                                       Chief Executive Officer


<PAGE>







                          FIRST MIDWEST FINANCIAL, INC.
                                  Fifth at Erie
                             Storm Lake, Iowa 50588
                                 (712) 732-4117

               __________________________________________________


                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                         To be held on January 26, 2004
               __________________________________________________

     Notice is hereby  given that the Annual  Meeting of  shareholders  of First
Midwest  Financial,  Inc.  will be held at our main  office  located at Fifth at
Erie, Storm Lake, Iowa, on Monday, January 26, 2004, at 1:00 p.m. local time. At
the  Annual  Meeting,  shareholders  will be asked to  consider  and vote on the
following:

     o    Election of three (3) directors, each for a term of three (3) years.

     Your Board of Directors recommends that you vote "FOR" the election of each
of the director nominees.

     Shareholders  also will transact any other  business that may properly come
before the Annual Meeting, or any adjournments or postponements  thereof. We are
not aware of any other business to come before the meeting.

     The  record  date  for  the  Annual  Meeting  is  December  1,  2003.  Only
shareholders  of record at the close of  business  on that date are  entitled to
notice of and to vote at the Annual Meeting or any  adjournment or  postponement
thereof.

     A proxy card and proxy  statement  for the  Annual  Meeting  are  enclosed.
Whether or not you plan to attend the Annual  Meeting,  please  take the time to
vote now by  signing,  dating  and  mailing  the  enclosed  proxy  card which is
solicited  on behalf of the Board of  Directors.  Your proxy will not be used if
you attend and vote at the Annual Meeting in person. Regardless of the number of
shares you own, your vote is very important. Please act today.

         Thank you for your continued interest and support.

                                             By Order of the Board of Directors


                                             /s/ James S. Haahr
                                             -----------------------------------
                                             JAMES S. HAAHR
                                             Chairman of the Board and
                                             Chief Executive Officer
Storm Lake, Iowa
D
ecember 17, 2003

================================================================================
Important:  The  prompt  return of proxies  will save us the  expense of further
requests for proxies to ensure a quorum at the Annual  Meeting.  A pre-addressed
envelope  is  enclosed  for your  convenience.  No postage is required if mailed
within the United States.
================================================================================


<PAGE>


                          FIRST MIDWEST FINANCIAL, INC.
                                  Fifth at Erie
                             Storm Lake, Iowa 50588
                                 (712) 732-4117

                           __________________________

                                 PROXY STATEMENT
                           __________________________

                         ANNUAL MEETING OF SHAREHOLDERS
                           To be held January 26, 2004


                                  INTRODUCTION

     Our Board of  Directors is using this proxy  statement  to solicit  proxies
from the holders of First Midwest Financial, Inc. ("First Midwest" or "Company")
common stock for use at First Midwest's Annual Meeting of shareholders  ("Annual
Meeting"). We are mailing this proxy statement and the enclosed form of proxy to
our shareholders on or about December 17, 2003.

     Certain  information  provided herein relates to First Federal Savings Bank
of the  Midwest  and  Security  State  Bank,  both of  which  are  wholly  owned
subsidiaries  of First  Midwest.  First Federal  Savings Bank of the Midwest and
Security State Bank are sometimes  referred to in this proxy statement as "First
Federal" and "Security  State,"  respectively.  First Federal and Security State
are collectively referred to in this proxy statement as the "Banks."


                      INFORMATION ABOUT THE ANNUAL MEETING

Time and Place of the Annual  Meeting;  Matters to be  Considered  at the Annual
Meeting

     Time and Place of the Annual  Meeting.  Our Annual  Meeting will be held as
     follows:

     Date: January 26, 2004
     Time: 1:00 p.m., local time
     Place: First Federal Savings Bank of the Midwest
            Fifth at Erie
            Storm Lake, Iowa

     Matters to be  Considered  at the Annual  Meeting.  At the Annual  Meeting,
shareholders  of First  Midwest are being  asked to  consider  and vote upon the
election of three directors,  each for a three-year term. The shareholders  also
will  transact  any other  business  that may  properly  come  before the Annual
Meeting.  As of the date of this proxy statement,  we are not aware of any other
business to be presented for  consideration at the Annual Meeting other than the
matters described in this proxy statement.

Voting Rights; Vote Required

     Voting Rights of Shareholders.  December 1, 2003 is the record date for the
Annual Meeting.  Only shareholders of record of First Midwest common stock as of

                                      -1-


<PAGE>

the close of  business  on that date are  entitled to notice of, and to vote at,
the Annual Meeting. You are entitled to one vote for each share of First Midwest
common  stock you own. On December 1, 2003,  2,505,617  shares of First  Midwest
common stock were outstanding and entitled to vote at the Annual Meeting.

     ESOP Shares.  We maintain the First Midwest  Employee Stock  Ownership Plan
("ESOP"),  which owns  approximately  11.03 percent of the First Midwest  common
stock  outstanding.  Employees of First Midwest and the Banks participate in the
ESOP. Each ESOP  participant is entitled to instruct the trustee of the ESOP how
to vote such participant's shares of First Midwest common stock allocated to his
or her  ESOP  account.  If an ESOP  participant  properly  executes  the  voting
instruction  card  distributed  by the ESOP trustee,  the ESOP trustee will vote
such  participant's  shares in accordance with the  participant's  instructions.
Where  properly  executed  voting  instruction  cards are  returned  to the ESOP
trustee with no specific  instruction as how to vote at the Annual Meeting,  the
trustee  may  vote  such  shares  in its  discretion.  In  the  event  the  ESOP
participant fails to give timely voting instructions to the trustee with respect
to the voting of the common stock that is allocated  to the  participant's  ESOP
account,  the ESOP  trustee  may vote such  shares in its  discretion.  The ESOP
trustee will vote the shares of First Midwest  common stock held in the ESOP but
not  allocated  to any  participant's  account  in the  manner  directed  by the
majority of the participants who directed the trustee as to the manner of voting
their allocated shares.

     Shares held by a Broker.  If you are the beneficial owner of shares held by
a broker in "street name," your broker, as the record holder of the shares, will
vote  the  shares  in  accordance  with  your  instructions.  If you do not give
instructions to your broker,  your broker will  nevertheless be entitled to vote
the shares with respect to  "discretionary"  items, but will not be permitted to
vote your  shares  with  respect to  "non-discretionary"  items.  In the case of
non-discretionary  items, the shares will be treated as "broker  non-votes." The
election of directors is expected to be  considered a  "discretionary"  item, in
which case your broker may vote your shares without instructions from you.

     Votes  Required  for  Election of  Directors  and a Quorum.  Directors  are
elected by a plurality of the votes cast,  in person or by proxy,  at the Annual
Meeting by  holders of First  Midwest  common  stock.  This means that the three
director  nominees with the most  affirmative  votes will be elected to fill the
three  available  seats.  Shares that are  represented by proxy which are marked
"vote  withheld"  for the election of one or more  director  nominees and broker
non-votes  will  have no  effect  on the vote  for the  election  of  directors,
although  they will be counted for purposes of  determining  whether  there is a
quorum. A quorum is necessary in order for us to conduct the Annual Meeting, and
if  one-third  of all the  shares  entitled  to vote  are in  attendance  at the
meeting, either in person or by proxy, then the quorum requirement is met.

     If a  director  nominee  is  unable  to stand  for  election,  the Board of
Directors  may either  reduce the number of  directors to be elected or select a
substitute nominee. If a substitute nominee is selected,  the proxy holders will
vote your shares for the substitute nominee, unless you have withheld authority.
As of the date of this Proxy  Statement,  we are not aware of any reason  that a
director nominee would be unable to stand for election.

     Your Board of Directors unanimously  recommends that you vote "FOR" each of
the director nominees set forth in this proxy statement.

Voting of Proxies; Revocability of Proxies; Proxy Solicitation Costs

     Voting  of  Proxies.  You may vote in person at the  Annual  Meeting  or by
proxy. To ensure your  representation  at the Annual Meeting,  we recommend that
you vote now by proxy  even if you plan to attend the  Annual  Meeting.  You may
change your vote by attending and voting at the Annual  Meeting or by submitting
another proxy with a later date. See "-Revocability of Proxies" below.

                                      -2-


<PAGE>


     Voting  instructions  are  included  on your  proxy  card.  Shares of First
Midwest common stock  represented by properly  executed proxies will be voted by
the  individuals  named in such  proxy  in  accordance  with  the  shareholder's
instructions. Where properly executed proxies are returned to First Midwest with
no specific  instruction as how to vote at the Annual Meeting, the persons named
in the proxy will vote the shares  "FOR" the  election  of each of the  director
nominees.

     The  persons  named in the proxy  will have the  discretion  to vote on any
other business  properly  presented for  consideration  at the Annual Meeting in
accordance with their best judgment. We are not aware of any other matters to be
presented  at the Annual  Meeting  other than those  described  in the Notice of
Annual Meeting of Shareholders accompanying this document.

     You may receive  more than one proxy card  depending on how your shares are
held. For example, you may hold some of your shares  individually,  some jointly
with your spouse and some in trust for your  children -- in which case you would
receive three separate proxy cards to vote.

     Revocability of Proxies. You may revoke your proxy before it is voted by:

     o    submitting a new proxy with a later date,

     o    notifying the Corporate  Secretary of First Midwest in writing  before
          the Annual Meeting that you have revoked your proxy, or

     o    voting in person at the Annual Meeting.

     If you plan to attend the  Annual  Meeting  and wish to vote in person,  we
will give you a ballot at the Annual Meeting.  However,  if your shares are held
in the  name  of  your  broker,  bank  or  other  nominee,  you  must  bring  an
authorization  letter from the broker,  bank or nominee indicating that you were
the  beneficial  owner of First  Midwest  common stock on December 1, 2003,  the
record date for voting at the Annual Meeting, if you wish to vote in person.

     Proxy Solicitation  Costs. We will pay our own costs of soliciting proxies.
In addition to this mailing,  First Midwest's directors,  officers and employees
may also solicit proxies  personally,  electronically  or by telephone.  We will
also reimburse  brokers,  banks and other nominees for their expenses in sending
these materials to you and obtaining your voting instructions.


                                 STOCK OWNERSHIP

     The following table presents information regarding the beneficial ownership
of First Midwest common stock as of December 1, 2003, by:

     o    those persons or entities (or group of affiliated persons or entities)
          known by management to beneficially  own more than five percent of our
          outstanding common stock;

     o    each director and director nominee of First Midwest;

     o    each  executive   officer  of  First  Midwest  named  in  the  Summary
          Compensation Table appearing under "Executive Compensation" below; and

     o    all of the  executive  officers and  directors  of First  Midwest as a
          group.

                                      -3-


<PAGE>


     The persons  named in the table below have sole voting power for all shares
of common  stock  shown as  beneficially  owned by them,  subject  to  community
property laws where  applicable  and except as indicated in the footnotes to the
table.

     Beneficial  ownership is  determined  in  accordance  with the rules of the
Securities  and  Exchange  Commission  (the "SEC").  In computing  the number of
shares  beneficially  owned by a person  and the  percentage  ownership  of that
person,  shares of common  stock  subject to  outstanding  options  held by that
person  that are  currently  exercisable  or  exercisable  within 60 days  after
December 1, 2003 are deemed outstanding.  Such shares,  however,  are not deemed
outstanding  for the purpose of computing the percentage  ownership of any other
person.


<TABLE>
<CAPTION>

 
                                                                     Shares Beneficially
                            Beneficial Owners                              Owned (1)        Percent of Class
-----------------------------------------------------------------    --------------------  ------------------
<S>                                                                      <C>                     <C>
  Tontine Financial Partners, L.P.                                       201,000                 8.02%

  First Midwest Financial, Inc. Employee Stock Ownership Plan(2)         276,260                11.03

  E. Wayne Cooley, Director(3)                                            75,970                 3.03

  E. Thurman Gaskill, Director(4)                                         50,014                 2.00

  James S. Haahr, Chairman of the Board and CEO(5)                       325,822                12.71

  J. Tyler Haahr, Director, President and COO(5) (6)                     132,124                 5.13

  G. Mark Mickelson, Director                                                640                  *

  Rodney G. Muilenburg, Director(7)                                      109,051                 4.35

  Jeanne Partlow, Director                                                 3,978                  *

  Donald J. Winchell, Senior Vice President, Secretary, Treasurer        124,846                 4.98
  and CFO(8)

  John Thune, Director                                                       100                  *

  Directors and executive officers of First Midwest                      822,545                31.22
  and the Banks as a group (8 persons)(9)
</TABLE>

------------------
*    Indicates less than 1%.

(1)  Included  in the shares  beneficially  owned by the named  individuals  are
     options to purchase shares of First Midwest common stock exercisable within
     60 days of December 1, 2003, as follows: Mr. James S. Haahr - 57,532 shares
     and Mr. J. Tyler Haahr - 71,114 shares.
(2)  Represents  shares  held by the ESOP,  252,448  shares  of which  have been
     allocated to accounts of  participants.  Pursuant to the terms of the ESOP,
     each  ESOP  participant  has the right to  direct  the  voting of shares of
     common  stock  allocated  to his or her  account  under the ESOP.  West Des
     Moines  State Bank,  West Des Moines,  Iowa,  as the ESOP  trustee,  may be
     deemed to beneficially  own the shares held by the ESOP which have not been
     allocated to the accounts of participants.
(3)  Includes 5,100 shares as to which Mr. Cooley has reported shared ownership.
(4)  Includes  49,114  shares  as to  which  Mr.  Gaskill  has  reported  shared
     ownership.
(5)  Mr. James S. Haahr is the father of Mr. J. Tyler Haahr.
(6)  Includes  33,032 shares as to which Mr. J. Tyler Haahr has reported  shared
     ownership.
(7)  Includes  44,144  shares as to which Mr.  Muilenburg  has  reported  shared
     ownership.

                                      -4-


<PAGE>

(8)  Includes  39,500  shares  as to which  Mr.  Winchell  has  reported  shared
     ownership.
(9)  Includes  shares held directly,  as well as, jointly with family members or
     held by trusts,  with  respect to which  shares the listed  individuals  or
     group  members may be deemed to have sole or shared  voting and  investment
     power.  Included  in the  shares  reported  as  beneficially  owned  by all
     directors and executive  officers are options to purchase 128,646 shares of
     First Midwest common stock exercisable within 60 days of December 1, 2003.

                                      -5-


<PAGE>


                              ELECTION OF DIRECTORS

     Our Board of Directors  currently consists of eight members.  Approximately
one-third of the directors are elected annually to serve for a three-year period
or until their  respective  successors  are elected  and  qualified.  All of our
director nominees currently serve as First Midwest directors.

     The table below sets forth  information  regarding  our Board of Directors,
including  their age,  position  with First  Midwest and term of office.  If any
director nominee is unable to serve before the election, your proxy authorizes a
vote for a  replacement  nominee if our Board of  Directors  names one.  At this
time,  we are not aware of any reason why a nominee  might be unable to serve if
elected. Except as disclosed in this proxy statement,  there are no arrangements
or  understandings  between any nominee and any other  person  pursuant to which
such nominee was selected. The Board of Directors recommends you vote "FOR" each
of the director nominees.

<TABLE>
<CAPTION>


                                                                     Director    Term to
        Name           Age    Position(s) Held in First Midwest      Since (1)    Expire
--------------------  -----  ------------------------------------   ----------  ---------
                                           Nominees
                                           --------
<S>                     <C>                                            <C>         <C>
E. Wayne Cooley         81   Director                                  1985        2007
J. Tyler Haahr(2)       40   Director, President and COO               1992        2007
John Thune              42   Director                                  2003        2007

                                   Directors Remaining in Office
                                   -----------------------------

E. Thurman Gaskill      68   Director                                   1982       2005
Rodney G. Muilenburg    59   Director                                   1989       2005
James S. Haahr(2)       64   Chairman of the Board and CEO              1962       2006
G. Mark Mickelson       37   Director                                   1997       2006
Jeanne Partlow          70   Director                                   1996       2006

</TABLE>


----------------------
(1)  Includes service as a director of First Federal.
(2)  James S. Haahr is the father of J. Tyler Haahr.

     The principal  occupation of each director of First Midwest and each of the
nominees for director is set forth below.  All  directors and nominees have held
their present position for at least five years unless otherwise indicated.

     E. Wayne Cooley - Dr. Cooley is Consultant Emeritus of the Iowa Girls' High
School Athletic Union in Des Moines, Iowa. He is Executive Vice President of the
Iowa High School  Speech  Association,  a member of the Buena  Vista  University
Board of Trustees, a member of the Drake Relays Executive Committee,  and on the
Board of Directors of the Women's College  Basketball  Association Hall of Fame.
Dr.  Cooley has served as  Chairman  of the Iowa Heart  Association  and as Vice
Chairman of the Iowa  Games.  He is a 1943  graduate  of Buena Vista  College in
Storm  Lake,  Iowa,  and holds  honorary  doctorate  degrees  from  Buena  Vista
University in Storm Lake, Iowa and Morningside College in Sioux City, Iowa.

     J. Tyler Haahr - Mr. Haahr is  President  and Chief  Operating  Officer for
First Midwest Financial,  Inc.;  President and Chief Operating Officer for First
Federal Savings Bank of the Midwest;  Chief Executive  Officer of Security State
Bank;  Vice President and Secretary of First  Services  Financial  Limited;  and
President of First Services Trust Company.  Mr. Haahr has been employed by First
Midwest and its  affiliates  since March 1997. He was  previously a partner with
the law firm of Lewis and Roca LLP,  Phoenix,  Arizona.  Mr. Haahr  received his
B.S.  degree with honors at the University of South Dakota in Vermillion,  South
Dakota.  He graduated  with honors from the  Georgetown  University  Law Center,
Washington, D.C.

                                      -6-

<PAGE>


     John  Thune  -  Mr.  Thune   received  his  Master's   Degree  in  Business
Administration  from the  University  of South Dakota in 1984. He then worked in
Washington,  DC as a legislative  assistant for U.S. Senator Jim Abdnor of South
Dakota.  From there, he was appointed by President Ronald Reagan to serve at the
Small  Business  Administration.  In 1989, Mr. Thune returned to South Dakota to
serve as Executive Director of the state's  Republican Party. In 1991,  Governor
George S. Mickelson appointed John as State Railroad Director. He held this post
until 1993,  when he accepted the  position as  Executive  Director of the South
Dakota  Municipal  League.  In 1996,  Mr. Thune sought and won his first term as
South Dakota's lone  Representative  to the U.S. House. He was reelected in 1998
and 2000. He served on the Agriculture,  Transportation and Infrastructure,  and
Small Business Committees.

     E. Thurman  Gaskill - Mr.  Gaskill has owned and  operated a grain  farming
operation  located  near  Corwith,   Iowa,  since  1958.  He  has  served  as  a
commissioner  with the Iowa  Department  of Economic  Development  and also as a
commissioner with the Iowa Department of Natural  Resources.  Mr. Gaskill is the
past  president of Iowa Corn Growers  Association,  past  chairman of the United
States  Feed  Grains  Council,  and has  served in  numerous  other  agriculture
positions.  He was  re-elected  to the Iowa State Senate in 2000 and  represents
District 6. He serves as Chairman of the Senate  Agricultural  Committee  and as
Assistant Majority Leader of the Iowa Senate.

     Rodney G.  Muilenburg - Mr.  Muilenburg is a retired dairy  specialist with
Purina  Mills,  Inc. He is currently a Consultant  for TransOva  Genetics  Dairy
Division.  Mr.  Muilenburg  received a B.A.  degree in  Biological  Science from
Northwestern  College,  Orange  City,  Iowa;  M.A.  degree in  secondary  school
education from Mankato State University,  Mankato,  Minnesota;  and a Specialist
Degree  in  secondary  school  administration  from  Mankato  State  University,
Mankato, Minnesota.

     James S. Haahr - Mr. Haahr is the Chairman of the Board and Chief Executive
Officer for First  Midwest  Financial,  Inc.,  a position he has held since June
1993.  Mr. Haahr is also  Chairman of the Board and Chief  Executive  Officer of
First Federal  Savings Bank of the Midwest.  Mr. Haahr serves as Chairman of the
Board of Security State Bank. Mr. Haahr has served in various  capacities  since
beginning  his career with First Federal in 1961. He is Chairman of the Board of
Trustees  and  former  Chairman  of the  Investment  Committee  of  Buena  Vista
University.  He is a former  member of the Savings  Association  Insurance  Fund
Industry  Advisory  Committee  at  FDIC,  and  past  member  of the  Legislative
Committee of Iowa Bankers Association.  Mr. Haahr is former Vice Chairman of the
Board of Directors of the Federal Home Loan Bank of Des Moines,  former Chairman
of the Iowa  League of  Savings  Institutions,  a former  member of the Board of
Directors  of  America's  Community  Bankers  and a former  director of the U.S.
League of Savings  Institutions.  Mr. Haahr received his B.S.  degree from Buena
Vista College in Storm Lake, Iowa.

     G. Mark Mickelson - Mr.  Mickelson is Vice President of Operations for Blue
Dot Services,  Inc., a subsidiary of Northwestern Corporation and was previously
a principal with Northwestern Growth Corporation.  Previously, Mr. Mickelson was
employed as an executive officer of Hegg Companies in Sioux Falls, South Dakota.
Mr. Mickelson received his undergraduate degree in Business  Administration from
the  University of South Dakota in Vermillion,  South Dakota.  He graduated with
high  honors  from  Harvard  Law School and is an  inactive  member of the South
Dakota Bar Association and a Certified Public Accountant.

                                      -7-

<PAGE>


     Jeanne Partlow - Mrs. Partlow retired in June 1998 as President of the Iowa
Savings Bank Division of First  Federal,  located in Des Moines,  Iowa.  She was
President,  Chief  Executive  Officer and  Chairman of the Board of Iowa Savings
Bank,  F.S.B.,  from 1987 until the end of December 1995, when Iowa Savings Bank
was  acquired  by and became a division  of First  Federal  Savings  Bank of the
Midwest.  Mrs. Partlow is a past member of the Board of Directors of the Federal
Home Loan Bank of Des Moines with over 30 years of bank management experience.


                             MEETINGS AND COMMITTEES

Meetings

     Meetings of the Board of Directors are generally  held on a monthly  basis.
The Board of Directors  conducted 12 regular  meetings  during fiscal 2003. Each
director attended at least 75% of the Board meetings and any committees on which
he or she served.

Committees

     The  Board  of  Directors  of  First   Midwest  has  an  Audit   Committee,
Compensation Committee and a Stock Option Committee.  Our entire Board serves as
the Nominating Committee.

     Audit Committee       Compensation Committee    Stock Option Committee
     ---------------       ----------------------    ----------------------

     E. Wayne Cooley       E. Wayne Cooley           E. Thurman Gaskill
     G. Mark Mickelson     E. Thurman Gaskill        Rodney G. Muilenburg
     Jeanne Partlow        Rodney G. Muilenburg      John Thune
     John Thune            Jeanne Partlow

     The Audit  Committee met three times during  fiscal 2003.  The functions of
the Audit Committee are as follows:

     o    Monitor the integrity of the Company's financial reporting process and
          systems  of  internal  controls  regarding  finance,  accounting,  and
          regulatory compliance;

     o    Monitor the independence and performance of the Company's  independent
          auditors and internal auditing department; and

     o    Provide an avenue of  communication  among the  independent  auditors,
          management,  the  internal  auditing  department,  and  the  Board  of
          Directors.

     The  Compensation  Committee met once during fiscal 2003.  The functions of
the Compensation Committee are as follows:

     o    Make salary and bonus recommendations, administer our restricted stock
          plan, and determine terms and conditions of employment of the officers
          of First Midwest;

     o    Oversee the  administration  of our employee  benefit  plans  covering
          employees generally; and

     o    Make  recommendations  to the Board of  Directors  with respect to our
          compensation policies.

     The Stock Option  Committee met twice during fiscal 2003.  The functions of
the Stock Option Committee are as follows:

     o    Administer our stock incentive plans; and

     o    Make  recommendations  to the Board of  Directors  with respect to our
          stock compensation policies.

                                      -8-


<PAGE>


     The entire Board of Directors acts as a nominating  committee for selecting
nominees for election as directors.  Nominations  of persons for election to the
Board of  Directors  may be made  only by or at the  direction  of the  Board of
Directors or by any  shareholder  entitled to vote for the election of directors
who  complies  with the  notice  procedures  set forth in the  By-laws  of First
Midwest. Pursuant to the By-laws,  nominations by shareholders must be delivered
in writing to the  Secretary of First Midwest at least 30 days prior to the date
of the Annual Meeting;  provided,  however,  that in the event that less than 40
days' notice or prior  disclosure of the date of the Annual  Meeting is given or
made to shareholders,  to be timely,  notice by the shareholder must be received
at the  executive  offices of First Midwest not later than the close of business
on the  10th  day  following  the day on which  such  notice  of the date of the
meeting was mailed or such public disclosure thereof was made.

Audit Committee Matters

     The following Report of the Audit Committee of the Board of Directors shall
not be deemed to be soliciting  material or to be  incorporated  by reference by
any general  statement  incorporating by reference this proxy statement into any
filing under the Securities Act of 1933 or the Securities  Exchange Act of 1934,
except to the extent First Midwest  Financial,  Inc.  specifically  incorporates
this Report therein, and shall not otherwise be deemed filed under such Acts.

     Audit Committee Report. The Audit Committee has issued the following report
with respect to the audited  financial  statements of the Company for the fiscal
year ended September 30, 2003:

     o    The Audit  Committee  has reviewed and  discussed  with the  Company's
          management the Company's fiscal 2003 audited financial statements;

     o    The Audit  Committee  has  discussed  with the  Company's  independent
          auditors  (McGladrey  &  Pullen,  LLP)  the  matters  required  to  be
          discussed  by Statement on Auditing  Standards  No. 61  "Communication
          with Audit Committees";

     o    The Audit  Committee has received the written  disclosures  and letter
          from the independent auditors required by Independence Standards Board
          Standard No. 1 (which relates to the auditors'  independence  from the
          Company and its related  entities) and has discussed with the auditors
          their independence from the Company; and

     o    Based on the review and  discussions  referred  to in the three  items
          above, the Audit Committee  recommended to the Board of Directors that
          the fiscal  2003  audited  financial  statements  be  included  in the
          Company's  Annual  Report  on Form  10-K  for the  fiscal  year  ended
          September 30, 2003.

     Submitted by the Audit Committee of the Company's Board of Directors:

     E. Wayne Cooley       G. Mark Mickelson         Jeanne Partlow John Thune

                                      -9-



<PAGE>



     Audit  Committee  Member  Independence  and Audit Committee  Charter.  Each
member  of  the  First  Midwest  Audit  Committee  is  "independent"  under  the
definition of independence  contained in the National  Association of Securities
Dealers' listing  standards for the Nasdaq Stock Market.  The Company's Board of
Directors has adopted a written audit  committee  charter,  which is attached to
this proxy statement as Appendix A.

     In  accordance  with SEC rules related to auditor  independence,  the table
below shows fees for audit services rendered by McGladrey & Pullen, LLP and fees
for other services rendered by McGladrey & Pullen, LLP or its associated entity,
RSM McGladrey,  Inc., to the Company and its  affiliates  during the fiscal year
2003.

     Audit fees........................................................$  83,000
     Audit related fees................................................$   7,000
     Tax fees..........................................................$   9,000
     Other fees........................................................$     --



                            COMPENSATION OF DIRECTORS


     During the fiscal year ended  September  30, 2003,  all  directors of First
Midwest  received an annual  retainer of $5,000.  For fiscal 2003,  non-employee
directors  of  First  Federal  were  paid  an  annual  retainer  of  $6,000  and
non-employee  directors  of  Security  State  were not paid an annual  retainer.
Directors  of First  Midwest do not receive any  additional  fees for  attending
board or committee meetings.  Each of the directors of First Midwest also serves
as a director  for each of the Banks.  Board  members who are  employees  of the
Banks do not  receive a fee for their  service  on the Banks'  Boards,  or their
respective committees.  Non-employee directors of First Federal receive $750 for
each  meeting of the board  attended and $200 for each board  committee  meeting
attended. Non-employee directors of Security State receive $400 for each meeting
of the board attended and $100 for each board committee meeting attended.

                                      -10-

<PAGE>



                             EXECUTIVE COMPENSATION

Summary Compensation Table

     The following table sets forth summary information concerning  compensation
awarded to, earned by or paid to First Midwest's chief executive officer and its
other executive  officers,  whose total salary and bonus exceeded $100,000,  for
services  rendered in all capacities during the fiscal years ended September 30,
2003,  2002 and 2001.  Each of these  officers  received  perquisites  and other
personal benefits in addition to salary and bonus during the periods stated. The
aggregate amount of these perquisites and other personal benefits,  however, did
not exceed the lesser of $50,000 or 10% of the total of their annual  salary and
bonus and, therefore,  has been omitted as permitted by the rules of the SEC. We
will use the term  "named  executive  officers"  from time to time in this proxy
statement to refer to the officers listed in the table below.


<TABLE>
<CAPTION>


                                                                      Long Term
                                                                    Compensation
                                           Annual Compensation         Awards
                                           -------------------      ------=------
                                            Salary        Bonus     Options/SARs     All Other
 Name and Principal Position        Year     ($)           ($)          (#)         Compensation ($)
---------------------------         ----   ----------   ---------   ------------    ----------------
<S>                                 <C>   <C>           <C>           <C>            <C>
James S. Haahr                      2003  $257,000(1)   $95,000       7,500          $50,655(3)
 Chairman of the Board and CEO      2002   239,000(1)    66,120       5,220           50,052
                                    2001   207,000(1)    58,000       5,250           41,482

J. Tyler Haahr                      2003  $250,000(2)   $91,000       7,350          $47,812(3)
  President and COO                 2002   237,000(2)    66,120       5,220           47,675
                                    2001   221,000(2)    62,640       5,670           44,483

Donald J. Winchell                  2003  $152,000      $55,000       4,560          $29,668(3)
 Senior Vice President, Secretary,  2002   145,500       41,468       3,274           31,030
  Treasurer and CFO                 2001   142,500       34,200       3,099           28,972

</TABLE>


----------------------

(1)  Includes  $2,000  of  deferred  compensation,   pursuant  to  the  deferred
     compensation  agreement entered into in 1980 between Mr. James S. Haahr and
     First Federal, and $5,000 for service as a director of First Midwest.

(2)  Includes  $5,000  paid to Mr. J. Tyler  Haahr for  service as a director of
     First Midwest.

(3)  Represents  the value as of  September  30, 2003 of  allocations  under the
     ESOP,  contributions  under the First Federal Profit Sharing Plan, payments
     under the First Federal Benefit  Equalization  Plan and term life insurance
     premiums paid to or on behalf of the named executive officers,  as follows:
     Mr. James S. Haahr - $12,696,  $15,582,  $20,444 and $1,933,  respectively;
     Mr. J. Tyler Haahr - $12,696, $15,582, $19,179 and $355, respectively;  and
     Mr. Winchell - $12,696, $15,582, $1,017 and $373, respectively.

                                      -11-

<PAGE>



Option Grants in Last Fiscal Year

     The  following  table  sets  forth  information  regarding  grants of stock
options under our stock option and  incentive  plans made during the fiscal year
ended September 30, 2003 to the named executive officers.  The amounts shown for
each named executive officer as potential realizable values are based on assumed
annualized  rates of stock price  appreciation  of five  percent and ten percent
over the full ten-year  term of the options,  which would result in stock prices
of approximately $35.45 and $56.45,  respectively,  for options with an exercise
price of $21.765.  No gain to the  optionees is possible  without an increase in
stock price, which benefits all stockholders  proportionately.  Actual gains, if
any,  on option  exercise  and  common  stock  holdings  depend  upon the future
performance of First Midwest  common stock and overall stock market  conditions.
There can be no assurance  that the  potential  realizable  values shown in this
table will be achieved.


<TABLE>
<CAPTION>


                                                                                  Potential Realizable
                                                                                Value at Assumed Annual
                                                                                     Rates of Stock
                                                                                Appreciation for Option
                                    Individual Grants                                     Terms
                      -------------------------------------------------------   -----------------------
                          Number of     % of Total
                         Securities     Options         Exercise
                         Underlying     Granted to      or Base
                       Options Granted  Employees in    Price      Expiration      5%            10%
    Name                    (#)         Fiscal Year    ($/Sh)        Date          ($)           ($)
-------------------   ----------------  --------------  ---------  ----------   --------     ----------
<S>                       <C>             <C>           <C>         <C>         <C>          <C>
James S. Haahr            7,500           20.4%         $21.765     9/30/13     $102,638     $260,138

J. Tyler Haahr            7,350           20.0           21.765     9/30/13      100,585      254,935

Donald J. Winchell        4,560           12.4           21.765     9/30/13       62,404      158,164
</TABLE>




     The option  exercise  price of the options  granted to the named  executive
officers shown above was the fair market value of First  Midwest's  common stock
on the date of grant.  These options vested as of the date of grant. The options
may not be  transferred  in any manner other than by will or the laws of descent
and  distribution  and may be exercised during the lifetime of the optionee only
by the optionee or his legal representative upon the optionee's death.


Aggregate Option Exercises in Last Fiscal Year and Fiscal Year End Option Values

     The following  table  summarizes for each of the named  executive  officers
certain  information  relating  to stock  options  exercised  by them during the
fiscal year ended  September  30,  2003.  Value  realized  upon  exercise is the
difference between the fair market value of the underlying stock on the exercise
date and the exercise or base price of the option.  The value of an unexercised,
in-the-money option at fiscal year-end is the difference between its exercise or
base price and the fair market value of the  underlying  stock on September  30,
2003, which was $21.765 per share. These values, unlike the amounts set forth in
the column "Value  Realized," have not been, and may never be,  realized.  These
options have not been, and may not ever be, exercised.  Actual gains, if any, on
exercise will depend on the value of First  Midwest  common stock on the date of
exercise.  There  can be no  assurance  that  these  values  will  be  realized.
Unexercisable options are those which have not yet vested.

                                      -12-

<PAGE>


<TABLE>
<CAPTION>
                                                                              Value of Unexercised
                                               Number of Unexercised          In-the-Money Options
                                               Options at FY-End (#)              at FY-End
                          Shares             --------------------------   --------------------------
                         Acquired
                            on      Value
        Name             Exercise  Realized  Exercisable  Unexercisable   Exercisable  Unexercisable
                            (#)       ($)        (#)          (#)             ($)           ($)
-------------------   -----------  --------  -----------  -------------   -----------  -------------
<S>                        <C>      <C>        <C>            <C>           <C>            <C>
James S. Haahr              --        --       57,532          --           $347,827        --

J. Tyler Haahr              --        --       71,114          --            364,265        --

Donald J. Winchell          --        --       31,796          --            169,328        --

</TABLE>



Employment Agreements

     First Federal has an employment  agreement with each of the named executive
officers. The employment agreements are designed to assist First Midwest and the
Banks in  maintaining  a stable and  competent  management  team.  The continued
success of First Midwest and the Banks depends,  to a significant degree, on the
skills and competence of their officers.  Each employment agreement provides for
annual base salary in an amount not less than the employee's  current salary and
a term of three years.  Each  agreement  provides for extensions of one year, in
addition to the then-remaining term under the agreement,  on each anniversary of
the effective date of the agreement,  subject to a formal performance evaluation
performed by  disinterested  members of the Board of Directors of First Federal.
The agreements  terminate upon such named executive  officer's death, for cause,
in certain events specified by Office of Thrift Supervision  regulations,  or by
such named executive officer upon 90 days notice to First Federal.  For the year
ended September 30, 2003, the disinterested  members of First Federal's Board of
Directors  authorized  one year  extensions  of the  named  executive  officers'
employment agreements.

     Each  employment  agreement  provides  for  payment to the named  executive
officer  of the  greater  of his  salary  for the  remainder  of the term of the
agreement, or 299% of his base compensation,  in the event there is a "change in
control"  of  First  Midwest  or  First  Federal  where  employment   terminates
involuntarily  in  connection  with such  change in  control or within 12 months
thereafter.  This  termination  payment is subject to reduction by the amount of
all other compensation to the named executive officer deemed for purposes of the
Internal  Revenue Code of 1986,  as amended,  to be  contingent  on a "change in
control",  and may not exceed three times the named executive  officer's average
annual  compensation  over the most recent five year period or be non-deductible
by First  Federal  for  federal  income tax  purposes.  For the  purposes of the
employment  agreements,  a change in control is defined as any event which would
require the filing of an  application  for  acquisition  of control or notice of
change in control  pursuant to 12 C.F.R.  ss. 574.3 or ss. 574.4,  respectively.
These events are generally  triggered prior to the acquisition or control of 10%
of First Midwest's common stock. Each agreement also guarantees participation in
an equitable manner in employee benefits applicable to executive personnel.

     Based on their current salaries,  if employment of Messrs.  James S. Haahr,
J. Tyler Haahr and Winchell had been terminated as of September 30, 2003,  under
circumstances  entitling them to termination  payments as described above,  they
would have been  entitled to receive  lump sum cash  payments  of  approximately
$989,000, $1,067,000 and $633,000, respectively.


                                      -13-


<PAGE>


 
          COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     Compensation  of the  executive  officers of First Midwest and the Banks is
currently  determined  by the  Compensation  Committee of First  Federal and the
Stock Option Committee of First Midwest.  Directors Cooley, Gaskill,  Muilenburg
and Partlow, each of whom are non-employee directors, are the current members of
the Compensation  Committee.  Directors  Gaskill,  Muilenburg and Thune, each of
whom are  non-employee  directors,  are the current  members of the Stock Option
Committee. All decisions by the First Federal Compensation Committee relating to
the cash  compensation  of executive  officers are reviewed by the full Board of
First Federal,  except that Board members who are also executive officers do not
participate in deliberations regarding their own compensation. See "Compensation
Committee Report" below.

                          COMPENSATION COMMITTEE REPORT

     First Midwest has not paid any cash compensation to its executive  officers
since its formation. All executive officers of First Midwest also currently hold
positions with First Federal and receive cash  compensation  from First Federal.
The  function of  administering  the  executive  compensation  policies of First
Federal is  currently  performed by the  Compensation  Committee of the Board of
Directors of First Federal,  consisting of Directors Cooley, Gaskill, Muilenburg
and Partlow. All decisions by the First Federal Compensation  Committee relating
to the cash compensation of First Federal's  executive  officers are reviewed by
the  full  Board  of First  Federal,  except  that  Board  members  who are also
executive   officers  do  not  participate  in  deliberations   regarding  their
respective compensation.

     Stock  option  awards  granted  under  First  Midwest's  stock  option  and
incentive plans are made solely by the First Midwest Stock Option Committee.

Overview and Philosophy

     The First Federal  Compensation  Committee has developed and implemented an
executive  compensation  program that is based on guiding principles designed to
align executive compensation with the values and objectives,  business strategy,
management  initiatives,  and the business and  financial  performance  of First
Midwest  and  the  Banks.  In  applying  these  principals,  the  First  Federal
Compensation Committee has established a program to:

     o    Support a  performance-oriented  environment that rewards  performance
          not only  with  respect  to our  goals,  but also our  performance  as
          compared to that of industry performance levels;

     o    Attract and retain key executives critical to our long-term success;

     o    Integrate  compensation  programs  with both First  Midwest's  and the
          Banks'   annual  and  long-term   strategic   planning  and  measuring
          processes; and

     o    Reward   executives  for  long-term   strategic   management  and  the
          enhancement of shareholder value.

     Furthermore,   in  making   compensation   decisions,   the  First  Federal
Compensation Committee focuses on the individual  contributions of our executive
officers.  The First Federal  Compensation  Committee uses its discretion to set
executive  compensation  where,  in  its  judgment,  external,  internal  or  an
individual's  circumstances warrant it. The First Federal Compensation Committee
also periodically reviews, both internally and through independent  consultants,
the compensation policies of other similarly situated companies, as set forth in

                                      -14-


<PAGE>

various industry  publications,  to determine whether our compensation decisions
are competitive within our industry.

Executive Officer Compensation Program

     The  executive  officer  compensation  program is comprised of base salary,
annual incentive bonuses,  long-term incentive compensation in the form of stock
options and restricted stock awards, and various benefits, including medical and
retirement plans generally available to employees of the Banks.

     Base Salary.  Base salary levels for executive  officers are  competitively
set  relative  to  other  publicly  traded  banking  and  thrift  companies.  In
determining base salaries,  the First Federal Compensation  Committee also takes
into  account   individual   experience  and  performance  and  specific  issues
particular to First Midwest and the Banks.

     Annual Incentive  Bonuses.  A program of annual incentive  bonuses has been
established  for  executive  officers  of First  Midwest and the Banks to reward
those officers who provide a level of performance  warranting recognition in the
form of compensation  above base salary.  Incentive bonuses are awarded based on
achievement of individual  performance  goals and overall  performance  goals of
First  Midwest and the Banks,  which are  established  at the  beginning of each
fiscal year.  Awards are determined as a percentage of each executive  officer's
base salary.

     Stock Benefit Plans. The stock option and incentive plans are our long-term
incentive  plans for  directors,  officers and  employees.  The objective of the
program is to align executive and shareholder  long-term interests by creating a
strong and direct link between  executive pay and First  Midwest's  performance,
and to enable executives to develop and maintain a significant,  long-term stock
ownership  position in First Midwest  common  stock.  Awards are made at a level
calculated  to be  competitive  with other  publicly  traded  banking and thrift
companies.

Chief Executive Officer Compensation

     Mr. James S. Haahr was  appointed  to the  position of President  and Chief
Executive  Officer of First  Federal in 1974 and Chairman in 1990,  and has also
served in such  capacities with First Midwest since its  incorporation  in 1993.
Mr.  Haahr's  fiscal 2003 base  salary was  $250,000  per year,  subject to such
adjustments  in  future  years as  shall  be  determined  by the  First  Federal
Compensation  Committee.  Mr.  Haahr's  base  salary for the  fiscal  year ended
September  30, 2002 was  $232,000.  In reviewing  Mr.  Haahr's  fiscal 2003 base
salary,  the First Federal  Compensation  Committee noted the median base salary
paid to executive officers in comparable  positions was higher than that paid to
Mr. Haahr.  As such,  the First  Federal  Compensation  Committee  determined it
appropriate to increase Mr. Haahr's base salary for fiscal 2003.

     In reviewing  the award of  incentive-based  compensation  to Mr. Haahr for
fiscal 2003, the Committee  noted  increases in net income,  earnings per share,
return on assets,  and return on equity  compared to the previous year.  Deposit
balances grew to an all-time  high as a result of internal  growth from existing
and  newly  opened  offices.   Lower  costing  transaction   accounts  increased
significantly  during the year.  Loan  balances  also rose to an all-time  high,
while  the  ratio of  non-performing  loans to total  loans at  fiscal  year end
continues to be below state and national  averages.  As such,  the First Federal
Compensation  Committee and the First Midwest Stock Option Committee  determined
First Midwest's overall performance warranted the payment of a cash bonus and an
award of stock options to Mr. Haahr for fiscal 2003.

                                      -15-


<PAGE>


     The effect of Section  162(m) of the Internal  Revenue Code is to eliminate
the  deductibility  of  compensation  over one  million  dollars,  with  certain
exclusions,  paid to each of certain highly  compensated  executive  officers of
publicly held  corporations.  Section 162(m) applies to all  remuneration,  both
cash and non-cash, that would otherwise be deductible for tax years beginning on
or after  January  1, 1994,  unless  expressly  excluded.  Because  the  current
compensation  of each of our named  executive  officers  is below the $1 million
threshold, we have not yet considered our policy regarding this provision.

     The  foregoing  report is  furnished  by the  members  of the  Compensation
Committee of First Federal and Stock Option  Committee of the Board of Directors
of First Midwest.

<TABLE>
<CAPTION>


<S>                  <C>                   <C>                      <C>              <C>
E. Wayne Cooley      E. Thurman Gaskill    Rodney G. Muilenburg     Jeanne Partlow    John Thune

</TABLE>


                   SHAREHOLDER RETURN PERFORMANCE PRESENTATION

     The rules and  regulations  of the SEC require the  presentation  of a line
graph comparing,  over a period of five years, the cumulative total  shareholder
return to a  performance  indicator of a broad equity  market index and either a
nationally  recognized  industry index or a peer group index  constructed by us.
The following  graph compares the  performance of First  Midwest's  common stock
with the Media General Savings and Loan Index and the Nasdaq Stock Market Index.
The  comparison  assumes $100 was  invested on September  30, 1998 in our common
stock and in each of the foregoing  indices and assumes the  reinvestment of all
dividends.  Historical stock price performance is not necessarily  indicative of
future stock price performance.



                        [Performance Graph Appears Here]





                 Comparison of Five-year Cumulative Total Return
          (First Midwest, Media General Savings and Loan Index and the
                           Nasdaq Stock Market Index)

                           -----------------------------------------------------
                             1998    1999     2000     2001       2002     2003
                           -----------------------------------------------------
FIRST MIDWEST...........    100.00   76.55    59.95    89.05     97.57    155.44
MG GROUP INDEX..........    100.00   96.18   117.51   156.74    164.48    219.73
NASDAQ MARKET...........    100.00  161.77   221.30    90.67     72.95    111.80


                                      -16-


<PAGE>




                              CERTAIN TRANSACTIONS

     The Banks have followed a policy of granting  loans to eligible  directors,
officers, employees and members of their immediate families for the financing of
their personal  residences and for consumer purposes.  As of September 30, 2003,
all loans or extensions of credit to executive  officers and directors were made
on substantially  the same terms,  including  interest rates and collateral,  as
those prevailing at the time for comparable transactions with the general public
and do not  involve  more than the normal  risk of  repayment  or present  other
unfavorable features.


 
            SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

     Section  16(a)  of the  Securities  Exchange  Act of  1934  requires  First
Midwest's directors and executive officers, and persons who own more than 10% of
a registered  class of First Midwest's equity  securities,  to file with the SEC
initial  reports of  ownership  and  reports of  changes in  ownership  of First
Midwest common stock and other equity  securities of First Midwest  generally by
the second business day following a transaction. Officers, directors and greater
than 10%  shareholders  are required by SEC regulations to furnish First Midwest
with copies of all Section 16(a) forms they file.

     To First  Midwest's  knowledge,  based  solely on a review of the copies of
such reports  furnished  to First  Midwest and written  representations  that no
other reports were required during the fiscal year ended September 30, 2003, all
Section 16(a) filing  requirements  applicable  to its  officers,  directors and
greater than 10 percent beneficial owners were complied with, except that during
the fiscal  year ended  September  30,  2003,  Mr.  Gaskill  and Mr.  Thune each
inadvertently  failed to timely report one  transaction.  Each late  transaction
report was subsequently filed.

 
                             INDEPENDENT AUDITORS

     The Company's independent auditors are McGladrey & Pullen, LLP, independent
certified public  accountants.  Representatives  of McGladrey & Pullen,  LLP are
expected to be present at the Annual Meeting to respond to appropriate questions
and to make a statement if they desire.

     The  Company's  Audit  Committee  has  considered  and  concluded  that the
provision of all  non-auditing  services (and the aggregate fees billed for such
services)  in the fiscal year ended  September  30, 2003 by  McGladrey & Pullen,
LLP, the principal  independent  auditors,  is compatible  with  maintaining the
principal auditors' independence.

             SHAREHOLDER PROPOSALS FOR THE YEAR 2005 ANNUAL MEETING

     Shareholder  proposals  to be  presented  at First  Midwest's  2005  Annual
Meeting of  Shareholders  must be received by our Secretary no later than August
17, 2004 to be eligible for inclusion in the First Midwest's proxy statement and
form of proxy  related to the 2005 Annual  Meeting.  Any such  proposal  will be
subject to the  requirements  of the proxy rules  adopted  under the  Securities
Exchange  Act  of  1934,  as  amended,  and as  with  any  shareholder  proposal
(regardless  of whether  such  proposal  is included  in First  Midwest's  proxy
materials),  First Midwest's certificate of incorporation,  by-laws and Delaware
law.

     To be considered for  presentation at the next Annual Meeting,  but not for
inclusion in the Company's  proxy  statement and form of proxy for that meeting,
proposals must be received by the Company by the Deadline.  The "Deadline" means
the date that is 30 days prior to the date of the next Annual Meeting;  however,
in the event that less than 40 days' notice of the date of such meeting is given

                                      -17-


<PAGE>

to  stockholders,  the  "Deadline"  means the close of business on the tenth day
following  the day on which  notice of the date of the meeting was mailed.  If a
stockholder  proposal  that is  received by the  Company  after the  Deadline is
raised at the next Annual  Meeting,  the holders of the proxies for that meeting
will have the  discretion to vote on the proposal in accordance  with their best
judgment and discretion, without any discussion of the proposal in the Company's
proxy statement for the next Annual Meeting.

                                  OTHER MATTERS

     The Board of  Directors  is not aware of any  business  to come  before the
Annual Meeting other than those matters described above in this proxy statement.
However,  if any other matter should properly come before the Annual Meeting, it
is intended that holders of the proxies will act in  accordance  with their best
judgment.

                                      -18-

<PAGE>



                                                                      APPENDIX A
                          FIRST MIDWEST FINANCIAL, INC.

                         CHARTER OF THE AUDIT COMMITTEE
                            OF THE BOARD OF DIRECTORS


I.  Audit Committee Purpose

The Audit  Committee  is appointed by the Board of Directors to assist the Board
in fulfilling  its oversight  responsibilities.  The Audit  Committee's  primary
duties and responsibilities are to:

     o    Monitor the integrity of the Company's financial reporting process and
          systems  of  internal  controls  regarding  finance,  accounting,  and
          regulatory compliance.

     o    Monitor the independence and performance of the Company's  independent
          auditors and internal auditing department.

     o    Provide an avenue of  communication  among the  independent  auditors,
          management,  the  internal  auditing  department,  and  the  Board  of
          Directors.

The Audit Committee has the authority to conduct any  investigation  appropriate
to fulfilling its responsibilities,  and it has direct access to the independent
auditors  as well as anyone in the  organization.  The Audit  Committee  has the
ability to retain, at the Company's expense, special legal, accounting, or other
consultants or experts it deems necessary in the performance of its duties.

II.  Audit Committee Composition and Meetings

Audit  Committee  members  shall meet the  requirements  of the  Securities  and
Exchange  Commission and Nasdaq Stock  Exchange.  The Audit  Committee  shall be
comprised of three or more  directors as determined  by the Board,  each of whom
shall be independent  nonexecutive  directors,  free from any relationship  that
would  interfere  with the  exercise  of his or her  independent  judgment.  All
members of the Audit Committee shall have a basic  understanding  of finance and
accounting and be able to read and understand  fundamental financial statements,
and at least one member of the Audit  Committee shall have accounting or related
financial management expertise.

Audit Committee members shall be appointed by the Board on recommendation of the
Nominating Committee.  If an Audit Committee Chair is not designated or present,
the members of the Audit Committee may designate a Chair by majority vote of the
Audit Committee membership.


<PAGE>


The Audit Committee shall meet at least three times annually, or more frequently
as circumstances  dictate. The Audit Committee Chair shall prepare or approve an
agenda in advance of each meeting.

The Audit Committee  shall provide  opportunity for the internal and independent
auditors  to meet with the  members of the Audit  Committee  without  members of
management  present.  Among the items to be discussed in these  meetings are the
independent  auditor's  evaluation of the Company's financial,  accounting,  and
auditing personnel,  and the cooperation that the independent  auditors received
during the course of the audit.

In addition, the Audit Committee,  or at least its Chair, shall communicate with
management  and the  independent  auditors  quarterly  to review  the  Company's
financial  statements and significant  findings based upon the auditors' limited
review procedures.

III.  Audit Committee Responsibilities and Duties

Review Procedures

     1)   Review and reassess  the  adequacy of this Charter at least  annually.
          Submit the charter to the Board of Directors for approval and have the
          document  published at least every three years in accordance  with SEC
          regulations.
     2)   Review the Company's  annual  audited  financial  statements  prior to
          filing and  recommend  to the Board of Directors  that such  financial
          statements  be included in the  Company's  annual report on Form 10-K.
          Review should  include  discussion  with  management  and  independent
          auditors  of  significant  issues  regarding  accounting   principles,
          practices, and judgments.
     3)   In consultation with the management, the independent auditors, and the
          internal auditor, consider the integrity and adequacy of the Company's
          financial  reporting  processes  and  controls.   Discuss  significant
          financial  risk  exposures  and the  steps  management  has  taken  to
          monitor,  control,  and  report  such  exposures.  Review  significant
          findings as  prepared by the  independent  auditors  and the  internal
          auditing department together with management's responses.
     4)   Review the Company's quarterly  financial  statements with management.
          Review and  discuss  with the  independent  auditors  any  significant
          changes to the Company's accounting  principles and any items required
          to be  communicated  in accordance with SAS 61. The Chair of the Audit
          Committee may represent the entire Audit Committee for purpose of this
          review.

Independent Auditors

     5)   The  independent  auditors  are  ultimately  accountable  to the Audit
          Committee and the Board of Directors. The Audit Committee shall review

                                     Page 2


<PAGE>

          the   independence  and  performance  of  the  auditors  and  annually
          recommend to the Board of Directors the appointment of the independent
          auditors  or approve any  discharge  of  auditors  when  circumstances
          warrant.
     6)   The  Audit   Committee  shall  approve  any  audit  services  and  any
          permissible  non-audit  services  prior  to  the  commencement  of the
          services.  In  making  its  pre-approval   determination,   the  Audit
          Committee shall consider whether providing the non-audit  services are
          compatible  with  maintaining  the auditor's  independence.  The Audit
          Committee may delegate this authority to a Audit  Committee  member or
          members.  Any  decisions  exercised by such member or members shall be
          reported at the next scheduled Audit Committee meeting.
     7)   On an annual basis, the Audit Committee should review and discuss with
          the independent auditors all significant  relationships they have with
          the Company that could impair the  auditor's  independence.  The Audit
          Committee should review the disclosures from the independent  auditors
          required by Standard No. 1 of the Independence Standards Board.
     8)   Review the independent  auditor's proposed audit scope for the current
          year and the audit procedures to be utilized.  9) Review the financial
          statements  contained in the annual  report to the  shareholders  with
          management  and  the  independent   auditors  to  determine  that  the
          independent  auditors are satisfied with the disclosure and content of
          the financial statements to be presented to the shareholders.
     10)  Discuss  certain   matters   required  to  be  communicated  to  audit
          committees in accordance with SAS 61.
     11)  Consider the  independent  auditor's  judgments  about the quality and
          appropriateness of the Company's  accounting  principles as applied in
          its financial reporting.

Internal Audit Department

     12)  Review the  internal  audit  function  of the  Company  including  the
          independence and authority of its reporting obligations,  the proposed
          audit plans and staffing for the coming year, and the  coordination of
          such plans with the independent auditors.
     13)  Review the  appointment,  performance,  and  replacement of the senior
          internal  auditor.  14) Review  significant  reports  prepared  by the
          internal  audit  department  together with  management's  response and
          follow-up to these reports.

Other Audit Committee Responsibilities

     15)  Annually, prepare a report to shareholders as required by the SEC. The
          report should be included in the Company's annual proxy statement.
     16)  Review accounting,  financial,  and internal audit human resources and
          succession  planning  within  the  Company.  17)  Maintain  minutes of
          meetings  and  periodically  report  to  the  Board  of  Directors  on
          significant results of the foregoing activities.
     18)  Perform  any  other  activities  consistent  with  this  Charter,  the
          Company's  bylaws,  and governing  law, as the Audit  Committee or the
          Board deems necessary or appropriate.

                                     Page 3



<PAGE>
                                                                      APPENDIX B

                                REVOCABLE PROXY
                         FIRST MIDWEST FINANCIAL, INC.
               ANNUAL MEETING OF SHAREHOLDERS - JANUARY 26, 2004

This  proxy is being  solicited  on behalf of the  Board of  Directors  of First
Midwest Financial, Inc.

The  undersigned  hereby appoints the members of the Board of Directors of First
Midwest Financial,  Inc.,(First  Midwest) and its survivors,  with full power of
substitution, and authorizes them to represent and vote, as designated below and
in accordance with their judgment upon any other matters  properly  presented at
the annual meeting,  all the shares of First Midwest common stock held of record
by the  undersigned  at the close of business on DECEMBER 1, 2003, at the annual
meeting  of  shareholders,  and at any and  all  adjournments  or  postponements
thereof.

                                              WITH-     FOR        ALL
                                              FOR       HOLD      EXCEPT
                                              --------------------------
The election of E. WAYNE COOLEY,              [_]       [_]        [_]
J. TYLER HAAHR and JOHN THUNE  as
directors for terms of three years.


INSTRUCTIONS:  To vote for all  nominees  mark  the box  "For"  with an "X".  To
                           ---
withhold  your vote for all  nominees  mark the box  "WITHHOLD"  with an "X". To
withhold your vote for an individual  nominee mark the box "For All Except" with
                          ----------
an "X" and write the name of the  nominee(s) on the line provided below for whom
you wish to withhold your vote.
--------------------------------------------------------------------------------

The Board of Directors recommends a vote "FOR" the election of the
above-named  directors.

     The undersigned  acknowledges  receipt from First Midwest Financial,  Inc.,
prior to the execution of this proxy, of the Notice of Annual Meeting  scheduled
to be held on January 27, 2003,  an Annual Report to  Shareholders  for the year
ended September 30, 2002, and a proxy  statement  relating to the business to be
addressed at the meeting.

     This proxy,  when properly  executed,  will be voted in the manner directed
herein by the  undersigned  shareholder(s).  If no direction is made, this proxy
will be voted "FOR" the  election  of each of the  directors  set forth  herein.
Should a director nominee be unable to serve as a director,  an event that First
Midwest does not currently  anticipate,  the persons named in this proxy reserve
the right, in their discretion,  to vote for a substitute  nominee designated by
the Board of Directors.

                                         Dated
                                             -----------------------------------


PRINTED NAME OF SHAREHOLDER              ---------------------------------------
APPEARS HERE                                    SIGNATURE OF SHAREHOLDER


                                         ---------------------------------------
                                                SIGNATURE OF SHAREHOLDER



Please sign exactly as your name(s)  appear(s)  above on this card. When signing
as attorney, executor, administrator, trustee,or guardian, please give your full
title. If shares are held jointly, each holder should sign.



                              fold and detach here
--------------------------------------------------------------------------------
      PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL THE ATTACHED PROXY IN
               THE ENCLOSED PRE-ADDRESSED, POSTAGE-PAID ENVELOPE


This proxy may be revoked at any time  before it is voted by  delivering  to the
Secretary of First Midwest  Financial,  Inc. on or before the taking of the vote
at the annual meeting,  a written notice of revocation bearing a later date than
the proxy or a later  dated proxy  relating to the same shares of First  Midwest
Financial,  Inc.  common stock, or by attending the annual meeting and voting in
person.  Attendance  at the annual  meeting  will not in itself  constitute  the
revocation  of a proxy.  If this proxy is properly  revoked as described  above,
then the power of such  attorneys and proxies shall be deemed  terminated and of
no further force and effect.