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SEC Correspondence

 [Letterhead of American Bank Incorporated]

 October 13, 2005

 VIA EDGAR AND FACSIMILE

 Donald Walker

 Senior Assistant Chief Accountant

 Securities and Exchange Commission

 100 F Street, NE

 Washington, DC 20549

Re:
American Bank Incorporated

Form 10-KSB for the Fiscal Year Ended December 31, 2004

 Dear Mr. Walker:

 In response to the letter from the Securities and Exchange Commission (the “Commission”) to Mark W. Jaindl, President and Chief Executive
Officer of American Bank Incorporated (the “Company”), dated September 28, 2005 (copy enclosed by facsimile), set forth below are the Company’s responses to the letter from the Commission.

 1. We will revise our future filings in response to the comment.

 2. We will revise our future filings in response to the comment.

 3. We analyze our security portfolio for Other than Temporary Impairment (“OTTI”)
on a monthly basis. We consider various factors in our determination, including the guidance provided in FASB #115 and SAB Topic 5:M. We consider the amount of decline in market value, the cause of the decline (changes in interest rates, changes in
credit quality or both), the likelihood and timing of market value recovery and our intent and ability to hold the investment until such expected recovery. If we determine that an OTTI exists we write down the investment and recognize the impairment
loss through current earnings.

 In determining the cause of a decline in market
value we consider interest rate environment changes and credit quality changes. For changes in credit quality we consider factors specific to the issuer, including whether the financial condition of the issuer has deteriorated, factors affecting the
industry of the issuer and factors affecting the economy as a whole. Both issuers of the securities we own are currently rated AA by two major rating agencies. Because of this high credit rating we do not consider credit quality to be a factor in
the decline in market value of these securities.

 Donald Walker

 October
13, 2005

 Page 2

 With regards to declines in market value caused by changing interest rates we consider overall changes in the
interest rate environment generally as well as specific to the security being analyzed. When applicable and available we utilize analysis from third parties such as market analysts.

 With regards to FNMA Series F and FHLMC Series M we note that these securities reprice every two years and the dividend rate is based upon
the two year Treasury note. We believe that even though these are preferred stock issues, the market prices them much like a debt security and as such, the market value is based upon the current dividend rate and the market yields of long term debt
securities of similar credit quality. We note the significant recovery in market value that FHLMC Series M security realized at reset on March 31, 2005 as strong evidence that supports our belief that the decline in market is the result of
changes in interest rates and further that the decline is temporary and can reasonably be expected to fully recover as interest rates increase and the economic cycle progresses.

 Impairment Determination Specific to FNMA Preferred Stock-Series F

 Federal National Mortgage Association - Series F
Non-cumulative Preferred Stock

 CUSIP 313586703

 Par value: $50.00

 Issue date: March 20,
2000

 Original dividend rate: 6.295%

 Purchase date: April 18, 2000

 Purchase price: $50.06

 Dividend rate resets on March 31, 2002 and every two years thereafter at the two-year U. S. Treasury CMT minus 16 basis points.

 Dividends received on this security qualify for the Dividends Received Deduction (“DRD”) for Corporate Income tax reporting.

 The issue is callable in whole or in part on every dividend reset date at par.

 Amortized cost December 31, 2004

$
1,005,117

 Market value December 31, 2004

722,737

 Market price December 31, 2004

36.14

 Amortized cost March 31, 2005

1,005,101

 Market value March 31, 2005

742,813

 Market price March 31, 2005

37.14

 Amortized cost June 30, 2005

1,005,090

 Market value June 30, 2005

734,783

 Market price June 30, 2005

36.74

 Donald Walker

 October
13, 2005

 Page 3

 We determined that this security was not other than temporarily impaired at December 31,
2004, March 31, 2005 and June 30, 2005. We determined that the decline in market value was a direct result of (1) decreasing market rates of interest in general; and (2) the level of the two-year Treasury note and the shape
of the Treasury yield curve in particular. As noted above this security qualifies for DRD treatment for income tax purposes, which has a significant impact on market value. The DRD increases the current yield by a factor of 1.36 times to determine
the tax equivalent yield. Also important to the analysis is the relative shape of the yield curve, as the steeper the curve the lower the market value of the security. Schedule 1 shows the specific data we considered in evaluating this security at
the respective measurement dates. We found that the level of interest rates and the shape of the yield curve have significant impact on the market value of this security. We believe that the changing economic cycle is the reason for the decline in
market value of this security and we further believe the market value will recover as this economic cycle progresses and interest rates and the Treasury yield curve returns to more normal levels and shape. We believe that the market is pricing this
security at a current yield level of 6.00% to 6.50% on a taxable equivalent basis, which is achieved when the two-year Treasury note is between 4.57% and 4.90%. These are levels that can reasonably be expected to be achieved in the current rising
interest rate environment. We believe that the shape of the yield curve is also important to the market value of this security. A spread of 50 basis points or less between the ten-year note and the two-year note makes this security an attractive
investment and will be reflected in market pricing. This spread relationship can also be reasonably expected to occur in this economic cycle.

 We expect that this change in interest rates and yield curve shape will result in recovery of market value to equal or exceed our cost basis. Further we have the ability
and intent to hold this security until the expected recovery occurs during the current economic cycle.

 We also considered the attached analysis prepared by FTN Financial Capital Markets regarding this particular security. The result of their analysis is that there is a strong correlation between the level of interest
rates and the shape of the yield curve and the market value of this security. They concluded that this security can reasonably be expected to fully recover its market value as interest rates recover from their historic lows and the shape of the
yield curve flattens to a more traditional level.

 Donald Walker

 October
13, 2005

 Page 4

 Impairment Determination Specific to FHLMC Preferred Stock-Series M

 Federal Home Loan Mortgage Corporation -
Series M Non-cumulative Preferred Stock

 CUSIP 313400780

 Par value: $50.00.

 Issue
date: January 26, 2001.

 Original dividend rate: 4.817%.

 Purchase date: March 2, 2001

 Purchase price: $49.95

 Dividend rate resets on March 31, 2003 and every two years thereafter at the two-year U. S. Treasury CMT plus 10 basis points.

 Dividends received on this security qualify for the Dividends Received Deduction (“DRD”) for Corporate Income tax reporting.

 The issue is callable in whole or in part on every dividend reset date at par.

 Amortized cost December 31, 2004

$
999,473

 Market value December 31, 2004

760,475

 Market price December 31, 2004

$
38.02

 Amortized cost March 31, 2005

999,476

 Market value March 31, 2005

850,532

 Market price March 31, 2005

42.53

 Amortized cost June 30, 2005

999,480

 Market value June 30, 2005

845,528

 Market price June 30, 2005

42.28

 We determined that this security was
not other than temporarily impaired at December 31, 2004, March 31, 2005 and June 30, 2005. We determined that the decline in market value was a direct result of (1) decreasing market rates of interest in general; and
(2) the level of the two-year Treasury note and the shape of the Treasury yield curve in particular. As noted above this security qualifies for DRD treatment for income tax purposes, which has a significant impact on market value. The DRD
increases the current yield by a factor of 1.36 times to determine the tax equivalent yield. Also important to the analysis is the relative shape of the yield curve, as the steeper the curve the lower the market value of the security. Schedule 2
shows the specific data we considered in evaluating this security at the respective measurement dates. We found that the level of interest rates and the shape of the yield curve have significant impact on the market value of this security. We
believe that the changing economic cycle is the reason for the decline in market value of this security and we further believe the market value will recover as this economic cycle progresses and interest rates and the Treasury yield curve returns to
more normal levels and shape. We believe that the market is pricing this security at a current yield level of

 Donald Walker

 October
13, 2005

 Page 5

6.00% to 6.50% on a taxable equivalent basis, which is achieved when the two-year Treasury note is between 4.31% and 4.65%. These are levels that can
reasonably be expected to be achieved in the current rising interest rate environment. We believe that the shape of the yield curve is also important to the market value of this security. A spread of 50 basis points or less between the ten-year note
and the two-year note makes this security an attractive investment and will be reflected in market pricing. This spread relationship can also be reasonably expected to occur in this economic cycle.

 We expect that this change in interest rates and yield curve shape will result in recovery of
market value to equal or exceed our cost basis. Further we have the ability and intent to hold this security until the expected recovery occurs during the current economic cycle.

 We also considered the attached analysis prepared by FTN Financial Capital Markets regarding this particular security. They concluded that
this security can reasonably be expected to fully recover its market value as interest rates recover from their historic lows and the shape of the yield curve flattens to a more traditional level.

 Impairment Determination Specific to FHLMC Preferred
5.70%

 Federal Home Loan Mortgage Corporation - Preferred Stock

 CUSIP 313400731

 Par value: $50.00.

 Issue date:
October 30, 2001.

 Dividend rate: 5.70%.

 Purchase date: November 2, 2001

 Purchase price: $50.00

 Dividends received on this security qualify for the Dividends Received Deduction (“DRD”) for Corporate Income tax reporting.

 The issue is callable in whole or in part on or after December 31, 2006.

 Amortized cost December 31, 2004

$
500,000

 Market value December 31, 2004

499,000

 Market price December 31, 2004

$
49.90

 Amortized cost March 31, 2005

500,000

 Market value March 31, 2005

487,500

 Market price March 31, 2005

47.50

 Amortized cost June 30, 2005

500,000

 Market value June 30, 2005

487,500

 Market price June 30, 2005

47.50

 Donald Walker

 October
13, 2005

 Page 6

 We determined that the unrealized loss on this security at December 31, 2004, March 31, 2005 and
June 30, 2005 was not material to the financial condition of the Company.

 *   *   *   *   *

 In connection with these responses, and as requested by the Commission, the Company acknowledges that:

•

the Company is responsible for the adequacy and accuracy of the disclosure in the filing;

•

staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and

•

the Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

 We trust that the above information is
responsive to the staff’s comments. Please direct any additional comments or questions to the undersigned at (610) 366-1800, or to our attorney, Ned Quint, at (202) 274-2007.

 Sincerely,

/s/    HARRY C.
BIRKHIMER

Harry C. Birkhimer

Vice President and Treasurer

cc:
Amanda Roberts, Securities and Exchange Commission

Mark W. Jaindl, President and Chief Executive Officer

Ned Quint, Esq.

Steven E. Morehart, Partner, Beard Miller Company LLP

 Analysis of Interest Rate Changes

Schedule 1

 FNMA Series F Preferred Stock

 CUSIP 313586703

Coupon

DRD
Factor

Tax Equivalent
Coupon Yield

Ten Year
Treas Note

Two Year
Treas Note

10yr-2yr
Treasury
Spread

TEY to 10
Yr Spread

Market
Price

Market
Yield

Tax Equiv
Mkt Yld

TEMY to 10
Yr Spread

 3/20/2000

6.30

1.36

8.56

6.26

6.53

(0.27
)

(2.30
)

$
50.00

6.30

8.56

(2.30
)

 6/30/2000

6.30

1.36

8.56

6.10

6.48

(0.38
)

(2.46
)

50.25

6.26

8.52

(2.42
)

 9/30/2000

6.30

1.36

8.56

5.80

6.08

(0.28
)

(2.76
)

50.13

6.28

8.54

(2.74
)

 12/31/2000

6.30

1.36

8.56

5.24

5.35

(0.11
)

(3.32
)

50.38

6.25

8.50

(3.26
)

 3/31/2001

6.30

1.36

8.56

4.89

4.34

0.55

(3.67
)

50.45

6.24

8.48

(3.59
)

 6/30/2001

6.30

1.36

8.56

5.28

4.08

1.20

(3.28
)

50.00

6.30

8.56

(3.28
)

 9/30/2001

6.30

1.36

8.56

4.73

3.12

1.61

(3.83
)

50.00

6.30

8.56

(3.83
)

 12/31/2001

6.30

1.36

8.56

5.09

3.11

1.98

(3.47
)

49.25

6.39

8.69

(3.60
)

 3/31/2002

3.55

1.36

4.83

5.28

3.56

1.72

0.45

45.25

3.92

5.33

(0.05
)

 6/30/2002

3.55

1.36

4.83

4.93

2.99

1.94

0.10

47.00

3.78

5.14

(0.21
)

 9/30/2002

3.55

1.36

4.83

3.87

2.00

1.87

(0.96
)

47.50

3.74

5.08

(1.21
)

 12/31/2002

3.55

1.36

4.83

4.03

1.84

2.19

(0.80
)

47.50

3.74

5.08

(1.05
)

 3/31/2003

3.55

1.36

4.83

3.81

1.57

2.24

(1.02
)

48.00

3.70

5.03

(1.22
)

 6/30/2003

3.55

1.36

4.83

3.33

1.23

2.10

(1.50
)

46.50

3.82

5.19

(1.86
)

 9/30/2003

3.55

1.36

4.83

4.27

1.71

2.56

(0.56
)

43.50

4.08

5.55

(1.28
)

 12/31/2003

3.55

1.36

4.83

4.27

1.91

2.36

(0.56
)

42.00

4.23

5.75

(1.48
)

 3/31/2004

1.37

1.36

1.86

3.83

1.58

2.25

1.97

41.00

1.67

2.27

1.56

 6/30/2004

1.37

1.36

1.86

4.73

2.76

1.97

2.87

39.00

1.76

2.39

2.34

 9/30/2004

1.37

1.36

1.86

4.13

2.53

1.60

2.27

38.00

1.80

2.45

1.68

 12/31/2004

1.37

1.36

1.86

4.23

3.01

1.22

2.37

36.14

1.90

2.58

1.65

 3/31/2005

1.37

1.36

1.86

4.50

3.73

0.77

2.64

37.14

1.84

2.51

1.99

 6/30/2005

1.37

1.36

1.86

4.26

4.08

0.18

2.40

36.74

1.86

2.54

1.72

 Analysis of Interest Rate Changes

Schedule 2

 FHLMC Series M Preferred Stock

 CUSIP 313400780

Coupon

DRD
Factor

Tax Equivalent
Coupon Yield

Ten Year
Treas Note

Two Year
Treas Note

10yr-2yr
Treasury
Spread

TEY to 10
Yr Spread

Market
Price

Market
Yield

Tax Equiv
Mkt Yld

TEMY to 10
Yr Spread

 3/31/2001

4.82

1.36

6.55

4.89

4.34

0.55

(1.66
)

$
49.85

4.83

6.57

(1.68
)

 6/30/2001

4.82

1.36

6.55

5.28

4.08

1.20

(1.27
)

49.80

4.84

6.58

(1.30
)

 9/30/2001

4.82

1.36

6.55

4.73

3.12

1.61

(1.82
)

50.05

4.81

6.54

(1.81
)

 12/31/2001

4.82

1.36

6.55

5.09

3.11

1.98

(1.46
)

50.00

4.82

6.55

(1.46
)

 3/31/2002

4.82

1.36

6.55

5.28

3.56

1.72

(1.27
)

48.00

5.02

6.82

(1.54
)

 6/30/2002

4.82

1.36

6.55

4.93

2.99

1.94

(1.62
)

48.00

5.02

6.82

(1.89
)

 9/30/2002

4.82

1.36

6.55

3.87

2.00

1.87

(2.68
)

47.50

5.07

6.90

(3.03
)

 12/31/2002

4.82

1.36

6.55

4.03

1.84

2.19

(2.52
)

44.00

5.47

7.44

(3.41
)

 3/31/2003

1.82

1.36

2.48

3.81

1.57

2.24

1.33

43.50

2.09

2.85

0.96

 6/30/2003

1.82

1.36

2.48

3.33

1.23

2.1