UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): ~~July~~ January 2, ~~2007~~ 2008

First Mutual Bancshares, Inc.

(exact name of registrant as specified it its charter)

Washington	000-28261	91-2005970
(State or other jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

400 -108^th AVENUE N.E.

BELLEVUE, WASHINGTON 98004

(425) 455-7300

(Address of principal executive offices, including zip code, and telephone number, Including area code)

Not applicable

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

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

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

o	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 204.13e-4(c))

Item 18.01. ~~Entry~~Other ~~into a Material Definitive Agreement~~Events

On ~~July~~ January 2, ~~2007~~2008, ~~First~~Washington ~~Mutual Bancshares~~Federal, Inc. (“~~First~~Washington ~~Mutual~~Federal”) ~~entered~~received written ~~into~~notification ~~an Agreement~~from ~~and~~the ~~Plan~~Office of ~~Merger~~Thrift (Supervision approving the previously ~~“Merger~~announced ~~Agreement”)~~acquisition ~~with~~of ~~Washington~~First ~~Federal~~Mutual Bancshares, Inc. (“~~Washington Federal~~First Mutual”). The ~~pursuant~~transaction tohas ~~which~~now ~~First~~been ~~Mutual~~approved ~~shall~~by ~~merge~~First ~~with~~Mutual’s stockholders and ~~into~~ ~~Washington~~by ~~Federal, with Washington Federal continuing as~~ the ~~surviving corporation~~necessary ~~(the~~regulatory ~~“Merger”)~~agencies. ~~In connection with the Merger, First~~Washington ~~Mutual~~ Federal ~~Bank, a Washington-chartered savings bank~~ and ~~wholly owned subsidiary of~~ First Mutual, ~~shall~~are ~~merge~~planning ~~with~~for ~~and~~the ~~into~~effective ~~Washington~~date ~~Federal~~and ~~Savings,~~time ~~a federally~~of ~~chartered~~ the merger ~~savings~~to ~~association~~be ~~and~~Friday ~~wholly~~February ~~owned subsidiary of Washington Federal~~1, ~~with~~ ~~Washington~~2008 ~~Federal~~at ~~Savings~~11:59 ~~continuing~~P.M. asPacific ~~the surviving bank~~Standard Time.

~~Under~~Additional ~~the terms~~ Information ofAbout the ~~Merger~~Washington ~~Agreement,~~Federal ~~shareholders~~– of First Mutual ~~will receive~~ aggregate consideration of $189.8 million, or approximately $27.05 per share, for the shares of First Mutual common stock outstanding immediately prior to the effective time of the Merger, which amount includes the cash-out of existing First Mutual stock options. First Mutual shareholders may elect to be paid in either Washington Federal common stock, cash or a combination of cash and Washington Federal common stock, subject to certain procedures designed to ensure that 50% of the total consideration will be in the form of Washington Federal common stock. The exchange price of Washington Federal common stock will be established as the average closing price of such stock during a ten-day period which ends five days prior to the closing. If the average closing price during such ten-day period is less than $22.75, Washington Federal can decide in its sole discretion to pay all of the merger consideration in cash. Transaction

~~The~~First ~~Merger~~ Mutual ~~Agreement~~stockholders ~~contains~~are ~~customary~~urged ~~representations~~to ~~and~~read ~~warranties~~the asproxy ~~of specific~~statement/prospectus ~~dates. Such representations and warranties were made solely~~regarding ~~for~~ the ~~purposes~~proposed merger of ~~the~~Washington ~~Merger~~Federal ~~Agreement~~ and ~~are~~First ~~subject~~Mutual, towhich ~~important~~was ~~qualifications~~first ~~and~~ mailed ~~limitations agreed~~ to byFirst ~~the~~Mutual ~~parties. The~~stockholders ~~transaction~~on isor ~~subject to~~about ~~customary~~September ~~closing~~10, ~~conditions~~2007, ~~including~~because it contains ~~the~~important ~~receipt~~information. ofThey ~~regulatory~~may ~~approvals and~~obtain ~~approval~~a byfree ~~the~~copy ~~shareholders~~ of ~~First Mutual. All of~~ the proxy ~~directors~~ statement/prospectus and ~~certain~~other ~~executive~~related ~~officers~~documents offiled ~~First~~by ~~Mutual~~Washington ~~have agreed to vote~~Federal ~~their~~ and First ~~shares~~Mutual inwith ~~favor of~~ the ~~approval~~Securities ofand ~~the~~Exchange ~~Merger~~Commission ~~Agreement~~(“SEC”) at the SEC’s ~~shareholders~~ Web ~~meeting~~site toat bewww.sec.gov. ~~held~~The ~~for~~proxy ~~the~~statement/prospectus ~~purpose~~and ~~of voting on~~ the ~~proposed transaction. In~~other ~~the event the Merger Agreement is terminated under~~documents ~~certain~~ also ~~circumstances,~~may ~~First~~be ~~Mutual~~obtained ~~has~~for ~~agreed~~free toby ~~pay~~accessing aWashington ~~termination~~Federal’s ~~fee~~Web ofsite at ~~$7,500,000~~www. ~~The~~washingtonfederal.com ~~foregoing~~com ~~summary~~or ~~of the Merger Agreement is qualified in its entirety~~ by ~~reference~~accessing toFirst ~~the~~Mutual’s ~~complete~~Web ~~text~~site ~~of the Merger~~at ~~Agreement which is attached as Exhibit 2~~www.1firstmutual.com.

~~The~~Forward-looking ~~Merger is expected to close in the fourth calendar quarter of 2007, pending the receipt of all requisite regulatory approvals and the approval of First Mutual’s shareholders.~~ Statements

~~Item~~Statements contained 9herein that are not historical facts should be considered forward-looking statements with respect to Washington Federal or First Mutual.01 Forward-looking statements of this type speak only as of the date of this report. By nature, forward-looking statements involve inherent risk and uncertainties. Various factors, including, but not limited to, unforeseen local, regional, national or global events, economic conditions, asset quality, interest rates, loan demand, changes in business or consumer spending, borrowing or savings habits, deposit growth, adequacy of the reserve for loan losses, competition, stock price volatility, government monetary policy, anticipated expense levels, changes in laws and regulations, the level of success of the company’s asset/liability management strategies as well as its marketing, product development, sales and other strategies, the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as the Financial ~~Statements~~Accounting Standards Board and other ~~Exhibits~~accounting standard setters, the costs and effects of litigation and of unexpected or adverse outcomes in such litigation, matters related to the proposed transaction between Washington Federal and First Mutual (including, among others, risks related to integration issues and cost and revenue synergies) and changes in the assumptions used in making the forward-looking statements, could cause actual results to differ materially from those contemplated by the forward-looking statements. First Mutual undertakes no obligation to update or revise forward-looking statements to reflect subsequent circumstances, events or information or for any other reason.

(a) Not Applicable

(b) Not Applicable

Exhibit Description

2.1 Agreement and Plan of Merger dated July 2, 2007.

99.1 Press Release, dated July 2, 2007.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FIRST MUTUAL BANCSHARES, INC.
Dated: July 2, 2007
Dated January 2, 2008
	By: /s/ John R. Valaas
	Its: President and CEO

Exhibit Index:

Exhibit Number	Description
2.1	Agreement and Plan of Merger dated July 2, 2007.
99.1	Press Release, dated July 2, 2007

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