EXHIBIT 99.1







PRESS RELEASE

December 22, 2000
For Immediate Release

For Further Information Contact:          Barry Backhaus
                                          First Federal Bankshares, Inc.
                                          329 Pierce Street, P.O. Box 897
                                          Sioux City, IA  51102
                                          712.277.0200


                  FIRST FEDERAL BANKSHARES, INC. ANNOUNCES NEW
                            STOCK REPURCHASE PROGRAM


Sioux City, Iowa.  (Nasdaq  National Market - "FFSX") First Federal  Bankshares,
Inc.,  announced today that it is commencing a new stock  repurchase  program to
acquire up to 460,000  shares of the Company's  common stock,  which  represents
approximately  10% of the outstanding  common stock. The new repurchase  program
follows the completion of the Company's  current stock  repurchase  program,  in
which the Company repurchased a total of 238, 500 shares of common stock.

Barry E. Backhaus,  President and Chief Executive Officer of the Company, stated
that the Board of Directors has  authorized  the  repurchase  program,  which is
expected to be completed  within a year. Mr.  Backhaus  stated that the Board of
Directors   considers  the  common  stock  to  be  an   attractive   investment,
particularly  in view of the current  price at which the common stock is trading
relative to the Company's earnings per share and book value per share and market
and economic factors generally, as well as other factors.

According to Mr. Backhaus,  the repurchases  generally would be effected through
open  market  purchases,  although  he did  not  rule  out  the  possibility  of
unsolicited  negotiated  transactions or other types of  repurchases.  No shares
will be repurchased from directors or officers of the Company.

At September 30, 2000,  the Company  reported total assets of $734.1 million and
stockholders' equity of $69.9 million.