CONSULTING AGREEMENT

Exhibit 10.2

CONSULTING AGREEMENT

THIS CONSULTING AGREEMENT (this “Agreement”) is made effective as of the 20th day of October, 2008, by and between BankFinancial Corporation (the “Company”), and Robert J. O’Shaughnessy (the “Consultant”).

WHEREAS, the Company and Consultant have entered into that certain Retirement Agreement dated October 20, 2008 (the “Retirement Agreement”);

WHEREAS, the Company has requested Consultant to provide limited consulting services to the Company and its wholly-owned subsidiary, BankFinancial, F.S.B. (the “Bank”) as set forth more fully herein, and Consultant has agreed to do so subject to the terms and conditions of this Agreement;

WHEREAS, the Retirement Agreement provides for certain payments (the “Retirement Payments”) to be made to Consultant;

WHEREAS, the Retirement Payments may be subject to the provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”); and

WHEREAS, to the extent applicable or necessary, the parties wish to take advantage of Internal Revenue Service provided transition relief under Code Section 409A to change the time and form of the Severance Payments, and any payment or payments made in substitution thereof.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and upon the other terms and conditions hereinafter provided, the parties hereby agree as follows:

Section 1. Term. Provided that Consultant remains employed by the Company through 11:59 p.m. Chicago Time on December 31, 2008 (the “Effective Time”) and does not subsequently revoke any waiver or release pursuant to Section 7 of the Retirement Agreement, the term of this Agreement shall commence at the Effective Time and, unless extended or sooner terminated as provided herein, shall end on December 31, 2009 (the “Term”). On or before December 31, 2009, the Company may, in its sole discretion, offer to extend the Term for an additional six (6) month period, and Consultant may accept or decline such offer in his sole discretion. All references herein to the Term shall mean the Term as initially established by, and as may subsequently be modified or extended pursuant to, this Section 1.

Section 2. Consulting Services. During the Term, Consultant shall provide such consulting services with respect to the Company as may be requested, including, but not limited to, assistance with loan reviews, residential and commercial lending operations, commercial loans, merchant processing, deposit servicing and pre-purchase due diligence (the “Services”). Such Services shall be rendered to the Board of Directors or such officers of the Company as are mutually agreed upon between Consultant and the Company, with Consultant’s principal work location being the Company’s office in Burr Ridge, Illinois or as otherwise agreed, subject to reasonable requests to travel on behalf of the Company. The Services to be provided by Consultant in any month during the first twelve (12) months of the

Term shall require no more than fifty (50) hours per month of his time unless otherwise hereafter agreed by the parties. A deficiency of hours in any month may be made up in other months, and any surplus hours in any month may be credited to other months. Should the Consultant be temporarily disabled from performing Services in any month of those first twelve (12) months, Consultant’s performance of Services while so disabled shall be excused without diminishing his monthly Consulting Fee (defined below).

Section 3. Independent Contractor.

(a) Consultant and the Company agree that during the Term, Consultant shall act as an independent contractor in the performance of his duties under this Agreement. Consultant shall have the full authority to select the means, manner and method of performing the services to be performed under this Agreement. Consultant shall not be considered by reason of the provisions of this Agreement or otherwise as being an employee of the Company. In no event shall Consultant represent to any third party that he is an agent or employee of the Company or connected with the Company in any manner other than pursuant to this Agreement.

(b) Consultant’s employment with the Company and the Bank shall cease prior to the commencement of the Term in accordance with the terms of the Retirement Agreement, As such, Consultant is not entitled to paid vacation, paid holidays, participation in group health insurance, participation in any retirement programs, premium or “overtime” pay, workers’ compensation, severance payments, or any other employment rights or benefits from the Company; provided, however, that all unvested stock options and all unvested shares of restricted stock that heretofore have been granted to Executive under the Corporation’s 2006 Equity Incentive Plan (the “EIP”) shall continue to vest subject to and in accordance with the terms and conditions of the EIP and the grant documents, and in his capacity as a consultant to the Company, shall be considered a “service provider” under Sections 1.3, 5.2(a) and 8.1(y) of the EIP. The Company has no obligation and will make no withholdings or deductions from compensation for any federal or state taxes or the Federal Insurance Contribution Act (FICA) or Federal Unemployment Tax Act (FUTA). It will be the Consultant’s responsibility to remit appropriate taxes to the proper state and Federal authorities. The Company will issue a Form 1099 reporting the amounts paid to the Consultant for services performed under this Agreement.

Section 4. Compensation.

(a) Consulting Fee. The Company agrees to pay to Consultant during the first twelve (12) months of the Term, and Consultant agrees to accept, a monthly consulting fee of Nine Thousand Seven Hundred-Fifty Dollars ($9,750.00), payable on the 1^st day of each month or the first business day thereafter if the 1^st day of the month is not a day that the Company is open for business, in consideration for Consultant’s performance of the Services. The Company agrees to pay to Consultant during any month of the Term following the first twelve (12) months thereof, and Consultant agrees to accept, a consulting fee equal to the number of hours worked to perform Services during the month by Consultant multiplied by an hourly rate of One Hundred Ninety-Five Dollars ($195.00), payable on the 15^th day of the month following the month during which the Services were performed or the first business day

thereafter if the 15^th day of the month is not a day that the Company is open for business; provided, however, that Consultant must provide the Company with an accurate record of hours worked during the previous month no later than the 2^nd business day of the month in which payment is due; otherwise such fees shall be paid within thirty (30) days of such submission of records. All fees described in this hereinafter referred to as the “Consulting Fee.”

(b) Reimbursement of Expenses. Consultant shall be reimbursed upon submission of appropriate vouchers and supporting documentation for all travel and other out-of-pocket expenses reasonably and necessarily incurred by Consultant in the performance of his services hereunder.

Section 5. Termination of Agreement. This Agreement shall terminate without notice or action on the part of either the Company or Consultant upon the expiration of the Term. Prior to the expiration of the Term, either the Company or the Consultant may, upon written notice to the other, terminate this Agreement and Consultant’s engagement hereunder for any reason or no reason. In the event of a termination by Consultant for any reason no reason or by the Company other than “For Cause” prior to the expiration of the Term, the Company shall pay Consultant his accrued and unpaid Consulting Fee as of the effective date of termination and the early termination fee set forth in Section 6 of this Agreement. Upon termination, no further Consulting Fees no other amounts shall be payable to Consultant, and the Company shall have no further obligations to Consultant under this Agreement. For the purposes of this Agreement, “For Cause” shall have the same meaning ascribed the term in Section 4(b) of the Amended and Restated Employment Agreement between the Bank and the Consultant dated as of May 6, 2008 (the “Employment Agreement”).

Section 6. Non-Competition and Other Agreements. Consultant acknowledges and agrees that the non-competition agreements set forth in Section 8(a) of the Employment Agreement, as amended by Section 5(a) of the Retirement Agreement, will remain in full force and effect in accordance with their terms, whether or not the Company or Consultant terminates this Agreement prior to the expiration of the Term pursuant to Section 5 of this Agreement. Notwithstanding the foregoing: (a) for each day during the Term, the Restricted Period described in Section 8(a) of the Employment Agreement, as amended by Section 5(a) of the Retirement Agreement, shall be reduced by one day (but not below six (6) months); and (b) in recognition of the limitations imposed by such non-competition agreements, the Company will pay Consultant an early termination fee calculated as follows if it terminates this Agreement other than For Cause prior to the expiration of the Term: (i) if the termination occurs during the first twelve (12) months of the Term, the Company will pay Consultant an amount equal to the monthly Consulting Fee that would have been paid to Consultant for the duration of such initial twelve (12) month period if the termination had not occurred; and (ii) if the termination occurs during any month of the Term following the first twelve (12) months thereof, the Company will pay Consultant an amount equal to fourteen thousand six hundred and twenty five dollars ($14,625). Notwithstanding the foregoing, no early termination fee shall be payable if this Agreement is terminated by the Company For Cause or by virtue of Consultant’s death, or because of the Consultant’s total and permanent disability.

Section 7. Governing Law. The validity, interpretation, performance and enforcement of this Agreement shall be governed by the internal laws of the State of Illinois, without regard or reference to any principles of conflicts of law of the State of Illinois, except to the extent that such internal laws are preempted by the laws of the United States or the regulations of the OTS or any other agency of the United States.

Section 8. Assignment, Successors and No Third Party Rights. No party may assign any of its rights under this Agreement to any other person without the prior written consent of the other party. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, heirs and permitted assigns. Except as expressly provided herein, nothing in this Agreement shall be construed to give any person other than the parties to this Agreement any legal or equitable right, remedy or claim under or with respect to this Agreement or any provision of this Agreement.

Section 9. Waiver. The rights and remedies of the parties to this Agreement are cumulative and not alternative. Neither the failure nor any delay by any party in exercising any right, power or privilege under this Agreement or the documents referred to in this Agreement will operate as a waiver of such right, power or privilege, and no single or partial exercise of any such right, power or privilege will preclude any other or further exercise of such right, power or privilege or the exercise of any other right, power or privilege.

Section 10. Modification. This Agreement may only be amended by a written agreement executed by both parties.

Section 11. Notices. All notices and other communications under this Agreement must be in writing and will be deemed to have been duly given if delivered by hand or by nationally recognized overnight delivery service (receipt requested) or mailed by certified mail (return receipt requested) with first class postage prepaid; and if to the Company, addressed to the principal headquarters office of the Company, Attention: Chief Executive Officer and General Counsel, with a copy concurrently so delivered to General Corporate Counsel to the Company, Barack Ferrazzano Kirschbaum & Nagelberg LLP, 200 West Madison Street, Suite 3900, Chicago, Illinois 60606, to the joint attention of Edwin S. del Hierro and Donald L. Norman, Jr.; or if to Consultant, to the address set forth below Consultant’s signature on this Agreement, or to other such address as the party to be notified shall have given to the other in writing. Except as otherwise provided herein, all such notices and other communications shall be effective: (a) if delivered by hand, when delivered; (b) if mailed in the manner provided in this Section, five (5) business days after deposit with the United States Postal Service; or (c) if delivered by overnight express delivery service, on the next business day after deposit with such service.

Section 12. Entire Agreement. This Agreement and any documents executed by the parties pursuant to this Agreement and referred to herein constitute a complete and exclusive statement of the entire understanding and agreement of the parties hereto with respect to their subject matter and supersede all other prior agreements and understandings, written or oral, relating to such subject matter between the parties.

Section 13. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. Without limiting the generality of the foregoing, if the scope of any provision contained in this Agreement is too broad to permit enforcement to its full extent, but may be made enforceable by limitations thereon, such provision shall be enforced to the maximum extent permitted by law, and Consultant hereby agrees that such scope may be judicially modified accordingly.

Section 14. Counterparts. This Agreement and any amendments thereto may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement.

Section 15. Compliance with Internal Revenue Code Section 409A. To the extent applicable, this Agreement is intended to comply in all respects with Internal Revenue Code Section 409A.

Section 16. Acknowledgement. Consultant hereby represents to the Company that it is Consultant’s belief that he is under no obligation or agreement that would prevent him from becoming a Consultant to the Company or adversely impact his ability to perform the expected Services. Consultant hereby agrees and acknowledges that in the event that any third party initiates any action claiming that this Agreement, or the provision of Services hereunder is in violation of any agreement between Consultant and the third party, that the Company has the absolute right to immediately terminate this Agreement, and any payments hereunder during the resolution of such dispute. Regardless of the outcome of such dispute, the Company shall have no obligation to re-hire or reinstate this Agreement in any manner, at any time. It is the intentions of the parties that in fulfilling the obligations of the Services, that Consultant will not unlawfully utilize any trade secrets or intellectual property rights of any third party, and the Company shall not put Consultant in a position which would require him to do so.

[Signature page follows]

IN WITNESS WHEREOF, this Agreement has been duly executed as of the dates set forth below.