##### Table of Contents

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended March 31, 2007

OR



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period fromto

0-24571

Commission File Number



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Pulaski Financial Corp.

(Exact name of registrant as specified in its charter)



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|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Missouri                                                       |  | 43-1816913                             
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)



|                                          |  |           
|----------------------------------------- |  | ----------
|12300 Olive Boulevard St. Louis, Missouri |  | 63141-6434
|(Address of principal executive office)   |  | (Zip Code)

Registrants telephone number, including area code: (314) 878-2210

Not Applicable

(Former name,
address and former fiscal year, if changed since last report)



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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2
of the Exchange Act.

Large accelerated filer ̈Accelerated filer  x    Non-accelerated filer ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act)    Yes ̈No  x

Indicate the number of shares outstanding of the registrants classes of common stock, as of the latest practicable
date.



|                                       |  |                           
|-------------------------------------- |  | --------------------------
|Class                                  |  | Outstanding at May 8, 2007
|Common Stock, par value $.01 per share |  | 9,979,919 shares          



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##### Table of Contents

PULASKI FINANCIAL CORP. AND SUBSIDIARIES

FORM 10-Q

MARCH 31, 2007

TABLE OF CONTENTS



| |  |                              |  |                                                                                                                                   |  |     
| |  | ---------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------- |  | ----
| |  |                              |  |                                                                                                                                   |  | Page
| |  | PART I FINANCIAL INFORMATION |  |                                                                                                                                  
| |  |                              | 
| |  | Item 1.                      |  | Financial Statements                                                                                                              |  |     
| |  |                              | 
| |  |                              |  | Consolidated Balance Sheets at March 31, 2007 (Unaudited) and September 30, 2006                                                  |  | 1   
| |  |                              | 
| |  |                              |  | Consolidated Statements of Income and Comprehensive Income for the Three and Six Months Ended March 31, 2007 and 2006 (Unaudited) |  | 2   
| |  |                              | 
| |  |                              |  | Consolidated Statement of Stockholders Equity for the Six Months Ended March 31, 2007 (Unaudited)                                |  | 3   
| |  |                              | 
| |  |                              |  | Consolidated Statements of Cash Flows for the Six Months Ended March 31, 2007 and 2006 (Unaudited)                                |  | 4   
| |  |                              | 
| |  |                              |  | Notes to Unaudited Consolidated Financial Statements (Unaudited)                                                                  |  | 6   
| |  |                              | 
| |  | Item 2.                      |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                             |  | 10  
| |  |                              | 
| |  | Item 3.                      |  | Quantitative and Qualitative Disclosures About Market Risk                                                                        |  | 22  
| |  |                              | 
| |  | Item 4.                      |  | Controls and Procedures                                                                                                           |  | 24  
| |  |                             
| |  | PART II OTHER INFORMATION    |  |                                                                                                                                  
| |  |                              | 
| |  | Item 1.                      |  | Legal Proceedings                                                                                                                 |  | 26  
| |  |                              | 
| |  | Item 1A.                     |  | Risk Factors                                                                                                                      |  | 26  
| |  |                              | 
| |  | Item 2.                      |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                       |  | 26  
| |  |                              | 
| |  | Item 3.                      |  | Defaults Upon Senior Securities                                                                                                   |  | 27  
| |  |                              | 
| |  | Item 4.                      |  | Submission of Matters to a Vote of Security Holders                                                                               |  | 27  
| |  |                              | 
| |  | Item 5.                      |  | Other Information                                                                                                                 |  | 27  
| |  |                              | 
| |  | Item 6.                      |  | Exhibits                                                                                                                          |  | 27  
| |  |                              | 
| |  |                              |  | Signatures                                                                                                                        |  |     



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##### Table of Contents

PART IFINANCIAL INFORMATION



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##### Table of Contents

PULASKI FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

MARCH 31, 2007 (UNAUDITED) AND SEPTEMBER 30, 2006



|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | -------------- | ------------- | - | ----------------- | - | ----------- | -
|                                                                                                                                                                      |  | March 31, 2007 |               |   | September 30,2006 |  
|ASSETS                                                                                                                                                                |  |                |               |   |                   |   |             |  
|Cash and amounts due from depository institutions                                                                                                                     |  | $              | 28,079,549    |   |                   | $ | 19,085,655  |  
|Federal funds sold and overnight deposit                                                                                                                              |  |                | 1,059,529     |   |                   |   | 3,030,571   |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Total cash and cash equivalents                                                                                                                                       |  |                | 29,139,078    |   |                   |   | 22,116,226  |  
|Interest bearing time deposits in other banks                                                                                                                         |  |                | 99,000        |   |                   |   | 792,000     |  
|Equity securities available for sale, at fair value                                                                                                                   |  |                | 3,807,166     |   |                   |   | 4,517,259   |  
|Debt securities held to maturity, at amortized cost (fair value, $18,910,391 and $12,874,121 at March 31, 2007 and September 30,
2006, respectively)                  |  |                | 18,936,007    |   |                   |   | 12,932,036  |  
|Mortgage-backed and related securities held to maturity, at amortized cost (fair value, $428,983 and $469,713 at March 31, 2007 and
September 30, 2006, respectively) |  |                | 400,818       |   |                   |   | 441,266     |  
|Mortgage-backed securities available for sale, at fair value                                                                                                          |  |                | 2,930,307     |   |                   |   | 3,190,125   |  
|Capital stock of Federal Home Loan Bank, at cost                                                                                                                      |  |                | 8,189,400     |   |                   |   | 9,524,300   |  
|Loans receivable held for sale, at lower of cost or market                                                                                                            |  |                | 76,703,117    |   |                   |   | 60,371,296  |  
|Loans receivable, net of allowance for loan losses of $8,509,581 and $7,817,317 at March 31, 2007 and September 30, 2006,
respectively                                |  |                | 857,094,544   |   |                   |   | 785,199,024 |  
|Real estate acquired in settlement of loans, net of allowance for losses of $103,535 and $26,350 at March 31, 2007 and September 30,
2006, respectively               |  |                | 2,262,591     |   |                   |   | 2,764,167   |  
|Premises and equipment, net                                                                                                                                           |  |                | 18,684,101    |   |                   |   | 18,165,840  |  
|Bank-owned life insurance                                                                                                                                             |  |                | 24,554,763    |   |                   |   | 24,043,698  |  
|Accrued interest receivable                                                                                                                                           |  |                | 5,967,142     |   |                   |   | 5,532,177   |  
|Goodwill                                                                                                                                                              |  |                | 3,938,524     |   |                   |   | 3,938,524   |  
|Core deposit intangible                                                                                                                                               |  |                | 577,078       |   |                   |   | 657,802     |  
|Other assets                                                                                                                                                          |  |                | 10,389,186    |   |                   |   | 8,274,356   |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Total assets                                                                                                                                                          |  | $              | 1,063,672,822 |   |                   | $ | 962,460,096 |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|                                                                                                                                                                      |  |               
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                                  |  |                |               |   |                   |   |             |  
|Liabilities:                                                                                                                                                          |  |                |               |   |                   |   |             |  
|Deposits                                                                                                                                                              |  | $              | 768,580,560   |   |                   | $ | 655,576,578 |  
|Advances from Federal Home Loan Bank                                                                                                                                  |  |                | 160,500,000   |   |                   |   | 172,800,000 |  
|Note payable                                                                                                                                                          |  |                | 3,150,000     |   |                   |   | 3,320,000   |  
|Subordinated debentures                                                                                                                                               |  |                | 19,589,000    |   |                   |   | 19,589,000  |  
|Advance payments by borrowers for taxes and insurance                                                                                                                 |  |                | 1,697,855     |   |                   |   | 3,054,713   |  
|Accrued interest payable                                                                                                                                              |  |                | 2,141,564     |   |                   |   | 1,800,764   |  
|Due to other banks                                                                                                                                                    |  |                | 18,120,708    |   |                   |   | 22,066,374  |  
|Other liabilities                                                                                                                                                     |  |                | 10,596,709    |   |                   |   | 8,426,121   |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Total liabilities                                                                                                                                                     |  |                | 984,376,396   |   |                   |   | 886,633,550 |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Stockholders' Equity:                                                                                                                                                 |  |                |               |   |                   |   |             |  
|Preferred stock$.01 par value per share, authorized 1,000,000 shares; none issued or outstanding                                                                     |  |                |              |   |                   |   |            |  
|Common stock$.01 par value per share, authorized 18,000,000 shares; 13,068,618 shares issued at March 31, 2007 and
September 30, 2006                                |  |                | 130,687       |   |                   |   | 130,687     |  
|Treasury stockat cost; 3,097,263 and 3,122,275 shares at March 31, 2007 and                                                                                          |  |                |               |   |                   |   |             |  
|September 30, 2006, respectively                                                                                                                                      |  |                | (16,349,015   | ) |                   |   | (15,982,452 | )
|Treasury stockequity trustat cost; 151,337 and 255,053 shares at                                                                                                    |  |                |               |   |                   |   |             |  
|March 31, 2007 and September 30, 2006, respectively                                                                                                                   |  |                | (1,881,411    | ) |                   |   | (3,131,404  | )
|Additional paid-in capital                                                                                                                                            |  |                | 49,687,237    |   |                   |   | 50,067,003  |  
|Accumulated other comprehensive loss                                                                                                                                  |  |                | (42,986       | ) |                   |   | (12,933     | )
|Retained earnings                                                                                                                                                     |  |                | 47,751,914    |   |                   |   | 44,755,645  |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Total stockholders equity                                                                                                                                            |  |                | 79,296,426    |   |                   |   | 75,826,546  |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  
|Total liabilities and stockholders equity                                                                                                                            |  | $              | 1,063,672,822 |   |                   | $ | 962,460,096 |  
|                                                                                                                                                                      |  |                |               |   |                   |   |             |  

See accompanying notes to the unaudited consolidated financial statements.



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##### Table of Contents

PULASKI FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

THREE AND SIX MONTHS ENDED MARCH 31, 2007 AND 2006 (UNAUDITED)



|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|--------------------------------------------------- |  | ---------------------------- | ---------- | - | -------------------------- | - | ---------- | ---- |  | - | ---------- | - |  | - | ---------- | -
|                                                    |  | Three Months Ended March 31, |            |   | Six Months Ended March 31, |  
|                                                    |  | 2007                         |            |   | 2006                       |   |            | 2007 |  |   | 2006       |  
|Interest and Dividend Income:                       |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Loans receivable                                    |  | $                            | 16,539,482 |   |                            | $ | 11,814,452 |      |  | $ | 32,489,702 |   |  | $ | 23,338,960 |  
|Debt and equity securities                          |  |                              | 221,940    |   |                            |   | 154,910    |      |  |   | 409,047    |   |  |   | 237,089    |  
|Mortgage-backed securities                          |  |                              | 40,536     |   |                            |   | 52,811     |      |  |   | 82,854     |   |  |   | 109,199    |  
|Capital stock of the Federal Home Loan Bank         |  |                              | 87,241     |   |                            |   | 57,568     |      |  |   | 185,584    |   |  |   | 132,522    |  
|Other                                               |  |                              | 45,045     |   |                            |   | 61,101     |      |  |   | 107,863    |   |  |   | 113,061    |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Total interest and dividend income                  |  |                              | 16,934,244 |   |                            |   | 12,140,842 |      |  |   | 33,275,050 |   |  |   | 23,930,831 |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Interest Expense:                                   |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Deposits                                            |  |                              | 7,583,237  |   |                            |   | 4,603,849  |      |  |   | 14,319,435 |   |  |   | 8,278,206  |  
|Advances from Federal Home Loan Bank of Des Moines  |  |                              | 1,967,703  |   |                            |   | 1,501,438  |      |  |   | 4,258,957  |   |  |   | 3,394,623  |  
|Subordinated debentures                             |  |                              | 373,007    |   |                            |   | 336,947    |      |  |   | 755,614    |   |  |   | 649,157    |  
|Note payable                                        |  |                              | 57,191     |   |                            |   | 57,432     |      |  |   | 115,904    |   |  |   | 111,951    |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Total interest expense                              |  |                              | 9,981,138  |   |                            |   | 6,499,666  |      |  |   | 19,449,910 |   |  |   | 12,433,937 |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Net interest income                                 |  |                              | 6,953,106  |   |                            |   | 5,641,176  |      |  |   | 13,825,140 |   |  |   | 11,496,894 |  
|Provision for loan losses                           |  |                              | 573,482    |   |                            |   | 452,750    |      |  |   | 1,255,035  |   |  |   | 859,371    |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Net interest income after provision for loan losses |  |                              | 6,379,624  |   |                            |   | 5,188,426  |      |  |   | 12,570,105 |   |  |   | 10,637,523 |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Non-Interest Income:                                |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Retail banking fees                                 |  |                              | 754,965    |   |                            |   | 684,608    |      |  |   | 1,537,196  |   |  |   | 1,432,359  |  
|Mortgage revenues                                   |  |                              | 1,258,984  |   |                            |   | 1,122,020  |      |  |   | 2,167,538  |   |  |   | 2,128,492  |  
|Title policy revenues                               |  |                              | 230,665    |   |                            |   | 174,139    |      |  |   | 443,560    |   |  |   | 372,423    |  
|Investment brokerage revenues                       |  |                              | 133,202    |   |                            |   | 149,920    |      |  |   | 375,656    |   |  |   | 267,202    |  
|Appraisal division revenues                         |  |                              | 215,363    |   |                            |   |           |      |  |   | 423,563    |   |  |   |           |  
|Gain on the sale of securities                      |  |                              |           |   |                            |   | 56,163     |      |  |   | 143,720    |   |  |   | 56,163     |  
|Gain on the sale of branch                          |  |                              |           |   |                            |   | 2,473,853  |      |  |   |           |   |  |   | 2,473,853  |  
|Bank-owned life insurance income                    |  |                              | 253,468    |   |                            |   | 189,374    |      |  |   | 511,065    |   |  |   | 351,985    |  
|Other                                               |  |                              | 316,453    |   |                            |   | 66,747     |      |  |   | 497,864    |   |  |   | 285,565    |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Total non-interest income                           |  |                              | 3,163,100  |   |                            |   | 4,916,824  |      |  |   | 6,100,162  |   |  |   | 7,368,042  |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Non-Interest Expense:                               |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Salaries and employee benefits                      |  |                              | 3,274,777  |   |                            |   | 2,745,779  |      |  |   | 5,948,795  |   |  |   | 5,004,474  |  
|Occupancy, equipment and data processing expense    |  |                              | 1,431,241  |   |                            |   | 1,226,814  |      |  |   | 2,681,911  |   |  |   | 2,335,051  |  
|Advertising                                         |  |                              | 371,617    |   |                            |   | 276,195    |      |  |   | 618,883    |   |  |   | 465,294    |  
|Professional services                               |  |                              | 399,038    |   |                            |   | 325,063    |      |  |   | 660,962    |   |  |   | 663,862    |  
|Loss (gain) on derivative instruments               |  |                              | (141,355   | ) |                            |   | 72,855     |      |  |   | (313,670   | ) |  |   | 480,246    |  
|Charitable contributions                            |  |                              | 17,135     |   |                            |   | 288,290    |      |  |   | 66,351     |   |  |   | 308,540    |  
|Data processing termination expense                 |  |                              |           |   |                            |   |           |      |  |   | 219,534    |   |  |   |           |  
|Real estate foreclosure losses and expense, net     |  |                              | 173,563    |   |                            |   | 29,075     |      |  |   | 236,057    |   |  |   | 55,302     |  
|Other                                               |  |                              | 792,655    |   |                            |   | 674,170    |      |  |   | 1,526,936  |   |  |   | 1,395,220  |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Total non-interest expense                          |  |                              | 6,318,671  |   |                            |   | 5,638,241  |      |  |   | 11,645,759 |   |  |   | 10,707,989 |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Income before income taxes                          |  |                              | 3,224,053  |   |                            |   | 4,467,009  |      |  |   | 7,024,508  |   |  |   | 7,297,576  |  
|Income tax expense                                  |  |                              | 1,019,761  |   |                            |   | 1,571,625  |      |  |   | 2,333,771  |   |  |   | 2,555,111  |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Net income                                          |  | $                            | 2,204,292  |   |                            | $ | 2,895,384  |      |  | $ | 4,690,737  |   |  | $ | 4,742,465  |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Other comprehensive loss                            |  |                              | (42,986    | ) |                            |   | (36,734    | )    |  |   | (30,053    | ) |  |   | (13,605    | )
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Net comprehensive income                            |  | $                            | 2,161,306  |   |                            | $ | 2,858,650  |      |  | $ | 4,660,684  |   |  | $ | 4,728,860  |  
|                                                    |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Per Share Amounts:                                  |  |                              |            |   |                            |   |            |      |  |   |            |   |  |   |            |  
|Basic earnings per share                            |  | $                            | 0.22       |   |                            | $ | 0.32       |      |  | $ | 0.48       |   |  | $ | 0.55       |  
|Weighted average common shares outstandingbasic    |  |                              | 9,829,899  |   |                            |   | 8,977,678  |      |  |   | 9,826,841  |   |  |   | 8,636,462  |  
|Diluted earnings per share                          |  | $                            | 0.21       |   |                            | $ | 0.30       |      |  | $ | 0.46       |   |  | $ | 0.52       |  
|Weighted average common shares outstandingdiluted  |  |                              | 10,265,321 |   |                            |   | 9,507,731  |      |  |   | 10,267,161 |   |  |   | 9,182,542  |  

See accompanying notes to the unaudited consolidated financial statements.



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##### Table of Contents

PULASKI FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS EQUITY

SIX MONTHS ENDED MARCH 31, 2007 (UNAUDITED)



|                                                              |  |             |         |                |   |             |                          |  |   |                                   |   |  |                  |         |   |       |   |            |   |  |   |            |  
|------------------------------------------------------------- |  | ----------- | ------- | -------------- | - | ----------- | ------------------------ |  | - | --------------------------------- | - |  | ---------------- | ------- | - | ----- | - | ---------- | - |  | - | ---------- | -
|                                                              |  | CommonStock |         | Treasury Stock |   |             | AdditionalPaid-InCapital |  |   | AccumulatedOtherComprehensiveLoss |   |  | RetainedEarnings |         |   | Total |  
|Balance, September 30, 2006                                   |  | $           | 130,687 |                | $ | (19,113,856 | )                        |  | $ | 50,067,003                        |   |  | $                | (12,933 | ) |       | $ | 44,755,645 |   |  | $ | 75,826,546 |  
|Comprehensive income:                                         |  |             |         |                |   |             |                          |  |   |                                   |   |  |                  |         |   |       |   |            |   |  |   |            |  
|Net income                                                    |  |             |        |                |   |            |                          |  |   |                                  |   |  |                  |        |   |       |   | 4,690,737  |   |  |   | 4,690,737  |  
|Unrealized loss on investment securities, net of tax          |  |             |        |                |   |            |                          |  |   |                                  |   |  |                  | (30,053 | ) |       |   |           |   |  |   | (30,053    | )
|                                                              |  |             |         |                |   |             |                          |  |   |                                   |   |  |                  |         |   |       |   |            |   |  |   |            |  
|Net comprehensive income                                      |  |             |        |                |   |            |                          |  |   |                                  |   |  |                  | (30,053 | ) |       |   | 4,690,737  |   |  |   | 4,660,684  |  
|Dividends ($.085 per share)                                   |  |             |        |                |   |            |                          |  |   |                                  |   |  |                  |        |   |       |   | (1,694,468 | ) |  |   | (1,694,468 | )
|Stock options exercised                                       |  |             |         |                |   | 229,999     |                          |  |   | 122,805                           |   |  |                  |        |   |       |   |           |   |  |   | 352,804    |  
|Stock option and award expense                                |  |             |        |                |   |            |                          |  |   | 152,360                           |   |  |                  |        |   |       |   |           |   |  |   | 152,360    |  
|Stock issued under dividend reinvestment plan (10,157 shares) |  |             |        |                |   | 42,929      |                          |  |   | 114,748                           |   |  |                  |        |   |       |   |           |   |  |   | 157,677    |  
|Stock repurchased (40,637 shares)                             |  |             |        |                |   | (639,491    | )                        |  |   |                                  |   |  |                  |        |   |       |   |           |   |  |   | (639,491   | )
|Purchase of equity trust shares (9,300 shares)                |  |             |        |                |   | (100,000    | )                        |  |   |                                  |   |  |                  |        |   |       |   |           |   |  |   | (100,000   | )
|Release of equity trust shares (113,016 shares)               |  |             |        |                |   | 1,349,993   |                          |  |   | (1,349,993                        | ) |  |                  |        |   |       |   |           |   |  |   |           |  
|Amortization of equity trust expense                          |  |             |        |                |   |            |                          |  |   | 375,125                           |   |  |                  |        |   |       |   |           |   |  |   | 375,125    |  
|Excess tax benefit from stock based compensation              |  |             |        |                |   |            |                          |  |   | 205,189                           |   |  |                  |        |   |       |   |           |   |  |   | 205,189    |  
|                                                              |  |             |         |                |   |             |                          |  |   |                                   |   |  |                  |         |   |       |   |            |   |  |   |            |  
|Balance, March 31, 2007                                       |  | $           | 130,687 |                | $ | (18,230,426 | )                        |  | $ | 49,687,237                        |   |  | $                | (42,986 | ) |       | $ | 47,751,914 |   |  | $ | 79,296,426 |  
|                                                              |  |             |         |                |   |             |                          |  |   |                                   |   |  |                  |         |   |       |   |            |   |  |   |            |  



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PULASKI FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR SIX MONTHS

ENDED MARCH 31, 2007 (UNAUDITED) AND MARCH 31, 2006 (UNAUDITED)



|                                                                              |  |                           |              |   |      |   |              |  
|----------------------------------------------------------------------------- |  | ------------------------- | ------------ | - | ---- | - | ------------ | -
|                                                                              |  | Six Months Ended March 31 |             
|                                                                              |  | 2007                      |              |   | 2006 |  
|Cash Flows From Operating Activities:                                         |  |                           |              |   |      |   |              |  
|Net income                                                                    |  | $                         | 4,690,737    |   |      | $ | 4,742,465    |  
|                                                                              |  |                           |              |   |      |   |              |  
|Adjustments to reconcile net income to net cash from operating activities:    |  |                           |              |   |      |   |              |  
|Depreciation, amortization and accretion:                                     |  |                           |              |   |      |   |              |  
|Premises and equipment                                                        |  |                           | 733,047      |   |      |   | 631,444      |  
|Net deferred loan costs                                                       |  |                           | 1,554,734    |   |      |   | 1,387,710    |  
|Net amortization of debt and equity securities premiums and discounts         |  |                           | (316,746     | ) |      |   | (148,215     | )
|Broker fees financed under interest-rate swap agreements                      |  |                           | 98,466       |   |      |   | 49,233       |  
|Equity trust expense                                                          |  |                           | 375,125      |   |      |   | 296,383      |  
|Stock option and award expense                                                |  |                           | 152,360      |   |      |   | 152,840      |  
|Provision for loan losses                                                     |  |                           | 1,255,035    |   |      |   | 859,371      |  
|Provision for losses on real estate acquired in settlement of loans           |  |                           | 84,535       |   |      |   | 109,612      |  
|Losses on sale of real estate acquired in settlement of loans                 |  |                           | 120,411      |   |      |   | 27,798       |  
|Originations of loans receivable for sale to correspondent lenders            |  |                           | (608,424,821 | ) |      |   | (488,064,204 | )
|Proceeds from sales of loans to correspondent lenders                         |  |                           | 593,689,026  |   |      |   | 500,516,352  |  
|Gain on sale of loans held for sale                                           |  |                           | (1,596,026   | ) |      |   | (1,756,352   | )
|Loss on sale of loan pools                                                    |  |                           |             |   |      |   | 127,742      |  
|Gain on sale of equity securities available for sale                          |  |                           | (143,720     | ) |      |   | (56,163      | )
|Gain on sale of branch, net of expense                                        |  |                           |             |   |      |   | (2,473,852   | )
|Loss (gain) on derivative instruments                                         |  |                           | (313,670     | ) |      |   | 480,246      |  
|Increase in cash value of bank-owned life insurance                           |  |                           | (511,065     | ) |      |   | (351,985     | )
|Decrease in accrued expenses                                                  |  |                           | (426,583     | ) |      |   | (757,808     | )
|Excess tax benefit from stock-based compensation                              |  |                           | (205,189     | ) |      |   | (67,691      | )
|Changes in other assets and liabilities                                       |  |                           | 948,046      |   |      |   | (779,313     | )
|                                                                              |  |                           |              |   |      |   |              |  
|Net adjustments                                                               |  |                           | (12,927,035  | ) |      |   | 10,183,148   |  
|                                                                              |  |                           |              |   |      |   |              |  
|Net cash (used in) provided by operating activities                           |  |                           | (8,236,298   | ) |      |   | 14,925,613   |  
|                                                                              |  |                           |              |   |      |   |              |  
|                                                                              |  |                          
|Cash Flows From Investing Activities:                                         |  |                           |              |   |      |   |              |  
|Proceeds from sales of equity securities available for sale                   |  |                           | 772,648      |   |      |   | 471,465      |  
|Proceeds from maturities of time deposits                                     |  |                           | 693,000      |   |      |   |             |  
|Proceeds from maturities of debt securities held to maturity                  |  |                           | 21,000,000   |   |      |   | 23,500,000   |  
|Proceeds from redemption of FHLB stock                                        |  |                           | 7,462,700    |   |      |   | 7,043,900    |  
|Purchases of debt securities available for sale                               |  |                           | (48,899      | ) |      |   | (544,165     | )
|Purchases of debt securities held to maturity                                 |  |                           | (26,684,644  | ) |      |   | (27,785,731  | )
|Purchases of FHLB stock                                                       |  |                           | (6,127,800   | ) |      |   | (6,242,700   | )
|Purchase of bank-owned life insurance policies                                |  |                           |             |   |      |   | (6,500,000   | )
|Principal payments received on mortgage-backed securities                     |  |                           | 338,942      |   |      |   | 597,196      |  
|Proceeds from sale of loan pools                                              |  |                           |             |   |      |   | 6,556,826    |  
|Net increase in loans                                                         |  |                           | (77,357,058  | ) |      |   | (81,088,981  | )
|Proceeds from sales of real estate acquired in settlement of loans receivable |  |                           | 2,948,400    |   |      |   | 1,072,115    |  
|Proceeds from disposal of equipment                                           |  |                           | 637          |   |      |   | 10,731       |  
|Purchases of premises and equipment                                           |  |                           | (1,251,945   | ) |      |   | (2,711,612   | )
|Cash received for branch acquisition, net of cash and cash equivalents paid   |  |                           |             |   |      |   | 15,733,735   |  
|Cash paid on sale of branch                                                   |  |                           |             |   |      |   | (19,448,123  | )
|                                                                              |  |                           |              |   |      |   |              |  
|Net cash used in investing activities                                         |  | $                         | (78,254,019  | ) |      | $ | (89,335,344  | )
|                                                                              |  |                           |              |   |      |   |              |  

See accompanying notes to the unaudited consolidated financial statements.



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PULASKI FINANCIAL CORP. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR SIX MONTHS ENDED

ENDED MARCH 31, 2007 (UNAUDITED) AND MARCH 31, 2006
(UNAUDITED)



|                                                                      |  |                            |             |   |      |   |             |  
|--------------------------------------------------------------------- |  | -------------------------- | ----------- | - | ---- | - | ----------- | -
|                                                                      |  | Six Months Ended March 31, |            
|                                                                      |  | 2007                       |             |   | 2006 |  
|Cash Flows From Financing Activities:                                 |  |                            |             |   |      |   |             |  
|Net increase in deposits                                              |  | $                          | 113,003,982 |   |      | $ | 89,927,226  |  
|Proceeds from Federal Home Loan Bank advances, net                    |  |                            | (12,300,000 | ) |      |   | (17,500,000 | )
|Payment on note payable                                               |  |                            | (170,000    | ) |      |   | (85,000     | )
|Net increase (decrease) in due to other banks                         |  |                            | (3,945,666  | ) |      |   | 3,314,547   |  
|Cash paid to trustee for purchase of equity trust shares              |  |                            | (100,000    | ) |      |   | (1,539,463  | )
|Net decrease in advance payments by borrowers for taxes and insurance |  |                            | (1,356,858  | ) |      |   | (1,591,275  | )
|Proceeds from common stock offering                                   |  |                            |            |   |      |   | 16,139,230  |  
|Proceeds from cash received in dividend reinvestment plan             |  |                            | 157,677     |   |      |   | 88,955      |  
|Excess tax benefit for stock based compensation                       |  |                            | 205,189     |   |      |   | 67,691      |  
|Treasury stock issued for stock options exercised                     |  |                            | 352,804     |   |      |   | 407,564     |  
|Dividends paid on common stock                                        |  |                            | (1,694,468  | ) |      |   | (1,431,391  | )
|Stock repurchases                                                     |  |                            | (639,491    | ) |      |   | (5,301      | )
|                                                                      |  |                            |             |   |      |   |             |  
|Net cash provided by financing activities                             |  |                            | 93,513,169  |   |      |   | 87,792,783  |  
|                                                                      |  |                            |             |   |      |   |             |  
|Net decrease in cash and cash equivalents                             |  |                            | 7,022,852   |   |      |   | 13,383,052  |  
|Cash and cash equivalents at beginning of period                      |  |                            | 22,116,226  |   |      |   | 25,688,486  |  
|                                                                      |  |                            |             |   |      |   |             |  
|Cash and cash equivalents at end of period                            |  | $                          | 29,139,078  |   |      | $ | 39,071,538  |  
|                                                                      |  |                            |             |   |      |   |             |  
|                                                                      |  |                           
|Supplemental Disclosures of Cash Flow Information:                    |  |                            |             |   |      |   |             |  
|Cash paid during the period for:                                      |  |                            |             |   |      |   |             |  
|Interest on deposits                                                  |  | $                          | 13,974,400  |   |      | $ | 7,912,930   |  
|Interest on advances from FHLB                                        |  |                            | 4,265,577   |   |      |   | 3,408,055   |  
|Interest on subordinated debentures                                   |  |                            | 753,843     |   |      |   | 630,742     |  
|Interest on notes payable                                             |  |                            | 116,517     |   |      |   | 112,770     |  
|                                                                      |  |                            |             |   |      |   |             |  
|Cash paid during period for interest                                  |  | $                          | 19,110,337  |   |      | $ | 12,064,497  |  
|Income taxes, net                                                     |  |                            | 1,390,077   |   |      |   | 3,517,000   |  
|                                                                      |  |                           
|Noncash Investing Activities:                                         |  |                            |             |   |      |   |             |  
|Real estate acquired in settlement of loans receivable                |  |                            | 2,651,770   |   |      |   | 1,542,191   |  

See accompanying notes to the unaudited consolidated financial statements.



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PULASKI FINANCIAL CORP. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)



|1. | BASIS OF PRESENTATION
|-- | ---------------------

The unaudited consolidated
financial statements include the accounts of Pulaski Financial Corp. (the Company) and its wholly owned subsidiary, Pulaski Bank (the Bank), and its wholly owned subsidiary, Pulaski Service Corporation. All significant
intercompany accounts and transactions have been eliminated. The assets of the Company consist primarily of the investment in the outstanding shares of the Bank and its liabilities consist principally of subordinated debentures. Accordingly, the
information set forth in this report, including the consolidated financial statements and related financial data, relates primarily to the Bank. The Company, through the Bank, operates as a single business segment, providing traditional community
banking services through its full service branch network.

In the opinion of management, the unaudited consolidated financial statements
contain all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of the financial condition of the Company as of March 31, 2007 and September 30, 2006 and its results of operations for the three- and
six-month periods ended March 31, 2007 and 2006. The results of operations for the three- and six-month periods ended March 31, 2007 are not necessarily indicative of the operating results that may be expected for the entire fiscal year.
These unaudited consolidated financial statements should be read in conjunction with the Companys audited consolidated financial statements for the year ended September 30, 2006 contained in the Companys 2006 Annual Report to
Stockholders, which was filed as an exhibit to the Companys Annual Report on Form 10-K for the year ended September 30, 2006.

The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements that affect the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. The allowance for loan losses and fair values of financial instruments are significant
estimates reported within the consolidated financial statements.



|2. | EARNINGS PER SHARE
|-- | ------------------

Basic earnings per share is
computed using the weighted average number of common shares outstanding. The dilutive effect of potential common shares outstanding is included in diluted earnings per share. The computations of basic and diluted earnings per share are presented in
the following table.



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|                                                    |  |                              |            |                            |   |           |  |      |            |  |   |          
|--------------------------------------------------- |  | ---------------------------- | ---------- | -------------------------- | - | --------- |  | ---- | ---------- |  | - | ---------
|                                                    |  | Three Months Ended March 31, |            | Six Months Ended March 31,
|                                                    |  | 2007                         |            | 2006                       |   | 2007      |  | 2006
|Weighted average shares outstandingbasic           |  |                              | 9,829,899  |                            |   | 8,977,678 |  |      | 9,826,841  |  |   | 8,636,462
|Treasury stockequity trust                         |  |                              | 122,428    |                            |   | 126,028   |  |      | 122,052    |  |   | 127,693  
|Equivalent sharesemployee stock options and awards |  |                              | 312,994    |                            |   | 404,025   |  |      | 318,268    |  |   | 418,387  
|                                                    |  |                              |            |                            |   |           |  |      |            |  |   |          
|Weighted average shares outstandingdiluted         |  |                              | 10,265,321 |                            |   | 9,507,731 |  |      | 10,267,161 |  |   | 9,182,542
|                                                    |  |                              |            |                            |   |           |  |      |            |  |   |          
|Net income per sharebasic                          |  | $                            | 0.22       |                            | $ | 0.32      |  | $    | 0.48       |  | $ | 0.55     
|Net income per sharediluted                        |  | $                            | 0.21       |                            | $ | 0.30      |  | $    | 0.46       |  | $ | 0.52     

Under the treasury stock method, outstanding stock options are dilutive when the average market
price of the Companys common stock, when combined with the effect of any unamortized compensation expense, exceeds the option price during a period. In addition, proceeds from the assumed exercise of dilutive options along with the related tax
benefit are assumed to be used to repurchase common shares at the average market price of such stock during the period.

The following
options to purchase shares during the three- and six-month periods ended March 31, 2007 and 2006 were not included in the respective computations of diluted earnings per share because the exercise price of the options, when combined with the
effect of the unamortized compensation expense, was greater than the average market price of the common shares and were considered anti-dilutive. These options expire in various periods through 2017 and 2016, respectively.



|                                |  |           |  |           |  |         |  |       
|------------------------------- |  | --------- |  | --------- |  | ------- |  | ------
|                                |  | March 31, |  | March 31,
|                                |  | 2007      |  | 2006      |  | 2007    |  | 2006  
|Number of option shares         |  | 126,392   |  | 24,328    |  | 125,639 |  | 18,486
|Equivalent anti-dilutive shares |  | 31,337    |  | 6,813     |  | 32,380  |  | 4,674 

3. STOCK-BASED COMPENSATION

The Companys shareholder-approved, stock-based incentive plans permit the grant of awards in the form of options intended to qualify as incentive stock options under Section 422 of the Internal Revenue
Code, options that do not so qualify (non-statutory stock options,) and grants of restricted shares of common stock. All employees, non-employee directors and consultants of the Company and its affiliates are eligible to receive awards under the
plans. Generally, all stock option awards were granted with an exercise price equal to the market value of the Companys shares at the date of grant and generally vest, and become exercisable, over a period of three to five years. The exercise
period for stock options generally may not exceed 10 years from the date of grant. Generally, option and share awards provide for accelerated vesting if there is a change in control (as defined in the plans). On July 19, 2006, the Company
granted stock option awards totaling 10,500 shares of its common stock to non-employee directors with exercise prices at a premium of 10% over the market value of the Companys shares at the date of grant. These stock option awards were
immediately vested on the date of grant and are exercisable for a period of five years from the date of grant.



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A summary of the Companys stock option programs as of March 31, 2007 and changes during the
six-month period then ended, is presented below:



|                               |  |                  |   |  |                              |       |                                       |      |                                              |           
|------------------------------ |  | ---------------- | - |  | ---------------------------- | ----- | ------------------------------------- | ---- | -------------------------------------------- | ----------
|                               |  | Number Of Shares |   |  | WeightedAverageExercisePrice |       | Aggregate IntrinsicValue (inmillions) |      | Weighted- Average Remaining Contractual Life
|                               |  |                  |  
|                               |  |                  |  
|                               |  |                  |  
|                               |  |                  |  
|Outstanding at October 1, 2006 |  | 820,300          |   |  | $                            | 8.21  |                                       |      |                                              |           
|Granted                        |  | 24,500           |   |  |                              | 15.57 |                                       |      |                                              |           
|Exercised                      |  | (55,492          | ) |  |                              | 6.36  |                                       |      |                                              |           
|Expired                        |  |                 |   |  |                              |      |                                       |      |                                              |           
|Forfeited                      |  | (9,750           | ) |  |                              | 16.52 |                                       |      |                                              |           
|                               |  |                  |   |  |                              |       |                                       |      |                                              |           
|Outstanding at March 31, 2007  |  | 779,558          |   |  |                              | 8.47  |                                       | $5.7 |                                              | 5.74 years
|                               |  |                  |   |  |                              |       |                                       |      |                                              |           
|Exercisable at March 31, 2007  |  | 540,049          |   |  |                              | 6.13  |                                       | $5.1 |                                              | 4.70 years
|                               |  |                  |   |  |                              |       |                                       |      |                                              |           

The total intrinsic value of stock options exercised during the six months ended March 31,
2007 and 2006 was $537,000 and $891,000, respectively. The weighted average grant-date fair value of options granted during the six months ended March 31, 2007 was $4.25. As of March 31, 2007, the total unrecognized compensation expense
related to non-vested stock options and awards was $829,000 and the related weighted average period over which it is expected to be recognized is 1.7 years.

The fair value of stock options granted in the six-month periods ended March 31, 2007 and 2006 is estimated on the date of grant using the Black-Scholes option pricing model with the following average
assumptions:



|                         |  |                           |   |  |       |  
|------------------------ |  | ------------------------- | - |  | ----- | -
|                         |  | Six Months EndedMarch 31, |  
|                         |  | 2007                      |   |  | 2006  |  
|Risk free interest rate  |  | 4.56                      | % |  | 4.40  | %
|Expected volatility      |  | 27.50                     | % |  | 27.93 | %
|Expected life in years   |  | 5.7                       |   |  | 6.0   |  
|Dividend yield           |  | 2.13                      | % |  | 1.82  | %
|Expected forfeiture rate |  | 1.24                      | % |  | 1.50  | %

The Company maintains an Equity Trust Plan for the benefit of key loan officers and sales staff.
The plan is designed to recruit and retain top-performing loan officers and other key revenue-producing employees who are instrumental to the Companys success. Currently, none of the Companys executive officers participate in the plan.
The plan allows the recipients to defer a percentage of commissions earned, which is partially matched by the Company and paid into a rabbi trust for the benefit of the participants. The assets of the trust are limited to the purchase of Company
shares in the open market. In exchange for the opportunity to defer income, the participants are required to sign a four-year or five-year contract prohibiting them from competing against the Company in the Companys market area. Should the
participants voluntarily leave the Company, they forgo any accrued benefits. At March 31, 2007, there were 151,337 total shares in the plan, of which 125,735 were not yet vested. Vested shares in the plan are treated as issued and outstanding
when computing basic and diluted earnings per share, whereas unvested shares are treated as issued and outstanding only when computing diluted earnings per share. Since the majority of the Companys loans originated are sold on a
servicing-released basis, most of the deferred expense is recorded as a reduction of the mortgage revenue realized upon sale. Excess tax benefits associated with all share based payments totaled approximately $205,000 for the six months ended
March 31, 2007.



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|4. | LOANS RECEIVABLE
|-- | ----------------

Loans receivable at
March 31, 2007 and September 30, 2006 are summarized as follows:



|                                                |  |                |             |   |                   |   |             |  
|----------------------------------------------- |  | -------------- | ----------- | - | ----------------- | - | ----------- | -
|                                                |  | March 31, 2007 |             |   | September 30,2006 |  
|Real estate mortgage:                           |  |                |             |   |                   |   |             |  
|One to four family residential                  |  | $              | 321,032,660 |   |                   | $ | 314,746,084 |  
|Multi-family residential                        |  |                | 16,981,312  |   |                   |   | 13,628,962  |  
|Commercial real estate                          |  |                | 175,545,737 |   |                   |   | 150,528,577 |  
|Real estate construction and development:       |  |                |             |   |                   |   |             |  
|Residential                                     |  |                | 32,882,588  |   |                   |   | 30,586,090  |  
|Multi-family                                    |  |                | 13,910,248  |   |                   |   | 6,042,116   |  
|Commercial                                      |  |                | 31,565,557  |   |                   |   | 20,566,734  |  
|Commercial and industrial                       |  |                | 67,079,720  |   |                   |   | 48,785,481  |  
|Equity lines                                    |  |                | 204,225,614 |   |                   |   | 207,152,688 |  
|Consumer and installment                        |  |                | 6,310,772   |   |                   |   | 6,276,425   |  
|                                                |  |                |             |   |                   |   |             |  
|                                                |  |                | 869,534,208 |   |                   |   | 798,313,157 |  
|Add (less):                                     |  |                |             |   |                   |   |             |  
|Deferred loan costs                             |  |                | 5,194,271   |   |                   |   | 4,879,507   |  
|Loans-in-process                                |  |                | (9,124,354  | ) |                   |   | (10,176,323 | )
|Allowance for loan losses                       |  |                | (8,509,581  | ) |                   |   | (7,817,317  | )
|                                                |  |                |             |   |                   |   |             |  
|Total                                           |  | $              | 857,094,544 |   |                   | $ | 785,199,024 |  
|                                                |  |                |             |   |                   |   |             |  
|Weighted average interest rate at end of period |  |                | 7.55        | % |                   |   | 7.50        | %
|                                                |  |                |             |   |                   |   |             |  



|5. | DEPOSITS
|-- | --------

Deposits at March 31, 2007 and
September 30, 2006 are summarized as follows:



|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  
|----------------------------- |  | -------------- | ----------- | --------------------------- | ------------------ | - | ------ | - | --------------------------- |  | ---- | -
|                              |  | March 31, 2007 |             |                             | September 30, 2006 |  
|                              |  | Amount         |             | WeightedAverageInterestRate |                    |   | Amount |   | WeightedAverageInterestRate | 
|Transaction accounts:         |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Non-interest-bearing checking |  | $              | 46,647,009  |                             |                   |   |        | $ | 38,830,048                  |  |     |  
|Interest-bearing checking     |  |                | 63,792,149  |                             | 1.76               | % |        |   | 53,448,091                  |  | 1.66 | %
|Passbook savings accounts     |  |                | 30,518,486  |                             | 0.37               | % |        |   | 31,895,237                  |  | 0.39 | %
|Money market                  |  |                | 148,588,099 |                             | 4.25               | % |        |   | 134,383,062                 |  | 4.12 | %
|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Total transaction accounts    |  |                | 289,545,743 |                             | 2.61               | % |        |   | 258,556,438                 |  | 2.53 | %
|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Certificates of deposit:      |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Less than $100,000            |  |                | 236,025,582 |                             | 5.18               | % |        |   | 207,899,136                 |  | 4.91 | %
|$100,000 and greater          |  |                | 243,009,235 |                             | 4.65               | % |        |   | 189,121,004                 |  | 4.43 | %
|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Total certificates of deposit |  |                | 479,034,817 |                             | 4.91               | % |        |   | 397,020,140                 |  | 4.68 | %
|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  
|Total deposits                |  | $              | 768,580,560 |                             | 4.04               | % |        | $ | 655,576,578                 |  | 3.83 | %
|                              |  |                |             |                             |                    |   |        |   |                             |  |      |  



|6. | RECLASSIFICATIONS
|-- | -----------------

Certain reclassifications have
been made to 2007 amounts to conform to the 2006 presentation.



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MANAGEMENTS DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This report contains certain
forward-looking statements within the meaning of the federal securities laws, which are made in good faith pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are
not historical facts; rather they are statements based on Pulaski Financial Corp.s current expectations regarding its business strategies, intended results and future performance. Forward-looking statements are generally preceded by terms such
as expects, believes, anticipates, intends and similar expressions.

Managements ability to predict
results or the effect of future plans or strategies is inherently uncertain. Factors which could affect actual results include interest rate trends, the general economic climate in the market area in which Pulaski Financial Corp. operates, as well
as nationwide, Pulaski Financial Corp.s ability to control costs and expenses, competitive products and pricing, loan delinquency rates and changes in federal and state legislation and regulation. These factors should be considered in
evaluating the forward-looking statements and undue reliance should not be placed on such statements. Subject to applicable law and regulation, Pulaski Financial Corp. assumes no obligation to update any forward-looking statements.

OVERVIEW

Pulaski Financial Corp. is the
holding company for Pulaski Bank, a $1.1 billion asset, growth-oriented bank, focused on becoming the premier community bank in St. Louis. The Banks 85-year history operating in the provincial and parochial St. Louis market as a deeply rooted
community institution servicing tens of thousands of residential, commercial and consumer customers has created years of customer goodwill. The current generation of management is leveraging this legacy of goodwill and customer service in an effort
to become the community bank of choice in the metropolitan St. Louis area.

Core Product Growth

The Companys business plan includes reshaping its physical footprint to increase its presence in key business centers of St. Louis. Prior to 2005, five of the six
Pulaski Bank locations were located in areas of St. Louis that were primarily retail-based markets. Since August 2005, the Company has added four full-service locations in several business districts of St. Louis, including the Richmond Heights
location, which opened on January 5, 2007. By the end of calendar year 2007, the Company anticipates opening two additional bank locations in Downtown St. Louis and Clayton, Missouri.

The addition of new bank locations combined with strong marketing efforts and focused talent acquisition has resulted in rapid growth in the Companys balance
sheet. Core deposits, which consist of checking, money market and passbook savings accounts, have been a key component of this growth and their growth is the primary focus of the Companys strategic plan. Primarily as the result of successful
marketing efforts and new branch locations, core deposits increased 12%, or $31.0 million, to $289.5 million at March 31, 2007 from $258.6 million at September 30, 2006. This growth in core deposits included an $18.2 million increase
in checking account balances to $110.4 million and a $14.2 million increase in money market deposit accounts to $148.6 million at March 31, 2007. Total deposits increased $113.0 million during the six-month period to $768.6 million.
Certificates of deposit totaled $479.0 million at March 31, 2007, including $176.0 million in brokered certificates of deposit. Excluding changes in brokered certificates of deposit, time deposits increased $24.5 million during
the six months ended December 31, 2007. Because of the competition for time deposits created by growth of de novo banks in the Companys market area, the Company often has the ability to raise brokered time deposits on a national level at
interest rates lower than in its market area. Management actively chooses between these two sources of time deposits depending on this price differential.

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While the Companys primary strategic objective is to grow core deposits, the Company continues to measure its
success through the growth and efficiency of its five primary banking products, which include two deposit products, checking and money market accounts, and three loan products, residential, home equity and commercial
loans. These five products provide the primary source of the Companys operating income and are the focus of the Companys balance sheet growth. Driving these relationships are more than 80 seasoned residential and commercial lenders
in the Companys two market locations, St. Louis and Kansas City.

Total assets increased $101.2 million to $1.1 billion at March 31, 2007 from
$962.5 million at September 30, 2006. The growth in total assets was primarily due to $71.9 million of growth in loans receivable and $16.3 million in loans held for sale during the six months ended March 31, 2007. The growth in loans
receivable stemmed primarily from growth in the commercial portfolio, as mortgage loans secured by commercial real estate increased $25.0 million to $175.5 million, total real estate construction and development loans increased $21.2 million to
$78.4 million, and commercial and industrial loans increased $18.3 million to $67.1 million at March 31, 2007, respectively. The increases were the result of the Companys continued focus on growing these core commercial loan products.

Results of Operations

Earnings for the quarter ended
March 31, 2007 were $2.2 million, or $0.21 per diluted share on 10.3 million average diluted shares outstanding, compared with earnings of $2.9 million, or $0.30 per diluted share on 9.5 million average diluted shares outstanding,
during the same quarter last year. For the six months ended March 31, 2007, earnings were $4.7 million, or $0.46 per diluted share on 10.3 million average diluted shares outstanding, compared with $4.7 million, or $0.52 per diluted share
on 9.2 million average diluted shares outstanding, for the same period a year ago. Earnings per share for the 2007 and 2006 periods reflect the impact of a 1.2 million increase in the number of shares outstanding from stock issued in a
secondary public offering in February 2006 and 211,000 shares issued to acquire CWE Bancorp on March 31, 2006.

Net income for the three and six
months ended March 31, 2006 included a $2.5 million gain on the sale of the Companys Kansas City bank branch, partially offset by a $250,000 charitable contribution to a St. Louis community-based organization. These items had a combined
impact on diluted earnings per share of $0.15 and $0.16 in last years three- and six-month periods, respectively.

Net interest income rose 23%, or
$1.3 million, to $7.0 million for the quarter ended March 31, 2007 compared with $5.6 million for the same period last year. The increase was fueled by strong growth in the average balances of loans receivable and loans held for sale,
which collectively increased to $910.7 million during the quarter ended March 31, 2007 compared with $720.5 million during the quarter ended March 31, 2006. For the six months ended March 31, 2007, net interest income rose to $13.8
million compared with $11.5 million for the same six-month period last year. The average balances of loans receivable and loans held for sale collectively increased to $887.9 million during the six months ended March 31, 2007 compared with
$713.5 million during the six months ended March 31, 2006.

The net interest margin declined during the March 2007 quarter to 2.95% from 3.00% for the
quarter ended March 31, 2006. For the six-month period, the net interest margin declined to 3.00% in 2007 compared with 3.09% in 2006. The decline in the net interest margin was due primarily to strong competition for loan originations, which
created pressure on loan yields, combined with an increase in wholesale funding sources, which are typically more costly than retail deposits.

Non-interest income declined $1.7 million to $3.2 million for the three months ended March 31, 2007 compared with $4.9 million for the same period in the prior year. Excluding the $2.5 million gain on the sale of the bank branch
in 2006, non-interest income rose $720,000 during the quarter ended March 31, 2007. Mortgage revenues increased 12.2% to $1.3 million during the quarter ended March 31, 2007 on loan sales of $307 million, compared with mortgage
revenues of $1.1 million during the quarter ended March 31, 2006 on loan sales of $231 million. The increased mortgage activity continued to drive title and appraisal revenues, which collectively increased $272,000 over the March 2006 quarter.
The appraisal division is in its third quarter of operations and generated $215,000 in revenue for the quarter ended March 31, 2007. Also contributing to the rise in non-interest income during the quarter was a 10% increase in retail banking
fees to $755,000 from $685,000, primarily as the result of the increase in core deposits. For the six months ended March 31, 2007, non-interest income decreased to $6.1 million compared with $7.4 million for the same six-month period last
year. See Discussion of Other Non-Interest Income and Expense for the Three and Six Months Ended March 31, 2007.



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Non-interest expense increased 12% to $6.3 million for the quarter ended March 31, 2007 compared with $5.6 million
for the same period a year ago. The increase was primarily due to higher compensation expense, which increased $529,000 to $3.3 million for the quarter ended March 31, 2007, higher occupancy, equipment and data processing expense, which
increased $204,000 to $1.4 million for the quarter ended March 31, 2007, and higher real estate foreclosure expense and losses, which increased $144,000 to $174,000 for the quarter ended March 31, 2007. Non-interest expense in the
current-year quarter was reduced by a $141,000 gain related to changes in the market values of derivative financial instruments compared with a $73,000 loss in the prior-year quarter. Chartable contributions decreased from $288,000 for the quarter
ended March 31, 2006 to $17,000 for the current-year quarter. The March 2006 quarter included a $250,000 charitable contribution to a St. Louis community-based organization. For the six months ended March 31, 2007, non-interest expense was
$11.6 million compared with $10.7 million for the same six-month period last year. See Discussion of Other Non-Interest Income and Expense for the Three and Six Months Ended March 31, 2007.

Asset Quality

The ratio of nonperforming assets to total assets
decreased slightly from 1.02% at September 30, 2006 to 0.98% at March 31, 2007. Non-performing assets totaled $10.5 million at March 31, 2007 compared with $9.9 million at September 30, 2006. The balance of nonperforming loans
increased $1.1 million to $8.2 million at March 31, 2007 from $7.0 million at September 30, 2006. See Non-Performing Assets and Delinquencies.

AVERAGE BALANCE SHEETS

The following table sets forth information regarding average
daily balances of assets and liabilities as well as the total dollar amounts of interest income from average interest-earning assets and interest expense on average interest-bearing liabilities, resultant yields, interest rate spread, net interest
margin, and ratio of average interest-earning assets to average interest-bearing liabilities for the periods indicated.



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|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|-------------------------------------------------------------------------------- |  | ---------------------- | --------- | - | -------------------- | - | ---------- |  | ---- | -------------- |  | - | -------------------- | - | ---------- | - | ------ |  | ---- | -
|                                                                                 |  | Three Months Ended     |          
|                                                                                 |  | March 31, 2007         |           |   | March 31, 2006       |  
|                                                                                 |  | AverageBalance         |           |   | InterestandDividends |   | Yield/Cost |  |      | AverageBalance |  |   | InterestandDividends |   | Yield/Cost |  
|                                                                                 |  | (Dollars in thousands) |          
|Interest-earning assets:                                                         |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Loans receivable:(1)                                                             |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Real estate and commercial                                                       |  | $                      | 645,177   |   |                      | $ | 11,470     |  | 7.11 | %              |  | $ | 483,868              |   |            | $ | 7,647  |  | 6.32 | %
|Consumer                                                                         |  |                        | 3,865     |   |                      |   | 63         |  | 6.52 | %              |  |   | 3,463                |   |            |   | 53     |  | 6.12 | %
|Home equity                                                                      |  |                        | 205,923   |   |                      |   | 4,180      |  | 8.12 | %              |  |   | 200,107              |   |            |   | 3,662  |  | 7.32 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total loans receivable                                                           |  |                        | 854,965   |   |                      |   | 15,713     |  | 7.35 | %              |  |   | 687,438              |   |            |   | 11,362 |  | 6.61 | %
|Loans available for sale                                                         |  |                        | 55,720    |   |                      |   | 826        |  | 5.93 | %              |  |   | 33,035               |   |            |   | 452    |  | 5.47 | %
|Debt securities                                                                  |  |                        | 18,204    |   |                      |   | 222        |  | 4.88 | %              |  |   | 15,001               |   |            |   | 155    |  | 4.13 | %
|FHLB stock                                                                       |  |                        | 8,308     |   |                      |   | 87         |  | 4.20 | %              |  |   | 7,543                |   |            |   | 58     |  | 3.05 | %
|Mortgage-backed securities                                                       |  |                        | 3,416     |   |                      |   | 41         |  | 4.75 | %              |  |   | 4,326                |   |            |   | 53     |  | 4.88 | %
|Other                                                                            |  |                        | 3,503     |   |                      |   | 45         |  | 5.14 | %              |  |   | 5,477                |   |            |   | 61     |  | 4.46 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-earning assets                                                    |  |                        | 944,116   |   |                      |   | 16,934     |  | 7.17 | %              |  |   | 752,820              |   |            |   | 12,141 |  | 6.45 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest-earning assets                                                      |  |                        | 77,861    |   |                      |   |            |  |      |                |  |   | 57,490               |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total assets                                                                     |  | $                      | 1,021,977 |   |                      |   |            |  |      |                |  | $ | 810,310              |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Interest-bearing liabilities:                                                    |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Demand deposit                                                                   |  | $                      | 65,786    |   |                      | $ | 345        |  | 2.10 | %              |  | $ | 44,801               |   |            | $ | 180    |  | 1.61 | %
|Savings                                                                          |  |                        | 29,982    |   |                      |   | 28         |  | 0.38 | %              |  |   | 30,168               |   |            |   | 25     |  | 0.34 | %
|Money market                                                                     |  |                        | 152,990   |   |                      |   | 1,601      |  | 4.18 | %              |  |   | 93,259               |   |            |   | 663    |  | 2.84 | %
|Time deposits                                                                    |  |                        | 452,355   |   |                      |   | 5,609      |  | 4.96 | %              |  |   | 376,398              |   |            |   | 3,736  |  | 3.97 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-bearing deposits                                                  |  |                        | 701,113   |   |                      |   | 7,583      |  | 4.33 | %              |  |   | 544,626              |   |            |   | 4,604  |  | 3.38 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|FHLB advances                                                                    |  |                        | 153,613   |   |                      |   | 1,968      |  | 5.12 | %              |  |   | 139,744              |   |            |   | 1,502  |  | 4.30 | %
|Note payable                                                                     |  |                        | 3,233     |   |                      |   | 57         |  | 7.08 | %              |  |   | 3,575                |   |            |   | 57     |  | 6.43 | %
|Subordinated debentures                                                          |  |                        | 19,589    |   |                      |   | 373        |  | 7.62 | %              |  |   | 19,589               |   |            |   | 337    |  | 6.88 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-bearing liabilities                                               |  |                        | 877,548   |   |                      |   | 9,981      |  | 4.55 | %              |  |   | 707,534              |   |            |   | 6,500  |  | 3.67 | %
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest bearing liabilities:                                                |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest bearing deposits                                                    |  |                        | 46,125    |   |                      |   |            |  |      |                |  |   | 27,501               |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Other non-interest bearing liabilities                                           |  |                        | 17,984    |   |                      |   |            |  |      |                |  |   | 14,275               |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total non-interest-bearing liabilities                                           |  |                        | 64,109    |   |                      |   |            |  |      |                |  |   | 41,776               |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Stockholders' equity                                                             |  |                        | 80,320    |   |                      |   |            |  |      |                |  |   | 61,000               |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total liabilities and stockholders' equity                                       |  | $                      | 1,021,977 |   |                      |   |            |  |      |                |  | $ | 810,310              |   |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Net interest income                                                              |  |                        |           |   |                      | $ | 6,953      |  |      |                |  |   |                      |   |            | $ | 5,641  |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Interest rate spread(2)                                                          |  |                        |           |   |                      |   |            |  | 2.62 | %              |  |   |                      |   |            |   |        |  | 2.78 | %
|Net interest margin(3)                                                           |  |                        |           |   |                      |   |            |  | 2.95 | %              |  |   |                      |   |            |   |        |  | 3.00 | %
|Ratio of average interest-earning assets to average interest-bearing liabilities |  |                        | 107.59    | % |                      |   |            |  |      |                |  |   | 106.40               | % |            |   |        |  |      |  
|                                                                                 |  |                        |           |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  

---

|(1) | Includes non-accrual loans with
an average balance of $750,000 and $3.4 million for the three months ended March 31, 2007 and 2006, respectively.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Yield on interest-earning assets
less cost of interest-bearing liabilities.
|--- | ---------------------------------------------------------------------------

|(3) | Net interest income divided by total average interest-earning assets.
|--- | ---------------------------------------------------------------------



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|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|-------------------------------------------------------------------------------- |  | ---------------------- | ------- | - | -------------------- | - | ---------- |  | ---- | -------------- |  | - | -------------------- | - | ---------- | - | ------ |  | ---- | -
|                                                                                 |  | Six Months Ended       |        
|                                                                                 |  | March 31, 2007         |         |   | March 31, 2006       |  
|                                                                                 |  | AverageBalance         |         |   | InterestandDividends |   | Yield/Cost |  |      | AverageBalance |  |   | InterestandDividends |   | Yield/Cost |  
|                                                                                 |  | (Dollars in thousands) |        
|Interest-earning assets:                                                         |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Loans receivable:(1)                                                             |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Real estate and commercial                                                       |  | $                      | 624,423 |   |                      | $ | 22,334     |  | 7.15 | %              |  | $ | 472,387              |   |            | $ | 14,955 |  | 6.33 | %
|Consumer                                                                         |  |                        | 3,884   |   |                      |   | 127        |  | 6.55 | %              |  |   | 3,409                |   |            |   | 105    |  | 6.17 | %
|Home equity                                                                      |  |                        | 206,161 |   |                      |   | 8,439      |  | 8.19 | %              |  |   | 198,507              |   |            |   | 7,181  |  | 7.23 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total loans receivable                                                           |  |                        | 834,468 |   |                      |   | 30,900     |  | 7.41 | %              |  |   | 674,303              |   |            |   | 22,241 |  | 6.60 | %
|Loans available for sale                                                         |  |                        | 53,460  |   |                      |   | 1,589      |  | 5.95 | %              |  |   | 39,185               |   |            |   | 1,098  |  | 5.60 | %
|Debt securities                                                                  |  |                        | 16,730  |   |                      |   | 409        |  | 4.89 | %              |  |   | 11,700               |   |            |   | 237    |  | 4.05 | %
|FHLB stock                                                                       |  |                        | 8,747   |   |                      |   | 186        |  | 4.24 | %              |  |   | 8,340                |   |            |   | 133    |  | 3.18 | %
|Mortgage-backed securities                                                       |  |                        | 3,485   |   |                      |   | 83         |  | 4.75 | %              |  |   | 4,514                |   |            |   | 109    |  | 4.84 | %
|Other                                                                            |  |                        | 4,211   |   |                      |   | 108        |  | 5.12 | %              |  |   | 5,307                |   |            |   | 113    |  | 4.26 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-earning assets                                                    |  |                        | 921,101 |   |                      |   | 33,275     |  | 7.23 | %              |  |   | 743,349              |   |            |   | 23,931 |  | 6.44 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest-earning assets                                                      |  |                        | 76,259  |   |                      |   |            |  |      |                |  |   | 54,304               |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total assets                                                                     |  | $                      | 997,360 |   |                      |   |            |  |      |                |  | $ | 797,653              |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Interest-bearing liabilities:                                                    |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Demand deposit                                                                   |  | $                      | 60,090  |   |                      | $ | 577        |  | 1.92 | %              |  | $ | 37,458               |   |            | $ | 206    |  | 1.10 | %
|Savings                                                                          |  |                        | 30,631  |   |                      |   | 57         |  | 0.37 | %              |  |   | 30,978               |   |            |   | 53     |  | 0.34 | %
|Money market                                                                     |  |                        | 150,891 |   |                      |   | 3,173      |  | 4.21 | %              |  |   | 93,081               |   |            |   | 1,279  |  | 2.75 | %
|Time deposits                                                                    |  |                        | 425,133 |   |                      |   | 10,512     |  | 4.95 | %              |  |   | 354,009              |   |            |   | 6,740  |  | 3.81 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-bearing deposits                                                  |  |                        | 666,745 |   |                      |   | 14,319     |  | 4.30 | %              |  |   | 515,526              |   |            |   | 8,278  |  | 3.21 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|FHLB advances                                                                    |  |                        | 165,041 |   |                      |   | 4,259      |  | 5.16 | %              |  |   | 160,698              |   |            |   | 3,395  |  | 4.22 | %
|Note payable                                                                     |  |                        | 3,275   |   |                      |   | 116        |  | 7.08 | %              |  |   | 3,574                |   |            |   | 112    |  | 6.26 | %
|Subordinated debentures                                                          |  |                        | 19,589  |   |                      |   | 756        |  | 7.71 | %              |  |   | 19,589               |   |            |   | 649    |  | 6.63 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total interest-bearing liabilities                                               |  |                        | 854,650 |   |                      |   | 19,450     |  | 4.55 | %              |  |   | 699,387              |   |            |   | 12,434 |  | 3.56 | %
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest bearing liabilities:                                                |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Non-interest bearing deposits                                                    |  |                        | 45,042  |   |                      |   |            |  |      |                |  |   | 27,615               |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Other non-interest bearing liabilities                                           |  |                        | 18,009  |   |                      |   |            |  |      |                |  |   | 15,529               |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total non-interest-bearing liabilities                                           |  |                        | 63,051  |   |                      |   |            |  |      |                |  |   | 43,144               |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Stockholders' equity                                                             |  |                        | 79,659  |   |                      |   |            |  |      |                |  |   | 55,122               |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Total liabilities and stockholders' equity                                       |  | $                      | 997,360 |   |                      |   |            |  |      |                |  | $ | 797,653              |   |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Net interest income                                                              |  |                        |         |   |                      | $ | 13,825     |  |      |                |  |   |                      |   |            | $ | 11,497 |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  
|Interest rate spread(2)                                                          |  |                        |         |   |                      |   |            |  | 2.68 | %              |  |   |                      |   |            |   |        |  | 2.88 | %
|Net interest margin(3)                                                           |  |                        |         |   |                      |   |            |  | 3.00 | %              |  |   |                      |   |            |   |        |  | 3.09 | %
|Ratio of average interest-earning assets to average interest-bearing liabilities |  |                        | 107.78  | % |                      |   |            |  |      |                |  |   | 106.29               | % |            |   |        |  |      |  
|                                                                                 |  |                        |         |   |                      |   |            |  |      |                |  |   |                      |   |            |   |        |  |      |  

---

|(1) | Includes non-accrual loans with
an average balance of $832,000 and $2.3 million for the six months ended March 31, 2007 and 2006, respectively.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Yield on interest-earning assets
less cost of interest-bearing liabilities.
|--- | ---------------------------------------------------------------------------

|(3) | Net interest income divided by total average interest-earning assets.
|--- | ---------------------------------------------------------------------



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##### Table of Contents

RATE VOLUME ANALYSIS

The following table sets forth the effects of changing rates and volumes on net interest income for the periods indicated. The total change for each category of
interest-earning asset and interest-bearing liability is segmented into the change attributable to variations in volume (change in volume multiplied by prior period rate) and the change attributable to variations in interest rates (changes in rates
multiplied by prior period volume). Changes in interest income and expense attributed to both changes in volume and changes in rate are allocated proportionately to rate and volume.



|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|----------------------------------------------------- |  | ---------------------------------------- | ----- | - | --------------------------------------- | - | ----- | --- |  | - | ------ | - |  | ---- | ----- | - | --- | - | ----- | - |  | - | ----- | -
|                                                      |  | Three Months EndedMarch 31, 2007 vs 2006 |       |   | Six Months Ended March 31, 2007 vs 2006 |  
|                                                      |  | Volume                                   |       |   | Rate                                    |   |       | Net |  |   | Volume |   |  | Rate |       |   | Net |  
|                                                      |  | (In thousands)                           |       |   | (In thousands)                          |  
|Interest-earning assets:                              |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Loans receivable:                                     |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Real estate and commercial                            |  | $                                        | 2,780 |   |                                         | $ | 1,043 |     |  | $ | 3,823  |   |  | $    | 5,261 |   |     | $ | 2,118 |   |  | $ | 7,379 |  
|Consumer                                              |  |                                          | 6     |   |                                         |   | 4     |     |  |   | 10     |   |  |      | 15    |   |     |   | 7     |   |  |   | 22    |  
|Home Equity                                           |  |                                          | 109   |   |                                         |   | 409   |     |  |   | 518    |   |  |      | 283   |   |     |   | 975   |   |  |   | 1,258 |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Total loans receivable                                |  |                                          | 2,895 |   |                                         |   | 1,456 |     |  |   | 4,351  |   |  |      | 5,559 |   |     |   | 3,100 |   |  |   | 8,659 |  
|Loans available for sale                              |  |                                          | 333   |   |                                         |   | 41    |     |  |   | 374    |   |  |      | 419   |   |     |   | 72    |   |  |   | 491   |  
|Debt securities                                       |  |                                          | 36    |   |                                         |   | 31    |     |  |   | 67     |   |  |      | 116   |   |     |   | 56    |   |  |   | 172   |  
|FHLB stock                                            |  |                                          | 6     |   |                                         |   | 23    |     |  |   | 29     |   |  |      | 7     |   |     |   | 46    |   |  |   | 53    |  
|Mortgage-backed securities                            |  |                                          | (11   | ) |                                         |   | (1    | )   |  |   | (12    | ) |  |      | (24   | ) |     |   | (2    | ) |  |   | (26   | )
|Other                                                 |  |                                          | (63   | ) |                                         |   | 47    |     |  |   | (16    | ) |  |      | (49   | ) |     |   | 44    |   |  |   | (5    | )
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Net change in income on interest earning assets       |  |                                          | 3,196 |   |                                         |   | 1,597 |     |  |   | 4,793  |   |  |      | 6,028 |   |     |   | 3,316 |   |  |   | 9,344 |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Interest-bearing liabilities:                         |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Demand deposits                                       |  |                                          | 100   |   |                                         |   | 65    |     |  |   | 165    |   |  |      | 166   |   |     |   | 205   |   |  |   | 371   |  
|Savings                                               |  |                                          | (2    | ) |                                         |   | 5     |     |  |   | 3      |   |  |      | (1    | ) |     |   | 5     |   |  |   | 4     |  
|Money market                                          |  |                                          | 540   |   |                                         |   | 398   |     |  |   | 938    |   |  |      | 1,021 |   |     |   | 873   |   |  |   | 1,894 |  
|Time deposits                                         |  |                                          | 837   |   |                                         |   | 1,036 |     |  |   | 1,873  |   |  |      | 1,515 |   |     |   | 2,257 |   |  |   | 3,772 |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Total interest-bearing deposits                       |  |                                          | 1,475 |   |                                         |   | 1,504 |     |  |   | 2,979  |   |  |      | 2,701 |   |     |   | 3,340 |   |  |   | 6,041 |  
|FHLB advances                                         |  |                                          | 159   |   |                                         |   | 307   |     |  |   | 466    |   |  |      | 93    |   |     |   | 771   |   |  |   | 864   |  
|Note payable                                          |  |                                          | (22   | ) |                                         |   | 22    |     |  |   |       |   |  |      | (21   | ) |     |   | 25    |   |  |   | 4     |  
|Subordinated debentures                               |  |                                          |      |   |                                         |   | 36    |     |  |   | 36     |   |  |      |      |   |     |   | 107   |   |  |   | 107   |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Net change in expense on interest bearing liabilities |  |                                          | 1,612 |   |                                         |   | 1,869 |     |  |   | 3,481  |   |  |      | 2,773 |   |     |   | 4,243 |   |  |   | 7,016 |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  
|Change in net interest income                         |  | $                                        | 1,584 |   |                                         | $ | (272  | )   |  | $ | 1,312  |   |  | $    | 3,255 |   |     | $ | (927  | ) |  | $ | 2,328 |  
|                                                      |  |                                          |       |   |                                         |   |       |     |  |   |        |   |  |      |       |   |     |   |       |   |  |   |       |  



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##### Table of Contents

NON-PERFORMING ASSETS

Non-performing assets at March 31, 2007 and September 30, 2006 are summarized as follows:



|                                              |  |                        |        |                   |   |      
|--------------------------------------------- |  | ---------------------- | ------ | ----------------- | - | -----
|                                              |  | March 31,2007          |        | September 30,2006
|                                              |  | (Dollars in thousands)
|Non-accrual loans:                            |  |                        |        |                   |   |      
|Residential real estate                       |  | $                      | 466    |                   | $ | 794  
|Home equity                                   |  |                        | 126    |                   |   | 119  
|Other                                         |  |                        | 53     |                   |   | 27   
|                                              |  |                        |        |                   |   |      
|Total non-accrual loans                       |  |                        | 645    |                   |   | 940  
|                                              |  |                        |        |                   |   |      
|Accruing loans past due 90 days or more:      |  |                        |        |                   |   |      
|Residential real estate                       |  |                        | 3,649  |                   |   | 3,984
|Commercial                                    |  |                        | 821    |                   |   | 125  
|Real estate-construction and development      |  |                        | 549    |                   |   |     
|Home equity                                   |  |                        | 1,745  |                   |   | 1,456
|Other                                         |  |                        | 54     |                   |   | 21   
|                                              |  |                        |        |                   |   |      
|Total accruing loans past due 90 days or more |  |                        | 6,818  |                   |   | 5,586
|                                              |  |                        |        |                   |   |      
|Restructured loans                            |  |                        | 117    |                   |   | 220  
|Other nonperforming loans                     |  |                        | 577    |                   |   | 302  
|                                              |  |                        |        |                   |   |      
|Total non-performing loans                    |  |                        | 8,157  |                   |   | 7,048
|Real estate acquired in settlement of loans   |  |                        | 2,263  |                   |   | 2,764
|Other nonperforming assets                    |  |                        | 43     |                   |   | 44   
|                                              |  |                        |        |                   |   |      
|Total non-performing assets                   |  | $                      | 10,463 |                   | $ | 9,856
|                                              |  |                        |        |                   |   |      

Total non-performing assets increased from $9.9 million at September 30, 2006 to $10.5 million at
March 31, 2007. The balance of non-accrual loans decreased from $940,000 to $645,000 as the Company foreclosed on several residential loans during the six-month period ended March 31, 2007. Accruing loans greater than 90 days past due
increased from $5.6 million at September 30, 2006 to $6.8 million at March 31, 2007, primarily as the result of a $1.2 million increase in loans secured by commercial, multi-family, and construction and development real estate that
were greater than 90 days past due and still accruing interest. Loans are placed on non-accrual status when, in the opinion of management, there is reasonable doubt as to the collectibility of interest or principal. Management considers many factors
before placing a loan on non-accrual, including the overall financial condition of the borrower, the progress of managements collection efforts and the value of the underlying collateral. The allowance for loan losses was $8.5 million at
March 31, 2007, or 0.90% of total loans and 104.32% of non-performing loans, compared with $7.8 million at September 30, 2006, or 0.92% of total loans and 110.91% of non-performing loans.

The provision for loan losses for the three and six months ended March 31, 2007 were $573,000 and $1.3 million, respectively, compared with $453,000 and $860,000,
respectively, for the same periods a year ago. The increases were due to both strong growth in the loan portfolio, primarily commercial and construction loans, which carry a higher risk of default than residential real estate loans, combined with
the increase in non-performing loans. Net charge-offs for the six months ended March 31, 2007 totaled $562,000, or 0.06% of average loans, compared with $552,000, or 0.08% of average loans, for the same period a year ago. Net charge-offs in
2007 primarily include $278,000 in charge-offs on single-family residential mortgage loans, $120,000 in charge-offs on multi-family real estate loans and $85,000 in charge-offs on home equity loans.

Real estate foreclosure losses and expense, net was $236,000 for the six months ended March 31, 2007 compared with $55,000 for the same 2006 period. A large part of
the increase was primarily the result of losses and expenses incurred in connection with several residential properties acquired, through foreclosure, from a single borrower. The properties are located in an economically depressed area of St. Louis
and experienced significant deterioration in physical condition.



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##### Table of Contents

The provision for loan losses is determined by management as the amount to bring the allowance for loan losses to a level
that is considered adequate to absorb probable losses in the loan portfolio. The allowance for loan losses is a critical accounting estimate reported within the consolidated financial statements. The allowance is based upon quarterly management
estimates of probable losses inherent in the loan portfolio. Managements estimates are determined by quantifying certain risks in the portfolio that are affected primarily by changes in the nature and volume of the portfolio combined with an
analysis of past-due and classified loans, but can also be affected by the following factors: changes in lending policies and procedures, including underwriting standards and collections, charge-off and recovery practices, changes in national and
local economic conditions and developments, and changes in the experience, ability, and depth of lending management staff.

Management believes that the
amount maintained in the allowance will be adequate to absorb probable losses inherent in the portfolio. Although management believes that it uses the best information available to make such determinations, future adjustments to the allowance for
loan losses may be necessary and results of operations could be significantly and adversely affected if circumstances differ substantially from the assumptions used in making the determinations. While management believes it has established the
allowance for loan losses in accordance with U.S. generally accepted accounting principles, there can be no assurance that the Banks regulators, in reviewing the Banks loan portfolio, will not request the Bank to significantly increase
its allowance for loan losses. In addition, because future events affecting borrowers and collateral cannot be predicted with certainty, there can be no assurance that the existing allowance for loan losses is adequate or that a substantial increase
will not be necessary should the quality of any loans deteriorate as a result of the factors discussed above. Any material increase in the allowance for loan losses will adversely affect the Companys financial condition and results of
operations.

Because management adheres to specific loan underwriting guidelines focusing primarily on residential and commercial real estate and home
equity loans secured by one-to four-family and commercial properties, the Companys five-year average annual historical loan loss experience has been low, totaling only $375,000, or 0.04% of average loans. While the losses have increased
slightly over the last five years, the balance of the allowance has increased dramatically, almost doubling in the last two fiscal years. The growth in allowance for loan losses was due to growth in the loan portfolio as well as loan product
diversification, which increased the risk profile of the portfolio. The Company was historically a lender of only 1-4 family conforming residential loans. Today, the Company has expanded its loan portfolio to include higher-risk home equity,
commercial and construction loans. Because the Companys loan portfolio is typically collateralized by real estate, losses occur more frequently when property values are declining and borrowers are losing equity in the underlying collateral.
Presently, the property values in the Companys lending areas have been stable and appreciating.

The following table is a summary of the activity in
the allowance for loan losses for the periods indicated:



|                                                    |  |                           |        |   |                   |   |        |  
|--------------------------------------------------- |  | ------------------------- | ------ | - | ----------------- | - | ------ | -
|                                                    |  | Six Months EndedMarch 31, |       
|                                                    |  | 2007                      |        |   | 2006              |  
|                                                    |  | (Dollars In Thousands)    |       
|Allowance for loan losses, beginning of period      |  | $                         | 7,817  |   |                   | $ | 6,806  |  
|Provision charged to expense                        |  |                           | 1,255  |   |                   |   | 860    |  
|Allowance on loans acquired in business combination |  |                           |       |   |                   |   | 282    |  
|Loans charged-off                                   |  |                           | (576   | ) |                   |   | (556   | )
|Recoveries of loans previously charged-off          |  |                           | 14     |   |                   |   | 4      |  
|                                                    |  |                           |        |   |                   |   |        |  
|Allowance for loan losses, end of period            |  | $                         | 8,510  |   |                   | $ | 7,396  |  
|                                                    |  |                           |        |   |                   |   |        |  
|                                                    |  |                          
|                                                    |  | March 31,2007             |        |   | September 30,2006 |  
|Ratio of allowance to total loans outstanding       |  |                           | 0.90   | % |                   |   | 0.92   | %
|Ratio of allowance to nonperforming loans           |  |                           | 104.32 | % |                   |   | 110.91 | %



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##### Table of Contents

The following assessments are performed quarterly in accordance with the Companys allowance for loan losses
methodology:

Homogeneous residential mortgage loans are given one of five standard risk ratings at the time of origination. The risk
ratings are assigned through the use of a credit scoring model, which assesses credit risk determinants from the borrowers credit history, the loan-to-value ratio, the affordability ratios or other personal history. Five-year historical loss
rates and industry data for each credit rating are used to determine the appropriate allocation percentage for each loan grade. Commercial real estate loans are individually reviewed and assigned a credit risk rating on an annual basis by the
internal loan committee. Consumer and home equity loans are assigned standard risk weightings that determine the allocation percentage.

When commercial real estate loans are over 30 days delinquent or residential, consumer and home equity loans are over 90 days past due, they are evaluated individually for impairment. Additionally, loans that demonstrate credit weaknesses
that may impact the borrowers ability to repay or the value of the collateral are also reviewed individually for impairment. The Company considers a loan to be impaired when management believes it will be unable to collect all principal and
interest due according to the contractual terms of the loan. If a loan is impaired, the Company records a loss valuation equal to the excess of the loans carrying value over the present value of estimated future cash flows or the fair value of
collateral if the loan is collateral dependent.

The Companys methodology includes factors that allow the Company to adjust its
estimates of losses based on the most recent information available. Historic loss rates used to determine the allowance are adjusted to reflect the impact of current conditions, including actual collection and charge-off experience. Any material
increase in non-performing loans will adversely affect our financial condition and results of operation.

ADDITIONAL
DISCUSSION OF FINANCIAL CONDITION

Cash and cash equivalents increased
$7.0 million to $29.1 million at March 31, 2007 from $22.1 million at September 30, 2006 The Company maintains cash reserves at its bank branch locations and at its correspondent banks including the Federal Reserve, to remain in compliance
with federal banking regulations. Typically, excess cash inflows are used to retire daily borrowings from the Federal Home Loan Bank.

Debt
securities held to maturityincreased $6.0 million to $18.9 million at March 31, 2007 from $12.9 million at September 30, 2006 primarily due to the purchase of securities to be used as collateral for large commercial deposits.

Advances from the Federal Home Loan Bankdecreased $12.3 million to $160.5 million at March 31, 2007 from $172.8 million at
September 30, 2006. The Company has the ability to raise time deposits on a national level that, at certain times, are available at interest rates lower than those available from the Federal Home Loan Bank. Management actively chooses between
these two sources of funding depending on this price differential.

Due to other banks totaled $18.1 million at March 31, 2007 compared
with $22.1 million at September 30, 2006. Due to other banks represents checks drawn on a correspondent banks checking account. On a daily basis, the Company settles with the correspondent bank. The balances primarily represent the checks
issued to fund loans on the final business day of the month.

Total stockholders equity at March 31, 2007 was $79.3 million, an
increase of $3.5 million from $75.8 million at September 30, 2006. The increase during the six-month period was primarily attributable to net income totaling $4.7 million, partially offset by dividend payments of $1.7 million and the
repurchase of 40,637 shares of the Companys common stock at a cost of $639,000.

DISCUSSION OF
OTHER NON-INTEREST INCOME AND EXPENSE FOR THE THREE AND SIX MONTHS
ENDED MARCH 31, 2007

Title policy revenuestotaled $231,000 and $174,000 for the three months
ended March 31, 2007 and 2006, respectively, and $444,000 and $372,000 for the six months ended March 31, 2007 and 2006, respectively. The title division captures sales opportunities from the Companys residential and commercial
lending activities. Its primary activities include



- 18 -



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##### Table of Contents

researching and issuing title policies on commercial and residential loans. The increased revenues were the result of the Companys increased loan
origination activity.

Appraisal division revenues totaled $215,000 and $424,000 for the three and six months ended March 31, 2007,
respectively. The appraisal divisions operations, which began in July 2006, consist primarily of cross-selling appraisal services to the Companys mortgage loan customers.

Investment brokerage revenuestotaled $133,000 and $150,000 for the three months ended March 31, 2007 and 2006, respectively, and $376,000 and $267,000 for the six months ended March 31, 2007
and 2006, respectively. The investment divisions operations consist principally of brokering bonds from wholesale brokerage houses to bank, municipal and individual investors. Revenues are generated on trading spreads and fluctuate with
changes in trading volumes.

Gain on sale of securities totaled $144,000 for the six months ending March 31, 2007 and resulted from the
sale of $773,000 of equity securities classified as available for sale compared to a $56,000 gain for the six months ended March 31, 2006 on sales of $471,000 of available-for-sale equity securities.

Gain on the sale of branch totaled $2.5 million for the six months ending March 31, 2006. No such sale occurred in the current fiscal year.

Bank-owned life insurance income increased $64,000 to $253,000 for the three-month period ending March 31, 2007 compared with the
three-month period ending March 31, 2006 and increased $159,000 to $511,000 for the six-month period ending March 31, 2007 compared with the six-month period ending March 31, 2006 due to income earned on $6.5 million of additional
policies purchased during February and March of 2006.

Other non-interest income totaled $316,000 and $67,000 for the three months ended
March 31, 2007 and 2006, respectively, and $498,000 and $286,000 for the six months ended March 31, 2007 and 2006, respectively. The Company was awarded $117,000 in settlement of pending litigation during the quarter ended March 31,
2007. The March 2006 quarter includes a $127,000 loss on the sale of a pool of nonperforming loans.

Salaries and employee benefits expense
increased $529,000 to $3.3 million for the quarter ended March 31, 2007 compared with $2.7 million for the quarter ended March 31, 2006 and increased $944,000 to $5.9 million for the six months ended March 31, 2007 compared with $5.0
million for the six months ended March 31, 2006. The increases resulted from the addition of the former Central West End Bank employees following its acquisition on March 31, 2006, employees at the new Richmond Heights bank location, and
staff expansion necessary to support increased loan activity.

Occupancy, equipment and data processing expense increased 17% to $1.4 million
during the three-month period ended March 31, 2007 compared with $1.2 million for the three-month period ended March 31, 2006 and increased 347,000 to $2.7 million for the six months ended March 31, 2007 compared with $2.3 million for
the six months ended March 31, 2006. The increases were primarily the result of the operating expenses associated with the two banking locations acquired in the Central West End Bank purchase, the new Richmond Heights bank location, and
additional mortgage origination offices.

Advertising expenseincreased $95,000 to $372,000 for the quarter ended March 31, 2007
compared with $276,000 for the quarter ended March 31, 2006 and increased $154,000 to $619,000 for the six months ended March 31, 2007 compared with $465,000 for the six months ended March 31, 2006. The growth in advertising expense
is consistent with the Companys objective to grow core deposits through an increased commercial banking presence and a consistent marketing message.

Professional services increased $74,000 to $399,000 for the quarter ended March 31, 2007 compared with $325,000 for the quarter ended March 31, 2006 as a result of increased consulting and legal expenses.

(Gain) loss on derivative instrumentswas a $141,000 gain for the quarter ended March 31, 2007 compared with a loss of $73,000 for the quarter
ended March 31, 2006. For the six-month period ended March 31, 2007, the gain was $314,000 compared to a loss of $480,000 for the six-month period ended March 31, 2006. The Company entered into interest rate swap agreements during
November 2004 which were designed to convert the fixed rates paid on certain brokered



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certificates of deposits into variable, LIBOR-based rates. During the first quarter of fiscal year 2006, changes in the estimated fair values of these
derivatives were recognized as charges or credits to earnings, as appropriate, during the periods in which the changes occurred. Effective January 1, 2006, the Company began using long-haul, fair-value, hedge accounting.

Data processing termination expensetotaled $220,000 for the six months ended March 31, 2007 due to the write off of capitalized expenses related to
the termination of a contract to convert the Companys core data processing system. There was no such expense in the prior fiscal year.

Real
estate foreclosure losses and expense, netincreased $144,000 to $174,000 for the quarter ended March 31, 2007 compared with $29,000 for the quarter ended March 31, 2006 and increased $181,000 to $236,000 for the six months ended
March 31, 2007 compared with $55,000 for the six months ended March 31, 2006. Included in these amounts are net losses on the sale of the properties totaling $83,000 and $124,000 for the three and six months ended March 31, 2007,
respectively, compared with $6,000 and $10,000 for the three and six months ended March 31, 2006, respectively. A large part of the increases were the result of losses and expenses incurred in connection with several residential properties
acquired, through foreclosure, from a single borrower. The properties are located in an economically depressed area of St. Louis and experienced significant deterioration in physical condition.

INCOME TAXES

The provision for
income taxes was $1.0 million and $2.3 million for the three and six months ended March 31, 2007, respectively, compared with $1.6 million and $2.6 million for the three and six months ended March 31, 2006, respectively. The effective tax
rates for the three-month periods ended March 31, 2007 and 2006 were 31.6% and 35.2%, respectively, and were 33.2% and 35.0%, respectively for the six-month periods ended March 31, 2007 and 2006. The lower effective tax rates in 2007 were
the result of an increase in BOLI income, which is non-taxable, and a $90,000 reduction of the current tax liability in March 2007 following the completion of an Internal Revenue Service exam and the resulting favorable resolution of a potential tax
liability.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2007, the Bank had outstanding commitments to originate loans totaling $168.0 million and commitments to
sell loans totaling $165.0 million. At March 31, 2007, certificates of deposit totaling $326.0 million are scheduled to mature in one year or less. Based on past experience, management believes the majority of certificates of deposit maturing
in one year or less will remain with the Bank.

If the Bank or the Company require funds beyond their ability to generate them internally, the Bank has the
ability to borrow funds from the FHLB and to raise certificates of deposit on a national level through broker relationships. The borrowings from the FHLB are obtained under a blanket agreement, which assigns all investments in FHLB stock, qualifying
first residential mortgage loans, residential loans held for sale and home equity loans with a 90% or greater LTV as collateral to secure the amounts borrowed. Total borrowings from the FHLB are subject to limitations based upon a risk assessment of
the Bank. At March 31, 2007, the Bank had approximately $79.7 million in additional borrowing authority under the arrangement with the FHLB in addition to the $160.5 million in advances outstanding at that date. The Company also maintains a
$20.0 million line of credit with a correspondent bank. At March 31, 2007, $3.2 million had been borrowed under this arrangement.

SOURCES AND USES OF CASH

The Company is a large
originator of residential mortgage loans with more than 87% of such loans sold in the secondary residential mortgage market. Consequently, the primary source and use of cash in operations is the origination and subsequent sale of loans
held for sale. During the six months ended March 31, 2007, the origination of loans held for sale used $608.4 million of cash and the sales of such loans provided cash totaling $593.7 million.

The primary use of cash from investing activities is the investment in loans receivable originated for the portfolio. During the six months ended
March 31, 2007, the Company had a net increase in loans receivable of $77.4 million compared with an increase of $81.1 million for the six months ended March 31, 2006. See Overview for a discussion of the growth in



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loans receivable. In addition, the Company purchased $26.7 million in debt securities during the six months ended March 31, 2007, primarily to serve as
collateral for large municipal deposits, compared with $27.8 million during the same period last year.

The Companys primary sources of funds from
financing activities during the six months ended March 31, 2007 was a $113.0 million increase in deposits offset by a decrease in Federal Home Loan Bank advances of $12.3 million.

The following table presents the maturity structure of time deposits and other maturing liabilities at March 31, 2007:



|                                      |  |                        |         |                |   |             |  |                   |       |                        |   |        |  |   |       
|------------------------------------- |  | ---------------------- | ------- | -------------- | - | ----------- |  | ----------------- | ----- | ---------------------- | - | ------ |  | - | ------
|                                      |  | March 31, 2007        
|                                      |  | Certificatesof deposit |         | FHLBBorrowings |   | NotePayable |  | Due to OtherBanks |       | SubordinatedDebentures
|                                      |  | (In thousands)        
|Three months or less                  |  | $                      | 157,836 |                | $ | 106,500     |  | $                 | 3,150 |                        | $ | 18,121 |  | $ |      
|Over three months through six months  |  |                        | 86,068  |                |   |            |  |                   |      |                        |   |       |  |   |      
|Over six months through twelve months |  |                        | 82,128  |                |   | 15,000      |  |                   |      |                        |   |       |  |   |      
|Over twelve months                    |  |                        | 153,003 |                |   | 39,000      |  |                   |      |                        |   |       |  |   | 19,589
|                                      |  |                        |         |                |   |             |  |                   |       |                        |   |        |  |   |       
|Total                                 |  | $                      | 479,035 |                | $ | 160,500     |  | $                 | 3,150 |                        | $ | 18,121 |  | $ | 19,589
|                                      |  |                        |         |                |   |             |  |                   |       |                        |   |        |  |   |       

CONTRACTUAL OBLIGATIONS

In addition to its owned banking facilities, the Company has entered into long-term operating leases to support ongoing activities. The required payments under such
commitments at March 31, 2007 are as follows:



|                                  |  |   |          
|--------------------------------- |  | - | ---------
|Less than one year                |  | $ | 441,377  
|Over 1 year but less than 5 years |  |   | 571,629  
|Over 5 years                      |  |   |         
|                                  |  |   |          
|Total                             |  | $ | 1,013,006
|                                  |  |   |          

REGULATORY CAPITAL

The Bank is required to maintain specific amounts of capital pursuant to Office of Thrift Supervision (OTS) regulations on minimum capital standards. The
OTS minimum capital standards generally require the maintenance of regulatory capital sufficient to meet each of three tests, hereinafter described as the tangible capital requirement, the Tier I (core) capital requirement and the risk-based
capital requirement. The tangible capital requirement provides for minimum tangible capital (defined as stockholders equity less all intangible assets) equal to 1.5% of adjusted total assets. The Tier I capital requirement provides for minimum
core capital (tangible capital plus certain forms of supervisory goodwill and other qualifying intangible assets) equal to 4.0% of adjusted total assets. The risk-based capital requirement provides for the maintenance of core capital plus a portion
of unallocated loss allowances equal to 8.0% of risk-weighted assets. In computing risk-weighted assets, the Bank multiplies the value of each asset on its balance sheet by a defined risk-weighting factor (e.g., one-to four-family conventional
residential loans carry a risk-weighting factor of 50%).

The following table illustrates the Banks regulatory capital levels compared with its
regulatory capital requirements at March 31, 2007 and September 30, 2006.



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|                                                     |  |                        |         |       |                              |   |        |                                                                               |        |  |      |        |  |       |        |  |       |  
|---------------------------------------------------- |  | ---------------------- | ------- | ----- | ---------------------------- | - | ------ | ----------------------------------------------------------------------------- | ------ |  | ---- | ------ |  | ----- | ------ |  | ----- | -
|                                                     |  | Actual                 |         |       | For CapitalAdequacy Purposes |   |        | To be Categorized as"Well Capitalized"Under PromptCorrective
ActionProvisions |       
|                                                     |  | Amount                 |         | Ratio |                              |   | Amount |                                                                               | Ratio  |  |      | Amount |  | Ratio |       
|                                                     |  | (Dollars in thousands) |        
|As of March 31, 2007                                 |  |                        |         |       |                              |   |        |                                                                               |        |  |      |        |  |       |        |  |       |  
|Tangible capital (to total assets)                   |  | $                      | 94,152  |       | 8.90                         | % |        | $                                                                             | 15,877 |  | 1.50 | %      |  |       | N/A    |  | N/A   |  
|Total risk-based capital (to risk- weighted assets)  |  |                        | 102,535 |       | 11.60                        | % |        |                                                                               | 70,695 |  | 8.00 | %      |  | $     | 88,368 |  | 10.00 | %
|Tier I risk-based capital (to risk- weighted assets) |  |                        | 94,152  |       | 10.65                        | % |        |                                                                               | 44,184 |  | 5.00 | %      |  |       | 53,021 |  | 6.00  | %
|Tier I leverage capital (to average assets)          |  |                        | 94,152  |       | 8.90                         | % |        |                                                                               | 42,338 |  | 4.00 | %      |  |       | 52,923 |  | 5.00  | %
|                                                     |  |                        |         |       |                              |  
|As of September 30, 2006                             |  |                        |         |       |                              |   |        |                                                                               |        |  |      |        |  |       |        |  |       |  
|Tangible capital (to total assets)                   |  | $                      | 88,954  |       | 9.30                         | % |        | $                                                                             | 14,348 |  | 1.50 | %      |  |       | N/A    |  | N/A   |  
|Total risk-based capital (to risk- weighted assets)  |  |                        | 96,598  |       | 11.99                        | % |        |                                                                               | 64,463 |  | 8.00 | %      |  | $     | 80,579 |  | 10.00 | %
|Tier I risk-based capital (to risk- weighted assets) |  |                        | 88,954  |       | 11.04                        | % |        |                                                                               | 40,289 |  | 5.00 | %      |  |       | 48,347 |  | 6.00  | %
|Tier I leverage capital (to average assets)          |  |                        | 88,954  |       | 9.30                         | % |        |                                                                               | 38,261 |  | 4.00 | %      |  |       | 47,826 |  | 5.00  | %

EFFECTS OF INFLATION

Changes in interest rates may have a significant impact on a banks performance because virtually all assets and liabilities of banks are monetary in nature.
Interest rates do not necessarily move in the same direction or in the same magnitude as the prices of goods and services. Inflation does have an impact on the growth of total assets in the banking industry, often resulting in a need to increase
equity capital at higher than normal rates to maintain an appropriate equity to asset ratio. The Companys operations are not currently impacted by inflation.

Quantitative and qualitative Disclosures About Market Risk

There have been no material changes in the Company's
quantitative or qualitative aspects of market risk during the quarter ended March 31, 2007 from that disclosed in the Company's Annual Report on Form 10-K for the year ended September 30, 2006.

The Company originates and purchases derivative financial instruments, including interest rate lock commitments, forward contracts to sell mortgage-backed securities and
interest rate swaps. Derivative financial instruments originated by the Company consist of interest rate lock commitments to originate residential loans. Commitments to originate loans consist primarily of residential real estate loans. At
March 31, 2007, the Company had issued $168.0 million of unexpired interest rate lock commitments to loan customers compared with $111.7 million of unexpired commitments at September 30, 2006.

The Company typically economically hedges these derivative commitments through one of two means  either by obtaining a corresponding best-efforts lock commitment
with an investor to sell the loan at an agreed upon price, or by forward selling mortgage-backed securities. The forward sale of mortgage-backed securities is a means of matching a corresponding derivative asset that has similar characteristics as
the bank-issued commitment but changes directly opposite in fair value from market movements. Loans hedged through forward sales of mortgaged-backed securities are sold individually or in pools on a mandatory delivery basis to investors, whereas the
best efforts sales are locked on a loan-by-loan basis shortly after issuing the rate lock commitments to customers. The Company had outstanding forward commitments to sell mortgage-backed securities totaling $34.0 million and $15.0 million in
notional value at March 31, 2007 and September 30, 2006, respectively. These hedges were matched against $28.8 million and $19.6 million of interest rate lock commitments at March 31, 2007 and September 30, 2006, respectively
that were to be sold through the mandatory delivery of loan pool sales.



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The carrying value of the interest rate lock commitment liabilities included in the consolidated balance sheets was a
debit balance totaling $41,000 at March 31, 2007 and a credit balance totaling $30,000 at September 30, 2006, respectively. The carrying value of the forward sales commitment assets included in the consolidated balance sheets was a credit
balance totaling $64,000 at March 31, 2007 and a debit balance totaling $81,000 at September 30, 2006.

The Company entered into interest rate
swap agreements during November 2004 which were designed to convert the fixed rates paid on certain brokered certificates of deposit into variable, LIBOR-based rates. The effect of the swap agreements result in the counterparty paying the fixed rate
to the Company while the Company pays the variable LIBOR-based rate to the counterparty. During the quarter ended December 31, 2005, changes in the estimated fair values of these derivatives were recognized as charges or credits to earnings, as
appropriate, during the periods in which the changes occurred. Effective January 1, 2006, the Company designated $80.0 million of interest rate swaps as fair value hedges of $80.0 million of the fixed-rate, brokered certificates of deposit
under Statement of Financial Accounting Standards No. 133, Accounting for Derivative Financial Instruments and Hedging Activities (SFAS No. 133) using long-haul, fair-value, hedge accounting. At March 31, 2007,
these fair value hedges were considered to be highly effective. Any hedge ineffectiveness was deemed not material and the impact was recognized as a charge or credit to earnings, as appropriate, during the period in which the change occurred. The
notional amounts of the liabilities being hedged were $80.0 million at March 31, 2007 and September 30, 2006, respectively. At March 31, 2007, there were no swaps in a net settlement receivable position and swaps in a net settlement
payable position totaled $1.4 million. At September 30, 2006, there were no swaps in a net settlement receivable position and swaps in a net settlement payable position totaled $2.0 million. Net gains of $141,000 and $314,000 were recognized on
fair value hedges during the three and six months ended March 31, 2007, respectively, compared with net losses of $73,000 and $480,000 during the three and six months ended March 31, 2006, respectively.

The maturity date, notional amounts, interest rates paid and received and fair value of the Companys interest rate swap agreements as of March 31, 2007 and
September 30, 2006 were as follows:



|                   |  |                |            |                  |      |                    |                      |      |   |                                 |   |                  |  |      |                      |  |      |                                 |  |   |          
|------------------ |  | -------------- | ---------- | ---------------- | ---- | ------------------ | -------------------- | ---- | - | ------------------------------- | - | ---------------- |  | ---- | -------------------- |  | ---- | ------------------------------- |  | - | ---------
|                   |  |                |            | March 31, 2007   |      | September 30, 2006
|Maturity Date      |  | NotionalAmount |            | InterestRatePaid |      |                    | InterestRateReceived |      |   | EstimatedFair ValueOf Liability |   | InterestRatePaid |  |      | InterestRateReceived |  |      | EstimatedFair ValueOf Liability
|October 20, 2008   |  | $              | 10,000,000 |                  | 5.28 | %                  |                      | 4.30 | % |                                 | $ | 109,941          |  | 5.29 | %                    |  | 4.30 | %                               |  | $ | 154,000  
|November 19, 2009  |  |                | 10,000,000 |                  | 5.30 | %                  |                      | 3.50 | % |                                 |   | 118,225          |  | 5.31 | %                    |  | 3.50 | %                               |  |   | 208,000  
|November 23, 2009  |  |                | 10,000,000 |                  | 5.28 | %                  |                      | 3.75 | % |                                 |   | 151,386          |  | 5.28 | %                    |  | 3.75 | %                               |  |   | 216,000  
|November 26, 2010  |  |                | 10,000,000 |                  | 5.30 | %                  |                      | 4.13 | % |                                 |   | 288,409          |  | 5.31 | %                    |  | 4.13 | %                               |  |   | 365,000  
|November 26, 2010  |  |                | 5,000,000  |                  | 5.29 | %                  |                      | 4.13 | % |                                 |   | 142,840          |  | 5.30 | %                    |  | 4.13 | %                               |  |   | 181,000  
|November 26, 2010  |  |                | 5,000,000  |                  | 5.28 | %                  |                      | 4.13 | % |                                 |   | 141,478          |  | 5.29 | %                    |  | 4.13 | %                               |  |   | 179,000  
|January 24, 2010   |  |                | 10,000,000 |                  | 5.26 | %                  |                      | 3.70 | % |                                 |   | 249,361          |  | 5.27 | %                    |  | 3.70 | %                               |  |   | 321,000  
|January 28, 2011   |  |                | 10,000,000 |                  | 5.28 | %                  |                      | 4.30 | % |                                 |   | 120,201          |  | 5.29 | %                    |  | 4.30 | %                               |  |   | 188,000  
|February 25, 2011  |  |                | 5,000,000  |                  | 5.28 | %                  |                      | 4.80 | % |                                 |   | 68,924           |  | 5.28 | %                    |  | 4.80 | %                               |  |   | 96,000   
|September 14, 2012 |  |                | 5,000,000  |                  | 5.28 | %                  |                      | 4.25 | % |                                 |   | 58,167           |  | 5.29 | %                    |  | 4.25 | %                               |  |   | 98,000   
|                   |  |                |            |                  |      |                    |                      |      |   |                                 |   |                  |  |      |                      |  |      |                                 |  |   |          
|Total              |  | $              | 80,000,000 |                  |      |                    |                      |      |   |                                 | $ | 1,448,932        |  |      |                      |  |      |                                 |  | $ | 2,006,000
|                   |  |                |            |                  |      |                    |                      |      |   |                                 |   |                  |  |      |                      |  |      |                                 |  |   |          



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The gross amounts of interest paid to and received from the counterparty under the swap agreements and
the related average interest rates during the quarters ended March 31, 2007 and 2006 are as follows:



|                                |  |                             |         |   |      |   |         |  
|------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------- | -
|                                |  | Three Months EndedMarch 31, |        
|                                |  | 2007                        |         |   | 2006 |  
|Interest paid (variable rate):  |  |                             |         |   |      |   |         |  
|Total amount (000s)             |  | $                           | 1,763.6 |   |      | $ | 1,382.3 |  
|Average interest rate           |  |                             | 4.41    | % |      |   | 3.46    | %
|                                |  |                            
|Interest received (fixed rate): |  |                             |         |   |      |   |         |  
|Total amount (000s)             |  | $                           | 1,346.9 |   |      | $ | 1,271.5 |  
|Average interest rate           |  |                             | 3.37    | % |      |   | 3.18    | %

CONTROLS AND PROCEDURES

Pulaski Financial maintains disclosure controls
and procedures as such term is defined in Rule 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act), that are designed to ensure that the information required to be disclosed
in the reports that Pulaski Financial files or submits under the Exchange Act with the Securities and Exchange Commission (the SEC) (1) is recorded, processed, summarized and reported within the time periods specified in the
SECs rules and forms, and (2) is accumulated and communicated to Pulaski Financials management including its principal executive and principal financial officers as appropriate to allow timely decisions regarding required
disclosure.

During the quarter ended March 31, 2007, Pulaski Financials management, including Pulaski Financials principal executive
officer and principal financial officer, evaluated the effectiveness of Pulaski Financials disclosure controls and procedures as of March 31, 2007, and concluded that Pulaski Financials disclosure controls and procedures were
effective as of such date.

There have been no changes in the Companys internal controls over financial reporting during the quarter that have
materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

In May 2005, the Financial Accounting Standards Board (FASB) issued Statement No. 154, Accounting Changes and Error Corrections (SFAS No. 154), a replacement of APB Opinion No. 20,
Accounting Changes, and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements. SFAS No. 154 requires retrospective application for voluntary changes in accounting principles unless it is
impracticable to do so. SFAS No. 154 is effective for the Company beginning October 1, 2006. The adoption of SFAS No.154 did not have a material effect on the Companys financial condition or results of operations.

In February 2006, the FASB issued Statement No. 155, Accounting for Certain Hybrid Financial Instruments (SFAS No. 155), which amends
FASB Statements No. 133 and 140. This Statement permits fair value re-measurement for any hybrid financial instrument containing an embedded derivative that would otherwise require bifurcation, and broadens a Qualified Special Purpose
Entitys (QSPE) permitted holdings to include passive derivative financial instruments that pertain to other derivative financial instruments. This statement is effective for the Company for all financial instruments acquired,
issued or subject to a re-measurement event occurring on or after October 1, 2006. The adoption of SFAS No. 155 did not have a material effect on the Companys financial condition or results of operations.

In March 2006, the FASB issued Statement No. 156, Accounting for Servicing of Financial Assets, an Amendment of FASB Statement No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities (SFAS No. 156), which requires that all separately recognized servicing assets and servicing liabilities be initially measured at fair value, if
practicable and permits the entities to elect either fair value measurement with changes in fair value reflected in earnings or the amortization and impairment requirements of Statement 140 for subsequent measurement. The subsequent measurement of
separately recognized servicing assets and servicing liabilities at fair value eliminates the



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necessity for entities that manage the risks inherent in servicing assets and servicing liabilities with derivatives to qualify for hedge accounting
treatment and eliminates the characterization of declines in fair value as impairments or direct write-downs. Statement No. 156 is effective for the Company beginning October 1, 2006. The adoption of SFAS No. 156 did not have a
material effect on the Companys financial condition or results of operations.

In September 2006, the FASB issued Statement No. 157, Fair
Value Measurements (SFAS No. 157), which defines fair value, establishes a framework for measuring fair value in generally accepted accounting standards, and expands disclosures about fair value measurements. SFAS No. 157
is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. Management is currently evaluating the requirements of SFAS No. 157 to determine its impact on
the Companys financial condition and results of operations.

In September 2006, the FASB issued Statement No. 158, Employers
Accounting for Defined Benefit Pension and Other Postretirement Plans (SFAS No. 158), which requires balance sheet recognition of the funded status of pension and other postretirement benefits with the offset to accumulated
other comprehensive income. Employers will recognize actuarial gains and losses, prior service cost, and any remaining transition amounts when recognizing a plans funded status. SFAS No. 158 is effective for fiscal years ending after
December 15, 2006. Management is currently evaluating the requirements of SFAS No. 158 to determine its impact on the Companys financial condition and results of operations.

In February 2007, the FASB issued Statement No. 159, The Fair Value Option for Financial Assets and Financial LiabilitiesIncluding an amendment of FASB
Statement No. 115 (SFAS No. 159). SFAS No. 159 provides companies with an option to report selected financial assets and liabilities at estimated fair value. Most of the provisions of SFAS No. 159 are elective;
however, the amendment to SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities, applies to all entities that own trading and available-for-sale securities. The fair value option created by SFAS No. 159 permits an
entity to measure eligible items at fair value as of specified election dates. The fair value option (a) may generally be applied instrument by instrument, (b) is irrevocable unless a new election date occurs, and (c) must be applied
to the entire instrument and not to only a portion of the instrument. SFAS No. 159 is effective as of the beginning of an entitys first fiscal year beginning after November 15, 2007. Early adoption is permitted as of the beginning of
the previous fiscal year provided that the entity makes that choice in the first 120 days of the fiscal year, has not yet issued financial statements for any interim period of such year, and also elects to apply the provisions of SFAS No. 157.
Management is currently evaluating the requirements of SFAS No. 159 to determine its impact on the Companys financial condition and results of operations.

In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of SFAS No. 109, Accounting for Income Taxes (Interpretation
No. 48), which clarifies the accounting for uncertainty in income taxes in financial statements and prescribes a recognition threshold and measurement attribute for financial statement recognition and measurement of a tax position taken
or expected to be taken. It also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Interpretation No. 48 is effective for fiscal years beginning after
December 15, 2006. Management is currently evaluating the requirements of Interpretation No. 48 to determine its impact on the Companys financial condition and results of operations.

In September 2006, the SEC Staff issued Staff Accounting Bulletin No. 108 (SAB No. 108), Considering the Effects of Prior Year Misstatements
when Quantifying Misstatements in Current Year Financial Statements, which addresses how the effects of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB
No. 108 will require registrants to quantify misstatements using both the balance sheet and income-statement approaches and to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative
and qualitative factors. When the effect of initial adoption is determined to be material, SAB No. 108 allows registrants to record that effect as a cumulative effect adjustment to beginning retained earnings. The requirements are effective for
the Company beginning October 1, 2006. The adoption of SAB No. 108 had no effect on the Companys financial condition or results of operations.

In September 2006, the Emerging Issues Task Force Issue 06-4, Accounting for Deferred Compensation and Postretirement Benefit Aspects of Endorsement Split-Dollar Life Insurance Arrangements, was ratified. This EITF Issue
addresses accounting for separate agreements which split life insurance policy benefits between an employer and employee. The Issue requires the employer to recognize a liability for future benefits payable to the employee under these agreements.



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The effects of applying this Issue must be recognized through either a change in accounting principle through an
adjustment to equity or through the retrospective application to all prior periods. For calendar year companies, the Issue is effective beginning January 1, 2008. Early adoption is permitted as of January 1, 2007. Management is currently
evaluating the requirements of the Issue to determine its impact on the Companys financial condition and results of operations.

PART
IIOTHER INFORMATION



|Item 1. | Legal Proceedings:
|------- | ------------------

Periodically, there have been
various claims and lawsuits involving the Bank, such as claims to enforce liens, condemnation proceedings on properties in which the Bank holds security interests, claims involving the making and servicing of real property loans and other issues
incident to the Banks business. Neither the Bank nor the Company is a party to any pending legal proceedings that it believes would have a material adverse effect on the financial condition or operations of the Company.



|Item 1A. | Risk Factors:
|-------- | -------------

In addition to the other information
set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for the year ended September 30, 2006, which could materially affect our business,
financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may
materially adversely affect our business, financial condition and/or operating results.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds:
|------- | ------------------------------------------------------------

The following table provides information regarding the Companys purchases of its equity securities during the three months ended March 31, 2007.

ISSUER PURCHASES OF EQUITY SECURITIES



|                          |  |                                             |  |                                       |       |                                                                                            |        |     |                                                                                                                          |        
|------------------------- |  | ------------------------------------------- |  | ------------------------------------- | ----- | ------------------------------------------------------------------------------------------ | ------ | --- | ------------------------------------------------------------------------------------------------------------------------ | -------
|Period                    |  | (a) TotalNumberof Shares(or Units)Purchased |  | (b)AveragePricePaid perShare(or Unit) |       | (c) Total Number ofShares (or Units)Purchased asPart of PubliclyAnnounced Plansor Programs |        |     | (d)Maximum Number(or ApproximateDollar Value) ofShares (or Units)That May Yet
BePurchased Under thePlans or Programs (1)
|January 1, 2007           |  | 19,242                                      |  | $                                     | 15.77 |                                                                                            | 19,242 | (2) |                                                                                                                          |       
|through January 31, 2007  |  |                                             |  |                                       |       |                                                                                            |        |     |                                                                                                                          |        
|February 1, 2007          |  | 13,636                                      |  | $                                     | 16.12 |                                                                                            | 13,636 |     |                                                                                                                          | 483,364
|through February 28, 2007 |  |                                             |  |                                       |       |                                                                                            |        |     |                                                                                                                          |        
|March 1, 2007             |  |                                            |  |                                       |      |                                                                                            |       |     |                                                                                                                          | 483,364
|through March 31, 2007    |  |                                             |  |                                       |       |                                                                                            |        |     |                                                                                                                          |        
|Total                     |  | 32,878                                      |  | $                                     | 15.92 |                                                                                            | 32,878 |     |                                                                                                                          |        



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---

|(1) | In February 2007, the Company announced a repurchase program under which it would repurchase up to 497,000 shares of the Companys common stock. The repurchase program will
continue until it is completed or terminated by the Board of Directors.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Includes 15,808 shares which were purchased in excess of the repurchase program. The Board of Directors ratified these repurchases in February 2007.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------



|Item 3. | Defaults Upon Senior Securities: Not applicable
|------- | -----------------------------------------------



|Item 4. | Submission of Matters to a Vote of Security Holders:
|------- | ----------------------------------------------------

The
Annual Meeting of the Stockholders of the Company was held on January 25, 2007. The results of the vote were as follows:



| | 1. | The following individuals were elected as directors, each for a three-year term:
| | -- | --------------------------------------------------------------------------------



|                         |  |           |  |               
|------------------------ |  | --------- |  | --------------
|                         |  | VOTES FOR |  | VOTES WITHHELD
|Stanley J. Bradshaw      |  | 8,999,932 |  | 236,050       
|William M. Corrigan, Jr. |  | 8,732,180 |  | 503,802       
|Christopher K. Reichert  |  | 8,987,863 |  | 248,119       



| | 2. | The appointment of KPMG LLP as independent auditors of Pulaski Financial Corp. for the fiscal year ended September 30, 2007 was ratified by the stockholders by the following
vote:
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|          |  |         |  |        
|--------- |  | ------- |  | -------
|FOR       |  | AGAINST |  | ABSTAIN
|9,174,034 |  | 55,585  |  | 6,363  



|Item 5. | Other Information: Not applicable
|------- | ---------------------------------



|Item 6. | Exhibits:
|------- | ---------



|     |  |                                                                                   
|---- |  | ----------------------------------------------------------------------------------
|3.1  |  | Articles of Incorporation of Pulaski Financial Corp.*                             
|     | 
|3.2  |  | Certificate of Amendment to Articles of Incorporation of Pulaski Financial Corp.**
|     | 
|3.3  |  | Bylaws of Pulaski Financial Corp.***                                              
|     | 
|4.0  |  | Form of Certificate for Common Stock****                                          
|     | 
|31.1 |  | Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer                 
|     | 
|31.2 |  | Rule 13a-14(a)/15d-14(a) Certification of the Chief Financial Officer             
|     | 
|32.1 |  | Section 1350 Certification of Chief Executive Officer                             
|     | 
|32.2 |  | Section 1350 Certification of Chief Financial Officer                             

---

|* | Incorporated by reference into this document from the Exhibits to the 2003 proxy statement as filed with the Securities and Exchange Commission on December 27, 2002.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

|** | Incorporated by reference into this document from the Form 10-Q, as filed with the Securities and Exchange Commission on February 17, 2004.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------



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##### Table of Contents

|*** | Incorporated herein by reference from the Form 10-Q, as filed with the Securities and Exchange Commission on August 9, 2005.
|--- | ----------------------------------------------------------------------------------------------------------------------------

|**** | Incorporated by reference from the Form S-1 (Registration No. 333-56465), as amended, as filed with the Securities and Exchange Commission on June 9, 1998.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------



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SIGNATURES

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, thereunto duly authorized.



|                  |  |                                     
|----------------- |  | ------------------------------------
|                  |  | PULASKI FINANCIAL CORP.             
|                  | 
|Date: May 8, 2007 |  | /s/ William A. Donius               
|                  |  | William A. Donius                   
|                  |  | Chairman and Chief Executive Officer
|                  | 
|Date: May 8, 2007 |  | /s/ Ramsey K. Hamadi                
|                  |  | Ramsey K. Hamadi                    
|                  |  | Chief Financial Officer