UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549

                                    FORM 10-Q

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

         For the quarterly period ended June 30, 1999

                                       OR

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

For the transition period from ______________________ to ______________________

                        Commission File Number 333-68363


                            CAPITOL FEDERAL FINANCIAL
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

         United States                                         48-1212142
--------------------------------------------------------------------------------
(State or other jurisdiction of                              (IRS Employer
 incorporation or organization)                           Identification Number)

     700 Kansas Avenue, Topeka, Kansas                           66603
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code:             (785) 235-1341

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

Transitional Small Business Format:                     Yes [  ]         No [X]

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest practicable date.

                    Common Stock               91,512,287
                    ------------          ---------------------
                       Class               Shares Outstanding
                                          as of August 13, 1999







<PAGE>



                                    FORM 10-Q
                            Capitol Federal Financial
                                      INDEX

<TABLE>
<CAPTION>


                                                                                                              Page
PART I -- FINANCIAL INFORMATION                                                                              Number
<S>                                                                                                          <C>
         Consolidated Balance Sheets at June 30, 1999 and September 30, 1998                                   3
         Consolidated Statements of Income for the three and nine months ended                                 4
          June 30, 1999 and June 30, 1998
         Consolidated Statement of Stockholders' Equity for the nine months
          ended June 30, 1999                                                                                  5
         Consolidated Statements of Cash Flows for the nine months ended
          June 30, 1999 and June 30, 1998                                                                      6
         Notes to Consolidated Interim Financial Statements                                                    8
Item 2.  Management's Discussion and Analysis of Financial Condition and Results
          of Operations                                                                                        13
Item 3.  Quantitative and Qualitative Disclosures about Market Risk                                            20

PART II -- OTHER INFORMATION
Item 1.  Legal Proceedings                                                                                     21
Item 2.  Changes in Securities and Use of Proceeds                                                             21
Item 3.  Defaults Upon Senior Securities                                                                       21
Item 4.  Submission of Matters to a Vote of Security Holders                                                   21
Item 5.  Other Information                                                                                     21
Item 6.  Exhibits and Reports on Form 8-K                                                                      21

Signature Page                                                                                                 22

</TABLE>


                                        2

<PAGE>



                         PART 1 -- FINANCIAL INFORMATION

                    CAPITOL FEDERAL FINANCIAL AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                                   June 30,           September 30,
                                                                                     1999                 1998
                                                                                  (unaudited)
                                                                                --------------       --------------
                                                                                          (dollars in thousands)
<S>                                                                             <C>                    <C>
ASSETS:
Cash and cash equivalents                                                        $   34,524             $   24,454
Securities purchased under agreement to resell                                            0                235,000
Investment securities held to maturity (market value of $14,799                      15,100                160,569
 and $160,712)
Capital stock of Federal Home Loan Bank                                              48,606                 43,584
Mortgage-related securities:
   Available-for-sale                                                             1,273,172                747,991
   Held-to-maturity (market value of $636,278 and $319,128)                         650,017                320,379

Loans held for sale, net                                                              2,393                 14,578
Loans receivable, net                                                             4,024,307              3,711,152
Premises and equipment                                                               24,067                 22,785
Real estate owned, net                                                                1,040                  1,964
Accrued interest receivable                                                          30,363                 27,998
Other assets                                                                          4,173                  5,347
                                                                                 ----------             ----------
TOTAL ASSETS                                                                     $6,107,762             $5,315,801
                                                                                 ==========             ==========

LIABILITIES AND STOCKHOLDERS' EQUITY:
Deposits                                                                         $3,941,558             $3,894,180
Advances from Federal Home Loan Bank                                                900,000                500,000
Securities sold under agreement to repurchase                                       175,000                175,000
Advance payments by borrowers for taxes and insurance                                22,092                 37,426
Deferred income taxes                                                                14,022                 28,995
Accounts payable and accrued expenses                                                22,214                 17,868
                                                                                 ----------             ----------
   Total liabilities                                                              5,074,886              4,653,469

COMMITMENTS AND CONTINGENCIES (NOTE 11)

STOCKHOLDERS' EQUITY:
Preferred stock ($0.01 par value) 50,000,000 shares                                       0                      0
 authorized; none issued
Common stock ($0.01 par value) 450,000,000 authorized;                                  915                      0
 91,512,287 shares issued
Additional paid in capital                                                          384,625                      0
Retained earnings                                                                   670,590                649,199
Unrealized gains on securities available-for-sale                                     5,417                 13,133
Unearned compensation, employee stock ownership plan                                (28,671)                     0
   Total stockholders' equity                                                     1,032,876                662,332
                                                                                 ----------             ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                       $6,107,762             $5,315,801
                                                                                 ==========             ==========


See accompanying notes to consolidated interim financial statements.


</TABLE>

                                                           3

<PAGE>



                    CAPITOL FEDERAL FINANCIAL AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                             Three Months Ended                   Nine Months Ended
                                                                  June 30,                            June 30,
                                                           ------------------------          --------------------------
                                                             1999             1998              1999             1998
                                                           -------          -------          --------          --------
<S>                                                       <C>              <C>              <C>               <C>
INTEREST AND DIVIDEND INCOME:
Loans receivable                                           $70,840          $67,597          $211,022          $199,041
Mortgage-related securities                                 27,873           16,409            66,943            42,985
Investment securities                                          200            4,011               965            20,214
Securities purchased under agreement to resell                   -            2,642             3,894             4,362
Cash and cash equivalents                                      241              882             2,003             3,280
Capital stock of Federal Home Loan Bank                        826              785             2,361             2,377
                                                           -------          -------          --------          --------
   Total interest and dividend income                       99,980           92,326           287,188           272,259

INTEREST EXPENSE:
Deposits                                                    48,669           50,821           148,499           152,019
Borrowings                                                  13,388            8,458            35,315            21,478
                                                           -------          -------          --------          --------
   Total interest expense                                   62,057           59,279           183,814           173,497

                                                           -------          -------          --------          --------
Net interest and dividend income                            37,923           33,047           103,374            98,762
Provision for loan losses                                        -                -               135                 -
                                                           -------          -------          --------          --------
   Net interest and dividend income after                   37,923           33,047           103,239            98,762
         provision for loan losses

OTHER INCOME:
Automated teller and debit card transaction fees             1,188              820             2,950             2,409
Checking account transaction fees                              720              629             2,109             2,041
Loan fees                                                      438              569             1,434             1,794
Insurance commissions                                          347              356             1,145             1,043
Other, net                                                     833              777             2,284             2,212
                                                           -------          -------          --------          --------
   Total other income                                        3,526            3,151             9,922             9,499

OTHER EXPENSES:
Salaries and employee benefits                               7,345            6,281            23,538            18,762
Occupancy of premises                                        1,866            1,690             6,298             5,529
Office supplies and related expenses                           849              785             2,419             2,336
Deposit and loan transaction fees                            1,014              802             2,942             2,460
Advertising                                                  1,101              619             2,128             1,665
Federal insurance premium                                      582              602             1,751             1,812
Contribution to Foundation                                       -                -            30,231                 -
Other, net                                                   1,024              850             2,747             2,517
                                                           -------          -------          --------          --------

   Total other expenses                                     13,781           11,629            72,054            35,081
                                                           -------          -------          --------          --------
Income before income tax expense                            27,668           24,569            41,107            73,180

Income tax expense                                          10,395            9,836            15,684            29,314
                                                           -------          -------          --------          --------
NET INCOME                                                 $17,273          $14,733          $ 25,423          $ 43,866
                                                           =======          =======          ========          ========

</TABLE>

See accompanying notes to consolidated interim financial statements.



                                                           4

<PAGE>



                    CAPITOL FEDERAL FINANCIAL AND SUBSIDIARY
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                                   (Unaudited)

<TABLE>
<CAPTION>


                                                Additional                     Unrealized        Unearned
                                        Common    Paid-In       Retained        gains on       Compensation
                                        Stock     Capital       Earnings       securities        (ESOP)          Total
                                        ------  ----------     ----------   ----------------   ------------   -------------

<S>                                    <C>      <C>            <C>             <C>              <C>            <C>
Balance at October 1, 1998              $  -     $      -       $649,199        $13,133          $      -       $  662,332
Capitalization of Mutual Holding
 Company                                   -            -           (100)             -                 -             (100)
Net income for nine months
 ended June 30, 1999                       -            -         25,423              -                 -           25,423
Unearned compensation (ESOP)               -            -              -                          (30,245)         (30,245)
Issuance of 91,512,287 shares of
 $.01 par value common stock in
 initial public offering, net of
 conversion related expenses             915      384,625              -              -                 -          385,540
Amortization of unearned
 compensation, ESOP                        -            -              -              -             1,574            1,574
Dividends paid                             -            -         (3,932)             -                 -          (3,932)
Change in unrealized gain
 on securities available for sale          -            -              -         (7,716)                -          (7,716)
                                        ----     --------       --------        -------          --------      ----------
         TOTAL                          $915     $384,625       $670,590        $ 5,417          $(28,671)     $1,032,876
                                        ====     ========       ========        =======          ========      ==========

</TABLE>

See accompanying notes to consolidated interim financial statements.



                                                           5

<PAGE>



                    CAPITOL FEDERAL FINANCIAL AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                       For Nine Months Ended June 30,
                                                                       ------------------------------
                                                                           1999              1998
                                                                       ------------      ------------
<S>                                                                    <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                              $   25,423          $43,866

Adjustments to reconcile net income to
 net cash provided by operating activities:

Federal Home Loan Bank stock dividends                                      (5,021)          (2,378)
Amortization of net deferred loan origination fees                          (7,622)          (3,402)
Provision for loan losses                                                      135                -
Provision for losses on real estate owned                                        -              (11)
Net loan origination fees capitalized                                        8,440            3,738
Gain on sales of real estate owned, net                                       (118)            (136)
Originations of loans held for sale                                           (854)         (16,533)
Proceeds from sales of loans held for sale                                  12,976           18,782
Amortization and accretion of premiums and discounts on
   mortgage related securities and investment securities                     3,090             (990)
Depreciation and amortization on premises & equipment                        2,479            2,141
Provision (benefit) for deferred income taxes                              (11,488)               -
Termination of Pension Plan                                                  1,600
Amortization of unearned compensation - ESOP                                 1,574
Changes in:
   Accrued interest receivable                                              (2,366)           1,705
   Other assets                                                               (363)           1,613
   Income taxes payable                                                      4,779            2,586
   Accounts payable and accrued expenses                                     2,418           (1,540)
                                                                       -----------        ---------
      Net cash provided by operating activities                             35,082           49,441

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of investment securities                          160,470          550,058
Purchases of investment securities                                         (15,000)        (225,000)
Proceeds from maturities of securities under agreement to                1,618,410                -
   resell
Purchases of securities under agreement to resell                       (1,383,410)        (782,934)
Principal collected on mortgage-related securities available-              470,178          159,821
    for-sale
Purchases of mortgage-related securities available-for-sale             (1,010,909)        (124,850)
Principal collected on mortgage-related securities held-to-                270,494           68,696
    maturity
Purchases of mortgage-related securities held-to-maturity                 (600,824)        (323,321)
Loan originations net of principal collected on loans                     (210,591)        (191,065)
   receivable
Purchases of loans receivable                                             (105,527)         (95,927)
Purchases of premises and equipment, net                                    (3,762)          (3,862)
Proceeds from sales of real estate owned                                     2,153            3,749
                                                                       -----------        ---------
   Net cash used in investing activities                                  (808,318)        (964,635)


                                                           6

<PAGE>





CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid                                                              (3,932)               -
Deposits, net of payments                                                   47,278          106,633
Proceeds from advances from Federal Home Loan Bank                         895,000          291,000
Repayments on advances from Federal Home Loan Bank                        (495,000)         (66,000)
Repayments of securities sold under agreement to repurchase                      -          682,942
Proceeds from stock issuance, net                                          355,295                -
Advance payments by borrowers for taxes and insurance                      (15,335)         (15,553)
                                                                         ---------         --------
   Net cash provided by financing activities                               783,306          999,022
NET INCREASE IN CASH AND CASH                                               10,070           83,828
 EQUIVALENTS
CASH AND CASH EQUIVALENTS:
Beginning of period                                                        $24,454          $31,188
End of period                                                              $34,524         $115,016
                                                                         =========         ========

SUPPLEMENTAL SCHEDULE OF NON-CASH  INVESTING AND
 FINANCING TRANSACTIONS:
   Note received from ESOP in exchange for stock                           $30,245
                                                                         =========


</TABLE>

See accompanying notes to consolidated interim financial statements.





                                        7

<PAGE>



Notes to Consolidated Interim Financial Statements

1.   Basis of Financial Statement Presentation
The accompanying  consolidated  financial statements were prepared in accordance
with generally accepted accounting principles ("GAAP"). Accordingly, they do not
include  information  or  footnotes  necessary  for a complete  presentation  of
financial  position,  results of operations  and cash flows in  conformity  with
GAAP.  However,  all  normal,  recurring  adjustments  which,  in the opinion of
management,  are necessary for a fair  presentation  of these interim  financial
statements,  have been included.  These financial  statements  should be read in
conjunction with the audited financial  statements and the notes thereto for the
period ended  September  30, 1998  contained in Capitol  Federal  Financial  and
subsidiary's (the "Company") Prospectus dated February 11, 1999. The results for
the three and nine months ended June 30, 1999 are not necessarily  indicative of
the results  that may be expected  for the year ended  September  30,  1999.  In
particular,  it is noted that during the second quarter of fiscal year 1999, the
Company  recorded  pre-tax  expenses of $30.2  million in  conjunction  with the
formation of the Capitol Federal  Foundation (the "Foundation") and $2.6 million
in  conjunction  with  the  termination  of the  existing  pension  plan and the
implementation of the Employee Stock Ownership Plan ("ESOP").

In preparing the financial statements,  management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities as of
the date of the balance sheet and revenues and expenses for the period. Material
estimates  that  are  particularly  susceptible  to  significant  change  in the
near-term relate to the  determination of the allowances for losses on loans and
real estate owned. While management believes that these allowances are adequate,
future additions to the allowances may be necessary based on changes in economic
conditions.

2.   Summary of Significant Accounting Policies
On March 31, 1999, the Company  completed the  reorganization of Capitol Federal
Savings and Loan  Association,  a federally  chartered  mutual  savings and loan
("Capitol  Federal  Savings" or the  "Bank"),  into the federal  mutual  holding
company form of ownership, whereby the Bank converted into a federally chartered
stock savings bank as a wholly owned subsidiary of the Company,  and the Company
became a  majority-owned  subsidiary of Capitol Federal Savings MHC, a federally
chartered  mutual  holding  company  (the  "MHC")  (the  "Reorganization").   In
connection  with the  Reorganization,  the  Company  sold  37,807,183  shares of
Company  common stock,  par value $0.01 per share  ("Company  Common  Stock") at
$10.00 per share,  which net of  issuance  costs  generated  proceeds  of $355.3
million, including shares issued to the ESOP. The Company also issued 52,192,817
shares  of  Company  Common  Stock  to  the  MHC.  As an  integral  part  of the
Reorganization and in furtherance of Capitol Federal Savings'  commitment to the
communities that it serves,  Capitol Federal Savings and the Company established
a charitable foundation known as the Foundation and contributed $15.1 million in
cash and 1,512,287 shares to the Foundation. The Foundation will provide funding
to support education,  affordable housing,  the United Way, and other charitable
causes  that  will  complement   Capitol  Federal  Savings'  existing  community
activities.  In addition,  the Company  established an ESOP for the employees of
the Company  and the Bank which  became  effective  with the  completion  of the
Reorganization.

Additional information regarding the Reorganization is included in the Company's
Registration Statement on Form S-1 filed on December 4, 1998, as amended.




                                       8

<PAGE>



3.     Loan Portfolio

The  following  table  presents  the  Company's  loan  portfolio  at  the  dates
indicated.

<TABLE>
<CAPTION>

                                                          June 30, 1999                    September 30, 1998
                                                 ------------------------------       ----------------------------
                                                   Amount              Percent          Amount             Percent
                                                 ----------            --------       ----------          --------
<S>                                              <C>                   <C>            <C>                 <C>
Real Estate Loans:
------------------
One- to four-family                              $3,826,180              94.02%       $3,504,799             93.47%
Multi-family                                         31,495               0.77            40,361              1.08
Commercial                                           12,121               0.30             9,069              0.24
Construction or development                          48,506               1.19            52,086              1.39
                                                 ----------             ------        ----------           -------
Total real estate loans                           3,918,302              96.28         3,606,315             96.18

Other Loans:
------------
Consumer loans:
Savings loans                                        15,779               0.39            16,446              0.44
Student                                              19,055               0.47            20,120              0.54
Home improvement                                      2,105               0.05             2,776              0.07
Automobile                                            6,737               0.17             5,758              0.15
Home equity                                         107,413               2.64            97,829              2.61
Other                                                   350               0.01               420              0.01
                                                 ----------             ------        ----------

Total consumer loans                                151,439               3.72           143,349              3.82
Commercial business loans                                 0               0.00                10              0.00
                                                 ----------             ------        ----------

Total other loans                                   151,439               3.72           143,359              3.82
                                                 ----------             ------        ----------

Total loans receivable                            4,069,741            100.00%         3,749,674           100.00%

Less:
-----
Loans in process                                     27,316                               21,690
Deferred fees and discounts                          13,953                               12,751
Allowance for losses                                  4,165                                4,081
                                                 ----------                           ----------
Total loans receivable, net                      $4,024,307                           $3,711,152
                                                 ==========                           ==========

</TABLE>


                                                           9

<PAGE>



4.  Non-Performing Loans

The following  table  presents the  Company's  non-performing  loans,  including
non-accrual loans and real estate owned, at the dates indicated.


                                                  June 30,   September 30,
                                                    1999         1998
                                                  -------    ------------
Non-accruing loans:
One-to four-family                                 $5,300       $6,048
Multi-family                                          ---          ---
Commercial real estate                                ---          ---
Construction or development                           ---          ---
Consumer                                               62          181
Commercial business                                   ---          ---
                                                  -------       ------
Total                                              $5,362       $6,229
                                                  =======       ======

Accruing loans delinquent more than 90 days:
One- to four-family                                   ---          ---
Multi-family                                          ---          ---
Commercial real estate                                ---          ---
Construction or development                           ---          ---
Consumer                                              ---          ---
Commercial business                                   ---          ---
                                                  -------       ------
Total                                                 ---          ---
                                                  =======       ======

Real Estate Owned:
One- to four-family                                $1,040       $1,964
Multi-family                                          ---          ---
Commercial real estate                                ---          ---
Construction or development                           ---          ---
Consumer                                              ---          ---
Commercial business                                   ---          ---
                                                  -------       ------
Total                                              $1,040       $1,964
                                                  =======       ======

Total non-performing assets                        $6,402       $8,193
                                                  =======       ======

Total as a percentage of total assets               0.10%        0.15%
                                                  =======       ======




                                       10

<PAGE>



5.  Allowance for Loan Losses
The following table presents the Company's activity for loan losses at the dates
and for the periods indicated.


<TABLE>
<CAPTION>
                                             For the quarter ending             For the nine months ending
                                                    June 30,                              June 30,
                                          ---------------------------           --------------------------
                                            1999               1998               1999             1998
                                          --------           --------           -------          --------
<S>                                       <C>                <C>               <C>                <C>
Balance at the beginning of period         $4,175             $1,639            $4,081            $1,634

Charge offs:
One- to four-family                           ---                ---                33               ---
Multi-family                                  ---                ---               ---               ---
Commercial real estate                        ---                ---               ---               ---
Construction or development                   ---                ---               ---               ---
Consumer                                       10                ---                20               ---
Commercial business                           ---                ---               ---               ---
                                           ------             ------            ------            ------
Total charge-offs                              10                ---                53               ---
                                           ======             ======            ======            ======

Recoveries:
One- to four-family                           ---                ---               ---               ---
Multi-family                                  ---                ---               ---               ---
Commercial real estate                        ---                ---               ---               ---
Construction or development                   ---                ---               ---               ---
Consumer                                      ---                ---               ---               ---
Commercial business                           ---                ---               ---               ---
                                           ------             ------            ------            ------
Total charge offs                             ---                ---               ---               ---
                                           ======             ======            ======            ======

Net charge-offs                                10                ---                53               ---
Additions charged to operations               ---                ---               135               ---
Balance at end of period                   $4,165             $1,639            $4,163            $1,639
                                           ======             ======            ======            ======

</TABLE>

6.  Savings Portfolio
The table below presents the Company's savings portfolio at the dates indicated.


<TABLE>
<CAPTION>
                                                   June 30, 1999                      September 30, 1998
                                         -------------------------------       --------------------------------
                                           Amount       Percent of Total          Amount       Percent of Total
                                         ----------    -----------------       ----------      ----------------
<S>                                       <C>                 <C>             <C>                    <C>

Demand deposits                            $286,526            7.27%           $  260,440             6.69%
Passbook and passcard                       130,640            3.31               129,180             3.32
Money market select                         313,705            7.96               213,181             5.47
Cash fund                                   212,271            5.39               225,356             5.79
Certificates                              2,998,416           76.07             3,066,023            78.73

                                         ----------                            ----------
Total deposits                           $3,941,558         100.00%            $3,894,180           100.00%
                                         ==========         ======             ==========           ======

</TABLE>

                                       11

<PAGE>



7.   Earnings Per Share
Earnings  per share for the  quarter  ended June 30,  1999 were $0.19 per share.
Earnings per share for quarters prior to March 31, 1999 are not  meaningful,  as
the Bank's Reorganization was not completed until March 31, 1999.

8.   Stock Holders' Equity
At June 30, 1999, the Bank exceeded all minimum  regulatory  requirements  for a
well  capitalized  institution,  with tangible  capital at 15.35% and risk-based
capital of 35.12%.  The Company  declared a $0.10 per share dividend on July 20,
1999 to holders of record on August 6, 1999 payable on August 20, 1999.

9.   Recent Accounting Pronouncements
In June 1997, the Financial  Accounting Standards Board (the "FASB") issued SFAS
No. 131,  "Disclosures about Segments of an Enterprise and Related Information."
The Statement establishes standards for the way that public business enterprises
report information about operating  segments in annual financial  statements and
requires that those  enterprises  report  selected  information  about operating
segments  in  interim  financial   reports  issued  to  shareholders.   It  also
establishes  standards  for related  disclosures  about  products and  services,
geographic  areas,  and major  customers.  The  statement is  effective  for the
Company's consolidated financial statements for the fiscal year ending September
30,  1999.  The Company is prepared  to comply  with the  additional  disclosure
requirements of this Statement.

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments  and  Hedging  Activities."  The  Statement  requires  an  entity to
recognize all  derivatives  as either assets or  liabilities in the statement of
financial position and measure those instruments at fair value. The Statement is
effective for the Company's  consolidated  financial  statements  for the fiscal
year ending  September 30, 2001.  The adoption of this Statement is not expected
to have a material impact on the Company's  consolidated  financial  position or
results of operations.

In October 1998,  the FASB issued SFAS No.134  "Accounting  for  Mortgage-Backed
Securities  Retained after the Securitization of Mortgage Loans Held for Sale by
a Mortgage Banking  Enterprise." The Statement  changes the way mortgage banking
firms  account for certain  securities  and other  interests  they retain  after
securitizing  mortgage  loans that were held for sale.  The  statement was first
effective  for the Company's  consolidated  interim  financial  statements as of
March 31, 1999. The  implementation  of this Statement had no material impact on
these  consolidated  interim financial  statements,  and it is not expected that
such  statement  will  have  a  material  impact  on the  consolidated  year-end
financial position or results of operations.

10.  Comprehensive Income
The only component of other comprehensive  income is the change in the estimated
fair value of mortgage-related securities available-for-sale.  This component of
other  comprehensive  income was ($5.3)  million for the three months ended June
30, 1999 and ($7.7) million for the nine months ended June 30, 1999.

11.   Commitments and Contingencies
In the normal  course of business,  the Company and its  subsidiaries  are named
defendants in various lawsuits and counter claims. In the opinion of management,
after consultation with legal counsel,  none of the suits will have a materially
adverse effect on the financial position or results of the Company's operations.


                                       12

<PAGE>



Item 2.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations


Except  for the  historical  information  contained  in this 10-Q,  the  matters
discussed may be deemed to be forward-looking statements,  within the meaning of
the Private  Securities  Litigation  Reform Act of 1995,  that involve risks and
uncertainties,  including changes in economic conditions in the Company's market
area,  changes in  policies by  regulatory  agencies,  fluctuations  in interest
rates,  demand for loans in the Company's  market area,  competition,  and other
risks.  Actual  strategies and results in future  periods may differ  materially
from those currently expected.  These  forward-looking  statements represent the
Company's judgment as of the date of this 10-Q. The Company disclaims,  however,
any intent or obligation to update these forward-looking statements.

The following  discussion is intended to assist in  understanding  the financial
condition and results of operations of Capitol Federal Financial. The discussion
includes  comments  relating to Capitol  Federal  Savings Bank since the Bank is
wholly owned by Capitol  Federal  Financial and comprises the majority of assets
and sources of income for the Company.

Financial Condition

Assets.  For the nine month  period  ended June 30,  1999,  total  assets of the
Company increased $791.9 million,  or 14.9%, from $5.32 billion at September 30,
1998 to $6.11 billion at June 30, 1999. The increase from September 30, 1998 was
primarily  due  to  the  growth  in  the  Company's  loan  and  mortgage-related
securities  portfolios,  partially  offset  by the  reduction  in the  Company's
investment securities  portfolio.  This increase in total assets was distributed
as follows:

-    $313.2 million,  or 8.4%,  increase in net loans receivable which increased
     from $3.71 billion at September 30, 1998 to $4.02 billion at June 30, 1999,

-    $854.8 million increase in  mortgage-related  securities,  or 79.4%,  which
     increased from $1.07 billion at September 30, 1998 to $1.92 billion at June
     30, 1999.

Total one- to four-family loan  originations for the quarter ended June 30, 1999
were a record $307.5 million; and were $884.3 million year to date.  Refinancing
of loans already  serviced by the Bank were 17.7% of loan  originations  for the
quarter and 25.4% for the year to date.  Fixed-rate loan originations  accounted
for 75.1% of originations  for the quarter and 80.5% for the year to date. Loans
purchased  totaled $54.8 million for the quarter ending June 30, 1999 and $105.5
million  for the  year  to  date,  all of  which  were  adjustable  rate.  Total
originations  of consumer  loans for the quarter  ended June 30, 1999 were $32.9
million,  and $90.0  million  for the year to date.  The  Company  expanded  its
capital  utilization  plan, or its leverage  strategy,  during the quarter ended
June 30, 1999 by purchasing $420.1 million of  mortgage-related  securities at a
spread of 102 basis points over the cost of funding. Mortgage-related securities
purchased  during the quarter were all fixed rate,  and 39.7% of  mortgage-relat
securities  purchased  during the year to date were fixed rated.  Subsequent  to
June  30,   1999  the   Company   purchased   $335.8   million   of  fixed  rate
mortgage-related  securities  at a spread of 116 basis  points  over the cost of
funding by borrowing $325.0 million of fixed rate, callable advances.

Liabilities.  Deposits  increased $47.4 million,  or 1.2%, from $3.89 billion at
September  30,  1998,  to $3.94  billion at June 30,  1999.  This  increase  was
attributable to $130.1 million of interest credits during the nine month period.
Certificate  accounts  decreased  in balance  over the period by $67.6  million.
Certificates   maturing  with  rates  generally  above  current  offering  rates
decreased  $132.6 million while  certificate  balances at current offering rates
increased $65.0 million.  Borrowings increased from September 30, 1998 by $400.0
million,  or 80.0% and were all advanced during the quarter ended June 30, 1999,
funding the purchase of mortgage-related securities during the quarter.

Equity.  Total  stockholders'  equity increased $370.5 million,  or 55.9%,  from
$662.3  million at September 30, 1998,  to $1.03  billion at June 30, 1999.  The
increase was  attributable to the funds raised by the Company in its Offering in
connection with the Bank's  Conversion,  with the increase in retained  earnings
partially  offset by dividends paid and the decrease in the  unrealized  gain on
available for sale securities.

                                       13

<PAGE>

                    Comparison of Operating Results for the
                   Three Months Ended June 30, 1999 and 1998

General.  For the three months ended June 30, 1999,  the Company  recognized net
income of $17.3  million,  compared to net income of $14.7 million for the three
months ended June 30, 1998. The Company's  efficiency ratio for the three months
ended June 30, 1999 was 33.96% compared to 32.90% for the quarter ended June 30,
1998.  There were no charges to the  allowance  for loan  losses for the current
quarter or the same quarter one year ago.

Net Interest  Income.  Net  interest  income for the three months ended June 30,
1999 was $37.9  million,  an  increase of $4.9  million,  or 14.8% from the same
period last year.  The increase was primarily the result of an increase of $1.25
billion in the balance of loans receivable and mortgage-related  securities from
$4.70  billion at June 30,  1998 to $5.95  billion at June 30,  1999 while total
interest bearing liabilities increased $447.8 million from $4.57 billion at June
30 , 1998 to $5.02  billion  at June 30 1999.  The net  interest  margin for the
quarter ended June 30, 1999 remained  unchanged from 2.59% for the quarter ended
June 30, 1998. The net interest rate spread decreased from 1.92% for the quarter
ended June 30, 1998 to 1.69% for the quarter ended June 30, 1999. The additional
increase  in  earning  assets  over  costing  liabilities,  which was  primarily
responsible  for maintaining the net interest margin and increasing net interest
income,  is  attributed  to  the  proceeds  received  from  the  mutual-to-stock
conversion  and the increase in retained  earnings.  The  Company's net interest
rate spread at June 30, 1999 was 1.86% which is unchanged from June 30, 1998.

Interest  Income.  Interest  income for the three months ended June 30, 1999 was
$100.0  million,  up from $92.3 million for the same period in 1998. The largest
component of interest  income is interest on loans.  Interest on loans increased
from $67.6 million for the three months ended June 30, 1998 to $70.8 million for
the three  months  ended June 30,  1999.  This  increase of $3.2 million was the
result of an increase in the average balance of loans which was partially offset
by a  decrease  in the  average  yiel  earned.  The  average  balance  of  loans
receivable  increased $367.9 million to $3.93 billion for the three months ended
June 30, 1999 compared to $3.56 billion for the same period one year ago,  while
the average  yield on loans  decreased  39 basis points to 7.20% for the quarter
ended June 30, 1999 from 7.59% for the  quarter  ended June 30,  1998.  Interest
income on mortgage-related securities increased $11.5 million from $16.4 million
for the quarter  ended June 30, 1998 to $27.9 million for the quarter ended June
30, 1999. The average balance of  mortgage-related  securities  increased $820.5
million from $1.02  billion at June 30, 1998 to $1.84  billion at June 30, 1999,
while the average yield decreased from 6.45% for the quarter ended June 30, 1998
to 6.07% for the quarter ended June 30, 1999. The increase in interest income on
loans and  mortgage-related  securities  was partially  offset by a reduction in
interest income on investment  securities.  Income on investment  securities and
securities  purchased  under  agreement to resell for the quarter ended June 30,
1999 was $200,000  compared to $6.7 million for the quarter ended June 30, 1998.
The balance of investment securities and securities purchased under agreement to
resell at June 30, 1999 was reduced to $15.1 million  compared to $360.6 million
at June 30, 1998. Investment securities were allowed to mature and were replaced
with  higher  rate  mortgage-related   securities  and  collateralized  mortgage
obligations (CMO's).

                                       14

<PAGE>

Interest  Expense.  Interest expense increased during the quarter ended June 30,
1999 to $62.1  million from $59.3  million for the same period in 1998.  For the
quarter  ended June 30,  1999  interest  expense on deposits  was $48.7  million
compared to $50.8  million for the quarter  ended June 30,  1998,  a decrease of
$2.1  million.  The decrease  was due to a reduction  in interest  rates paid on
short-term deposits, a reduction in the rate paid on money market accounts,  and
certificates  of deposit  maturing  and renewing  into lower rate,  shorter term
accounts.  The average  balance of deposits  increased  during the quarter ended
June 30, 1999 to $3.93  billion  compared to $3.86 billion for the quarter ended
June 30, 1998, an increase of $56.2  million,  or 1.5%. The average rate paid on
deposits for the quarter ended June 30, 1999 was 4.95% compared to 5.25% for the
quarter ended June 30, 1998, a decrease of 30 basis points.  Interest expense on
borrowings  for the quarter  ended June 30, 1999 was $13.4  million  compared to
$8.5 million for the quarter  ended June 30, 1998,  an increase of $4.9 million,
or 57.6%.  The average balance of borrowings for the quarter ended June 30, 1999
was $911.8  million  compared to $600.0  million for the quarter  ended June 30,
1998, an increase of 311.8 million,  or 52.0%. The increase is due to additional
long-term fixed rate, callable advances and short-term advances from the Federal
Home Loan Bank which were taken out during the  quarter to fund the  origination
and purchase of loans and mortgage related  securities.  The average cost of the
borrowings  for the quarter ended June 30, 1999 was 5.87%  compared to 5.64% for
the quarter ended June 30, 1998.

Provision  for Loan Losses.  For quarters  ended June 30, 1999 and June 30, 1998
there were no charges to the  provision for loan losses.  The  assessment of the
estimated  losses  inherent  in the loan  portfolio  resulting  from the formula
allowance,  specific  allowances  for  identified  problem  loans and  portfolio
segments indicated that for the current quarter no additions were required.

Noninterest Income. Total noninterest income for the quarter ended June 30, 1999
was $3.5  million,  up from $3.2  million for the quarter  ended June 30,  1998.
There were no significant changes in noninterest income for any category for the
quarter ended June 30, 1998 compared to the quarter ended June 30, 1999.

Noninterest  Expense.  Total noninterest expense increased $2.2 million to $13.8
million for the quarter  ended June 30, 1999  compared to $11.6  million for the
same period in 1998.  The increase in  noninterest  expense was primarily due to
increases in personnel  and  advertising  expense.  Personnel  increases  were a
result of costs  associated  with the  ESOP,  three new  branch  locations,  and
increased loan production and back office support staff.

Income Tax  Expense.  Income tax  expense  increased  from $9.8  million for the
quarter  ended June 30, 1998 to $10.4  million  for the  quarter  ended June 30,
1999.  The increase was due  primarily to an increase in pre-tax  earnings.  The
increase  was  partially  offset by a reduction in the State of Kansas tax by 2%
which lowered the effective tax rate from 40% to 38%.

                     Comparison of Operating Results for the
                    Nine Months Ended June 30, 1999 and 1998

General.  For the nine months ended June 30, 1999,  the Company  recognized  net
income of $25.4  million  compared  to net income of $43.9  million for the nine
months ended June 30, 1998. The primary reason for the reduction was noninterest
expense  increasing  $37.0  million  for the nine  months  ended  June 30,  1999
compared to the same period last year as a result of conversion related charges.
This  increase in  noninterest  expense was  partially  offset by a reduction in
income tax expense of $13.6  million.  The  efficiency  ratio,  exclusive of the
conversion related expenses,  for the nine months ended June 30, 1999 was 35.35%
compared to 33.16% for the nine months ended June 30, 1998.

                                     15

<PAGE>

Net Interest Income. Net interest income for the nine months ended June 30, 1999
was $103.4 million  compared to $98.8 million for the nine months ended June 30,
1998,  an increase of $4.6  million,  or 4.6%.  The net interest  margin  spread
decreased 17 basis points from 2.65% at June 30, 1998 to 2.48% at June 30, 1999.

Interest  Income.  Interest  income for the nine months  ended June 30, 1999 was
$287.2 million,  up from $272.3 million for the nine months ended June 30, 1998.
The  largest  component  of interest  income is  interest  on loans  receivable.
Interest on loans  increased  from $199.0 million for the nine months ended June
30,  1998 to $211.0  million  for the nine  months  ended  June 30,  1999.  This
increase of $12.0  million was the result of an increase in the average  balance
of loans  receivable,  which was  partially  offset by a decrease in the average
yield earned.  The average  balance of loans  increased  $365.3 million to $3.83
billion for the nine months ended June 30, 1999 from $3.46  billion for the nine
months ended June 30, 1998. The average yield on loans decreased 31 basis points
from 7.66% for the nine months  ended June 30, 1998 to 7.35% for the nine months
ended June 30, 1999. Interest on mortgage-related  securities increased by $24.0
million, or 55.8%, from $43.0 million for the nine months ended June 30, 1998 to
$67.0 million for the nine months ended June 30, 1999,  primarily as a result of
an increase in the average balance of mortgage-related  securities.  The average
balance of mortgage-related  securities increased $625.6 million, or 72.7%, from
$861.0  million for the nine months ended June 30, 1998 to $1.49 billion for the
nine months  ended June 30,  1999,  while the average  yield for the nine months
ended June 30, 1999 was 6.00%,  down from 6.66% for the  nine-months  ended June
30,  1998.  Interest on  investment  securities  was $20.2  million for the nine
months  ended June 30, 1998  compared to $965,000 for the nine months ended June
30, 1999.  Investment  securities  were allowed to mature and were replaced with
higher rate mortgage-related securities.

Interest Expense.  Interest expense increased during the nine month period ended
June 30, 1999 to $183.8  million from $173.5  million for the nine months ending
June 30, 1998.  Interest  expense on deposits  decreased from $152.0 million for
the nine months ended June 30, 1998 to $148.5  million for the nine months ended
June 30, 1999, a $3.5 million  decrease,  or 2.3%.  The average cost of deposits
decreased  to 5.04% for the nine  months  ended June 30, 1999 from 5.26% for the
nine months ended June 30, 1998, or 22 basis points,  which was partially offset
by an increase in the average  balance of deposits of $69.3 million,  from $3.86
billion  for the nine months  ended June 30, 1998 to $3.93  billion for the nine
months ended June 30, 1999.  Interest  expense on borrowings  increased to $35.3
million from $21.5  million,  a $13.8 million  increase,  or 64.2%.  The average
balance of borrowings  increased  from $500.0  million for the nine months ended
June 30, 1998 to $819.9  million for the nine months  ended June 30,  1999.  The
average cost of borrowings  increased  from 5.73% for the nine months ended June
30, 1998 to 5.74% for the nine months ended June 30, 1999.

Provision  for Loan Losses.  The  provision  for loan losses for the nine months
ended June 30, 1999 of $135,000  resulted  from the  assessment of the estimated
losses  inherent in the loan  portfolio  resulting  from the formula  allowance,
specific allowances for identified problem loans and portfolio  segments.  There
were no charges to the  provision for loan losses for the nine months ended June
30, 1998.

                                       16


<PAGE>

Noninterest  Income.  Total  noninterest  income for the nine month period ended
June 30, 1999 was $9.9  million,  up slightly from the $9.5 million for the nine
month period ended June 30, 1998,  resulting from increased fees charged for ATM
usage.

Noninterest Expense.  Total noninterest expense increased $37.0 million to $72.1
million for the nine months ended June 30, 1999,  up from $35.1  million for the
nine  months  ended June 30,  1998.  The  increase  in  noninterest  expense was
primarily  due  to  conversion  related  expenses.  However,  exclusive  of  the
conversion  related expenses,  noninterest  expense was up $4.1 million to $39.2
million for the nine months  ended June 30, 1999  compared to $35.1  million for
the nine months  ended June 30, 1998,  or 11.7%.  The increase was due to a $2.1
million  increase in compensation  related  expenses and a $769,000  increase in
occupancy expense.  Compensation  related expenses increased primarily from ESOP
charges,  operating three new branch locations,  and additional loan and support
staff. The increase in occupancy  related  expenses is primarily  related to the
cost of leasing three new locations, and upgrades to computer systems.

Income Tax Expense. Income tax expense decreased from $29.3 million for the nine
month period ended June 30, 1998 to $15.7 million for the nine months ended June
30, 1999.  The reduction is primarily  the result of the tax benefit  associated
with the contribution to the Foundation.

                         Impact of the Year 2000 Issues

General.  The Year  2000  issue  confronting  Capitol  Federal  Savings  and its
suppliers,  customers,  customers  suppliers  and  competitors,  centers  on the
inability of computer systems to recognize the year 2000 ("Y2K").  Many existing
computer  programs and systems  originally  were programmed with six digit dates
that  provided  only two digits to identify the calendar year in the date field.
With the impending new  millennium,  these programs and computers will recognize
"00" as the year 1900 rather than the year 2000.

Financial  institution  regulators  have  remained  focused upon Y2K  compliance
issues  and have  issued  guidance  concerning  the  responsibilities  of senior
management and directors.  The Federal Financial Institution Examination Council
has issued several interagency  statements on Y2K Project Management  Awareness.
These statements require financial  institutions to, among other things, examine
the Y2K  implications of their reliance on vendors with respect to data exchange
and the  potential  impact  of the Y2K issu on their  customers,  suppliers  and
borrowers.  These  statements  also require each federally  regulated  financial
institution  to survey  its  exposure,  measure  its risk and  prepare a plan to
address the Y2K issue. In addition,  the federal banking  regulators have issued
safety  and  soundness   guidelines   to  be  followed  by  insured   depository
institutions  to assure  resolution  of any Y2K  problems.  The federal  banking
agencies  have  assured that Y2K testing and  certification  is a key safety and
soundness  issue  in  conjunction  with  regulatory  exams  and  thus,  that  an
institution's  failure to address  appropriately  the Y2K issue could  result in
supervisory  action,  including the reduction of the  institution's  supervisory
ratings,  the denial of applications  for approval of mergers or acquisitions or
the imposition of civil money penalties.

                                       17


<PAGE>


Risk.  Like most financial  service  providers,  Capitol Federal Savings and its
operations may be significantly  affected by the Y2K issue due to its dependence
on technology and date-sensitive  data.  Computer  software,  hardware and other
equipment,  both within and outside Capitol Federal  Savings' direct control and
third parties with whom Capitol Federal Savings  electronically or operationally
interfaces  are likely to be affected.  If computer  systems are not modified in
order to be able to identify the yea 2000, many computer applications could fail
or create erroneous results.  As a result,  many calculations which rely on date
field  information,  such as interest,  payment or due dates and other operating
functions,   could   generate   results  which  are   significantly   misstated,
consequently  Capitol Federal  Savings could  experience an inability to process
transactions,   prepare   statements  or  engage  in  similar  normal   business
activities.  Likewise,  under  certain  circumstances  a failure  to  adequately
address the Y2K issue could  adversely  affect the viability of Capitol  Federal
Savings'  suppliers  and creditors and the  creditworthiness  of its  borrowers.
Thus, if not adequately  addressed,  the Y2K issue could result in a significant
adverse  impact  on  Capitol  Federal  Savings'  operations  and,  in turn,  its
financial condition and results of operations.

State of Readiness.  During April 1997,  Capitol Federal Savings  formulated its
plan to address  the Y2K issue.  Since that time,  Capitol  Federal  Savings has
taken the following steps:


          -    Established    senior    management     advisory    and    review
               responsibilities;

          -    Completed a  company-wide  inventory  of  application  and system
               software;

          -    Built an internal  tracking  database for  application and vendor
               software;

          -    Developed  compliance  plans  and  schedules  for  all  lines  of
               business;

          -    Remediated or replaced all mission critical applications;

          -    Tested remediated computer code;

          -    Surveyed  for  vendor  compliance   verification,   testing  when
               appropriate;

          -    Provided awareness and education activities for employees through
               existing internal communication channels; and

          -    Developed a process to help educate customers on the Y2K issue as
               well as respond to customer inquiries.

          The  following  paragraphs  summarize  the phases of  Capitol  Federal
          Savings' Y2K plan:

               Awareness  Phase.  Capitol  Federal  Savings'  senior  management
          formally  established a Y2K plan, and a project team was assembled for
          management  of the Y2K  project.  The project  team  created a plan of
          action that includes  milestones,  budget estimates,  strategies,  and
          methodologies  to track and report the status of the project.  Members
          of the project team also attended  conferences and information sharing
          sessions  to gain  more  insight  into  the Y2K  issue  and  potential
          strategies for addressin it. This stage is complete.

                                       18

<PAGE>

               Assessment  Phase.   Capitol  Federal  Savings'  strategies  were
          further  developed  with respect to how the objectives of the Y2K plan
          would be achieved,  and a Y2K  business  risk  assessment  was made to
          quantify  the extent of  Capitol  Federal  Savings'  Y2K  exposure.  A
          corporate  inventory,  which is periodically updated as new technology
          is acquired and as systems progress  through  subsequent  phases,  was
          developed  to  identify  and  monitor Y2K  readiness  for  information
          systems  (hardware,  software,  utilities,  and  vendors)  as  well as
          environmental  systems (security systems,  facilities,  etc.). Systems
          were prioritized based on business impact and available  alternatives.
          As  part  of  this  process,  118  vendors  and  2,458  programs  were
          identified as mission  critical.  Mission critical systems supplied by
          vendors were researched to determine Y2K readiness.  By June 30, 1999,
          all mission  critical  programs were identified as or determined to be
          Y2K-ready.  By  June  30,  1999,  all  mission  critical  vendors  had
          indicated  they would be  Y2K-ready.  If Y2K-ready  versions  were not
          available,   Capitol  Federal  Savings  began  identifying  functional
          replacements which were upgradable or are currently  Y2K-ready,  and a
          formal plan was  developed  to repair,  upgrade or replace all mission
          critical systems. This phase is complete.

               Capitol Federal Savings' larger borrowers have been evaluated for
          Y2K  exposure  using a  questionnaire  developed  by  Capitol  Federal
          Savings'  Y2K Business  Systems  Team.  As part of the current  credit
          approval  process,  all new and renewed  loans are  evaluated  for Y2K
          risk.  Capitol  Federal  Savings' loan policy  clearly states that all
          loans, especially commercial real estate loans, require an analysis of
          the impact of Y2K issues on the creditworthiness of the borrower prior
          to  approval.  Commercial  real estate loans  represent  only 0.30% of
          total loans at June 30, 1999,  and all are secured by real estate.  No
          commercial  real estate  borrower was  identified as mission  critical
          during the assessment  process due to the size, nature, and collateral
          of  commercial  real estate loans at Capitol  Federal  Savings.  While
          Capitol  Federal  Savings will continue to monitor the progress  being
          made by its larger  borrowers in addressing  their own Y2K issues,  to
          date  Capitol  Federal  Savings  is  generally  satisfied  with  these
          customers' responses to Capitol Federal Savings' inquiries.

               Renovation Phase.  Capitol Federal Savings'  corporate  inventory
          revealed  that Y2K upgrades  were  available  for all vendor  supplied
          mission  critical  systems,  and these  Y2K-ready  versions  have been
          delivered,  installed and have entered the validation process. Capitol
          Federal  Savings  has  renovated  all  mission  critical   proprietary
          software. This phase is complete.

               Validation  Phase.  The validation  phase is designed to test the
          ability of hardware and software to accurately  process date sensitive
          data.  Capitol Federal Savings has completed the process of validation
          testing of each  mission  critical  system.  Capitol  Federal  Savings
          created  a  test  environment  comprised  of an  IBM  Multiprise  2000
          dedicated to Y2K testing which is virtually  insulated from production
          and development environments. The validation phase is complete for all
          mission critical  applications.  During the validation testing process
          to date, no significant Y2K problems were  identified  relating to any
          modified or upgraded mission critical systems. This phase is complete.

                                       19

<PAGE>


               Implementation  Phase.  Capitol  Federal  Savings' plan calls for
          putting   Y2K-ready  code  into  production   before  having  actually
          completed  Y2K  validation  testing.  Y2K-ready  modified  or upgraded
          versions have been installed and placed into  production  with respect
          to all proprietary mission critical systems. This phase is complete.

     Bank  Resources  Invested.  Capitol  Federal  Savings' Y2K project team has
completed the task of ensuring that all mission  critical systems across Capitol
Federal  Savings are  identified,  analyzed  for Y2K  compliance,  corrected  if
necessary,  tested,  and  changes  implemented.  The Y2K  project  team  members
represent all functional areas of Capitol Federal Savings,  including  branches,
data  processing,   loan   administration,   accounting,   item  processing  and
operations, compliance, internal audit, human resources, and marketing. The team
is headed by an Executive Vice President who reports  directly to the President.
Capitol Federal  Savings' board of directors  oversees the Y2K plan and provides
guidance and resources to and receives monthly updates from the Y2K project team
leader.

     Capitol  Federal  Savings is expensing all costs  associated  with required
system  changes as those  costs are  incurred,  and such costs are being  funded
through  operating cash flows. The total cost of the Y2K conversion  project for
Capitol  Federal   Savings  is  estimated  to  be  $2.3  million.   Expenses  of
approximately $1.2 million were incurred and expensed through June 30, 1999. Y2K
expenses are not expected to exceed the budget, and Capitol Federal Savings does
not expect significant increases in future data processing costs relating to Y2K
compliance.

     Contingency  Plans.  During the assessment  phase,  Capitol Federal Savings
began to develop back-up or contingency  plans for each of its mission  critical
systems.  A few  of  Capitol  Federal  Savings'  mission  critical  systems  are
dependent upon third party vendors or service providers, therefore,  contingency
plans include selecting a new vendor or service provider and converting to their
system.  In the event a current  vendor's  system  fails  during the  validation
phase,  and it is  determined  that the vendor is unable or unwilling to correct
the  failure,  Capitol  Federal  Savings  will  convert to a new  system  from a
pre-selected list of prospective  vendors. In each case, realistic trigger dates
have been established to allow for orderly and successful conversions.  For some
systems, contingency plans consist of using or reverting to manual systems until
system problems can be corrected.

     Capitol Federal Savings identified a worst case scenario that envisions the
possibility of the lack of power and/or  communication  services for a period of
time in excess of one day.  Contingency  planning is an integral part of Capitol
Federal Savings' Y2K readiness plan. Key operating  personnel were actively used
in  analyzing  services  that will be  supported  during  extended  outages  and
preparing written plans and procedures to train Bank personnel.  The contingency
plans  have  been  tested  when  practical  to  validate  the  effectiveness  of
contingent procedures.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

     For a discussion of the Company's asset and liability  management  policies
as well as the  potential  impact of interest rate changes upon the market value
of the  Company's  portfolio,  see  "Management's  Discussion  and  Analysis  of
Financial  Condition and Results of Operations,  Asset and Liability  Management
and Market Risk" in the Company's prospectus dated February 11, 1999.





                                       20

<PAGE>



                           Part 2 - OTHER INFORMATION

Item 1.  Legal Proceedings

Not Applicable

Item 2.  Change in Securities and Use of Proceeds

Not Applicable

Item 3.  Defaults Upon Senior Securities

Not applicable

Item 4.  Submission of Matters to a Vote of Security Holders

Not applicable

Item 5.  Other Information

Not applicable

Item 6.  Exhibits and Reports on Form 8-K




                                       21

<PAGE>



                                   Signatures


Pursuant  to the  requirement  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.

                               CAPITOL FEDERAL FINANCIAL


Date:   August 13, 1999        By:   /s/ John C. Dicus
                                     -----------------------------------------
                                     John C. Dicus, Chairman and
                                     Chief Executive Officer



Date:   August 13, 1999        By:   /s/ Neil F. M. McKay
                                     -----------------------------------------
                                     Neil F.M. McKay, Executive Vice President
                                     and Chief Financial Officer


                                       22

<PAGE>



                                Index to Exhibits


                                                            Sequentially
                                                            Numbered Page
Exhibit                                                     Where Attached
Number                                                      Exhibits are Located
-------                                                     --------------------


27               Financial Data Schedule                            24









                                       23