UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549




FORM
      10-QSB





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




For
      the
      quarterly period ended December
      31, 2006




Commission
      File Number: 0-29276








FIRST
      ROBINSON FINANCIAL CORPORATION


(Exact
      name of registrant as specified in its charter)





DELAWARE
            36-4145294(State
                or other jurisdiction of incorporation or organization)
            I.R.S.
                Employer ID Number




501
      EAST MAIN STREET, ROBINSON, ILLINOIS       
 62454


(Address
      of principal executive
      offices)  (Zip
      Code)





Registrant’s
      telephone number, including area code (618)
      544-8621




Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Exchange Act during the past 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
o




Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act).




YES
o  NO x




As
      of
      February 13, 2007, the Registrant had 487,750 shares of Common Stock, par value
      $0.01, issued and outstanding.




Transitional
      Small Business Disclosure Format (check one):




YES
oNOx








1


FIRST
      ROBINSON FINANCIAL CORPORATION


Index
      to
      Form 10-QSB





PART
                1. FINANCIAL INFORMATION
            PAGEItem
                1.     Financial StatementsCondensed
                Consolidated Balance Sheets as of December 31, 2006 And March 31,
                2006
            3Condensed
                Consolidated Statements of Income for the Three-Month and Nine-Month
                Periods Ended December 31, 2006 and December 31, 2005
            4Condensed
                Consolidated Statements of Cash Flows for the Nine-Month Periods
                Ended
                December 31, 2006 and December 31, 2005
            6Notes
                to Condensed Consolidated Financial Statements
            8Item
                2.     Management’s Discussion and Analysis or Plan of
                Operation
            13Item
                3.     Controls and Procedures
            26PART
                II. OTHER INFORMATIONItem
                1.     Legal Proceedings
            27Item
                2.     Unregistered Sales of Equity Securities and Use
                of Proceeds
            27Item
                3.     Defaults Upon Senior Securities
            27Item
                4.     Submission of Matters to a Vote of Security
                Holders
            27Item
                5.     Other Information
            27Item
                6.     Exhibits
            27SIGNATURES
            28








2


Item
      1:


FIRST
      ROBINSON FINANCIAL CORPORATION


CONDENSED
      CONSOLIDATED BALANCE SHEETS


(In
      thousands, except share data)




(Unaudited)December
                  31, 2006
              
              March
                  31, 2006ASSETSCash
                  and cash equivalents
              
              $
              7,225
              
              $
              7,389Available-for-sale
                  securities
              
              
              32,326
              
              
              30,535Loans,
                  net of allowance for loan losses of $755 and $753at
                  December 31, 2006 and March 31, 2006, respectively
              
              
              72,475
              
              
              65,506Federal
                  Reserve and Federal Home Loan Bank stock
              
              
              799
              
              
              831Premises
                  and equipment, net
              
              
              2,570
              
              
              2,640Foreclosed
                  assets held for sale, net
              
              
              —
              
              
              11Interest
                  receivable
              
              
              656
              
              
              645Deferred
                  income taxes
              
              
              192
              
              
              241Cash
                  surrender value of life insurance
              
              
              1,327
              
              
              1,290Other
                  assets
              
              
              352
              
              
              340Total
                  Assets
              
              $
              117,922
              
              $
              109,428LIABILITIES
                  AND STOCKHOLDERS’ EQUITYDeposits
              
              
              86,212
              
              
              86,202Securities
                  sold under agreements to repurchase
              
              
              18,693
              
              
              10,774Advances
                  from borrowers for taxes and insurance
              
              
              77
              
              
              126Accrued
                  income taxes
              
              
              206
              
              
              168Interest
                  payable
              
              
              184
              
              
              156Other
                  liabilities
              
              
              561
              
              
              586Total
                  Liabilities
              
              
              105,933
              
              
              98,012Commitments
                  and Contingencies
              
              
              —
              
              
              —Stockholders’
                  EquityPreferred
                  stock, $.01 par value; authorized 500,000 shares,no
                  shares issued and outstandingCommon
                  stock, $ .01 par value; authorized 2,000,000 shares; 859,625 shares
                  issued;outstanding
                  December 31, 2006 - 487,750 shares; March 31, 2006 - 498,050
                  shares
              
              
              9
              
              
              9Additional
                  paid-in capital
              
              
              8,415
              
              
              8,722Retained
                  earnings
              
              
              9,511
              
              
              8,878Unearned
                  RRP shares
              
              
              —
              
              
              (125
              )Unearned
                  ESOP
              
              
              —
              
              
              (41
              )Unearned
                  incentive compensation
              
              
              —
              
              
              (262
              )Treasury
                  stock, at costCommon:
                  December 31, 2006 - 364,644 shares; March 31, 2006 - 354,344
                  shares
              
              
              (5,701
              )
              
              (5,414
              )Accumulated
                  other comprehensive loss
              
              
              (245
              )
              
              (351
              )Total
                  Stockholders’ Equity
              
              
              11,989
              
              
              11,416Total
                  Liabilities and Stockholders’ Equity
              
              $
              117,922
              
              $
              109,428




See
      Notes
      to Condensed Consolidated Financial Statements.




3




FIRST
      ROBINSON FINANCIAL CORPORATION


CONDENSED
      CONSOLIDATED STATEMENTS OF INCOME


For
      the
      Three and Nine Month Periods Ended December 31, 2006 and 2005


(In
      thousands, except per share data)


(Unaudited)


Three
                  Month Period
              
              Nine
                  Month Period2006
              
              2005
              
              2006
              
              2005Interest
                  and Dividend Income:Loans
              
              $
              1,360
              
              $
              1,145
              
              $
              3,849
              
              $
              3,379Securities:Taxable
              
              
              398
              
              
              334
              
              
              1,162
              
              
              973Tax-exempt
              
              
              25
              
              
              24
              
              
              74
              
              
              60Dividends
                  on FRB and FHLB stock
              
              
              7
              
              
              —
              
              
              22
              
              
              21Total
                  Interest and Dividend Income
              
              
              1,790
              
              
              1,503
              
              
              5,107
              
              
              4,433Interest
                  Expense:Deposits
              
              
              529
              
              
              406
              
              
              1,485
              
              
              1,118Federal
                  Home Loan Bank advances
              
              
              —
              
              
              17
              
              
              —
              
              
              49Other
                  borrowings
              
              
              187
              
              
              70
              
              
              461
              
              
              169Total
                  Interest Expense
              
              
              716
              
              
              493
              
              
              1,946
              
              
              1,336Net
                  Interest Income
              
              
              1,074
              
              
              1,010
              
              
              3,161
              
              
              3,097Provision
                  for Loan Losses
              
              
              15
              
              
              45
              
              
              45
              
              
              135Net
                  Interest Income After Provision for Loan Losses
              
              
              1,059
              
              
              965
              
              
              3,116
              
              
              2,962Non-interest
                  income:Charges
                  and fees on deposit accounts
              
              
              221
              
              
              183
              
              
              640
              
              
              571Charges
                  and other fees on loans
              
              
              7
              
              
              6
              
              
              20
              
              
              18Net
                  gain on sale of loans
              
              
              26
              
              
              17
              
              
              73
              
              
              47Net
                  gain on sale of foreclosed assets
              
              
              —
              
              
              —
              
              
              —
              
              
              5Other
              
              
              72
              
              
              58
              
              
              214
              
              
              190Total
                  Non-Interest Income
              
              
              326
              
              
              264
              
              
              947
              
              
              831Non-interest
                  expense:Compensation
                  and employee benefits
              
              
              529
              
              
              458
              
              
              1,474
              
              
              1,465Occupancy
                  and equipment
              
              
              138
              
              
              127
              
              
              404
              
              
              391Foreclosed
                  property expense
              
              
              —
              
              
              —
              
              
              1
              
              
              2Data
                  processing
              
              
              64
              
              
              45
              
              
              161
              
              
              133Audit,
                  legal and other professional
              
              
              37
              
              
              45
              
              
              106
              
              
              134Advertising
              
              
              32
              
              
              18
              
              
              91
              
              
              79Telephone
                  and postage
              
              
              23
              
              
              21
              
              
              69
              
              
              66Net
                  loss on sale of foreclosed property
              
              
              —
              
              
              —
              
              
              2
              
              
              —Other
              
              
              126
              
              
              139
              
              
              394
              
              
              386Total
                  Non-Interest Expense
              
              
              949
              
              
              853
              
              
              2,702
              
              
              2,656


See
      Notes
      to Condensed Consolidated Financial Statements.





4








FIRST
      ROBINSON FINANCIAL CORPORATION


CONDENSED
      CONSOLIDATED STATEMENTS OF INCOME


For
      the
      Three and Nine Month Periods Ended December 31, 2006 and 2005


(In
      thousands, except per share data)


(Unaudited)




Three
                  Month Period
              
              Nine
                  Month Period2006
              
              2005
              
              2006
              
              2005Income
                  before income tax
              
              
              436
              
              
              376
              
              
              1,361
              
              
              1,137Provision
                  for income taxes
              
              
              144
              
              
              133
              
              
              455
              
              
              389Net
                  Income
              
              $
              292
              
              $
              243
              
              $
              906
              
              $
              748Earnings
                  Per Share-Basic
              
              $
              0.62
              
              $
              0.50
              
              $
              1.91
              
              $
              1.52Earnings
                  Per Share-Diluted
              
              $
              0.59
              
              $
              0.48
              
              $
              1.83
              
              $
              1.45Comprehensive
                  IncomeNet
                  Income
              
              $
              292
              
              $
              243
              
              $
              906
              
              $
              748Other
                  Comprehensive Income (Loss):Unrealized
                  gains (losses) on securities
              
              
              197
              
              
              (325
              )
              
              170
              
              
              (330
              )Related
                  tax effects
              
              
              (74
              )
              
              122
              
              
              (64
              )
              
              124Other
                  Comprehensive Income (Loss)
              
              
              123
              
              
              (203
              )
              
              106
              
              
              (206
              )Comprehensive
                  Income
              
              $
              415
              
              $
              40
              
              $
              1,012
              
              $
              542





See
      Notes
      to Condensed Consolidated Financial Statements.





5


FIRST
      ROBINSON FINANCIAL CORPORATION


CONDENSED
      CONSOLIDATED STATEMENTS OF CASH FLOWS


For
      the
      Nine Month Periods Ended December 31, 2006 and 2005


(In
      thousands)


(Unaudited)




Nine
                    Month Period2006
                
                2005Cash
                    flows from operating activities:Net
                    income
                
                $
                906
                
                $
                748Items
                    not requiring (providing) cash:Depreciation
                    and amortization
                
                
                172
                
                
                191Provision
                    for loan losses
                
                
                45
                
                
                135Amortization
                    of premiums and discounts on securities
                
                
                (11
                )
                
                36Amortization
                    of loan servicing rights
                
                
                30
                
                
                23Compensation
                    related to ESOP
                
                
                102
                
                
                108Compensation
                    related to the exercise of options
                
                
                66
                
                
                94Deferred
                    income taxes
                
                
                (15
                )
                
                41Federal
                    Home Loan Bank Stock dividends
                
                
                —
                
                
                (23
                )Originations
                    of mortgage loans held for sale
                
                
                (3,467
                )
                
                (2,469
                )Proceeds
                    from the sale of mortgage loans
                
                
                3,540
                
                
                2,516Net
                    gain on loans sold
                
                
                (73
                )
                
                (47
                )Net
                    (gain) loss on sale of foreclosed property
                
                
                2
                
                
                (5
                )Changes
                    in:Interest
                    receivable
                
                
                (11
                )
                
                78Cash
                    surrender value of life insurance
                
                
                (37
                )
                
                (34
                )Other
                    assets
                
                
                (42
                )
                
                (84
                )Accrued
                    income taxes
                
                
                38
                
                
                98Interest
                    payable
                
                
                28
                
                
                37Other
                    liabilities
                
                
                (25
                )
                
                (2
                )Net
                    cash provided by operating activities
                
                
                1,248
                
                
                1,441Cash
                    flows from investing activities:Proceeds
                    from maturities of securities available for sale
                
                
                —
                
                
                1,500Purchase
                    of securities available for sale
                
                
                (5,010
                )
                
                (7,854
                )Sale
                    of Federal Home Loan Bank Stock
                
                
                32
                
                
                —Repayment
                    of principal on mortgage-backed securities
                
                
                3,400
                
                
                4,143Net
                    change in loans
                
                
                (7,014
                )
                
                1,007Proceeds
                    from sale of foreclosed assets
                
                
                9
                
                
                19Purchase
                    of premises and equipment
                
                
                (102
                )
                
                (141
                )Net
                    cash used in investing activities
                
                
                (8,685
                )
                
                (1,326
                )





See
      Notes
      to Condensed Consolidated Financial Statements.





6


FIRST
      ROBINSON FINANCIAL CORPORATION


CONDENSED
      CONSOLIDATED STATEMENT OF CASH FLOWS


For
      the
      Nine Month Periods Ended December 31, 2006 and 2005


(In
      thousands)


(Unaudited)





Nine
                  Month Period2006
              
              2005Cash
                  flows from financing activities:Net
                  increase (decrease) in deposits
              
              $
              10
              
              $
              (5,088
              )Advances
                  from Federal Home Loan Bank
              
              
              —
              
              
              19,320Repayment
                  of FHLB Advances
              
              
              —
              
              
              (19,320
              )Proceeds
                  from other borrowings
              
              
              104,310
              
              
              75,751Repayment
                  of other borrowings
              
              
              (96,391
              )
              
              (73,689
              )Purchase
                  of incentive plan shares
              
              
              (9
              )
              
              (8
              )Purchase
                  of treasury stock
              
              
              (350
              )
              
              (484
              )Proceeds
                  received from exercise of options
              
              
              25Dividends
                  paid
              
              
              (273
              )
              
              (263
              )Net
                  decrease in advancesfrom
                  borrowers for taxes and insurance
              
              
              (49
              )
              
              (44
              )Net
                  cash provided by (used in) financing activities
              
              
              7,273
              
              
              (3,825
              )Decrease
                  in cash and cash equivalents
              
              
              (164
              )
              
              (3,710
              )Cash
                  and cash equivalents at beginning of period
              
              
              7,389
              
              
              8,848Cash
                  and cash equivalents at end of period
              
              $
              7,225
              
              $
              5,138Supplemental
                  Cash Flows InformationInterest
                  paid
              
              $
              1,919
              
              $
              1,303Income
                  taxes paid (net of refunds)
              
              
              432
              
              
              249Real
                  estate acquired in settlement of loans
              
              
              —
              
              
              11




See
      Notes
      to Condensed Consolidated Financial Statements.





7




FIRST
      ROBINSON FINANCIAL CORPORATION


NOTES
      TO
      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




1.  Basis
      of Presentation





The
      condensed consolidated financial statements include the accounts of First
      Robinson Financial Corporation (the “Company”) and its wholly owned subsidiary,
      First Robinson Savings Bank, National Association (the “Bank”). All significant
      intercompany accounts and transactions have been eliminated in consolidation.
      The accompanying condensed consolidated financial statements are unaudited
      and
      should be read in conjunction with the consolidated financial statements and
      notes thereto included in the Company’s Form 10-KSB filed with the Securities
      and Exchange Commission. The accompanying unaudited interim condensed
      consolidated financial statements have been prepared in accordance with the
      rules and regulations for reporting on Form 10-QSB and, therefore, do not
      include information or footnotes necessary for a complete presentation of
      financial condition, results of operations, and cash flows in conformity with
      accounting principles generally accepted in the United States of America. In
      the
      opinion of management of the Company, the unaudited condensed consolidated
      financial statements reflect all adjustments (consisting of normal recurring
      adjustments) necessary to present fairly the financial position of the Company
      at December 31, 2006 and the results of its operations for the three months
      and
      nine months ended December 31, 2006 and 2005 and cash flows for the nine-month
      periods ended December 31, 2006 and 2005. The results of operations for those
      months ended December 31, 2006 are not necessarily indicative of the results
      to
      be expected for the full year.





The
      Condensed Consolidated Balance Sheet of the Company, as of March 31, 2006,
      has
      been derived from the audited Consolidated Balance Sheet for the Company as
      of
      that date.




2.  Employee
      Stock OwnershipPlan





In
      connection with the conversion to the stock form of ownership, the Board of
      Directors established an employee stock ownership plan (ESOP) for the exclusive
      benefit of participating employees. Employees age 21 or older who have completed
      one year of service are eligible to participate. Upon the issuance of the common
      stock, the ESOP acquired 68,770 shares of $0.01 par value common stock at the
      subscription price of $10.00 per share. The Bank makes contributions to the
      ESOP
      equal to the ESOP’s debt service less dividends received by the ESOP. Dividends
      on the unallocated shares received by the ESOP are used to pay debt service.
      As
      the debt is repaid, shares are released from collateral and allocated to active
      employees. Accordingly, the debt of the ESOP is recorded as debt and the shares
      pledged as collateral are reported as unearned ESOP shares in the condensed
      consolidated balance sheets. As shares are released from collateral, the Bank
      reports compensation expense equal to the current market price of the shares,
      and the shares become outstanding for earnings-per-share calculations. Dividends
      on allocated shares are recorded as a reduction of retained earnings; dividends
      on unallocated ESOP shares are recorded as a reduction of debt or accrued
      interest. ESOP compensation expense for the three month periods ended December
      31, 2006 and 2005 was $34,000 and $36,000 respectively. The expense for the
      nine-month periods ended December 31, 2006 and 2005 was $102,000 and $108,000
      respectively.




3.  Authorized
      Share Repurchase Program





On
      January 17, 2006, the Board of Directors of First Robinson Financial Corporation
      approved a repurchase program of its equity stock. The announcement of the
      program was filed purusant to Form 8-K. This program expired on December 31,
      2006 with 22,563 of the authorized 25,000 shares being repurchased. The Board
      of
      Directors of First Robinson Financial Corporation approved a subsequent
      repurchase program on January 16, 2007. The announcement of the program was
      also
      filed purusant to Form 8-K. The Company may repurchase up to 25,000 shares
      of
      the Company’s common stock from time to time, in the open market, when deemed
      appropriate by management. The progam approved January 16, 2007 will expire
      the
      earlier of December 31, 2007 or when 25,000 of the Company’s outstanding shares
      are repurchased.






8





FIRST
      ROBINSON FINANCIAL CORPORATION


NOTES
      TO
      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




4.  Earnings
      Per Share for the Three Month Periods





Basic
      earnings per share is calculated by dividing net income by the weighted average
      number of common shares outstanding during the period. Diluted earnings per
      share gives effect to the increase in the average shares outstanding which
      would
      have resulted from the exercise of dilutive stock options. The components of
      basic and diluted earnings per share for the three months ended December 31,
      2006 and 2005 were computed as follows (dollar amounts in thousands except
      share
      data):




WeightedAverage
              
              Per
                  ShareIncome
              
              Shares
              
              AmountFor
                  the Quarter Ended December 31, 2006:Basic
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              292
              
              
              471,337
              
              $
              0.62Effect
                  of Dilutive Securities:Unearned
                  incentive plan shares
              
              
              
              
              
              15,442Stock
                  options
              
              
              
              
              
              6,359Diluted
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              292
              
              
              493,138
              
              $
              0.59For
                  the Quarter Ended December 31, 2005:Basic
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              243
              
              
              485,560
              
              $
              0.50Effect
                  of Dilutive Securities:Unearned
                  incentive plan shares
              
              
              
              
              
              14,561Stock
                  options
              
              
              
              
              
              9,096Diluted
                  Earnings per Share:Income
                  available for common stockholders
              
              $
              243
              
              
              509,217
              
              $
              0.48


9


FIRST
      ROBINSON FINANCIAL CORPORATION


NOTES
      TO
      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




4. Earnings
      Per Share for the Nine Month Periods





Basic
      earnings per share is calculated by dividing net income by the weighted average
      number of common shares outstanding during the period. Diluted earnings per
      share gives effect to the increase in the average shares outstanding which
      would
      have resulted from the exercise of dilutive stock options. The components of
      basic and diluted earnings per share for the nine months ended December 31,
      2006
      and 2005 were computed as follows (dollar amounts in thousands except share
      data):




WeightedAverage
              
              Per
                  ShareIncome
              
              Shares
              
              AmountFor
                  the Nine Month Period Ended December 31, 2006:Basic
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              906
              
              
              474,826
              
              $
              1.91Effect
                  of Dilutive Securities:Unearned
                  incentive plan shares
              
              
              
              
              
              15,343Stock
                  options
              
              
              
              
              
              6,283Diluted
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              906
              
              
              496,452
              
              $
              1.83For
                  the Nine Month Period Ended December 31, 2005:Basic
                  Earnings per Share:Income
                  available to common stockholders
              
              $
              748
              
              
              492,930
              
              $
              1.52Effect
                  of Dilutive Securities:Unearned
                  incentive plan shares
              
              
              
              
              
              14,480Stock
                  options
              
              
              
              
              
              8,848Diluted
                  Earnings per Share:Income
                  available for common stockholders
              
              $
              748
              
              
              516,258
              
              $
              1.45


5.  Stock-based
      Compensation





On
      July
      29, 1998, the stockholders of the Company approved a Stock Option Plan (“SOP”)
      and a Recognition and Retention Plan (“RRP”). Options and restricted shares were
      granted to directors, officers and employees at the fair value of the shares
      as
      of that date. The plans were for a period of ten (10) years with a five year
      vesting period for both plans from the date of the grant. Prior to April 1,
      2006
      the Company accounted for the Plan under the recognition and measurement
      provisions of Accounting Principles Board Opinion No. 25, "Accounting for Stock
      Issued to Employees," and related Interpretations Historically, stock-based
      employee compensation cost was not recognized until options were exercised.
      Through the fiscal year ending March 31, 2003, compensation expense was
      recognized for restricted shares awards ratably over the period of service,
      usually the restricted period, based on the fair value of the stock on the
      date
      of grant.




10


FIRST
      ROBINSON FINANCIAL CORPORATION


NOTES
      TO
      CONDENSED CONSOLIDATED FINANCIAL STATEMENTS




In
      December 2004, the Financial Accounting Standards Board ("FASB") issued
      Statement of Financial Accounting Standards ("SFAS") No. 123 (revised 2004),
      "Share Based Payment," which established standards for the accounting for
      transactions in which an entity exchanges its equity instruments for goods
      or
      services, and focuses primarily on accounting for transactions in which an
      entity obtains
      employee services. The SFAS requires a public entity to measure the cost of
      employee services received in exchange for its equity instruments based on
      the
      fair value at the grant date (with limited exceptions) and recognize that cost
      over the service period. This statement revises SFAS No. 123, "Accounting for
      Stock-Based Compensation," and supersedes APB Opinion No. 25, "Accounting for
      Stock Issued to Employees." Effective April 1, 2006, the Company adopted the
      provisions of SFAS No. 123 (revised 2004). As a result of adopting SFAS No.
      123R
      on April 1, 2006, the Company did not record any additional compensation
      expense, as no stock options had been granted in recent years and options
      granted were fully vested prior to adoption. However, on April 1, 2006, the
      Company reclassified $125,000 of unearned compensation related to previously
      recognized compensation for restricted share awards that had been vested as
      of
      that date to additional paid-in capital as these awards represent equity awards
      as defined in SFAS No. 123R. The following table illustrates the effect on
      net
      income earnings per share if the Company had applied the fair value recognition
      provisions of SFAS No. 123 on stock-based employee compensation for the three
      months and nine months ended December 31, 2005. As all options previously
      granted are vested, there was no effect on net income for the three and six
      month periods ended December 31, 2006.




Three
                  Month Period
              
              Nine
                  Month Period2006
              
              2005
              
              2006
              
              2005Net
                  income, as reported
              
              $
              292
              
              $
              243
              
              $
              906
              
              $
              748Add:
                  Stock-based employee compensation expenseincluded
                  in reported income, net of related taxeffects
              
              
              —
              
              
              —
              
              
              —
              
              
              54Deduct:
                  Total stock-basedemployee
                  compensation expensedetermined
                  under fair valuebased
                  method for all awards,net
                  of related tax effects
              
              
              —
              
              
              —
              
              
              —
              
              
              (59
              )Pro
                  forma net income
              
              $
              292
              
              $
              243
              
              $
              906
              
              $
              743Earnings
                  per common share - basic:As
                  reported
              
              $
              0.62
              
              $
              0.50
              
              $
              1.91
              
              $
              1.52Pro
                  forma
              
              $
              0.62
              
              $
              0.50
              
              $
              1.91
              
              $
              1.51Earnings
                  per common share - diluted:As
                  reported
              
              $
              0.59
              
              $
              0.48
              
              $
              1.83
              
              $
              1.45Pro
                  forma
              
              $
              0.59
              
              $
              0.48
              
              $
              1.83
              
              $
              1.44





6.  Recent
      Accounting Pronouncements





Generally
      accepted accounting principals are complex and require management to apply
      significant judgements to various accounting, reporting and disclosure matters.
      Management of the Company must use assumptions and estimates to apply these
      principles where actual measurement is not possible or practical. For a complete
      discussion of the Company’s significant accounting policies, see “Notes to the
      Consolidated Financial Statements” in the Company’s 2006 Annual Report. Certain
      policies are considered critical because they are highly dependent on subjective
      or complex judgements, assumptions and estimates. Changes in such estimates
      may
      have a significant impact on the financial statements. Management has reviewed
      the application of these policies with the Audit Committee
      of the Company’s Board of Directors. For a discussion of applying critical
      accounting policies, See “Significant Accounting Policies” in the Company’s 2006
      Annual Report.




11


FIRST
        ROBINSON FINANCIAL CORPORATION
 NOTES
        TO
        CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


In
      March
      2006, the FASB issued Statement of Financial Accounting Standards No. 156 (“SFAS
      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* ,
      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 necessity for entities that manage the risks inherent in
      servicing assets and servicing liabilities with deriatives 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
      as of
      the entity’s first fiscal year beginning after September 15, 2006. Earlier
      adopotion is permitted as of the beginning of an entity’s fiscal year, provided
      the entity has not yet issued financial statements, including interim financial
      statements for any period of that fiscal year. The Company plans to adopt the
      statement on April 1, 2007 and is in the process of assessing the impact, if
      any, of the adoption of this statement on the financial results.





In
      July
      2006, the FASB issued FASB Interpretation No. 48 (FIN 48), *Accounting
      for Uncertainity in Income Taxes -an Interpretation of FASB Statement
      109* ,
      which
      provides guidance on the measurement, recognition and disclosure of tax
      positions taken or expected to be taken in a tax return. The Interpretation
      also
      provides guidance on derecognition, classification, interest and penalties,
      and
      disclosure. FIN 48 prescribes that a tax position should only be recognized
      if
      it is more-likely-than-not that the position will be sustained upon examination
      by the appropriate taxing authority. A tax position that meets this threshold
      is
      measured as the largest amount of benefit that is greater than 50 percent likely
      of being realized upon ultimate settlement. The cumulative effect of applying
      the provisions of FIN 48 is to be reported as an adjustment to the beginning
      balance of retained earnings in the period of adoption. FIN 48 is effective
      for
      fiscal years beginning after December 15, 2006. The Company is currently
      assessing the impact, if any, that the adoption of this interpretation will
      have
      on its financial statements.





In
      September, 2006, FASB issued SFAS No. 157, *Fair
      Value Measurements* ,
      which
      provides enhanced guidance for using fair value to measure assets and
      liabilities. SFAS No. 157 establishes a common definition of fair value,
      provides a framework for measuring fair value under U.S. GAAP and expands
      disclosure requirements about fair value measurements. SFAS No. 157 is effective
      for financial statements issued in fiscal years beginning after November 15,
      2007, and interim periods within those fiscal years. We are currently evaluating
      the impact, if any, the adoption of SFAS No. 157 will have on our financial
      reporting and disclosures.





In
      September, 2006, the Financial Accounting Standards Board (FASB) issued SFAS
      No.
      158, *Employers'
      Accounting for Defined Benefit Pension and Other Postretirement Plans - an
      amendment of FASB Statements No. 87, 88, 106 and 132(R),* which
      requires recognition of a net liability or asset to report the funded status
      of
      defined benefit pension and other postretirement plans on the balance sheet
      and
      recognition (as a component of other comprehensive income) of changes in the
      funded status in the year in which the changes occur. Additionally, SFAS No.
      158
      requires measurement of a plan's assets and obligations as of the balance sheet
      date and additional annual disclosures in the notes to the financial statements.
      The recognition and disclosure provisions of SFAS No. 158 are effective for
      fiscal years ending after December 15, 2006, while the requirement to measure
      a
      plan's assets and obligations as of the balance sheet date is effective for
      fiscal years ending after December 15, 2008. We are currently evaluating the
      impact the adoption of SFAS No. 158 will have on our financial reporting and
      disclosures.






12





Item
      2:




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation








**Forward-Looking
      Statements**





When
      used
      in this filing and in future filings by First Robinson Financial Corporation
      (the “Company”) with the Securities and Exchange Commission, in the Company’s
      press releases or other public or shareholder communications, or in oral
      statements made with the approval of an authorized executive officer, the words
      or phrases “would be,” “will allow,” “intends to,” “will likely result,” “are
      expected to,” “will continue,” “is anticipated,” “estimate,” “project” or
      similar expressions are intended to identify “forward-looking statements” within
      the meaning of the Private Securities Litigation Reform Act of 1995. Such
      statements are subject to risks and uncertainties, including but not limited
      to
      changes in economic conditions in the Company’s market area, changes in policies
      by regulatory agencies, changes in accounting principles, policies or
      guidelines, fluctuations in interest rates, demand for loans in the Company’s
      market area and competition, all or some of which could cause actual results
      to
      differ materially from historical earnings and those presently anticipated
      or
      projected. References in this filing to “we”, “us” , and “our” refer to the
      Company and/or the Bank, as the content requires.





The
      Company wishes to caution readers not to place undue reliance on any such
      forward-looking statements, which speak only as of the date made and advises
      readers that various factors, including regional and national economic
      conditions; substantial changes in levels of market interest rates;
      legislative/regulatory provisions; monetary and fiscal policies of the U.S.
      Government, including policies of the U.S. Treasury and the Federal Reserve
      Board; credit and other risks of lending and investment activities; demand
      for
      loan products; deposit flows; competition; and accounting principals, policies
      and guidelines, could affect financial performance and could cause actual
      results for future periods to differ materially from those anticipated or
      projected. Further information concerning the Company and its business,
      including additional factors that could materially affect the Company's
      financial results, is included in the Company's filings with the Securities
      and
      Exchange Commission.





The
      Company does not undertake, and specifically disclaims any obligation, to update
      any forward-looking statements to reflect occurrences or unanticipated events
      or
      circumstances after the date of such statements.




**General**





First
      Robinson Financial Corporation’s (the “Company”) principal business, through its
      operating subsidiary, First Robinson Savings Bank, National Association (the
      “Bank”), consists of accepting deposits from the general public and investing
      these funds primarily in loans, mortgage-backed securities and other securities.
      Loans consist primarily of loans secured by residential real estate located
      in
      our market area, consumer loans, commercial loans, and agricultural
      loans.





The
      Company’s results of operations is dependent primarily on net interest income,
      which is the difference between interest earned on interest-earning assets
      and
      the interest paid on interest-bearing liabilities. Net interest income is a
      function of "interest rate spread," which is the difference between the average
      yield earned on interest-earning assets and the average rate paid on
      interest-bearing liabilities. The interest rate spread is affected by
      regulatory, economic and competitive factors that influence interest rates,
      loan
      demand and deposit flows. To a lesser extent, the results of operations are
      also
      affected by other income, and general, administrative and other expense, the
      provision for losses on loans and income tax expense. Other income consists
      primarily of service charges and gains (losses) on sales of loans. General,
      administrative and other expense consists primarily of salaries and employee
      benefits, occupancy and office expenses, advertising, data processing expenses
      and the costs associated with being a publicly held company.





Operations
      are significantly affected by prevailing economic conditions, competition and
      the monetary, fiscal and regulatory policies of government agencies. Lending
      activities are influenced by the demand for and supply of housing, competition
      among lenders, the level of interest rates and the availability of funds.
      Deposit flows and costs of funds are influenced by prevailing market rates
      of
      interest, competing investments, account maturities and the levels of personal
      income and savings in our market area.





Historically,
      the Company’s mission has been to originate loans on a profitable basis to the
      communities served. In seeking to accomplish this mission, the Board of
      Directors and management have adopted a business strategy designed (i) to
      maintain the Bank's capital level in excess of regulatory requirements; (ii)
      to
      maintain asset quality, (iii) to maintain, and if possible, increase earnings;
      and (iv) to manage exposure to changes in interest rates.




13





FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation




**Business
      Strategy**





First
      Robinson Savings Bank, N.A. is a community-oriented, locally owned financial
      institution offering community-banking services to residents and businesses
      of
      Crawford County, Illinois, our primary market area. Periodically, the Board
      of
      Directors and management meet to strategically plan for the future. The Company
      reviews and discusses both current and new products and services to determine
      their effect on profitability and customer service. Any and all current events
      and economic trends in the local area that could materially impact the Bank’s
      earnings are continually monitored. At the present time, the employment market
      has remained strong in Crawford County and no events or economic trends that
      could negatively affect the Bank are anticipated. The recent and foreseen rise
      in interest rates should have a positive affect on the Bank, as management
      will
      endeavor to slow the growth of deposit rates in comparison to loan rates.





The
      strategic plan identifies the most critical issue to success as consistent
      earnings. Net earnings have remained relatively consistent. A positive factor
      in
      maintaining consistent earnings is the Bank’s overall asset quality, which is
      strong. The Bank continues to offer fixed rate residential real estate mortgages
      through programs with the Federal Home Loan Bank of Chicago and USDA Rural
      Development. The non-interest income generated from these programs can fluctuate
      based on the current interest rate environment and demand for home loans. The
      Bank’s Internet banking service, “Netteller” is very popular and the number of
      customers actively using the service is increasing. The program allows the
      Bank
      to offer bill paying, cash management and also direct deposit and payroll
      services to business customers. Currently, a multi-factor security
      authentication system is in the process of being implemented on the Bank’s
      Internet banking product to help mitigate risks associated with online banking.
      To date, the Bank is not aware of any security breaches on the internet banking
      product. Investment brokerage services are provided to customers through
      PrimeVest Financial Services. The service continues to grow and is also
      providing non-interest income. In order to grow deposits and increase the
      customer base, the Bank has recently introduced a new deposit product called
      Reward Checking. The account uses electronic banking services in order too
      earn
      a higher rate of interest. The Bank also continues to evaluate the viability
      of
      implementing an internal trust department and we hope to reach a decision in
      the
      near future.





The
      Bank
      continues to maintain a strong presence in the community and are pleased to
      be
      the only independent community bank in Robinson, Palestine and Oblong, Illinois.
      To visit First Robinson Savings Bank on the web go to www.frsb.net.





**Asset
      Quality**




***Delinquencies*** .
      When a
      borrower fails to make a required payment on a loan, the Bank attempts to cause
      the delinquency to be cured by contacting the borrower. In the case of loans
      secured by real estate, reminder notices are sent to borrowers. If payment
      is
      late, appropriate late charges are assessed and a notice of late charges is
      sent
      to the borrower. If the loan is in excess of 60 days delinquent, the loan will
      generally be referred to the Bank’s legal counsel for collection.




When
      a
      loan becomes more than 90 days delinquent and collection of principal and
      interest is considered doubtful, or is otherwise impaired, the Bank will
      generally place the loan on non-accrual status and previously accrued interest
      income on the loan is charged against current income.




Delinquent
      consumer loans are handled in a similar manner as to those described above.
      The
      Bank’s procedures for repossession and sale of consumer collateral are subject
      to various requirements under applicable consumer protection laws.






14





FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation







The
      following table sets forth the Bank’s loan delinquencies by type, by amount and
      by percentage of type at December 31, 2006.




Loans
                  Delinquent For:30-89
                  Days(1)
              
              90
                  Days and Over(1)
              
              Nonaccrual
              
              Total
                  Delinquent LoansNumber
              
              Amount
              
              Percent
                  of Loan Category
              
              Number
              
              Amount
              
              Percent
                  of Loan Category
              
              Number
              
              Amount
              
              Percent
                  of Loan Category
              
              Number
              
              Amount
              
              Percent
                  of Loan Category(Dollars
                  in thousands)Real
                  Estate:One-
                  to four-family
              
              
              2
              
              $
              95
              
              
              0.26
              %
              
              —
              
              
              —
              
              
              —
              
              
              4
              
              $
              111
              
              
              0.30
              %
              
              6
              
              $
              206
              
              
              0.56
              %Commercial
                  and agricultural real estate
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —Construction,
                  land
              
              
              1
              
              
              89
              
              
              2.97
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              —
              
              
              1
              
              
              89
              
              
              2.97
              %Consumer
                  and other loans
              
              
              6
              
              
              37
              
              
              0.61
              
              
              —
              
              
              —
              
              
              —
              
              
              1
              
              
              31
              
              
              0.51
              
              
              7
              
              
              68
              
              
              1.12
              %Commercial
                  business and agriculturalfinance
              
              
              3
              
              
              32
              
              
              0.33
              
              
              —
              
              
              —
              
              
              —
              
              
              2
              
              
              45
              
              
              0.47
              
              
              5
              
              
              77
              
              
              0.80
              %Total
              
              
              12
              
              $
              253
              
              
              0.34
              %
              
              —
              
              
              —
              
              
              —
              
              
              7
              
              $
              187
              
              
              0.26
              %
              
              19
              
              $
              440
              
              
              0.60
              %





(1)
            Loans
                are still accruing.




***Non-Performing
      Assets*** .
      The
      table below sets forth the amounts and categories of non-performing assets
      in
      the Bank’s loan portfolio. Loans are placed on non-accrual status when the
      collection of principal and/or interest become doubtful. Foreclosed assets
      include assets acquired in settlement of loans.




December
                  31,
              
              March31,
              
              December
                  31,2006
              
              2006
              
              2005Non-accruing
                  loans:One-
                  to four-family
              
              $
              111
              
              $
              444
              
              $
              368Commercial
                  and agriculturalreal
                  estate
              
              
              —
              
              
              66
              
              
              —Consumer
                  and other loans
              
              
              31
              
              
              37
              
              
              —Commercial
                  business and agricultural finance
              
              
              45
              
              
              1
              
              
              35Total
              
              
              187
              
              
              548
              
              
              403Foreclosed
                  assets:One-
                  to four-family
              
              
              —
              
              
              11
              
              
              11Total
              
              
              —
              
              
              11
              
              
              11Total
                  non-performing assets
              
              $
              187
              
              $
              559
              
              $
              414Total
                  as a percentage of totalassets
              
              
              0.16
              %
              
              0.51
              %
              
              0.38
              %




Gross
      interest income which would have been recorded had the non-accruing loans been
      current in accordance with their original terms amounted to approximately $4,000
      for the three months and $12,000 for the nine months ended December 31, 2006
      and
      $4,000 for the three months and $13,000 for the nine months ended December
      31,
      2005.






15




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation





***Classified
        Assets*** .
        Federal
        regulations provide for the classification of loans and other assets, such
        as
        debt and equity securities, considered by the Office of the Comptroller of
        the
        Currency (“OCC”) to be of lesser quality, as “substandard,” “doubtful” or
“loss.” An asset is considered “substandard” if it is inadequately protected by
        the current net worth and paying capacity of the obligor or
        the collateral
        pledged, if any. “Substandard” assets include those characterized by the
“distinct possibility” that the insured institution will sustain “some loss” if
        the deficiencies are not corrected. Assets classified as “doubtful” have all of
        the weaknesses inherent in those classified “substandard” with the added
        characteristic that the weaknesses present make “collection or liquidation in
        full” on the basis of currently existing facts, conditions and values, “highly
        questionable and improbable.” Assets classified as “loss” are those considered
“uncollectible” and of such little value that their continuance as assets
        without the establishment of a specific loss reserve is not
        warranted.




When
      an
      insured institution classifies problem assets as either substandard or doubtful,
      it may establish general allowances for losses in an amount deemed prudent
      by
      management. General allowances represent loss allowances which have been
      established to recognize the inherent risk associated with lending activities,
      but which, unlike specific allowances, have not been allocated to particular
      problem assets. When an insured institution classifies problem assets as “loss,”
it is required either to establish a specific allowance for losses equal to
      100%
      of that portion of the asset so classified or to charge-off such amount. An
      institution’s determination as to the classification of its assets and the
      amount of its valuation allowances is subject to review by the regulatory
      authorities, who may order the establishment of additional general or specific
      loss allowances.





In
      connection with the filing of its periodic reports with the OCC and in
      accordance with its classification of assets policy, the Bank regularly reviews
      loans in its portfolio to determine whether such assets require classification
      in accordance with applicable regulations. On the basis of management’s review
      of its assets, at December 31, 2006, the Bank had classified a total of $843,000
      of its assets as substandard and $208,000 as doubtful or loss. At December
      31,
      2006, total classified assets comprised $1.1 million, or 9.6% of the Bank’s
      capital, and 0.9% of the Bank’s total assets.





***Other
      Loans of Concern*** *.* As of
      December 31, 2006, there were $3.7 million in loans identified, but not
      classified, by the Bank with respect to which known information about the
      possible credit problems of the borrowers or the cash flows of the business
      have
      caused management to have some doubts as to the ability of the borrowers to
      comply with present loan repayment terms and which may result in the future
      inclusion of such items in the non-performing asset categories.





***Allowance
      for Loan Losses*** *.* The
      allowance for loan losses is maintained at a level which, in management’s
      judgment, is adequate to absorb credit losses inherent in the loan portfolio.
      The amount of the allowance is based on management’s evaluation of the
      collectibility of the loan portfolio, including the nature of the portfolio,
      credit concentrations, trends in historical loss experience, specific impaired
      loans and economic conditions. Allowances for impaired loans are generally
      determined based on collateral values. The allowance is increased by a provision
      for loan losses, which is charged to expense and reduced by charge-offs, net
      of
      recoveries.





Real
      estate properties acquired through foreclosure are recorded at the market fair
      value minus 20% of the market fair value if the property is appraised at $50,000
      or less. If the property is appraised at greater than $50,000, then the property
      is recorded at the market fair value less 10% of the fair market value. If
      fair
      value at the date of foreclosure is lower than the balance of the related loan,
      the difference will be charged-off to the allowance for loan losses at the
      time
      of transfer. Valuations are periodically updated by management and if the value
      declines, a specific provision for losses on such property is established by
      a
      charge to operations. At December 31, 2006, the Bank had no real estate
      properties acquired through foreclosure.





Although
      management believes that it uses the best information available to determine
      the
      allowance, unforeseen market conditions could result in adjustments and net
      earnings could be significantly affected if circumstances differ substantially
      from the assumptions used in making the final determination. Future additions
      to
      the Bank’s allowance for loan losses will be the result of periodic loan,
      property and collateral reviews and thus cannot be predicted in advance. In
      addition, federal regulatory agencies, as an integral part of the examination
      process, periodically review the Bank’s allowance for loan losses. Such agencies
      may require the Bank to increase the allowance based upon their judgment of
      the
      information available to them at the time of their examination. At December
      31,
      2006, the Bank had a total allowance for loan losses of $755,000, representing
      1.04% of the Bank’s loans, net. At March 31, 2006, the Bank’s total allowance
      for loan losses to the Bank’s loans, net was at 1.15%.





16


FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation




The
      distribution of the Bank’s allowance for losses on loans at the dates indicated
      is summarized as follows:




December
                31, 2006
            
            
            March
                31, 2006Amount
                of Loan Loss Allowance
            
            Loan
                Amounts by Category
            
            
            Percent
                of Loans in Each Category to Total Loans
            
            
            Amount
                of Loan Loss Allowance
            
            Loan
                Amounts by Category
            
            
            Percent
                of Loans in Each Category to Total Loans(Dollars
                in thousands)One-
                to four-family
            
            $
            126
            
            $
            36,566
            
            
            
            49.51
            %
            
            $
            171
            
            $
            35,669
            
            
            
            53.34
            %Multi-family
            
            
            —
            
            
            545
            
            
            
            0.74
            
            
            
            —
            
            
            574
            
            
            
            0.86Commercial
                andagricultural
                real estate
            
            
            375
            
            
            14,785
            
            
            
            20.02
            
            
            
            354
            
            
            14,127
            
            
            
            21.13Construction
                ordevelopment
            
            
            25
            
            
            2,999
            
            
            
            4.06
            
            
            
            8
            
            
            1,776
            
            
            
            2.66Consumer
                and other loans
            
            
            34
            
            
            6,071
            
            
            
            8.22
            
            
            
            42
            
            
            4,453
            
            
            
            6.66State
                and MunicipalGovernments
            
            
            —
            
            
            3,261
            
            
            
            4.42
            
            
            
            —
            
            
            1,299
            
            
            
            1.94Commercial
                businessand
                agriculturalfinance
            
            
            195
            
            
            9,629
            
            
            
            13.03
            
            
            
            178
            
            
            8,972
            
            
            
            13.41Undisbursed
                potion of loans
            
            
            
            
            
            (626
            )
            
            
            
            
            
            
            
            
            
            (611
            )Unallocated
            
            
            —
            
            
            
            
            
            
            
            
            
            
            —Total
            
            $
            755
            
            $
            73,230
            
            
            
            100.00
            %
            
            $
            753
            
            $
            66,259
            
            
            
            100.00
            %




The
      following table sets forth an analysis of the Bank’s allowance for loan
      losses.




Three
                  Months Ended
                Dectember
                  31,
              
              
              Nine
                  Months Ended
                December
                  31,2006
              
              
              2005
              
              
              2006
              
              
              2005(Dollars
                  in thousands)Balance
                  at beginning of period
              
              $
              770
              
              
              $
              675
              
              
              $
              753
              
              
              $
              672Charge-offs:One-
                  to four-family
              
              
              28
              
              
              
              —
              
              
              
              35
              
              
              
              113Consumer
                  and other loans
              
              
              8
              
              
              
              3
              
              
              
              23
              
              
              
              25Total
                  charge-offs
              
              
              36
              
              
              
              3
              
              
              
              58
              
              
              
              138Recoveries:One-
                  to four-family
              
              
              —
              
              
              
              10
              
              
              
              3
              
              
              
              47Consumer
                  and other loans
              
              
              6
              
              
              
              2
              
              
              
              12
              
              
              
              13Total
                  recoveries
              
              
              6
              
              
              
              12
              
              
              
              15
              
              
              
              60Net
                  charge-offs
              
              
              30
              
              
              
              (9
              )
              
              
              43
              
              
              
              78Additions
                  charged to operations
              
              
              15
              
              
              
              45
              
              
              
              45
              
              
              
              135Balance
                  at end of period
              
              $
              755
              
              
              $
              729
              
              
              $
              755
              
              
              $
              729Ratio
                  of net charge-offs during the period toaverage
                  loans outstanding during the period
              
              
              0.04
              %
              
              
              (0.01
              )%
              
              
              0.06
              %
              
              
              0.12
              %Ratio
                  of net charge-offs during the period toaverage
                  non-performing assets
              
              
              14.01
              %
              
              
              (2.31
              )%
              
              
              13.22
              %
              
              
              21.84
              %




17




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation




**Overview**





First
      Robinson Financial Corporation is the holding company (the “Company”) for First
      Robinson Savings Bank, National Association (the “Bank”). The Company is
      headquartered in Robinson, Illinois and operates three full service offices
      and
      one drive-up facility in Crawford County. The Company earned $906,000 for the
      first nine months of the fiscal year 2007, versus $748,000 in the same period
      of
      fiscal year 2006, an increase of 21.1%. Earnings were positively impacted by
      a
      $154,000 increase in net interest income after provision for loan losses,
      attributable primarily to lower provisions in fiscal 2007, and a $116,000
      increase in non-interest income. Offsetting these positive impacts was an
      increase of $46,000 in non-interest expense and an increase of $66,000 in income
      tax provision. Basic earnings per share for the 2007 nine month fiscal period
      were $1.91 per share versus $1.52 per share for the same period of 2006. Diluted
      earnings per share reflect the potential dilutive impact of stock options
      granted under the stock option plan. Diluted earnings per share for the nine
      months of fiscal 2007 were $1.83 per share, versus $1.45 per share for the
      nine
      months of fiscal 2006.





Net
      income for the December 2006 quarter was $292,000, an increase of 20.2% versus
      $243,000 for the comparable period of 2005. The increase in net earnings was
      primarily attributable to an increase of $287,000 in total interest income
      from
      the third quarter of fiscal 2007 to 2006, which was only partially offset by
      the
      increase in total interest expense of $223,000 during the same comparative
      periods. Also contributing to the increase in net earnings for the same
      comparitive periods was a $30,000 decrease in the provision for loan losses
      and
      a $62,000 increase in total non-interest income. These positivies were offset
      by
      a $96,000 increase in non-interest expense attributable primarily to increases
      in compensation and employee benefits, occupancy and equipment and data
      processing. Basic earnings per share for the third quarter of fiscal 2007 were
      $0.62 per share, versus $0.50 per share for the third quarter of fiscal 2006.
      Diluted earnings per share for the third quarter of fiscal 2007 were $0.59
      per
      share, versus $0.48 per share for the third quarter of fiscal 2006.





**Results
      of Operations**





**Net
      Interest Income**





For
      the
      three-month period ended December 31, 2006, net interest income totaled $1.1
      million, an increase of 6.3%, or $64,000, compared to the same period of 2005.
      The increase in net interest income is primarily due to an increase of $8.0
      million in the amount of average interest-earning assests partially offset
      by an
      increase of $7.7 million in average interest-bearing liabilities. For the
      nine-month period ended December 31, 2006, net interest income totaled $3.2
      million, an increase of 2.1%, or $64,000 versus the same period of 2005. Net
      interest income increased in the nine-month period of fiscal year 2007 versus
      the comparable period of fiscal year 2006, primarily due to an increase in
      average interest earning assets of $4.1 million, or 4.0% compared to an increase
      of $3.9 million in the average amount of interest-bearing liabilities.





During
      the December 2006 quarter, total interest and dividend income increased
      $287,000, or 19.1%, to $1.8 million, versus $1.5 million during the same quarter
      of 2005. For the three-month period ended December 31, 2006, the yield on
      average-earning assets increased 62 basis points to 6.63% from the yield of
      6.01% for the three-month period ended December 31, 2005. During the first
      nine
      months of fiscal 2007, total interest and dividend income increased by $674,000,
      or 15.2%, to $5.1 million, versus $4.4 million during the first nine months
      of
      fiscal 2006. The yield on average earning assets increased by 63 basis points
      to
      6.49% for the nine-month period ended December 31, 2006 versus 5.86% in the
      same
      period of 2005.





The
      average daily loan balances for the quarter ended December 31, 2006 increased
      $6.6 million, or 10.2%, to $71.2 million, versus $64.6 million for the same
      period of 2005. During the same period, loan interest income increased by
      $215,000, or 18.8%, to $1.4 million versus $1.1 million during the quarter
      ended
      December 31, 2006. The yield on loans increased 55 basis points to 7.64% from
      7.09% for the December 2006 quarter compared to the December 2005 quarter.
      The
      average daily loan balances for the nine-month period ending December 31, 2006
      increased $2.7 million, or 4.2% over the same period in fiscal year 2006. Loan
      interest income increased by $470,000, or 13.9%, to $3.8 million. The increase
      was the result of a 64 basis point increase in the yield on loans to 7.52%
      from
      6.88% in the same nine-month period of fiscal year 2006.





The
      average daily securities balances, the Company’s interest-earning demand
      deposits and the federal funds sold balances for the third quarter of fiscal
      year 2007 increased $1.5 million, or 4.2%, to $36.1 million, versus $34.6
      million for the same period of fiscal year 2006. During the same period, income
      from these sources increased by $65,000, or 18.2%, to $423,000 versus $358,000
      during the second quarter of fiscal year 2006. The increase was primarily the
      result of the 56 basis point increase in the yield on investments, to 4.69%,
      versus 4.13% in the third quarter of fiscal year 2006. The average daily
      balances of securities, interest-earning demand deposits
      and federal funds sold for the first nine months of fiscal 2007 increased $1.3
      million, or 3.9%, to $35.8 million, versus $34.5 million for the same period
      of
      fiscal year 2006. During the same periods, income from securities,
      interest-earning demand deposits and federal funds sold increased by $203,000,
      or 19.7%, to $1.2 million versus $1.0 million during the nine months of fiscal
      2006. The increase in investment interest income was primarily the result of
      the
      60 basis point increase in the yields on investments, to 4.60% versus 4.00%
      in
      the nine months of fiscal year 2006.




18




FIRST
        ROBINSON FINANCIAL CORPORATION
 Management’s
        Discussion and Analysis or Plan of Operation


Dividends
      received from Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”)
      stocks increased by $7,000 when comparing the December 2006 quarter to the
      December 2005 quarter. The rate of return on the FRB stock remained steady
      at
      6.0% for each quarter when comparing December 2006 to 2005. However, the rate
      earned on the FHLB stock was lower at 3.1%. For the nine months ended December
      2006, dividends received from FHLB and FRB stock were $22,000 when compared
      to
      the same period in the prior fiscal year at $21,000.





Total
      interest expense increased $223,000, or 45.2%, to $716,000 for the three-month
      period ended December 31, 2006, from $493,000 for the comparable period in
      2005.
      The increase was primarily the result of a 78 basis point increase in the
      Company's daily cost of funds to 3.17%, versus 2.39% for the same period of
      2005. Total interest expense also increased $610,000, or 45.7%, to $1.9 million
      for the nine-month period ended December 31, 2006, from $1.3 million for the
      comparable period in 2005. The increase was primarily the result of an 84 basis
      point increase in the Company's daily cost of funds to 2.97%, versus 2.13%
      for
      the same period of 2005.





On
      an
      average daily basis, total interest-bearing deposits increased $594,000, or
      0.8%, to $73.6 million for the three-month period ended December 31, 2006,
      versus $73.0 million in the same period in 2005. The average cost of funds
      increased by 65 basis points to 2.88% for the December 2006 quarter versus
      the
      December 2005 quarter at 2.23%. The average daily balance of interest-bearing
      deposits for the nine-month period ended December 2006 decreased by $1.1
      million, or 1.5%, to $73.5 million from $74.6 million. When comparing the
      average cost of funds for the December 2006 nine-month period to the same period
      ending December 31, 2005 there was an increase of 69 basis points from 2.00%
      to
      2.69%.





Average
      daily balances of long-term borrowings for the December 2006 quarter decreased
      by $1.0 million from the December 2005 quarter. The $1.0 million FHLB advance
      matured February 28, 2006. Therefore, there was no interest expense for long
      term borrowings for the quarter nor the nine-months ended December 30, 2006.
      There were no overnight borrowings utilized during the quarter ended December
      31, 2006. However during the December 2005 quarter, the average balance for
      the
      quarter of overnight borrowings from the FHLB was $476,000. There were also
      no
      overnight borrowings utilized during the nine-months ended December 31, 2006.
      Advance interest expense decreased by $17,000, or 100.0%, for the quarter ended
      December 31, 2006 and by $49,000, or 100.0% for the nine-months ended Dectember
      31, 2006.





For
      the
      three-months ended December 31, 2006 versus the same period of 2005, the average
      daily balance of other short-term borrowings increased $8.6 million, or 104.9%,
      from $8.2 million to $16.8 million. The average cost of funds also increased
      for
      the December 2006 quarter by 105 basis points from 3.42% to 4.47%. The average
      daily balance of short-term borrowings for the nine-months ended Dectember
      31,
      2006 increased by $6.3 million, or 82.1%, to $13.9 million from $7.7 million
      for
      the nine-month period ending December 31, 2005. The average cost of funds also
      increased by 147 basis points to 4.40% from 2.93% when comparing the nine-months
      of fiscal year 2007 to fiscal year 2006.





**Provision
      for Loan Losses**





Based
      on
      management's review of the adequacy of the allowance for loan losses, provisions
      for losses on loans of $15,000 and $45,000 were recorded during the three-month
      and nine-month periods ended December 31, 2006, versus provisions of $45,000
      and
      $135,000 recorded during the same periods of 2005. The decrease in the provision
      for loan losses for the periods ended December 31, 2006 reflected a number
      of
      factors, including the level of charge-offs, management's overall view on
      current credit quality, and the amount and status of impaired loans. Management
      meets on a quarterly basis to review the adequacy of the allowance for loan
      losses based on Company guidelines. Classified loans are reviewed by the loan
      officers to arrive at specific reserve levels for those loans. Once the specific
      reserve for each loan is calculated, management calculates general reserves
      for
      each loan category based on a combination of loss history adjusted for current
      national and local economic conditions, trends in delinquencies and charge-offs,
      trends in volume and term of loans, changes in underwriting standards, and
      industry conditions. While the Company cannot assure that future chargeoffs
      and/or provisions will not be necessary, the Company's management believes
      that,
      as of December 31, 2006, its allowance for loan losses was
      adequate.




19




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation








**Non-interest
      Income**





Non-interest
      income categories for the three and nine-month periods ended December 31, 2006
      and 2005 are shown in the following table:




Three
                  Months EndedDecember
                  31,Non-interest
                  income:
              
              2006
              
              2005
              
              %
                  Change(In
                  thousands)Charges
                  and fees on deposit accounts
              
              
              221
              
              
              183
              
              
              20.8
              %Charges
                  and other fees on loans
              
              
              7
              
              
              6
              
              
              16.7Net
                  gain on sale of loans
              
              
              26
              
              
              17
              
              
              52.9Other
              
              
              72
              
              
              58
              
              
              24.1Total
                  Non-Interest Income
              
              
              326
              
              
              264
              
              
              23.5
              %
 
 Nine
                  Months EndedDecember
                  31,Non-interest
                  income:
              
              2006
              
              2005
              
              %
                  Change(In
                  thousands)Charges
                  and fees on deposit accounts
              
              
              640
              
              
              571
              
              
              12.1
              %Charges
                  and other fees on loans
              
              
              20
              
              
              18
              
              
              11.1Net
                  gain on sale of loans
              
              
              73
              
              
              47
              
              
              55.3Net
                  gain on sale of foreclosed assets
              
              
              —
              
              
              5
              
              
              (100.0
              )Other
              
              
              214
              
              
              190
              
              
              12.6Total
                  Non-Interest Income
              
              
              947
              
              
              831
              
              
              14.0
              %


Charges
      and fees on deposit accounts increased $38,000 for the three-month and $69,000
      for the nine-month periods ended December 31, 2006 versus the same periods
      in
      2005. In June of 2006, the Company increased the amount they will allow
      customers to overdraw their accounts. This has led to increased fee income
      in
      overdrawn fees.





Charges
      and other fees on loans were relatively steady in both the three and nine-month
      periods when compared to the same periods in 2005.





The
      increase in gains on the sale of loans resulted primarily from an increase
      in
      the amount earned on each loan sold during the three-month period ended December
      31, 2006 versus the same period in 2005. During the September 30, 2006 quarter,
      the Company negotiated a new contract on the sale of the rural housing loans
      and
      was able to increase the amount earned on those sales from an average of
      approximately $300 per loan to an average of approximately $1,000 per loan.
      This
      new contract was also a factor in the increased income for the nine-months
      ended
      December 31, 2006 compared to 2005. The Company also sold $3.5 million in
      mortgage loans for the nine-months ended December 31, 2006 versus $2.5 million
      in the comparable period of fiscal year 2006. The increased volume also
      attributed to the increased income.





Other
      income consists of normal recurring fee income such as commissions from
      PrimeVest Investment Services, our investment brokerage service, the cash value
      of life insurance, ATM/Debit card interchange income and fees, and safe deposit
      box rent, as well as other income that management classifies as non-recurring.
      Other income increased $14,000 and $24,000, respectively, in the three and
      nine-month periods ended December 31, 2006 versus the same period of 2005.
      The
      primary driver behind the increases in the three and nine-month periods can
      be
      attributed to the increase in ATM/Debit card fees received.




20





FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation








**Non-interest
      Expense**





Non-interest
      expense categories for the three and nine-month periods ended December 31,
      2006,
      and 2005 are shown in the following table:




Three
                  Months EndedDecember
                  31,2006
              
              2005
              
              %
                  ChangeNon-interest
                  expense:
              
              
              
              (In
                  thousands)Compensation
                  and employee benefits
              
              
              529
              
              
              458
              
              
              15.5
              %Occupancy
                  and equipment
              
              
              138
              
              
              127
              
              
              8.7Data
                  processing
              
              
              64
              
              
              45
              
              
              42.2Audit,
                  legal and other professional
              
              
              37
              
              
              45
              
              
              (17.8
              )Advertising
              
              
              32
              
              
              18
              
              
              77.8Telephone
                  and postage
              
              
              23
              
              
              21
              
              
              9.5Other
              
              
              126
              
              
              139
              
              
              (9.4
              )Total
                  Non-Interest Expense
              
              
              949
              
              
              853
              
              
              11.3
              %
 
 Nine
                  Months EndedDecember
                  31,2006
              
              2005
              
              %
                  ChangeNon-interest
                  expense:
              
              
              
              (In
                  thousands)Compensation
                  and employee benefits
              
              
              1,474
              
              
              1,465
              
              
              0.6
              %Occupancy
                  and equipment
              
              
              404
              
              
              391
              
              
              3.3Foreclosed
                  property expense
              
              
              1
              
              
              2
              
              
              (50.0
              )Data
                  processing
              
              
              161
              
              
              133
              
              
              21.1Audit,
                  legal and other professional
              
              
              106
              
              
              134
              
              
              (20.9
              )Advertising
              
              
              91
              
              
              79
              
              
              15.2Telephone
                  and postage
              
              
              69
              
              
              66
              
              
              4.5Net
                  loss on sale of foreclosed assets
              
              
              2
              
              
              —Other
              
              
              394
              
              
              386
              
              
              2.1Total
                  Non-Interest Expense
              
              
              2,702
              
              
              2,656
              
              
              1.7
              %


Compensation
      and employee benefits increased in the three-month period when comparing
      December 2006 and 2005. The increase in the three-month period can be
      attributed, in part, to a $42,000 increase in expense related to options
      exercised, a $17,000 increase in the fair value of the shares held in the
      Directors Retirement Plan, an increase of $8,000 in salaries and an increase
      of
      $7,000 in directors fees. These increases were partially offset by a decrease
      in
      the cost of health and life insurance of $7,000. When comparing the nine-months
      ended December 31, 2006 to the same period in 2005, compensation and employee
      benefits increased by $9,000. The increase in the nine-month period can be
      attributed, in part, to a $24,000 increase in salaries, an increase of $10,000
      in directors fees, and a $4,000 increase in the fair value of the shares held
      in
      the Directors Retirement Plan, partially offset by a decrease of $9,000 in
      expense related to options exercised, and a decrease of $23,000 in the cost
      of
      health and life insurance premiums.





The
      increase of $11,000 in occupancy and equipment expense for the three-month
      period is a result of an increase in upkeep on the office buildings. The
      increase of $13,000 for the nine-month period reflects the costs associated
      with
      increased maintenance costs on equipment. Heating and electric expense could
      increase in the coming months due to the de-regulation of electricity and the
      open market auction held for the utility companies to purchase
      electricity.








21




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation




Data
      processing expense increased $19,000 and $28,000 for the three and nine month
      periods ended December 31, 2006 partially as a result of implementing Character
      Amount Recognition/Legal Amount Recognition (“CAR/LAR”) and image capture for
      Check 21 in September 2006. CAR/LAR will improve efficiency in operations and
      Check 21 allows for the quicker collection of funds.





Audit,
      legal and other professional fees decreased primarily due to a decreases in
      audit and legal expenses for both the three-month and nine-month
      periods.





The
      increase of $14,000 for the three months ended December 31, 2006 and $12,000
      for
      the nine months ended December 31, 2006 in advertising expense is primarily
      associated with the push of stepped up customer service and increased
      sponsorship of community groups to promote name recognition.





Other
      expense includes miscellaneous operating expenses such as office supplies,
      ATM/Debit card interchange fees, check processing fees, loan expenses, federal
      deposit insurance premiums and assessments by the bank regulators among others.
      When comparing the December 31, 2006 quarter to the December 31, 2005 quarter,
      the decrease of $13,000 in other expenses can be attributed, in part, to
      decreases in stationary and printing costs, check processing costs, and costs
      associated with training conferences and seminars partially offset by an
      increase in costs of the bounce protection program. The increase of $8,000
      in
      other expenses in the nine-month period ending December 31, 2006 verses the
      same
      period in 2005 is primarily the result of increases in costs of the bounce
      protection program and loan expenses. These increases were partially offset
      by
      decreases in check processing fees and costs associated with training
      conferences and seminars.





**Income
      Tax Expense**





Income
      tax expense increased $11,000, or 8.3%, for the three-months ending December
      31,
      2006, compared to the same period in 2005. Income tax expense for the nine-month
      period increased $66,000, or 17.0%, compared to the same period of 2005. The
      combined state and federal income tax expense as a percentage of income before
      income tax expense decreased to 33.0% during the three-month period of 2006
      compared to 35.3% during the same period in 2005. It decreased to 33.4% for
      the
      nine-month period ending December 31, 2006, versus 34.2% for the same period
      of
      2005.





**Financial
      Condition**





Total
      assets of the Company increased by $8.5 million, or 7.8%, to $117.9 million
      at
      December 31, 2006 from $109.4 million at March 31, 2006. The increase in assets
      was primarily due to an increase of $7.0 million, or 10.6%, in loans, net,
      and
      an increase of $1.8 million, or 5.9%, in available for sale securities,
      partially offset by a decrease of $164,000, or 2.2%, in cash and cash
      equivalents.





The
      Company's federal funds sold increased by $325,000, or 9.3%, to $3.8 million
      at
      December 31, 2006 from $3.5 million at March 31, 2006. The increase in federal
      funds sold was offset, in part, by a decrease of $481,000, or 14.5%, in cash
      and
      due from banks. The total decrease in cash and cash equivalents of $164,000
      was
      primarily a result of the increase in loans.





Available-for-sale
      investment securities amounted to $32.3 million at December 31, 2006 compared
      to
      $30.5 million at March 31, 2006, a $1.8 million increase. The increase resulted
      from $5.0 million in investment purchases and the amortization of $1,000 of
      premiums and discounts on investments partially offset by $3.4 million in
      repayments on mortgage-backed securities and a $170,000 increase in the market
      valuation of the available-for-sale portfolio. The investment portfolio is
      managed to limit the Company's exposure to risk by containing mostly
      mortgage-backed securities and other securities which are either directly or
      indirectly backed by the federal government or a local municipal
      government.





The
      Company's net loan portfolio increased by $7.0 million to $72.5 million at
      December 31, 2006 from $65.5 million at March 31, 2006. Loans on one to
      four-family real estate increased by $897,000, or 2.5%, consumer and other
      loans
      increased $1.6 million, or 36.3%, construction and development loans increased
      $1.2 million, or 68.9%, commercial nonresidential real estate and farmland
      loans
      increased $658,000, or 4.7%, loans to state and municipal governments increased
      $2.0 million, or 151.0%, and an increase of $657,000, or 7.3%, in commercial
      business and agricultural finance loans.





At
      December 31, 2006 the allowance for loan losses was $755,000, or 1.04%, of
      the
      net loan portfolio at December 31, 2006, which increased $2,000 from the
      allowance for loan losses at March 31, 2006 at $753,000, or 1.15%, of the net
      loan portfolio. During the first nine-months of fiscal 2007, the Company charged
      off $58,000 of loan losses, $23,000 of which were in consumer and other loans,
      and $35,000 pertained to loans secured by 1-4 family residential properties.
      The
      chargeoffs of $58,000 were partially offset by $15,000
      in recoveries, consisting of $12,000 in consumer and other loans and $3,000
      in
      1-4 family residential loans. At December 31, 2006, the allowance for loan
      losses constituted 0.64% of the Company’s total assets. Management reviews the
      adequacy of the allowance for loan losses quarterly, and believes that its
      allowance is adequate; however, the Company cannot assure that future chargeoffs
      and/or provisions will not be necessary. See “Asset Quality” for further
      information on delinquencies.




22


FIRST
        ROBINSON FINANCIAL CORPORATION
 Management’s
        Discussion and Analysis or Plan of Operation


As
      of
      December 31, 2006, the Company had no real estate properties held for sale.
      At
      March 31, 2006, the Company had one property at $11,000 which was sold for
      a net
      loss of $2,000. Foreclosed assets are carried at lower of cost or net realizable
      value.





Adjustments
      to deferred income taxes for the tax effect of the decrease in market value
      of
      investment securities available for sale resulted in a deferred tax asset of
      $147,000 at December 31, 2006 compared to a deferred tax asset of $211,000
      at
      March 31, 2006.





Total
      deposits increased by $10,000 to $86.2 million at December 31, 2006 from $86.2
      million at March 31, 2006. The 0.01% increase in total deposits was due to
      an
      increase of $1.2 million in certificates of deposit and an increase of $731,000
      in NOW accounts Offsetting these increases were decreases of $1.8 million in
      savings and money market accounts and $91,000 in non-interest bearing demand
      deposits. The decrease in savings and money markets can be partially attributed
      to a local school district, that keeps the majority of their funds in a savings
      account, using those funds for the completion of a new school building. Also,
      since rates have been on the rise, customers may be moving funds into
      certificate of deposits from low or non-interest bearing accounts.





Federal
      Home Loan Bank advances remained unchanged with no borrowings at December 31,
      2006 and March 31, 2006. However, other borrowings consisting entirely of
      repurchase agreements, increased $7.9 million, or 73.5%. The obligations are
      secured by mortgage-backed securities and US Government agency obligations
      held
      in safekeeping at Independent Bankers Bank in Springfield, Illinois. At December
      31, 2006, the average rate on the repurchase agreements was 4.29% compared
      to
      4.10% at March 31, 2006. These agreements mature periodically within 24 months.





Advances
      from borrowers for taxes and insurance decreased by $49,000 from $126,000 at
      March 31, 2006 to $77,000 at December 31, 2006. Accrued income taxes payable
      increased $38,000. Accrued interest payable increased by $28,000 due to the
      rise
      in interest rates on variable rate deposit accounts. Other liabilities decreased
      $25,000 from $586,000 at March 31, 2006 to $561,000 at December 31, 2006,
      primarily due to the payment of real estate taxes due on the Company’s
      facilities.





Stockholders'
      equity at December 31, 2006 was $12.0 million compared to $11.4 million at
      March
      31, 2006, an increase of $573,000. The increase in stockholders’ equity can be
      attributed to the increases in retained earnings of $906,000 in net income
      offset by $273,000 in dividends declared and paid, the increase of $41,000
      due
      to the final allocation of employee stock ownership shares to plan participants,
      and the increase of $106,000 in accumulated comprehensive income due to the
      increase in the fair value of securities available for sale, net of related
      tax
      effect. These increases were offset, in part, by the purchase of Treasury shares
      of First Robinson Financial stock in the amount of $350,000, offset by $63,000
      in Treasury shares distributed for options exercised. Due to a change in
      accounting standards, incentive plan shares are now netted from additional
      paid-in-capital. This change in accounting standards resulted in a decrease
      of
      $396,000 to additional paid in capital, which was offset, in part, by an
      increase of $89,000 consisting of $61,000 in the valuation of shares in the
      employee stock ownership plan and $28,000 in options exercised.





**Off-Balance
      Sheet Arrangements**





The
      Company has entered into performance standby and financial standby letters
      of
      credit with various local commercial businesses in the aggregate amount of
      $419,000. The letters of credit are collateralized and underwritten, as
      currently required by loan policy, in the same manner as any commercial loan.
      The advancement of any funds on these letters of credit is not
      anticipated.





**Liquidity
      and Capital Resources**





The
      Company’s principal sources of funds are deposits and principal and interest
      payments collected on loans, investments and related securities. While scheduled
      loan repayments and maturing investments are relatively predictable, deposit
      flows and early loan prepayments are more influenced by interest rates, general
      economic conditions and competition.





Liquidity
      resources are used principally to meet outstanding commitments on loans, to
      fund
      maturing certificates of deposit and deposit withdrawals and to meet operating
      expenses. The Company anticipates no foreseeable problems in meeting current
      loan commitments. At December 31, 2006, outstanding commitments to extend credit
      amounted to **** $14.7
      million (including $8.1 million, in available revolving commercial and
      agricultural lines of credit). Management believes that loan repayments and
      other sources of funds will be adequate to meet any foreseeable liquidity
      needs.




23


FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation








The
      Company maintains a $24.5 million line of credit with the FHLB, which was not
      utilized except as described below, as of December 31, 2006. This line can
      be
      accessed immediately. The Company regularly uses FHLB Letters of Credit as
      security for public unit deposits. The available line of credit with the FHLB
      is
      reduced by the amount of these letters of credit. As of December 31, 2006,
      $4.2
      million in FHLB letters of credit were pledged. In addition to the Letters
      of
      Credit, the available line of credit with the FHLB is also reduced by $1.2
      million for the credit enhancement reserve established as a result of the
      participation in the FHLB Mortgage Partnership Finance (“MPF”) program. The
      Company also maintains a $5.0 million revolving line of credit and a $600,000 revolving
      line of credit with Independent Banker’s Bank located in Springfield, Illinois.
      The Company has also established borrowing capabilities at the discount window
      with the Federal Reserve Bank of St. Louis.





Liquidity
      management is both a daily and long-term responsibility of management. The
      Company adjusts their investments in liquid assets based upon management's
      assessment of (i) expected loan demand, (ii) expected deposit flows, (iii)
      yields available on interest- bearing
      investments and (iv) the objectives of its asset/liability management program.
      Excess liquidity generally is invested in interest-earning overnight deposits
      and other short-term government and agency obligations.





The
      Company and the Bank are subject to capital requirements of the federal bank
      regulatory agencies which require the Bank to maintain minimum ratios of Tier
      I
      capital to total risk-weighted assets and total capital to risk-weighted assets
      of 4% and 8% respectively. Tier I capital consists of total stockholders’ equity
      calculated in accordance with generally accepted accounting principals less
      intangible assets, and total capital is comprised of Tier I capital plus certain
      adjustments, the only one of which is applicable to the Bank is the allowance
      for loan losses. Risk-weighted assets refer to the on- and off-balance sheet
      exposures of the Bank adjusted for relative risk levels using formulas set
      forth
      by OCC regulations. The Bank is also subject to an OCC leverage capital
      requirement, which calls for a minimum ratio of Tier I capital to quarterly
      average total assets of 3% to 5%, depending on the institution’s composite
      ratings as determined by its regulators. Both the Bank and the Company are
      considered well-capitalized under federal regulations.




24




FIRST
      ROBINSON FINANCIAL CORPORATION


Management’s
      Discussion and Analysis or Plan of Operation








At
      December 31, 2006, the Bank was in compliance with all of the aforementioned
      capital requirements as summarized below:




December
                  31, 2006(In
                  thousands)Tier
                  I Capital:Common
                  stockholders’ equity
              
              $
              11,012Unrealized
                  loss on securities available for sale
              
              
              245Less
                  disallowed intangible assets
              
              
              (14
              )Total
                  Tier I capital
              
              
              11,243Tier
                  II Capital:Total
                  Tier I capital
              
              
              11,243Qualifying
                  allowance for loan losses
              
              
              755Total
                  risk-based capital
              
              
              11,998Risk-weighted
                  assets
              
              
              70,196Quarter
                  average assets
              
              
              116,022
  To
                    be Well CapitalizedUnder
                    the PromptFor
                    Capital
                
                
                Corrective
                    ActionActual
                
                
                Adequacy
                    Purposes
                
                
                ProvisionsAmount
                
                Ratio
                
                
                Amount
                
                Ratio
                
                
                Amount
                
                RatioAs
                    of December 31, 2006:Total
                    Risk-Based Capital(to
                    Risk-Weighted Assets)
                
                $
                11,998
                
                
                17.09
                %
                
                $
                5,616
                
                
                8.00
                %
                
                $
                7,020
                
                
                10.00
                %Tier
                    I Capital(to
                    Risk-Weighted Assets)
                
                
                11,243
                
                
                16.02
                
                
                
                2,808
                
                
                4.00
                
                
                
                4,212
                
                
                6.00Tier
                    I Capital(to
                    Average Assets)
                
                
                11,243
                
                
                9.69
                
                
                
                4,641
                
                
                4.00
                
                
                
                5,801
                
                
                5.00


At
      the
      time of the conversion of the Bank to a stock organization, a special
      liquidation account was established for the benefit of eligible account holders
      and the supplemental account holders in an amount equal to the net worth of
      the
      Bank. This special liquidation account will be maintained for the benefit of
      eligible account holders and the supplemental account holders who continue
      to
      maintain their accounts in the Bank after June 27, 1997. In the unlikely event
      of a complete liquidation, each eligible and the supplemental eligible account
      holders will be entitled to receive a liquidation distribution from the
      liquidation account in an amount proportionate to the current adjusted
      qualifying balances for accounts then held. The Bank may not declare or pay
      cash
      dividends on or repurchase any of its common stock if stockholders’ equity would
      be reduced below applicable regulatory capital requirements or below the special
      liquidation account.




25





FIRST
      ROBINSON FINANCIAL CORPORATION





Item:
      3 **Controls
      and Procedures**





Any
      control system, no matter how well designed and operated, can provide only
      reasonable (not absolute) assurance that its objectives will be met.
      Furthermore, no evaluation of controls can provide absolute assurance that
      all
      control issues and instances of fraud, if any, have been detected.




**Disclosure
      Controls and Procedures**





The
      Company’s management, with the participation of the Company’s Chief Executive
      Officer and Chief Financial Officer, has evaluated the effectiveness of the
      Company’s disclosure controls and procedures, as such term is defined in Rules
      13a - 15(e) and 15d - 15(e) of the Securities Exchange Act of 1934 (Exchange
      Act) as of the end of the period covered by the report.





Based
      upon that evaluation, the Company’s Chief Executive Officer and Chief Financial
      Officer concluded that as of December 31, 2006 the disclosure controls and
      procedures were effective to provide reasonable assurance that (i) the
      information required to be disclosed by the Company in this Report was recorded,
      processed, summarized and reported within the time periods specified in the
      SEC's rules and forms, and (ii) information required to be disclosed by the
      Company in its reports that are filed or submitted under the Exchange Act is
      accumulated and communicated to management, including the Company’s principal
      executive and principal financial officers, or persons performing similar
      functions, as appropriate to allow timely decisions regarding required
      disclosure.




**Internal
      Control Over Financial Reporting**





There
      have not been any changes in the Company’s internal control over financial
      reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the
      Exchange Act) during the fiscal quarter to which this report relates that have
      materially affected, or are reasonably likely to materially affect, the
      Company’s internal control over financial reporting.





Section
      404 of the Sarbanes-Oxley Act of 2002 requires that companies evaluate and
      annually report on their systems of internal control over financial reporting.
      The Company will begin the process of evaluating, documenting and testing their
      system of internal control over financial reporting to provide the basis for
      its
      report that we anticipate, for the first time, will be a required part of our
      annual report on Form 10-KSB for the fiscal year ending March 31, 2008. Due
      to
      the ongoing evaluation and testing of our internal controls, there can be no
      assurance that if any control deficiencies are identified they will be corrected
      before the end of the 2008 fiscal year, or that there may not be significant
      deficiencies or material weaknesses that would be required to be reported.
      In
      addition, the Company expects the evaluation process and any required
      remediation, if applicable, to increase accounting, legal and other
      costs.







26










PART
      II
      OTHER INFORMATION








Item
      1.  Legal
      Proceedings


None





Item
      2.  Unregistered
      Sales of Equity Securities and Use of Proceeds




The
      following table provides information about purchases by the Company for the
      quarter ended December
      31, 2006 regarding the Company’s common stock.





PURCHASES
      OF EQUITY SECURITIES BY COMPANY (1)


Period
              
              Total
                  Number of Shares Purchased
              
              Average
                  Price Paid per Share
              
              Total
                  Number of Shares Purchased as Part of Publicly Announced Plans
                  or
                  Programs
              
              Maximum
                  Number of Shares that May Yet Be Purchased Under the Plans or
                  Programs10/1/2006
                  - 10/31/2006
              
              —
              
              —
              
              —
              
              3,53711/1/2006
                  - 11/30/2006
              
              1,100
              
              $25.25
              
              1,100
              
              2,43712/1/2006
                  - 12/31/2006
              
              —
              
              —
              
              —
              
              2,437Total
              
              1,100
              
              $25.25
              
              —
              
              2,437




(1)
      On
      January 17, 2006, the Board of Directors of First Robinson Financial Corporation
      approved a repurchase program of its equity stock. The announcement of the
      program was filed purusant to Form 8-K. This program expired on December 31,
      2006 with 22,563 of the authorized 25,000 shares being repurchased. The Board
      of
      Directors of First Robinson Financial Corporation approved a subsequent
      repurchase program on January 16, 2007. The announcement of the program was
      also
      filed purusant to Form 8-K. The Company may repurchase up to 25,000 shares
      of
      the Company’s common stock from time to time, in the open market, when deemed
      appropriate by management. The progam approved January 16, 2007 will expire
      the
      earlier of December 31, 2007 or when 25,000 of the Company’s outstanding shares
      are repurchased. As of December 31, 2006, the number of shares held in Treasury
      were 364,644.





Item
      3.  Defaults
      Upon Senior Executives


None




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


None




Item
      5.  Other
      Information


None




Item
          6. Exhibits





a.
            Exhibit
                31: Section 302 Certifications





b.
            Exhibit
                32: Section 906 Certification




27







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.




FIRST
              ROBINSON
              FINANCIAL CORPORATIONDate:
              February
              14, 2007
            By:
            /s/ Rick
              L.
              CattRick
                L. Catt
              President
                and Chief Executive Officer


Date:
                February
                14, 2007
              By:
              /s/ Jamie
                E.
                McReynoldsJamie
                  E. McReynolds
                Chief****Financial
                  Officer and Vice President
 
 28




EXHIBIT
      INDEX




**Exhibit
      No.**




31.1
            Certification
                by the CEO pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002





31.2
            Certification
                by the CFO pursuant to Section 302 of the Sarbanes-Oxley Act of
                2002





32
            Certifications
                of the CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley
                Act of
                2002







29