Exhibit 13
  Greenville
    Federal Financial Corporation
  
   2008
    Annual Report




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Greenville Federal Financial Corporation
June 30, 2008 and 2007
 ContentsLetter from the President and Chief Executive Officer
    
    
    1Business of Greenville Federal Financial Corporation
    
    
    2Selected Financial and Other Data
    
    
    3Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    5Financial StatementsReport of Independent Registered Public Accounting Firm
    
    
    20Consolidated Balance Sheets
    
    
    21Consolidated Statements of Operations
    
    
    22Consolidated Statements of Comprehensive Income
    
    
    23Consolidated Statements of Stockholders Equity
    
    
    24Consolidated Statements of Cash Flows
    
    
    25Notes to Consolidated Financial Statements
    
    
    27Directors and Officers
    
    
    53Investors and Corporate Information
    
    
    54Office Locations
    
    
    55




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Letter from the President and Chief Executive Officer
        Sincerely,-s- David m. keplerDavid M. KeplerPresident & Chief Executive Officer 1




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Greenville Federal Financial Corporation
Business of Greenville Federal Financial Corporation
      2




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Greenville Federal Financial Corporation
Selected Financial and Other Data
  At June 30,2008
    
    2007(In thousands)SELECTED FINANCIAL CONDITION DATA:Total assets
    
    $
    126,126
    
    
    $
    129,708Cash and cash equivalents
    
    
    7,220
    
    
    
    3,527Investment securities available for sale
    
    
    16,157
    
    
    
    17,013Investment securities held to maturity
    
    
    2,021
    
    
    
    11,031Mortgage-backed securities held to maturity
    
    
    1,280
    
    
    
    1,684Loans receivable
    
    
    89,851
    
    
    
    87,413Deposits
    
    
    83,697
    
    
    
    79,633Advances from the Federal Home Loan Bank
    
    
    19,214
    
    
    
    26,125Stockholders equity
    
    
    21,856
    
    
    
    22,744Allowance for loan losses
    
    
    583
    
    
    
    579Nonperforming loans
    
    
    747
    
    
    
    471
 For the year ended June 30,2008
    
    
    2007(In thousands, except per share data)SELECTED OPERATIONS DATA:Total interest income
    
    $
    7,422
    
    
    $
    7,471Total interest expense
    
    
    3,416
    
    
    
    3,592Net interest income
    
    
    4,006
    
    
    
    3,879Provision for loan losses
    
    
    189
    
    
    
    20Net interest income after provision for loan losses
    
    
    3,817
    
    
    
    3,859Total other income
    
    
    858
    
    
    
    825Total general, administrative and other expense
    
    
    5,829
    
    
    
    3,786Income (loss) before income taxes (credits)
    
    
    (1,154
    )
    
    
    898Federal income taxes (credits)
    
    
    (231
    )
    
    
    257Net income (loss)
    
    $
    (923
    )
    
    $
    641Earnings (loss) per share  basic and diluted
    
    $
    (0.42
    )
    
    $
    0.29
 3




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Greenville Federal Financial Corporation
Selected Financial and Other Data
 At or for the year endedJune 30,2008
    
    2007Performance Ratios:Return on average assets
    
    
    (0.72
    )%
    
    
    0.49
    %Return on average equity
    
    
    (4.15
    )
    
    
    2.84Average equity to average assets
    
    
    17.47
    
    
    
    17.41Equity to assets at the end of the year
    
    
    17.33
    
    
    
    17.53Interest rate spread 1
    
    
    2.80
    
    
    
    2.64Net interest margin 2
    
    
    3.37
    
    
    
    3.20Average interest-earning assets to average
interest-bearing liabilities
    
    
    119.85
    
    
    
    118.81Total general, administrative and other
expenses to average total assets5
    
    
    3.15
    
    
    
    2.92Efficiency ratio 36
    
    
    82.43
    
    
    
    80.48Dividend payout ratio 4
    
    NA
    
    
    
    96.55Asset Quality Ratios:Nonperforming loans as a percent of total loans
    
    
    0.81
    
    
    
    0.53Nonperforming assets as a percent of total assets
    
    
    1.14
    
    
    
    0.55Allowance for loan losses as a percent of total loans
    
    
    0.64
    
    
    
    0.65Allowance for loan losses as a percent of
nonperforming loans
    
    
    78.05
    
    
    
    122.93Regulatory Capital Ratios:Tangible capital
    
    
    10.56
    
    
    
    10.71Core capital
    
    
    10.56
    
    
    
    10.71Risk-based capital
    
    
    16.56
    
    
    
    20.44Number of banking offices
    
    
    2
    
    
    
    2
 
 1
    
    Interest rate spread represents the difference between
the weighted-average yield on interest-earning assets and the weighted-average
cost of interest-bearing liabilities for the year.2
    
    Net interest margin represents net interest income as a
percent of average interest-earning assets for the year.3
    
    The efficiency ratio represents general, administrative
and other expenses as a percent of the total of net interest income and other
income.4
    
    The dividend payout ratio represents dividends declared
per share divided by earnings per share. The ratio has not been adjusted for
dividends waived by Greenville Federal MHC.5
    
    This ratio was calculated without the other-than-temporary
impairment charge on investment securities of $1.8 million. Including the
impairment charge, the ratio was 4.58%.6
    
    This ratio was calculated without the other-than-temporary
impairment charge on investment securities. Including the impairment charge,
the ratio was 119.8%. 4




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  General
  Forward-looking statements
  
    
    our estimates of future income and expenses;
    
    our business plans, prospects and operating strategies;
    
    the quality of our assets, including loans and investments; and
    
    other goals, intentions and expectations.
 5




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  
    
    general economic conditions, either in our market area or nationally, that
are significantly different from what we expect;
    
    increasing foreclosures in our market area;
    
    increasing difficulty in obtaining deposits;
    
    inflation and changes in the interest rate environment that reduce our
interest margins or reduce the market value of our assets;
    
    increased competition among financial institutions within our market area;
    
    adverse changes in the securities markets;
    
    changes in consumer spending, borrowing and savings habits;
    
    legislative or regulatory changes that affect our business;
    
    our ability, either due to our resources or outside factors, that affect our
success in entering into or growing in new markets and cross-selling in our
existing market;
    
    changes in accounting policies and practices, as may be adopted by the
governmental agencies that regulate our business and the Financial Accounting
Standards Board; and
    
    unexpected costs for compensation and benefits.
  Critical accounting policies
   6




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
    Comparison of financial condition at June 30, 2008 and June 30, 2007
   7




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
     8




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
     Comparison of results of operations for the fiscal years ended June 30, 2008 and June 30, 2007
 General.
  9




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
 Interest income.
 
 Interest expense .
 Net interest income
 Provision for loan losses
 10




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  Other income .
 General, administrative and other expense .
   11




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  Federal income taxes
 Average balance sheets
  12




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
 2008
    
    
    
    
    
    
    
    
    
    
    2007Interest income/
    
    
    Yield
    
    
    
    
    
    
    Interest income/
    
    
    YieldAverage balances
    
    
    expense
    
    
    rates
    
    
    Average balances
    
    
    expense
    
    
    rates(Dollars in thousands)Loans receivable 1
    
    $
    88,761
    
    
    $
    6,034
    
    
    
    6.80
    %
    
    $
    85,263
    
    
    $
    5,818
    
    
    
    6.82
    %Mortgage-backed securities
    
    
    1,485
    
    
    
    89
    
    
    
    5.99
    
    
    
    1,966
    
    
    
    106
    
    
    
    5.39Investment securities
    
    
    24,032
    
    
    
    1,098
    
    
    
    4.57
    
    
    
    30,606
    
    
    
    1,345
    
    
    
    4.39Other interest-bearing deposits
    
    
    4,594
    
    
    
    201
    
    
    
    4.38
    
    
    
    3,205
    
    
    
    202
    
    
    
    6.30Total interest-earning assets
    
    
    118,872
    
    
    
    7,422
    
    
    
    6.24
    
    
    
    121,040
    
    
    
    7,471
    
    
    
    6.17Non-interest-earning assets
    
    
    8,516
    
    
    
    
    
    
    
    
    
    
    
    8,729Total assets
    
    $
    127,388
    
    
    
    
    
    
    
    
    
    
    $
    129,769Interest-bearing deposits:Interest-bearing demand deposits
    
    $
    4,459
    
    
    
    25
    
    
    
    0.56
    
    
    $
    4,829
    
    
    
    28
    
    
    
    0.58Savings deposits
    
    
    19,379
    
    
    
    215
    
    
    
    1.11
    
    
    
    20,272
    
    
    
    209
    
    
    
    1.03Time deposits
    
    
    51,567
    
    
    
    2,070
    
    
    
    4.01
    
    
    
    49,466
    
    
    
    2,042
    
    
    
    4.13Total interest-bearing deposits
    
    
    75,405
    
    
    
    2,310
    
    
    
    3.06
    
    
    
    74,567
    
    
    
    2,279
    
    
    
    3.06Borrowings
    
    
    23,781
    
    
    
    1,106
    
    
    
    4.65
    
    
    
    27,312
    
    
    
    1,313
    
    
    
    4.81Total interest-bearing liabilities
    
    
    99,186
    
    
    
    3,416
    
    
    
    3.44
    
    
    
    101,879
    
    
    
    3,592
    
    
    
    3.53Non-interest-bearing demand deposits
    
    
    4,420
    
    
    
    
    
    
    
    
    
    
    
    4,178Non-interest-bearing liabilities
    
    
    1,525
    
    
    
    
    
    
    
    
    
    
    
    1,116Total liabilities
    
    
    105,131
    
    
    
    
    
    
    
    
    
    
    
    107,173Stockholders equity
    
    
    22,257
    
    
    
    
    
    
    
    
    
    
    
    22,596Total liabilities and
stockholders equity
    
    $
    127,388
    
    
    
    
    
    
    
    
    
    
    $
    129,769Net interest income
    
    
    
    
    
    $
    4,006
    
    
    
    
    
    
    
    
    
    
    $
    3,879Interest rate spread
    
    
    
    
    
    
    
    
    
    
    2.80
    %
    
    
    
    
    
    
    
    
    
    
    2.64
    %Net interest margin (net
interest income as a
percent of average
interest-earning assets)
    
    
    
    
    
    
    
    
    
    
    3.37
    %
    
    
    
    
    
    
    
    
    
    
    3.20
    %Average interest-earning
assets to average interest-bearing liabilities
    
    
    
    
    
    
    
    
    
    
    119.85
    %
    
    
    
    
    
    
    
    
    
    
    118.81
    %
 
 1
    
    Includes average balances of non-accrual loans. 13




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
 Yields earned and rates paid
  At June 30,
    
    Year ended June 30,2008
    
    2008
    
    2007Weighted-average yield on loan portfolio1
    
    
    6.58
    %
    
    
    6.80
    %
    
    
    6.82
    %Weighted-average yield on mortgage-backed securities
    
    
    5.62
    
    
    
    5.99
    
    
    
    5.39Weighted-average yield on investment securities
    
    
    4.16
    
    
    
    4.57
    
    
    
    4.39Weighted-average yield on interest-bearing deposits
    
    
    2.89
    
    
    
    4.38
    
    
    
    6.30Weighted-average yield on all interest-earning assets
    
    
    5.96
    
    
    
    6.24
    
    
    
    6.17Weighted-average interest rate on deposits
    
    
    2.45
    
    
    
    3.06
    
    
    
    3.06Weighted-average interest rate on Federal Home
Loan Bank advances
    
    
    4.43
    
    
    
    4.65
    
    
    
    4.81Weighted-average interest rate paid on all interest-bearing liabilities
    
    
    2.81
    
    
    
    3.44
    
    
    
    3.53Interest rate spread (spread between weighted-average
interest rate on all interest-earning assets and all
interest-bearing liabilities)
    
    
    3.15
    
    
    
    2.80
    
    
    
    2.64Net interest margin (net interest income as a percentage
of average interest-earning assets)
    
    
    N/A
    
    
    
    3.37
    
    
    
    3.20
 
 1
    
    Includes average balances of non-accrual loans. 14




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  Year ended June 30,2008 vs. 2007Increase(decrease)due toVolume
    
    
    Rate
    
    
    Total(In thousands)Interest income attributable to:Loans receivable
    
    $
    238
    
    
    $
    (22
    )
    
    $
    216Mortgage-backed securities
    
    
    (28
    )
    
    
    11
    
    
    
    (17
    )Investment securities
    
    
    (298
    )
    
    
    51
    
    
    
    (247
    )Interest-earning deposits
    
    
    72
    
    
    
    (73
    )
    
    
    (1
    )Total interest income
    
    
    (16
    )
    
    
    (33
    )
    
    
    (49
    )Interest expense attributable to:Savings deposits
    
    
    (10
    )
    
    
    16
    
    
    
    6Time deposits
    
    
    85
    
    
    
    (60
    )
    
    
    25Federal Home Loan Bank advances
    
    
    (165
    )
    
    
    (42
    )
    
    
    (207
    )Total interest expense
    
    
    (90
    )
    
    
    (86
    )
    
    
    (176
    )Increase (decrease) in net interest income
    
    $
    74
    
    
    $
    53
    
    
    $
    127
 Asset and liability management
    15




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
  June 30, 2008Net portfolio value(2)Net portfolio value asEstimated increase (decrease)
    
    a percentage ofin NPV
    
    present value of assets(3)Change ininterest rates
    
    Estimated
    
    
    
    
    
    
    
    
    
    
    
    
    
    Change in(basis points)(1)
    
    NPV
    
    Amount
    
    Percent
    
    NPV ratio(4)
    
    basis points(Dollars in thousands)+300
    
    $
    14,541
    
    
    $
    (3,933
    )
    
    
    (21
    )%
    
    
    11.58
    %
    
    (241
    )bp+200
    
    
    15,791
    
    
    
    (2,683
    )
    
    
    (15
    )
    
    
    12.37
    
    
    
    (162
    )+100
    
    
    17,295
    
    
    
    (1,179
    )
    
    
    (6
    )
    
    
    13.31
    
    
    
    (68
    )0
    
    
    18,474
    
    
    
    
    
    
    
    
    
    
    
    13.99
    
    
    -100
    
    
    19,095
    
    
    
    621
    
    
    
    3
    
    
    
    14.29
    
    
    
    30-200 (5)
 June 30, 2007Net portfolio value(2)Net portfolio value asEstimated increase (decrease)
    
    a percentage ofin NPV
    
    present value of assets(3)Change ininterest rates
    
    Estimated
    
    
    
    
    
    
    
    
    
    
    
    
    
    Change in(basis points)(1)
    
    NPV
    
    Amount
    
    Percent
    
    NPV ratio(4)
    
    basis points(Dollars in thousands)+300
    
    $
    13,224
    
    
    $
    (5,974
    )
    
    
    (31
    )%
    
    
    10.49
    %
    
    (382
    )bp+200
    
    
    15,424
    
    
    
    (3,774
    )
    
    
    (20
    )
    
    
    11.96
    
    
    
    (235
    )+100
    
    
    17,523
    
    
    
    (1,675
    )
    
    
    (9
    )
    
    
    13.30
    
    
    
    (101
    )0
    
    
    19,198
    
    
    
    
    
    
    
    
    
    
    
    14.31
    
    
    -100
    
    
    20,294
    
    
    
    1,096
    
    
    
    6
    
    
    
    14.91
    
    
    
    60-200
    
    
    20,695
    
    
    
    1,497
    
    
    
    8
    
    
    
    15.07
    
    
    
    76
 
 (1)
    
    One hundred basis points equals one percent. Assumes an instantaneous uniform
change in interest rates at all maturities.(2)
    
    Net portfolio value represents the discounted present value of the difference
between incoming cash flows on interest-earning and other assets and outgoing cash flows on
interest-bearing liabilities.(3)
    
    Present value of assets represents the discounted present value of incoming cash
flows on interest-earning assets.(4)
    
    NPV ratio represents the net portfolio value divided by the present value of assets.(5)
    
    Because of the low interest rate environment, the Office of Thrift Supervision did
not calculate results for minus 200 bp. 16




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
    Liquidity and capital resources
  Year ended June 30,2008
    

    2007(In thousands)Net income (loss)
    
    $
    (923
    )
    
    $
    641Adjustments to reconcile net income (loss) to net
cash from operating activities
    
    
    2,000
    
    
    
    (32
    )Net cash provided by operating activities
    
    
    1,077
    
    
    
    609Net cash provided by investing activities
    
    
    5,902
    
    
    
    1,383Net cash used in financing activities
    
    
    (3,286
    )
    
    
    (1,719
    )Net increase in cash and cash equivalents
    
    
    3,693
    
    
    
    273Cash and cash equivalents at beginning of year
    
    
    3,527
    
    
    
    3,254Cash and cash equivalents at end of year
    
    $
    7,220
    
    
    $
    3,527
 17




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
    Payments due by periodMore1 year or
    
    
    Over 1-3
    
    
    Over 3-5
    
    
    thanless


    years


    years


    5 years


    Total(In thousands)Contractual obligations:Advances from the Federal Home Loan Bank
    
    $
    3,380
    
    
    $
    12,016
    
    
    $
    1,823
    
    
    $
    1,995
    
    
    $
    19,214Certificate of deposit maturities
    
    
    39,141
    
    
    
    8,896
    
    
    
    5,587
    
    
    
    
    
    
    
    53,624Amount of commitments expiration per period:Commitments to originate one- to four-family
loans
    
    
    2,132
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,132Letters of credit
    
    
    35
    
    
    
    20
    
    
    
    
    
    
    
    
    
    
    
    55Home equity and commercial lines of credit
    
    
    3,041
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,041Undisbursed loans in process
    
    
    857
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    857Data processing contracts
    
    
    626
    
    
    
    160
    
    
    
    
    
    
    
    
    
    
    
    786Lease obligations
    
    
    52
    
    
    
    68
    
    
    
    
    
    
    
    
    
    
    
    120Total contractual obligations
    
    $
    49,264
    
    
    $
    21,160
    
    
    $
    7,410
    
    
    $
    1,995
    
    
    $
    79,829
  18




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition and
Results of Operations
   June 30, 2008Excess of regulatory capitalRegulatory capital
    
    Current requirement
    

    over current requirementAmount
    
    Percent
    
Amount
    
    Percent

    
    Amount
    
    Percent(Dollars in thousands)Tangible capital
    
    $
    13,319
    
    
    
    10.6
    %
    
    $
    1,892
    
    
    
    1.5
    %
    
    $
    11,427
    
    
    
    9.1
    %Core capital
    
    $
    13,319
    
    
    
    10.6
    %
    
    $
    5,045
    
    
    
    4.0
    %
    
    $
    8,274
    
    
    
    6.6
    %Risk-based capital
    
    $
    13,834
    
    
    
    16.6
    %
    
    $
    6,683
    
    
    
    8.0
    %
    
    $
    7,151
    
    
    
    8.6
    %
 Impact of Inflation and Changing Prices
   19




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Report of Independent Registered Public Accounting Firm
 
    
 
 
 20




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Greenville Federal Financial Corporation
Consolidated Balance Sheets
June 30, 2008 and 2007
(In thousands, except share data)
 2008
    
    
    2007AssetsCash and due from banks
    
    $
    1,601
    
    
    $
    2,030Interest-bearing deposits in other financial institutions
    
    
    5,619
    
    
    
    1,497Cash and cash equivalents
    
    
    7,220
    
    
    
    3,527Investment securities available for sale  at market
    
    
    16,157
    
    
    
    17,013Investment securities held to maturity  at amortized cost
    
    
    2,021
    
    
    
    11,031Mortgage-backed securities held to maturity  at amortized cost
    
    
    1,280
    
    
    
    1,684Loans receivable  net of allowance for loans losses of $583
and $579 at June 30, 2008 and 2007, respectively
    
    
    89,851
    
    
    
    87,413Office premises and equipment  at depreciated cost
    
    
    1,907
    
    
    
    2,022Real estate acquired through foreclosure
    
    
    687
    
    
    
    247Stock in Federal Home Loan Bank  at cost
    
    
    1,976
    
    
    
    1,925Cash surrender value of life insurance
    
    
    4,002
    
    
    
    3,849Accrued interest receivable
    
    
    549
    
    
    
    550Deferred federal income taxes
    
    
    157
    
    
    
    Prepaid expenses and other assets
    
    
    319
    
    
    
    447Total assets
    
    $
    126,126
    
    
    $
    129,708Liabilities and Stockholders EquityDeposits
    
    $
    83,697
    
    
    $
    79,633Advances from the Federal Home Loan Bank
    
    
    19,214
    
    
    
    26,125Advances by borrowers for taxes and insurance
    
    
    398
    
    
    
    382Accrued interest payable
    
    
    215
    
    
    
    333Other liabilities
    
    
    691
    
    
    
    387Accrued federal income taxes
    
    
    55
    
    
    
    Deferred federal income taxes
    
    
    
    
    
    
    104Total liabilities
    
    
    104,270
    
    
    
    106,964Commitments and contingencies
    
    
    
    
    
    
    Stockholders equityPreferred stock  authorized 1,000,000 shares, $.01 par
value; no shares issued
    
    
    
    
    
    
    Common stock  authorized 8,000,000 shares, $.01 par value;
2,298,411 shares issued and outstanding
    
    
    23
    
    
    
    23Additional paid-in capital
    
    
    9,021
    
    
    
    9,145Retained earnings  restricted
    
    
    13,443
    
    
    
    14,636Shares acquired by Employee Stock Ownership Plan
    
    
    (631
    )
    
    
    (721
    )Accumulated comprehensive loss  unrealized losses on
securities designated as available for sale, net of related
tax benefits
    
    
    
    
    
    
    (339
    )Total stockholders equity
    
    
    21,856
    
    
    
    22,744Total liabilities and stockholders equity
    
    $
    126,126
    
    
    $
    129,708
 See Notes to Consolidated Financial Statements
 21




---



##### 



Greenville Federal Financial Corporation
Consolidated Statements of Operations
For the years ended June 30, 2008 and 2007
(In thousands, except share data)
 2008
    
    
    2007Interest IncomeLoans
    
    $
    6,034
    
    
    $
    5,818Mortgage-backed securities
    
    
    89
    
    
    
    106Investment securities
    
    
    1,098
    
    
    
    1,345Interest-bearing deposits and other
    
    
    201
    
    
    
    202Total interest income
    
    
    7,422
    
    
    
    7,471Interest ExpenseDeposits
    
    
    2,310
    
    
    
    2,279Borrowings
    
    
    1,106
    
    
    
    1,313Total interest expense
    
    
    3,416
    
    
    
    3,592Net Interest Income
    
    
    4,006
    
    
    
    3,879Provision for Loan Losses
    
    
    189
    
    
    
    20Net Interest Income After Provision for Loan Losses
    
    
    3,817
    
    
    
    3,859Other IncomeCustomer service charges
    
    
    596
    
    
    
    553Gain (loss) on sale of real estate acquired through foreclosure
    
    
    (1
    )
    
    
    5Other operating
    
    
    263
    
    
    
    267Total other income
    
    
    858
    
    
    
    825General, Administrative and Other ExpenseEmployee compensation and benefits
    
    
    2,092
    
    
    
    2,048Occupancy and equipment
    
    
    377
    
    
    
    393Franchise taxes
    
    
    215
    
    
    
    212Data processing
    
    
    541
    
    
    
    464Advertising
    
    
    69
    
    
    
    69Other operating
    
    
    684
    
    
    
    600Impairment charge on investment securities
    
    
    1,820
    
    
    
    Provision for loss on real estate acquired through foreclosure
    
    
    31
    
    
    
    Total general, administrative and other expense
    
    
    5,829
    
    
    
    3,786Income (Loss) Before Federal Income Taxes (Credits)
    
    
    (1,154
    )
    
    
    898Federal Income Taxes (Credits)Current
    
    
    48
    
    
    
    181Deferred
    
    
    (279
    )
    
    
    76Total federal income taxes (credits)
    
    
    (231
    )
    
    
    257Net Income (Loss)
    
    $
    (923
    )
    
    $
    641Earnings (Loss) Per Share  Basic and Diluted
    
    $
    (0.42
    )
    
    $
    0.29
 See Notes to Consolidated Financial Statements
 22




---



##### 



Greenville Federal Financial Corporation
Consolidated Statements of Comprehensive Income (Loss)
For the years ended June 30, 2008 and 2007
(In thousands)
 2008
    
    
    2007Net Income (Loss)
    
    $
    (923
    )
    
    $
    641Other Comprehensive Loss, Net of Related Tax Benefits:Unrealized holding losses on securities during the
year, net of taxes of $13 for the year ended June 30,
2007
    
    
    
    
    
    
    (24
    )Reclassification of impairment charge included in net
loss, net of taxes of $175 for the year ended June
30, 2008
    
    
    339
    
    
    
    Comprehensive Income (Loss)
    
    $
    (584
    )
    
    $
    617Accumulated Comprehensive Loss
    
    $
    
    
    
    $
    (339
    )
 See Notes to Consolidated Financial Statements
 23




---



##### 



Greenville Federal Financial Corporation
Consolidated Statements of Stockholders Equity
For the years ended June 30, 2008 and 2007
(In thousands, except share data)
 Shares
    
    
    UnrealizedAcquired
    
    
    Losses onby Employee
    
    
    SecuritiesAdditional
    
    
    
    
    
    
    Stock
    
    
    DesignatedCommon
    
    
    Paid-in
    
    
    Retained
    
    
    Ownership
    
    
    as AvailableStock
    
    
    Capital
    
    
    Earnings
    
    
    Plan
    
    
    for Sale
    
    
    TotalBalance, July 1, 2006
    
    $
    23
    
    
    $
    9,400
    
    
    $
    14,285
    
    
    $
    (811
    )
    
    $
    (315
    )
    
    $
    22,582Unrealized losses
on securities
designated as
available for sale,
net of related tax
benefits
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (24
    )
    
    
    (24
    )Net income for the
year ended June 30,
2007
    
    
    
    
    
    
    
    
    
    
    641
    
    
    
    
    
    
    
    
    
    
    
    641Cash dividends paid
of $.28 per share
    
    
    
    
    
    
    
    
    
    
    (290
    )
    
    
    
    
    
    
    
    
    
    
    (290
    )Amortization of
ESOP expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    90
    
    
    
    
    
    
    
    90Shares acquired by
2006 equity plan
trust
    
    
    
    
    
    
    (255
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (255
    )Balance, June 30, 2007
    
    
    23
    
    
    
    9,145
    
    
    
    14,636
    
    
    
    (721
    )
    
    
    (339
    )
    
    
    22,744Impairment losses
recognized on
securities
designated as
available for sale,
net of related
taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    339
    
    
    
    339Net loss for the
year ended June 30,
2008
    
    
    
    
    
    
    
    
    
    
    (923
    )
    
    
    
    
    
    
    
    
    
    
    (923
    )Cash dividends paid
of $.28 per share
    
    
    
    
    
    
    
    
    
    
    (270
    )
    
    
    
    
    
    
    
    
    
    
    (270
    )Amortization of
ESOP expense
    
    
    
    
    
    
    (13
    )
    
    
    
    
    
    
    90
    
    
    
    
    
    
    
    77Expense recognized
for 2006 equity
plan trust
    
    
    
    
    
    
    74
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    74Shares acquired by
2006 equity plan
trust
    
    
    
    
    
    
    (185
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (185
    )Balance, June 30, 2008
    
    $
    23
    
    
    $
    9,021
    
    
    $
    13,443
    
    
    $
    (631
    )
    
    $
    
    
    
    $
    21,856
 See Notes to Consolidated Financial Statements
 24




---



##### 



Greenville Federal Financial Corporation
Consolidated Statements of Cash Flows
For the years ended June 30, 2008 and 2007
(In thousands)
 2008
    
    
    2007Cash Flows from Operating ActivitiesNet income (loss)
    
    $
    (923
    )
    
    $
    641Adjustments to reconcile net income (loss) to net cash provided by
operating activities:Accretion and amortization of premiums and discounts on
investment and mortgage-backed securities  net
    
    
    (4
    )
    
    
    (2
    )Amortization of deferred loan origination fees
    
    
    (43
    )
    
    
    (48
    )Depreciation and amortization
    
    
    125
    
    
    
    143Amortization of mortgage servicing rights
    
    
    30
    
    
    
    37Amortization of ESOP expense
    
    
    77
    
    
    
    90Other-than-temporary impairment charge on investment securities
    
    
    1,820
    
    
    
    Provision for loan losses
    
    
    189
    
    
    
    20Provision for losses on mortgage servicing rights
    
    
    10
    
    
    
    Provision for losses on real estate acquired through foreclosure
    
    
    31
    
    
    
    (Gain) loss on sale of real estate acquired through foreclosure
    
    
    1
    
    
    
    (5
    )Amortization of expense related to stock benefit plans
    
    
    74
    
    
    
    Federal Home Loan Bank stock dividends
    
    
    (51
    )
    
    
    (56
    )Increase in cash surrender value of life insurance
    
    
    (153
    )
    
    
    (144
    )Increase (decrease) in cash due to changes in:Accrued interest receivable
    
    
    1
    
    
    
    25Prepaid expenses and other assets
    
    
    (69
    )
    
    
    (51
    )Accrued interest payable
    
    
    (118
    )
    
    
    62Other liabilities
    
    
    304
    
    
    
    (53
    )Federal income taxesCurrent
    
    
    55
    
    
    
    (126
    )Deferred
    
    
    (279
    )
    
    
    76Net cash provided by operating activities
    
    
    1,077
    
    
    
    609Cash Flows Provided by (Used in) Investing ActivitiesPurchases of investment securities designated as available for sale
    
    
    (450
    )
    
    
    (846
    )Proceeds from maturity of investment securities designated as held
to maturity
    
    
    9,010
    
    
    
    6,010Proceeds from repayment of mortgage-backed securities
    
    
    408
    
    
    
    490Loan principal repayments
    
    
    12,415
    
    
    
    14,818Loan disbursements
    
    
    (15,672
    )
    
    
    (19,562
    )Purchase of office premises and equipment
    
    
    (10
    )
    
    
    (96
    )Proceeds from sale of real estate acquired through foreclosure
    
    
    201
    
    
    
    569Net cash provided by investing activities
    
    
    5,902
    
    
    
    1,383Net cash provided by operating and investing
activities (subtotal carried forward)
    
    
    6,979
    
    
    
    1,992
 See Notes to Consolidated Financial Statements
 25




---



##### 



Greenville Federal Financial Corporation
Consolidated Statements of Cash Flows
For the years ended June 30, 2008 and 2007
(In thousands)
 2008
    
    
    2007Net cash provided by operating and investing
activities (subtotal brought forward)
    
    $
    6,979
    
    
    $
    1,992Cash Flows Provided by (Used in) Financing ActivitiesNet increase in deposit accounts
    
    
    4,064
    
    
    
    851Proceeds from Federal Home Loan Bank advances
    
    
    30,000
    
    
    
    36,000Repayment of Federal Home Loan Bank advances
    
    
    (36,911
    )
    
    
    (38,052
    )Advances by borrowers for taxes and insurance
    
    
    16
    
    
    
    27Shares acquired by 2006 equity plan
    
    
    (185
    )
    
    
    (255
    )Dividends paid on common stock
    
    
    (270
    )
    
    
    (290
    )Net cash used in financing activities
    
    
    (3,286
    )
    
    
    (1,719
    )Increase in Cash and Cash Equivalents
    
    
    3,693
    
    
    
    273Cash and Cash Equivalents, Beginning of Year
    
    
    3,527
    
    
    
    3,254Cash and Cash Equivalents, End of Year
    
    $
    7,220
    
    
    $
    3,527Supplemental Disclosure of Cash Flow InformationCash paid during the year for:Interest on deposits and borrowings
    
    $
    3,534
    
    
    $
    3,530Federal income taxes
    
    $
    83
    
    
    $
    308Supplemental Disclosure of Noncash Investing ActivitiesTransfers from loans to real estate acquired through foreclosure
    
    $
    673
    
    
    $
    811Unrealized losses on securities designated as available for
sale, net of related tax benefits
    
    $
    
    
    
    $
    (24
    )
 See Notes to Consolidated Financial Statements
 26




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 1: Summary of Accounting Policies
     Principles of Consolidation
  27




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Loans Receivable
   Securities
    Loan Origination Fees and Costs
  28




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Allowance for Loan Losses
     Office Premises and Equipment
  29




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Real Estate Acquired through Foreclosure
  Investment in Federal Home Loan Bank Stock
  Mortgage Servicing Rights
  Income Taxes
  Cash and Cash Equivalents
  30




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Fair Value of Financial Instruments
    Cash and cash equivalents
 Investment and mortgage-backed securities
 Loans receivable
 Federal Home Loan Bank stock
 Accrued Interest Receivable
 Deposits
 Federal Home Loan Bank advances
 Accrued Interest Payable
 Commitments to extend credit
 31




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
  2008
    
    
    2007Carrying
    
    
    Fair
    
    
    Carrying
    
    
    FairValue
    
    
    Value
    
    
    Value
    
    
    Value(In thousands)Financial AssetsCash and cash equivalents
    
    $
    7,220
    
    
    $
    7,220
    
    
    $
    3,527
    
    
    $
    3,527Investment securities available
for sale
    
    
    16,157
    
    
    
    16,157
    
    
    
    17,013
    
    
    
    17,013Investment securities held to
maturity
    
    
    2,021
    
    
    
    2,022
    
    
    
    11,031
    
    
    
    10,859Mortgage-backed securities
    
    
    1,280
    
    
    
    1,300
    
    
    
    1,684
    
    
    
    1,692Loans receivable
    
    
    89,851
    
    
    
    89,307
    
    
    
    87,413
    
    
    
    86,582Federal Home Loan Bank stock
    
    
    1,976
    
    
    
    1,976
    
    
    
    1,925
    
    
    
    1,925Accrued interest receivable
    
    
    549
    
    
    
    549
    
    
    
    550
    
    
    
    550$
    119,054
    
    
    $
    118,531
    
    
    $
    123,143
    
    
    $
    122,148Financial LiabilitiesDeposits
    
    $
    83,697
    
    
    $
    84,324
    
    
    $
    79,633
    
    
    $
    79,650Advances from the Federal Home
Loan Bank
    
    
    19,214
    
    
    
    19,183
    
    
    
    26,125
    
    
    
    25,625Advances by borrowers for taxes
and insurance
    
    
    398
    
    
    
    398
    
    
    
    382
    
    
    
    382Accrued interest payable
    
    
    215
    
    
    
    215
    
    
    
    333
    
    
    
    333$
    103,524
    
    
    $
    104,120
    
    
    $
    106,473
    
    
    $
    105,990
 Cash Surrender Value of Life Insurance
  Advertising
  Earnings Per Share
  32




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
   Reclassifications
  Recent Accounting Developments
  33




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
      34




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
  Note 2: Investment and Mortgage-backed Securities
  June 30, 2008Gross
    
    
    Gross
    
    
    EstimatedUnrealized
    
    
    Unrealized
    
    
    FairAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)Available for Sale:Asset management fund
    
    $
    16,157
    
    
    $
    
    
    
    $
    
    
    
    $
    16,157Held to Maturity:Municipal obligations
    
    $
    21
    
    
    $
    
    
    
    $
    
    
    
    $
    21Federal Home Loan
Bank bonds
    
    
    2,000
    
    
    
    1
    
    
    
    
    
    
    
    2,001$
    2,021
    
    
    $
    1
    
    
    $
    
    
    
    $
    2,022
 June 30, 2007Gross
    
    
    Gross
    
    
    EstimatedUnrealized
    
    
    Unrealized
    
    
    FairAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)Available for Sale:Asset management fund
    
    $
    17,527
    
    
    $
    
    
    
    $
    (514
    )
    
    $
    17,013Held to Maturity:Municipal obligations
    
    $
    31
    
    
    $
    
    
    
    $
    
    
    
    $
    31Federal Home Loan
Mortgage Corporation
bonds
    
    
    2,000
    
    
    
    
    
    
    
    (24
    )
    
    
    1,976Federal National
Mortgage Association
bonds
    
    
    3,000
    
    
    
    
    
    
    
    (36
    )
    
    
    2,964Federal Home Loan
Bank bonds
    
    
    6,000
    
    
    
    
    
    
    
    (112
    )
    
    
    5,888$
    11,031
    
    
    $
    
    
    
    $
    (172
    )
    
    $
    10,859
 35




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
  June 30,2008
    
    
    2007Estimated
    
    
    
    
    
    
    EstimatedAmortized
    
    
    Fair
    
    
    Amortized
    
    
    FairCost
    
    
    Value
    
    
    Cost
    
    
    ValueHeld to Maturity:Due within one year
    
    $
    2,000
    
    
    $
    2,001
    
    
    $
    2,000
    
    
    $
    1,991Due after one year through
three years
    
    
    21
    
    
    
    21
    
    
    
    9,031
    
    
    
    8,868Due after three years
through five years
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total held to maturity
    
    $
    2,021
    
    
    $
    2,022
    
    
    $
    11,031
    
    
    $
    10,859
  June 30, 2008EstimatedGross Unrealized
    
    
    Gross Unrealized
    
    
    FairAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)Federal Home Loan Mortgage
Corporation participation
certificates
    
    $
    180
    
    
    $
    1
    
    
    $
    
    
    
    $
    181Federal National Mortgage
Association participation
certificates
    
    
    1,088
    
    
    
    20
    
    
    
    
    
    
    
    1,108Government National Mortgage
Association participation
certificates
    
    
    12
    
    
    
    
    
    
    
    
    
    
    
    12Total
mortgage-backed
securities
    
    $
    1,280
    
    
    $
    21
    
    
    $
    
    
    
    $
    1,301
 36




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 June 30, 2007EstimatedGross Unrealized
    
    
    Gross Unrealized
    
    
    FairAmortized Cost
    
    
    Gains
    
    
    Losses
    
    
    Value(In thousands)Federal Home Loan Mortgage
Corporation participation
certificates
    
    $
    232
    
    
    $
    1
    
    
    $
    
    
    
    $
    233Federal National Mortgage
Association participation
certificates
    
    
    1,436
    
    
    
    8
    
    
    
    (1
    )
    
    
    1,443Government National Mortgage
Association participation
certificates
    
    
    16
    
    
    
    
    
    
    
    
    
    
    
    16Total
mortgage-backed
securities
    
    $
    1,684
    
    
    $
    9
    
    
    $
    (1
    )
    
    $
    1,692
  June 30,2008
    
    
    2007Estimated
    
    
    
    
    
    
    EstimatedAmortized
    
    
    Fair
    
    
    Amortized
    
    
    FairCost
    
    
    Value
    
    
    Cost
    
    
    ValueDue in less than one year
    
    $
    3
    
    
    $
    3
    
    
    $
    
    
    
    $
    Due in one to five years
    
    
    1
    
    
    
    1
    
    
    
    16
    
    
    
    17Due in five to ten years
    
    
    154
    
    
    
    155
    
    
    
    165
    
    
    
    165Due after ten years
    
    
    1,122
    
    
    
    1,142
    
    
    
    1,503
    
    
    
    1,510$
    1,280
    
    
    $
    1,301
    
    
    $
    1,684
    
    
    $
    1,692
 37




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
  June 30, 2007Less than 12 months
    
    
    12 months or longer
    
    
    TotalDescription of
    
    Number of
    
    
    
    
    
    
    Unrealized
    
    
    Number of
    
    
    
    
    
    
    Unrealized
    
    
    Number of
    
    
    
    
    
    
    Unrealizedsecurities
    
    investments
    
    
    Fair value
    
    
    losses
    
    
    investments
    
    
    Fair value
    
    
    losses
    
    
    investments
    
    
    Fair value
    
    
    losses(Dollars in thousands)Investment
securities
available for sale
    
    
    
    
    
    $
    
    
    
    $
    
    
    
    
    1
    
    
    $
    17,013
    
    
    $
    514
    
    
    
    1
    
    
    $
    17,013
    
    
    $
    514Investment
securities
held to maturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11
    
    
    
    10,828
    
    
    
    172
    
    
    
    11
    
    
    
    10,828
    
    
    
    172Mortgage-backed
securities
    
    
    5
    
    
    
    1,003
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    1,003
    
    
    
    1Total temporarily
impaired securities
    
    
    5
    
    
    $
    1,003
    
    
    $
    1
    
    
    
    12
    
    
    $
    27,841
    
    
    $
    686
    
    
    
    17
    
    
    $
    28,844
    
    
    $
    687
    38




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 3: Loans Receivable
  2008
    
    
    2007(In thousands)Residential real estateOne- to four-family
    
    $
    74,882
    
    
    $
    72,089Multi-family
    
    
    3,907
    
    
    
    3,864Construction
    
    
    998
    
    
    
    701Nonresidential real estate
    
    
    5,999
    
    
    
    5,242Nonresidential real estate construction
    
    
    
    
    
    
    750Commercial
    
    
    2,879
    
    
    
    3,467Consumer and other
    
    
    3,004
    
    
    
    3,121Total loans
    
    
    91,669
    
    
    
    89,234LessUnearned interest
    
    
    10
    
    
    
    9Deferred loan origination fees, net
    
    
    368
    
    
    
    371Allowance for loan losses
    
    
    583
    
    
    
    579Undisbursed portion of loans in process
    
    
    857
    
    
    
    862Net loans
    
    $
    89,851
    
    
    $
    87,413
   
 39




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 4: Allowance for Loan Losses
  2008
    
    
    2007(In thousands)Balance, beginning of year
    
    $
    579
    
    
    $
    579Provision for loan losses
    
    
    189
    
    
    
    20Charge-offs of loans, net of recoveries
    
    
    (185
    )
    
    
    (20
    )Balance, end of year
    
    $
    583
    
    
    $
    579
  Note 5: Office Premises and Equipment
  2008
    
    
    2007(In thousands)Land
    
    $
    572
    
    
    $
    572Leasehold improvements
    
    
    204
    
    
    
    204Buildings and improvements
    
    
    1,721
    
    
    
    1,721Furniture and equipment
    
    
    1,528
    
    
    
    1,518Vehicles
    
    
    13
    
    
    
    134,038
    
    
    
    4,028Less accumulated depreciation and amortization
    
    
    (2,131
    )
    
    
    (2,006
    )Net premises and equipment
    
    $
    1,907
    
    
    $
    2,022
 
 40




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 6: Mortgage Servicing Rights
  2008
    
    
    2007(In thousands)Balance at beginning of year
    
    $
    148
    
    
    $
    185Recognition of mortgage servicing rights on sale of loans
    
    
    
    
    
    
    Amortization of mortgage servicing rights
    
    
    (30
    )
    
    
    (37
    )Balance at end of year
    
    $
    118
    
    
    $
    148Valuation allowance for impairment at beginning of year
    
    $
    
    
    
    $
    Valuation allowance recorded
    
    
    (10
    )
    
    
    Valuation allowance for impairment at end of year
    
    $
    (10
    )
    
    $
    Net carrying value of mortgage servicing rights at end
of year
    
    $
    108
    
    
    $
    148
  41




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 7: Deposits
  2008
    
    
    2007Deposit type and weighted average interest rate
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(Dollars in thousands)Non-interest-bearing checking
    
    $
    4,806
    
    
    
    5.7
    %
    
    $
    4,248
    
    
    
    5.3
    %NOW accounts2008  0.56%
    
    
    4,580
    
    
    
    5.52007  0.56%
    
    
    
    
    
    
    
    
    
    
    4,844
    
    
    
    6.1Money market accounts2008  0.60%
    
    
    330
    
    
    
    0.42007  0.60%
    
    
    
    
    
    
    
    
    
    
    498
    
    
    
    0.6Savings accounts2008  1.50%
    
    
    20,357
    
    
    
    24.32007  1.08%
    
    
    
    
    
    
    
    
    
    
    18,818
    
    
    
    23.7Total demand, transaction and
savings deposits
    
    
    30,073
    
    
    
    35.9
    
    
    
    28,408
    
    
    
    35.7Certificates of deposit
Original maturities of:Less than twelve months2008  2.75%
    
    
    32,130
    
    
    
    38.42007  4.85%
    
    
    
    
    
    
    
    
    
    
    28,596
    
    
    
    35.9Twelve months to thirty-six months2008  3.68%
    
    
    9,678
    
    
    
    11.62007  3.69%
    
    
    
    
    
    
    
    
    
    
    12,441
    
    
    
    15.6Thirty-six months and greater2008  3.92%
    
    
    11,816
    
    
    
    14.12007  3.87%
    
    
    
    
    
    
    
    
    
    
    10,188
    
    
    
    12.8Total certificates of deposit
    
    
    53,624
    
    
    
    64.1
    
    
    
    51,225
    
    
    
    64.3Total deposit accounts
    
    $
    83,697
    
    
    
    100.0
    %
    
    $
    79,633
    
    
    
    100.0
    %
 42




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 The Corporation had certificate of deposit accounts with balances in excess of $100,000
totaling approximately $17.3 million and $13.3 million at June 30, 2008 and 2007,
respectively. Deposits in excess of $100,000 included accounts received from the State of
Ohio totaling $13.0 million and $11.0 million at those respective dates. At June 30, 2008,
the Corporation had letters of credit from the Federal Home Loan Bank totaling $15.2 million
to secure certain deposits.Interest expense on deposits is summarized as follows for the years ended June 30:
 2008
    
    
    2007(In thousands)Demand, transaction and savings accounts
    
    $
    242
    
    
    $
    238Certificate of deposit accounts
    
    
    2,068
    
    
    
    2,041Balance at end of year
    
    $
    2,310
    
    
    $
    2,279
 Maturities of certificate of deposit accounts as of June 30 are as follows:
 2008
    
    
    2007(In thousands)Due within one year
    
    $
    39,141
    
    
    $
    38,758Due after one year to two years
    
    
    6,498
    
    
    
    5,758Due after two years to three years
    
    
    2,398
    
    
    
    3,635Due after three years to four years
    
    
    1,915
    
    
    
    1,570Due after four years to five years
    
    
    3,672
    
    
    
    1,504$
    53,624
    
    
    $
    51,225
 Note 8: Advances from the Federal Home Loan Bank
 Advances from the Federal Home Loan Bank, collateralized at June 30, 2008, by a blanket
pledge of residential real estate mortgage loans totaling $25.9 million and the Corporations
investment in Federal Home Loan Bank stock, are summarized as follows:
 Maturing in fiscal year ending June 30,
    
    2008
    
    
    2007(In thousands)2008
    
    $
    
    
    
    $
    14,1582009
    
    
    3,380
    
    
    
    2,7722010
    
    
    6,657
    
    
    
    2,3912011
    
    
    5,359
    
    
    
    5,0822012
    
    
    1,114
    
    
    
    828Thereafter
    
    
    2,704
    
    
    
    894$
    19,214
    
    
    $
    26,125
 43




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 9: Federal Income Taxes (Credits)
 The provision for federal income taxes (credits) differs from that computed at the statutory
corporate rate for the fiscal years ended June 30 as follows:
 2008
    
    
    2007(In thousands)Federal income taxes (credits) computed at the 34%
statutory rate
    
    $
    (392
    )
    
    $
    305Increase (decrease) in taxes resulting from:Increase in cash surrender value of life insurance
    
    
    (52
    )
    
    
    (49
    )Valuation allowance on deferred tax assets
    
    
    210
    
    
    
    Other
    
    
    3
    
    
    
    1Federal income tax provision (credit) per consolidated
financial statements
    
    $
    (231
    )
    
    $
    257Effective rate of tax
    
    
    (20.0
    )%
    
    
    28.6
    %
 The composition of the Corporations net deferred tax asset (liability) at June 30 is as
follows:
 2008
    
    
    2007(In thousands)Taxes (payable) refundable on temporary
differences at statutory rate:Deferred tax liabilitiesFederal Home Loan Bank stock dividends
    
    $
    (406
    )
    
    $
    (397
    )Difference between book and tax depreciation
    
    
    (27
    )
    
    
    (41
    )Mortgage servicing rights
    
    
    (37
    )
    
    
    (50
    )Prepaid expenses and other
    
    
    (32
    )
    
    
    (40
    )Total deferred tax liabilities
    
    
    (502
    )
    
    
    (528
    )Deferred tax assetsGeneral loan loss allowance
    
    
    185
    
    
    
    189Deferred loan origination fees
    
    
    73
    
    
    
    53Charitable contributions
    
    
    
    
    
    
    7Unrealized losses on securities available for sale
    
    
    
    
    
    
    175Other-than-temporary impairment loss
    
    
    607
    
    
    
    Other
    
    
    4
    
    
    
    Gross deferred tax assets
    
    
    869
    
    
    
    424Less: valuation allowance
    
    
    (210
    )
    
    
    Total deferred tax assets, net
    
    
    659
    
    
    
    424Net deferred tax asset (liability)
    
    $
    157
    
    
    $
    (104
    )
 The valuation allowance relates to the other-than-temporary impairment loss which may not be
deductible in future periods. Should the loss be realized upon redemption of the security,
since the loss will be capital in nature, it may only be deducted to the extent the
Corporation has capital gains. The realized capital loss can be carried back three years and
carried forward five years.
 44




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Prior to 1997, the Corporation was allowed a special bad debt deduction generally limited to
8% of otherwise taxable income and subject to certain limitations based on aggregate loans
and deposit account balances at the end of the year. If the amounts that previously
qualified as deductions for federal income taxes are later used for purposes other than bad
debt losses, including distributions in liquidation, such distributions will be subject to
federal income taxes at the then current corporate income tax rate. Retained earnings at
June 30, 2008, include approximately $1.8 million for which federal income taxes have not
been provided. The amount of unrecognized deferred tax liability relating to the cumulative
bad debt deduction was approximately $600,000 at June 30, 2008. Management believes that it
is more likely than not that the results of future operations, as integrated with the
reversal of deferred tax credits, will generate sufficient taxable income to realize reported
deferred tax assets.
 Note 10: Commitments and Contingencies
 The Corporation is a party to financial instruments with off-balance-sheet risk in the normal
course of business to meet the financing needs of its customers, including commitments to
extend credit. Such commitments involve, to varying degrees, elements of credit and
interest-rate risk in excess of the amount recognized in the statement of financial
condition. The contract or notional amounts of the commitments reflect the extent of the
Corporations involvement in such financial instruments.The Corporations exposure to credit loss in the event of nonperformance by the other party
to the financial instrument for commitments to extend credit is represented by the
contractual notional amount of those instruments. The Corporation uses the same credit
policies in making commitments and conditional obligations, including receipt of collateral,
as those utilized for on-balance-sheet instruments.At June 30, 2008, the Corporation had outstanding commitments of $65,000 to originate
adjustable-rate loans and $2.4 million to originate fixed-rate loans at interest rates
ranging from 5.75% to 9.625%. Additionally, the Corporation had commitments under unused
lines of credit for home equity loans and commerical loans totaling approximately $2.7
million and $349,000, respectively. Finally, the Corporation had commitments under stand-by
letters of credit totaling approximately $55,000. Stand-by letters of credit are conditional
commitments issued by the Corporation to guarantee the performance of a customer to a third
party. In the opinion of management, all loan commitments equaled or exceeded prevalent
market interest rates as of June 30, 2008 and will be funded from normal cash flow from
operations.
 45




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 11:
    
    Lease Commitments
  Year ended June 30,
    
    (In thousands)2009
    
    $
    522010
    
    
    522011
    
    
    16$
    120
  Note 12:
    
    Benefit Plans
   46




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 2008
    
    
    2007Allocated shares
    
    
    27,030
    
    
    
    18,020Unallocated shares
    
    
    63,068
    
    
    
    72,078Total ESOP shares
    
    
    90,098
    
    
    
    90,098Fair value of unallocated shares at June 30
    
    $
    460,000
    
    
    $
    681,000
   Note 13:
    
    Stock Option Plan
  47




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
        Note 14:
    
    Regulatory Capital
  48




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
    As of June 30, 2008To Be Well CapitalizedFor Capital Adequacy
    
    Under Prompt CorrectiveActual
    
    Purposes
    
    Action ProvisionsAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)Tangible capital
    
    $
    13,319
    
    
    
    10.6
    %
    
    
    > $1,892
    
    
    
    > 1.5
    %
    
    
    > $6,306
    
    
    
    >  5.0
    %Core capital
    
    $
    13,319
    
    
    
    10.6
    %
    
    
    > $5,045
    
    
    
    > 4.0
    %
    
    
    > $7,568
    
    
    
    >  6.0
    %Risk-based capital
    
    $
    13,834
    
    
    
    16.6
    %
    
    
    > $6,683
    
    
    
    > 8.0
    %
    
    
    > $8,353
    
    
    
    >10.0
    %
 As of June 30, 2007To Be Well CapitalizedFor Capital Adequacy
    
    Under Prompt CorrectiveActual
    
    Purposes
    
    Action ProvisionsAmount
    
    Ratio
    
    Amount
    
    Ratio
    
    Amount
    
    Ratio(Dollars in thousands)Tangible capital
    
    $
    13,881
    
    
    
    10.7
    %
    
    
    > $1,946
    
    
    
    > 1.5
    %
    
    
    > $6,486
    
    
    
    >  5.0
    %Core capital
    
    $
    13,881
    
    
    
    10.7
    %
    
    
    > $5,189
    
    
    
    > 4.0
    %
    
    
    > $7,784
    
    
    
    >  6.0
    %Risk-based capital
    
    $
    14,437
    
    
    
    20.4
    %
    
    
    > $5,655
    
    
    
    > 8.0
    %
    
    
    > $7,069
    
    
    
    >10.0
    %
 49




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
  June 30,2008
    
    
    2007(In thousands)GAAP capital
    
    $
    13,326
    
    
    $
    13,891Reconciling items:Mortgage servicing rights excluded
    
    
    (7
    )
    
    
    (10
    )Tangible and core capital
    
    
    13,319
    
    
    
    13,881General valuation allowance
    
    
    515
    
    
    
    556Risk-based capital
    
    $
    13,834
    
    
    $
    14,437
    50




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Note 15:
    
    Related Party Transactions
   Note 16:
    
    Greenville Federal Financial Corporation Condensed Financial Statements
  Greenville Federal Financial Corporation
Balance Sheets
 2008
    
    
    2007AssetsInterest-bearing deposits in Greenville Federal
    
    $
    7,855
    
    
    $
    3,426Demand deposit in Greenville Federal
    
    
    3
    
    
    
    5Loan receivable from ESOP
    
    
    663
    
    
    
    738Dividend receivable from Greenville Federal
    
    
    
    
    
    
    4,712Receivable from Greenville Federal
    
    
    61
    
    
    
    Investment in Greenville Federal
    
    
    13,326
    
    
    
    13,891Total assets
    
    $
    21,908
    
    
    $
    22,772Liabilities and Stockholders EquityAccrued expenses and other liabilities
    
    $
    52
    
    
    $
    28Stockholders equity
Common stock and additional paid-in capital
    
    
    9,044
    
    
    
    9,168Retained earnings
    
    
    13,443
    
    
    
    14,636Shares acquired by employee stock ownership plan
    
    
    (631
    )
    
    
    (721
    )Unrealized losses on securities designated
as available for sale, net of tax effects
    
    
    
    
    
    
    (339
    )Total stockholders equity
    
    
    21,856
    
    
    
    22,744Total liabilities and stockholders equity
    
    $
    21,908
    
    
    $
    22,772
 51




---



##### 



Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
June 30, 2008 and 2007
 Greenville Federal Financial Corporation
Statements of Operations
 2008
    
    
    2007RevenueInterest income
    
    $
    286
    
    
    $
    193Equity in earnings (loss) of Greenville Federal
    
    
    (981
    )
    
    
    607Total revenue (loss)
    
    
    (695
    )
    
    
    800General and administrative expenses
    
    
    198
    
    
    
    142Income (loss) before income taxes
    
    
    (893
    )
    
    
    658Income taxes
    
    
    30
    
    
    
    17Net Income (Loss)
    
    $
    (923
    )
    
    $
    641
 Greenville Federal Financial Corporation
Statements of Cash Flows
 2008
    
    
    2007Cash flows from operating activities:Net income (loss)
    
    $
    (923
    )
    
    $
    641Equity in undistributed (income) loss of Greenville Federal
    
    
    981
    
    
    
    (607
    )Amortization of expense related to stock benefit plans
    
    
    75
    
    
    
    Increase in cash due to changes in:Prepaid expenses and other assets
    
    
    4,651
    
    
    
    Other liabilities
    
    
    23
    
    
    
    23Net cash provided by operating activities
    
    
    4,807
    
    
    
    57Cash flows from investing activities:Principal repayments on loan to ESOP
    
    
    75
    
    
    
    70Net cash provided by investing activities
    
    
    75
    
    
    
    70Cash flows from financing activities:Shares acquired under 2006 equity plan
    
    
    (185
    )
    
    
    (255
    )Dividends paid
    
    
    (270
    )
    
    
    (290
    )Net cash used in financing activities
    
    
    (455
    )
    
    
    (545
    )Net increase (decrease) in cash and cash equivalents
    
    
    4,427
    
    
    
    (418
    )Cash and cash equivalents at beginning of year
    
    
    3,431
    
    
    
    3,849Cash and cash equivalents at end of year
    
    $
    7,858
    
    
    $
    3,431
 52




---



##### 



Greenville Federal Financial Corporation
 Directors and Officers
 Directors of Greenville
    
    ExecutiveFederal Financial
    
    Officers of
    
    ExecutiveCorporation and
    
    Greenville Federal
    
    Officers ofGreenville Federal
    
    Financial Corporation
    
    Greenville FederalDavid M. Kepler
President and Chief
Executive Officer
Greenville Federal Financial
Corporation and Greenville
FederalDavid T. Feltman
RetiredGeorge S. Luce, Jr.
Salesperson
Best Equipment Company, Inc.
(Distributor)Richard J. OBrien
RetiredEunice F. Steinbrecher
Chair of the Board
Messiah College;
Real Estate Management
and InvestmentJames W. Ward
Certified Public Accountant
Fry and CompanyDavid R. Wolverton
Retired, President and Chief
Executive Officer
Greenville Federal
    
    David M. Kepler
President and Chief
Executive OfficerSusan J. Allread
Chief Financial Officer,
Treasurer, Vice President
and Secretary
    
    David M. Kepler
President and Chief
Executive OfficerSusan J. Allread
Chief Financial Officer,
Treasurer, Secretary,
Vice President and
Compliance Officer
 53




---



##### 



Greenville Federal Financial Corporation
 Investor and Corporate Information
 Market Price of GFFCs Common Stock and Related Stockholder Matters
    Dividendsdeclared perQuarter Ended
    
    High
    
    Low
    
    shareJune 30, 2008
    
    $
    8.25
    
    
    $
    7.05
    
    
    $
    0.07March 31, 2008
    
    $
    8.68
    
    
    $
    8.00
    
    
    $
    0.07December 31, 2007
    
    $
    9.50
    
    
    $
    8.10
    
    
    $
    0.07September 30, 2007
    
    $
    9.75
    
    
    $
    8.85
    
    
    $
    0.07
 Dividendsdeclared perQuarter Ended
    
    High
    
    Low
    
    shareJune 30, 2007
    
    $
    10.05
    
    
    $
    9.45
    
    
    $
    0.07March 31, 2007
    
    $
    10.60
    
    
    $
    9.85
    
    
    $
    0.07December 31, 2006
    
    $
    10.34
    
    
    $
    9.60
    
    
    $
    0.07September 30, 2006
    
    $
    9.88
    
    
    $
    9.25
    
    
    $
    0.07
   54




---



##### 



Greenville Federal Financial Corporation
 Stockholder and General Inquiries
 
 Registered Independent Auditors
    
    Corporate CounselBKD, LLP
312 Walnut Street
Suite 3000
Cincinnati, Ohio 45202
(513) 621-8300
    
    Vorys, Sater, Seymour and Pease LLP
Suite 2000, Atrium Two
221 E. Fourth Street
Cincinnati, Ohio 45202
(513) 723-4000
 Annual Reports
  OFFICE LOCATIONS
 Full Service Banking Locations
 Main Office:
    
    690 Wagner Avenue
Greenville, Ohio 45331
(937) 548-4158
    
    Branch Office:
    
    GF XPRESS
200 Lease Avenue
Greenville, Ohio 45331
(937) 548-4158
 www.greenvillefederal.com
 55




---



##### 



Greenville
    Federal Financial Corporation
  690
    Wagner Avenue
 Greenville, Ohio
    45331
 937-548-4158
 www.greenvillefederal.com