U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                 ---------------

                                   FORM 10-QSB

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

     For  the quarterly period ended September 30, 1996

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

     For the transition period from          to
                                    --------    --------   

                         Commission File Number 0-26510

                            NCF FINANCIAL CORPORATION
--------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its Charter)

                Delaware                                61-1285330
                --------                                ----------
(State or other jurisdiction of            (IRS Employer Identification Number)
      incorporation or organization)

   119 E. Stephen Foster Avenue, Bardstown, Kentucky         40004
-------------------------------------------------------    ----------
       (Address of principal executive offices)            (Zip Code)

Registrant's telephone number, including area code: (502) 348-9278
                                                    --------------

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                               X  Yes          No
                              ---          ---


                      Class                      Outstanding
                      -----                      -----------

As of October 28, 1996,  there were 770,500  shares of the  Registrant's  common
stock,  par value  $0.10 per share,  outstanding.  The  Registrant  has no other
classes of common equity outstanding.

<PAGE>

                           NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                               Bardstown, Kentucky

                                      Index

PART I.
-------

FINANCIAL INFORMATION                                                  Page(s)

Item I.
Financial Statements

Consolidated Balance Sheets - (Unaudited) as of June 30, 1996
 and September 30, 1996 ..............................................     3

Consolidated Statements of Income - (Unaudited) for the three
 month periods ended September 30, 1995 and 1996 .....................     4

Consolidated Statements of Stockholders' Equity (unaudited) ..........     5

Consolidated Statements of Cash Flows - (Unaudited) for the
 three months ended September 30, 1995 and 1996 ......................     6

Notes to Consolidated Financial Statements (Unaudited) ...............  7-11

Item 2.
Management's Discussion and Analysis of Financial Condition
 and Results of Operations ........................................... 12-14

PART II.
--------

OTHER INFORMATION

Item 1.  Legal Proceedings ...........................................    15

Item 2.  Changes in Securities .......................................    15

Item 3.  Defaults Upon Senior Securities .............................    15

Item 4.  Submission of Matters to a Vote of Security Holders .........    15

Item 5.  Other Information ...........................................    15

Item 6.  Exhibits and Reports on Form 8-K ............................    15

Signatures ...........................................................    16


                                       2
<PAGE>

                           NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                           Consolidated Balance Sheets
                                   (Unaudited)
                                 (in thousands)
<TABLE>
<CAPTION>

                                                          June 30,   September 30,
                                                            1996         1996
                                                          -------       -------
       Assets
       ------
<S>                                                       <C>           <C>    
Cash and due from banks                                   $   195       $   473
Interest-earning deposits                                   4,968         2,115
Loans receivable, net                                      28,861        28,459
Investment securities
 (market value - $-0- and $2,947)                            -            2,921
Mortgage-backed securities
 (market value - $165 and $162)                               143           139
Premises and equipment, net                                    51            47
Federal Home Loan Bank stock                                  412           419
Interest receivable                                           220           268
Deferred tax asset                                              4            68
Other                                                          51            43
                                                          -------       -------
      Total assets                                        $34,905       $34,952
                                                          =======       =======

   Liabilities and Stockholders' Equity
   ------------------------------------

Deposits                                                  $22,741       $22,584
Accrued expenses and other liabilities                        247           298
FDIC special assessment accrual                              -              153
Income taxes payable:
  Current                                                     114            65
  Deferred                                                   -             -
                                                          -------       -------
      Total liabilities                                    23,102        23,100

Preferred stock ($.01 par value, 100,000 shares
 authorized; none issued and outstanding)                    -             -
Common stock ($.10 par value, 1,400,000 shares
 authorized; 770,500 shares issued and outstanding)            77            77
Additional paid-in capital                                  7,270         7,275
Retained earnings, substantially restricted                 4,918         4,942
Less unearned compensation:
  Employee stock ownership plan                              (462)         (442)
                                                          -------       -------

      Total stockholders' equity                           11,803        11,852
                                                          -------       -------

      Total liabilities and stockholders' equity          $34,905       $34,952
                                                          =======       =======
</TABLE>


The accompanying notes are an integral part of 
these consolidated financial statements.

                                       3

<PAGE>

                           NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY
                       Consolidated Statements of Income
                                   (Unaudited)
                                 (in thousands)

                                                           Three Months Ended
                                                              September 30,
                                                          ---------------------
                                                           1995          1996
                                                          -------       -------

Interest income:
  Loans                                                    $544          $575
  Investment securities                                      -             26
  Mortgage-backed securities                                  5             4
  Interest-earning deposits                                  40            48
                                                           ----          ----  
      Total interest income                                 589           653

Interest expense:
  Deposits                                                  289           269
  Federal Home Loan Bank advances                            18            -
                                                           ----          ----  
      Total interest expense                                307           269

      Net interest income                                   282           384

Provision for loan losses                                     4             4
                                                           ----          ----  
      Net interest income after provision
       for loan losses                                      278           380

Non-interest income:
  Loan fees and service charges                               6             6

Non-interest expenses:
  Compensation and employee benefits                         76           125
  Net occupancy expense                                       6             7
  Deposit insurance premiums                                 13           167
  Data processing                                            10            11
  State franchise and other taxes                             7            15
  Professional fees                                           3            19
  Other                                                      15            18
                                                           ----          ----  
      Total non-interest expenses                           130           362
                                                           ----          ---- 
      Income before income taxes                            154            24

Income tax expense                                           56            -
                                                           ----          ----

      Net income                                           $ 98          $ 24
                                                           ====          ====

Net income per share                                        n/a          $.03
                                                           ====          ====

Cash dividend per share                                     n/a          $.00
                                                           ====          ====

The accompanying notes are an integral part
of these consolidated financial statements.

                                        4
<PAGE>

                            NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY


                Consolidated Statements of Stockholders' Equity
                                   (Unaudited)
                                 (in thousands)
<TABLE>
<CAPTION>

                                          Additional
                                   Common   Paid-in     Retained    Unearned
                                   Stock    Capital     Earnings  Compensation    Total
                                   -----    -------     --------  ------------    -----

<S>                                 <C>      <C>         <C>         <C>         <C>    
Balance, June 30, 1995              $-       $ -         $4,636      $  -        $ 4,636

Net income                           -         -            398         -            398

Net proceeds from sale
 of common stock                     77       7,259        -          (500)        6,836

Fair value of shares committed
 to be released from ESOP plan       -           11        -            38            49

Cash dividend paid                   -         -           (116)        -           (116)
                                    ---      ------      ------      -----       -------

Balance, June 30, 1996               77       7,270       4,918       (462)       11,803

Net income three months ended
 September 30, 1996                  -         -             24       -               24

Fair value of shares committed
 to be released from ESOP plan       -            5        -            20            25
                                    ---      ------      ------      -----       -------

Balance, September 30, 1996         $77      $7,275      $4,942      $(442)      $11,852
                                    ===      ======      ======      =====       =======

</TABLE>



The accompanying notes are an integral part of
these consolidated financial statements.

                                       5
<PAGE>
                           NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                     Consolidated Statements of Cash Flows
                                   (Unaudited)
                                 (in thousands)

                                                          Three Months Ended
                                                             September 30,
                                                          ------------------
                                                           1995       1996
                                                           ----       ----

Operating Activities:
  Net income                                              $    98    $    24
  Adjustments to reconcile net income to
   net cash provided by operating activities:
    Depreciation                                                3          4
    Provision for loan losses                                   4          4
    Deferred income taxes (benefit)                          -           (64)
    FHLB dividends received in stock                           (7)        (7)
    Amortization of deferred loan origination fees, net      -          -
    Accretion of discounts on mortgage-backed securities     -          -
    (Decrease) increase in allowance for uncollectible
     interest                                                  (1)        14
    Increase in interest receivable                           (41)       (62)
    Decrease in other assets                                   20          8
    (Decrease) increase in accrued expenses and other
     liabilities                                              (10)       204
    Increase (decrease) in current income taxes payable        56        (49)
    ESOP plan expense                                        -            25
                                                          -------    -------
Net Cash Provided By Operating Activities                     122        101

Investing Activities:
  Principal payments on mortgage-backed securities              5          4
  Purchase of investment securities held-to-maturity         -        (2,921)
  Net (increase) decrease in loans originated              (1,052)       398
  Acquisition of premises and equipment                      -          -
                                                          -------    -------

Net Cash Used In Investing Activities                      (1,047)    (2,519)

Financing Activities:
  Net increase (decrease) in deposits                       9,060       (157)
  (Repayments) advances from FHLB                            (700)      -
  Stock conversion cost                                       (92)      -
                                                          -------    -------

Net Cash Provided By (Used In) Financing Activities         8,268       (157)
                                                          -------    -------

Increase (Decrease) In Cash and Cash Equivalents            7,343     (2,575)

Cash and Cash Equivalents, beginning of period              1,201      5,163
                                                          -------    -------

Cash and Cash Equivalents, end of period                  $ 8,544    $ 2,588
                                                          =======    =======
Supplemental Disclosures:
  Noncash investing and financing activities:
   Cash paid during the period for:
    Interest                                              $   236    $   311
                                                          =======    =======

    Income taxes                                          $   114    $  -
                                                          =======    =======

The accompanying notes are an integral part of
these consolidated financial statements.

                                       6
<PAGE>


                            NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)



1.   NCF Financial Corporation
     -------------------------

     NCF Financial  Corporation (the "Company") was incorporated  under the laws
     of the State of Delaware  for the purpose of becoming  the savings and loan
     holding company of Nelson County Federal Savings and Loan  Association (the
     "Association")  in  connection  with the  Association's  conversion  from a
     federally-chartered    mutual   savings   and   loan   association   to   a
     federally-chartered  stock  savings and loan  association,  pursuant to its
     Plan  of  Conversion.   The  Company   commenced  on  August  24,  1995,  a
     Subscription  Offering of its shares in connection  with the  conversion of
     the Association (the "Conversion"). At October 12, 1995, the Conversion was
     complete.  The financial  statements of the  Association are presented on a
     consolidated  basis  with  those  of  the  Company.   In  July,  1996,  the
     Association  changed its name to Nelson  County  Federal  Savings Bank (the
     "Bank").

     The consolidated  financial statements included herein are for the Company,
     the  Bank  and  the  Bank's  wholly  owned   subsidiary,   Nelson   Service
     Corporation.  The  impact  of  Nelson  Service  Corporation  (NSC)  on  the
     consolidated  financial  statements is insignificant.  NSC has no operating
     activity other than to own stock in the third-party service bureau.

2.   Basis of Preparation
     --------------------

     The accompanying  unaudited consolidated financial statements were prepared
     in  accordance  with  instructions  for Form 10-QSB and  therefore,  do not
     include  all  disclosures  necessary  for a  complete  presentation  of the
     consolidated statements of financial condition,  consolidated statements of
     income,  consolidated  statements of stockholders' equity, and consolidated
     statements of cash flows in conformity with generally  accepted  accounting
     principles.   However,  all  adjustments  which  are,  in  the  opinion  of
     management,  necessary for the fair  presentation of the interim  financial
     statements have been included.  The statement of income for the three month
     period  ended  September  30,  1996 is not  necessarily  indicative  of the
     results which may be expected for the entire year.

3.   Earnings Per Share
     ------------------

     Earnings per share  amounts for the three month period ended  September 30,
     1996 is based on the average  number of shares  outstanding  throughout the
     period.  No  comparative  amounts have been  presented  for the three month
     period ended September 30, 1995 because no shares were  outstanding  during
     that period.  Unallocated ESOP shares are not considered as outstanding for
     this calculation.


                                        7

<PAGE>

                           NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)


4.   New Accounting Standards
     ------------------------

     The FASB has issued SFAS No. 106, "Employers' Accounting for Postretirement
     Benefits Other Than Pensions," which requires,  during an employee's active
     years of service, accrual of the expected costs of providing postretirement
     benefits,  principally  health care and life  insurance,  to employees  and
     their  beneficiaries  and dependents.  SFAS No. 106 is effective for fiscal
     years  beginning  after  December 15,  1994.  At  September  30, 1996,  the
     statement has no material impact on the consolidated financial statements.

     In November,  1992,  FASB issued SFAS No. 112  "Employers'  Accounting  for
     Postemployment   Benefits."  SFAS  No.  112  requires  recognition  of  the
     obligations  to  provide  postemployment  benefits  to former  or  inactive
     employees after employment,  but before retirement.  The effective date for
     this  statement is for fiscal years  beginning  after December 15, 1993. At
     September  30,  1996,   the  statement  has  no  material   impact  on  the
     consolidated financial statements.

     In November,  1993, the American  Institute of Certified Public Accountants
     issued Statement of Position 93-6 "Employers' Accounting for Employee Stock
     Ownership  Plans." This  statement is effective for fiscal years  beginning
     after December 15, 1993.  This statement  changes the way employers  report
     transactions  with a leveraged  employee stock ownership plan ("ESOP").  It
     requires,  among other things,  that:  (1) for ESOP shares  committed to be
     released in a period to compensate  employees  directly,  employers  should
     recognize compensation cost equal to the fair value of the shares committed
     to be released,  and (2) for earnings-per-share  computations,  ESOP shares
     that have been committed to be released  should be considered  outstanding.
     ESOP  shares  that have not been  committed  to be  released  should not be
     considered outstanding.

     In November, 1995, the FASB's Emerging Issues Task Force (EITF) issued EITF
     D-47  concerning the  accounting for special  assessments of FDIC insurance
     premiums for SAIF member institutions. This opinion requires recognition of
     an accrual for the FDIC special  assessment in the period when  legislation
     was enacted to provide for such assessment. This opinion does not allow the
     charge to earnings to be  recorded as an  extraordinary  item and should be
     recorded as a component of  operating  income.  This opinion also  requires
     deferred tax  accounting if the timing of payment of the assessment is in a
     period different than that of the accrual. See further discussion in note 6
     as to the impact on these financial statements.

                                        8
<PAGE>

                            NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)


5.   Plan of Conversion
     ------------------

     On April 27, 1995, the Bank's Board of Directors  formally  approved a plan
     ("Plan") to convert from a federally-chartered mutual savings and loan to a
     federally-chartered stock savings and loan which was approved by the Bank's
     members on July 31, 1995. The Plan,  which includes  formation of a holding
     company,  was  approved  by the  Office  of  Thrift  Supervision  (OTS) and
     included the filing of a  registration  statement  with the  Securities and
     Exchange Commission.

     NCF  Financial  Corporation  was formed on June 19,  1995,  as the  holding
     company  for  Nelson  County  Federal  Savings  and  Loan   Association  in
     connection with Association's conversion from a federally-chartered  mutual
     savings and loan  association  to a  federally-chartered  stock savings and
     loan  association  ("Conversion"). 

     On October 12, 1995,  the Company  issued and sold 770,500 shares of common
     stock at $10 per share in its initial  public  offering,  including  50,000
     shares  to  the  Bank's  ESOP.  The  net  proceeds  to  the  Company  after
     recognizing  approximately  $374,000 of expenses and underwriting costs and
     $500,000 of employee compensation plans were approximately $6.8 million.

     The Company  used $3.7  million of the net  proceeds to purchase all of the
     outstanding  capital  stock of the Bank and invested  virtually  all of the
     remaining proceeds in short-term investments (after loaning $500,000 to the
     Bank's ESOP).

     The Bank may not declare or pay a cash dividend if the effect thereof would
     cause its net worth to be reduced below either the amounts required for the
     liquidation account discussed below or the regulatory capital  requirements
     imposed by the OTS.

     At the time of conversion, the Bank established a liquidation account in an
     amount  equal  to  its  retained   earnings  as  reflected  in  the  latest
     consolidated  balance sheet used in the final  conversion  prospectus.  The
     liquidation  account will be maintained for the benefit of eligible account
     holders who continue to maintain  their deposit  accounts in the Bank after
     conversion. In the event of a complete liquidation of the Bank (and only in
     such an event), eligible depositors who continue to maintain accounts shall
     be entitled to receive a distribution  from the liquidation  account before
     any liquidation may be made with respect to common stock.

                                        9
<PAGE>

                            NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)


6.   Deposit Insurance Premiums
     --------------------------

     The  Bank  currently  pays an  insurance  premium  to the  Federal  Deposit
     Insurance  Corporation  (FDIC)  equal to .23% of its  total  deposits  as a
     member of the Savings Association Insurance Fund (SAIF).  Effective January
     1, 1996, the FDIC lowered the annual  insurance  premium for members of the
     Bank  Insurance  Fund (BIF) to $2,000  minimum.  The disparity in insurance
     premiums  between BIF and SAIF could create a competitive  disadvantage for
     SAIF  members by enabling  BIF members to attract and retain  deposits at a
     lower  effective  cost than that possible for the Bank and put  competitive
     pressure on the Bank to raise its  interest  rates paid on  deposits,  thus
     increasing its cost of funds and possibly reducing net interest income. The
     resultant competitive disadvantage could result in the Bank losing deposits
     to BIF members who have a lower cost of funds and are therefore able to pay
     higher rates of interest on deposits.  Although the Bank has other  sources
     of funds, these other sources may have higher costs than those of deposits.

     In order to allow  SAIF  members  to enjoy the same  premium  levels as BIF
     members,  legislation was enacted on September 30, 1996.  This  legislation
     requires a special  one-time  premium  assessment of 65.7 cents per $100 of
     deposits.  Under FASB EITF D-47, the Company has  established an accrual at
     September 30, 1996 of  approximately  $153,000 and has recorded this charge
     to  normal  operating  expense.  This  charge  to  earnings  is  offset  by
     approximately  $52,000 in deferred tax benefits  from the timing of payment
     of the special assessment which is anticipated to take place in the quarter
     ended December 31, 1996.

     Beginning January 1, 1997,  deposit insurance  assessments for SAIF members
     are expected to be reduced to approximately  .064% of deposits on an annual
     basis  through the end of 1999.  During this same  period,  BIF members are
     expected  to be  assessed  approximately  .013%  of  deposits.  Thereafter,
     assessments  for BIF and SAIF  members  should be the same and SAIF and BIF
     may be merged.  It is expected that these  continuing  assessments for both
     SAIF  and  BIF  members  will  be  used  to  repay  outstanding   Financing
     Corporation  bond  obligations.  As a result  of these  changes,  beginning
     January  1,  1997,  the rate of deposit  insurance  assessed  the Bank will
     decline by  approximately  70%. In addition,  there is certain  legislation
     that allows for the  conversion of the thrift  charter into a bank charter.
     The tax impact of  elimination of the thrift charter could have resulted in
     recapture of existing  bad debt  reserves for income tax purposes in excess
     of those allowed for banks.  However,  this potential tax  implication  has
     generally been eliminated.

                                       10
<PAGE>


                            NCF FINANCIAL CORPORATION
                                 AND SUBSIDIARY

                   Notes to Consolidated Financial Statements
                                   (Unaudited)


7.   Employee Stock Ownership Plan (ESOP)
     ------------------------------------

     The Bank has established for eligible employees an Employee Stock Ownership
     Plan  ("ESOP").  The ESOP borrowed  $500,000  from the Holding  Company and
     purchased 50,000 common shares issued in the offering. The Bank is expected
     to make scheduled cash  contributions to the ESOP sufficient to service the
     amount  borrowed.  The $500,000 in stock  issued by the Holding  Company is
     reflected in the accompanying consolidated financial statements as a charge
     to unearned  compensation and a credit to common stock and paid-in capital.
     In  accordance  with  GAAP,  the  unpaid  balance of the ESOP loan has been
     eliminated  in  consolidation  and  the  unamortized  balance  of  unearned
     compensation is shown as a deduction of stockholders' equity.

     For the three months ending September 30, 1996,  compensation from the ESOP
     of  approximately  $25,105 was expensed.  Compensation is recognized at the
     average fair value of the ratably  released  shares  during the  accounting
     period as the employees performed services. At September 30, 1996, the ESOP
     had approximately 5,750 allocated shares and 44,250 unallocated shares. The
     fair  value  of  the   unallocated   shares  at  September  30,  1996,  was
     approximately $591,844.

     The Plan  administrators  will determine whether dividends on allocated and
     unallocated shares will be used for debt service.  Any allocated  dividends
     used will be replaced with common stock of equal value.  For the purpose of
     computing earnings per share, all ESOP shares committed to be released have
     been considered outstanding.


                                       11

<PAGE>

Item 2.

         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS

General

The following discussion and analysis is intended to assist in understanding the
financial condition and the results of operations of the Company.  References to
the "Company"  include NCF Financial  Corporation  and/or Nelson County  Federal
Savings Bank, as appropriate.

Comparison of Financial Condition at June 30, 1996 and September 30, 1996

Total  consolidated  assets  of the  Company  at  September  30,  1996  remained
consistent with a small increase of  approximately  $47,000 since June 30, 1996.
Total consolidated assets were approximately $34.95 million and $34.9 million at
September 30, 1996 and June 30, 1996, respectively.

The primary  change in the balance  sheet is the  Company's  efforts to maximize
interest  earnings on liquid assets by repositioning  interest-earning  deposits
into Investment Securities consisting of FHLB Discount Notes of approximately $3
million.  The Company also  experienced  some prepayment of mortgage loans which
resulted in a decline in Loans  Receivable of  approximately  $402,000 from June
30,  1996  to  September  30,  1996.   

There  was a  decrease  in  deposits  of  approximately  $157,000  or  .7%  from
$22,741,000 at June 30, 1996 to $22,584,000 at September 30, 1996. Although this
is only a small decline due to normal customer balance  maintenance,  management
is looking at expanding  customer  account  services to provide  future  deposit
growth.  Included  in total  liabilities  is an  accrual  for the  FDIC  special
assessment  of  approximately  $153,000  which is recorded at September 30, 1996
under the  guidance of FASB's  Emerging  Issues Task Force (EITF D-47,  November
1995).

Comparison  of Results of  Operations  for the Three Months Ended  September 30,
1995 and 1996

Net Income.  Net income  decreased  $74,000 for the three months ended September
30, 1996 when compared to the same period for September 30, 1995. However,  this
decrease is primarily  attributed to the accrual for the FDIC special assessment
of approximately $101,000 (net of tax). Without this special assessment accrual,
net income would have increased by approximately  $27,000 or 27.5% for the three
month  period as  compared  to last year.  Net  income of $24,000  for the three
months ended September 30, 1996 resulted in earnings per share of .03 cents.

Net  Interest  Income.  Net  interest  income  increased  $102,000 or 36.7% from
$282,000 for the three months ended September 30, 1995 to $384,000 for the three
months  ended  September  30,  1996.  The  improvement  in net  interest  income
primarily reflects an increase in average  interest-earning  assets over average
interest-bearing  liabilities  for the Bank of $1.9  million  or 19.31%  for the
three  months  ended  September  30, 1996 as  compared  to 1995,  enhanced by an
increase  in the  interest  rate  spread  from 2.8% for the three  months  ended
September 30, 1995 to 2.85% for the three months ended  September 30, 1996.  One
of the factors  contributing  to the increase in the interest rate spread is the
repayment of FHLB advances.

                                       12
<PAGE>


Interest Income.  Total interest income increased  $64,000 from $589,000 for the
three  months  ended  September  30, 1995 to $653,000 for the three months ended
September 30, 1996.  Interest on loans increased $31,000 or 5.7%. An increase of
$26,000  was  attributable  to a  2%  rise  in  the  average  balance  of  loans
outstanding  and $5,000 of the increase was due to the average yield on the loan
portfolio increasing from 8.00% during the three months ended September 30, 1995
to 8.03% during the three months ended September 30, 1996.

Interest income on mortgage-backed  securities  decreased $1,000 from $5,000 for
the three months ended  September  30, 1995 to $4,000 for the three months ended
September 30, 1996. This decrease was solely due to the principal  repayments on
the existing portfolio.

Interest  income  from other  interest-earning  assets  increased  $34,000  from
$40,000 for the three months ended  September  30, 1995 to $74,000 for the three
months ended September 30, 1996. The average  balance of other  interest-earning
assets  for the Bank  increased  $609,000  or 12.5% for the three  months  ended
September 30, 1996. In addition, the average yield continued to increase for the
three months ended  September 30, 1996 from 5.27% to 5.38% which in  combination
with the volume increase resulted in the overall increase.

Interest Expense. Interest expense decreased $38,000 from $307,000 for the three
months ended September 30, 1995 to $269,000 for the three months ended September
30, 1996.  The decrease  for the three months ended  September  30, 1996 was the
result of a $18,000  decrease in interest on advances that were  outstanding  in
1995 but not in 1996.  Between the three  months  ended  September  30, 1995 and
three months ended September 30, 1996, the average balance of deposits decreased
by $743,000,  and average  rates  decreased  from 4.82% to 4.78%.  Both of these
factors attributed to the decrease in interest expense.

Provision  for Loan Losses.  The  provision for loan losses for the three months
ended  September  30, 1995 was $4,000  compared  to $4,000 for the three  months
ended September 30, 1996. Historically,  management has emphasized the Company's
loss experience  over other factors in establishing  provisions for loan losses.
However,  management  has reviewed the  allowance for loan losses in relation to
the Company's  composition of its loan portfolio and observations of the general
economic climate and loan loss expectations.

Non-Interest  Income.  Fee  income and other  service  charges of $6,000 for the
three months ended September 30, 1995 remained  relatively  stable when compared
to the three months ended September 30, 1996.

Non-Interest  Expense.  Non-interest expense increased by $232,000 from $130,000
for the three  months  ending  September  30, 1995 to $362,000  for 1996.  These
increases are the direct result of the special one-time FDIC assessment accrual,
additional  operating  expense as a public  company and the effect of  increased
compensation  from the recognition of allocated ESOP shares at fair market value
and increased  compensation  from the recognition of the Directors  Consultation
and Retirement Plan (Directors  Plan)  agreement.  During the three month period
ended September 30, 1996, the Company  recognized a $153,000 expense accrual for
the FDIC special assessment.  During the three month period ending September 30,
1996, the Company  recognized  $25,000 of  compensation  expense  related to the
Employee Stock  Ownership Plan.  During the three month period ending  September
30, 1996, the Company recognized  approximately  $22,000 of compensation expense
related to the  Directors  Plan  agreement.  Other  non-interest  expense  items
remained relatively stable with minor percentage changes.

                                       13
<PAGE>



Income Taxes.  The effective tax rate for the three months ending  September 30,
1995 was  approximately  34%. For the three month period  ending  September  30,
1996,  cuent income tax  provisions of $52,000 were offset by the recording of a
deferred tax benefit of $52,000 as a result of the timing of payment of the FDIC
special assessment.

Liquidity  and Capital  Resources.  The Company's  primary  sources of funds are
deposits  and  proceeds  from  principal  and  interest  payments  on loans  and
investment securities.  While maturities and scheduled amortization of loans and
investment  securities  are a  predictable  source of funds,  deposit  flows and
mortgage prepayments are greatly influenced by general interest rates,  economic
conditions and competition.  The Company's  primary  investing  activity is loan
originations.  The  Company  maintains  liquidity  levels  adequate to fund loan
commitments,  investment opportunities,  deposit withdrawals and other financial
commitments.  At September  30,  1996,  there were no material  commitments  for
capital expenditures, however, the construction of a new bank location is in the
planning phase with an anticipated  cost of approximately  $500,000.  Management
has no knowledge of any trends,  events or  uncertainties  that will have or are
reasonably  likely to have material effects on the liquidity,  capital resources
or  operations of the Company.  Further,  management is not aware of any current
recommendations by the regulatory authorities which, if implemented,  would have
such an effect.

                                       14

<PAGE>


Part II
                                OTHER INFORMATION


Item 1.   Legal Proceedings
          -----------------

          From time to time, the Company and any  subsidiaries may be a party to
          various  legal  proceedings  incident  to its or  their  business.  At
          September  30,  1996,  there  were no legal  proceedings  to which the
          Company  or any  subsidiary  was a party,  or to which of any of their
          property was subject, which were expected by management to result in a
          material loss.


Item 2.  Changes in Securities
         ---------------------

         None

Item 3.  Defaults Upon Senior Securities
         -------------------------------

         None

Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------
 
         None

Item 5.  Other Information
         ----------------- 

         None

Item 6.  Exhibits and Reports on Form 8-K
         --------------------------------

          (a)  Exhibits:  Exhibit 27 (financial data schedule)

          (b)  Reports on Form 8-K: On July 5, 1996, the Company filed Amendment
               Number 1 to a Form 8-K (items 5 and 7)  concerning  the change in
               accountants

                                       15
<PAGE>

                                   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.

                                              NCF FINANCIAL CORPORATION

Date:   November 11, 1996                     By /s/ Dan R. Biggs
        -----------------                        -------------------------------
                                                 Dan R. Biggs
                                                 (Vice President and Principal
                                                  Financial Officer and duly
                                                  authorized representative)

                                       16