##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 OR
 o
    
    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: 0-54238
 EUREKA FINANCIAL CORP.
  Maryland
    
    26-3671639(State or other jurisdiction of incorporation or 
organization)
    
    (I.R.S. Employer Identification No.)3455 Forbes Avenue, Pittsburgh, Pennsylvania
    
    15213(Address of principal executive offices)
    
    (Zip Code)
 (412) 681-8400  (Registrants telephone number, including area code)
 Not Applicable  (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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##### 



EUREKA FINANCIAL CORP.
 Table of Contents
 PageNumberPART I  FINANCIAL INFORMATIONItem 1: Financial Statements
    
    
    1Consolidated Balance Sheets as of March 31, 2011 and
September 30, 2010 (unaudited)
    
    
    1Consolidated Statements of Income for the Three and Six Months Ended
March 31, 2011 and 2010  (unaudited)
    
    
    2Consolidated Statement of Changes in Stockholders Equity for the
Six Months Ended March 31, 2011 (unaudited)
    
    
    3Consolidated Statements of Cash Flows for the Six Months Ended
March 31, 2011 and 2010 (unaudited)
    
    
    4Notes to Consolidated Financial Statements (unaudited)
    
    
    5Item 2: Managements Discussion and Analysis of
Financial Condition and Results of Operations
    
    
    19Item 3: Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 4: Controls and Procedures
    
    
    26PART II  OTHER INFORMATIONItem 1: Legal Proceedings
    
    
    26Item 1A: Risk Factors
    
    
    26Item 2: Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    26Item 3: Defaults Upon Senior Securities
    
    
    27Item 4: [Removed and Reserved]
    
    
    27Item 5: Other Information
    
    
    27Item 6: Exhibits
    
    
    27SIGNATURES
    
    
    28Exhibit 10.1Exhibit 10.2Exhibit 31.1Exhibit 31.2Exhibit 32.0




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
 EUREKA FINANCIAL CORP. AND SUBSIDIARY
 
 Consolidated Balance Sheets
 (unaudited)
 March 31,
    
    
    September 30,2011
    
    
    2010Assets:Cash and due from banks
    
    $
    1,475,960
    
    
    $
    886,456Interest-bearing deposits in other banks
    
    
    14,818,209
    
    
    
    10,763,745Cash and cash equivalents
    
    
    16,294,169
    
    
    
    11,650,201Investment securities held to maturity (fair
market value of $14,067,000 and $10,522,353,
respectively)
    
    
    14,210,693
    
    
    
    10,482,550Mortgage-backed securities, available for sale
    
    
    32,061
    
    
    
    38,595Federal Home Loan Bank stock, at cost
    
    
    718,600
    
    
    
    796,400Loans receivable, net of allowance for loan
losses of $940,038 and $905,038, respectively
    
    
    100,591,448
    
    
    
    98,033,540Premises and equipment, net
    
    
    1,313,543
    
    
    
    1,360,233Deferred tax asset, net
    
    
    1,836,798
    
    
    
    2,018,594Accrued interest receivable and other assets
    
    
    2,241,544
    
    
    
    2,929,470Total Assets
    
    $
    137,238,856
    
    
    $
    127,309,583Liabilities and Stockholders EquityDeposit Accounts:Non-interest bearing
    
    $
    3,594,980
    
    
    $
    3,417,157Interest bearing
    
    
    111,481,524
    
    
    
    107,626,407Total Deposits
    
    
    115,076,504
    
    
    
    111,043,564Advances from borrowers for taxes and insurance
    
    
    335,026
    
    
    
    429,816FHLB advances
    
    
    
    
    
    
    1,000,000Accrued interest payable and other liabilities
    
    
    1,019,101
    
    
    
    706,879Total Liabilities
    
    
    116,430,631
    
    
    
    113,180,259Total Commitments and Contingencies
    
    
    
    
    
    
    Stockholders Equity:Common stock, $0.01 par value; 10,000,000 shares
authorized; 1,314,705 shares issued and

outstanding at March 31, 2011;


 $0.10
par value; 4,000,000 shares authorized;
1,377,810 shares issued; 1,261,231 shares
outstanding at  September 30,
2010, respectively
    
    
    13,147
    
    
    
    137,781Paid-in capital
    
    
    11,916,490
    
    
    
    6,348,745Retained earnings  substantially restricted
    
    
    9,481,530
    
    
    
    9,111,556Accumulated other comprehensive income
    
    
    1,848
    
    
    
    97Unearned ESOP shares
    
    
    (604,790
    )
    
    
    Treasury
stock, 116,579 shares at cost at September 30, 2010
    
    
    
    
    
    
    (1,468,855
    )Total Stockholders Equity
    
    
    20,808,225
    
    
    
    14,129,324Total Liabilities and Stockholders Equity
    
    $
    137,238,856
    
    
    $
    127,309,583
 The accompanying notes are an integral part of these consolidated financial statements.
  1




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##### Table of Contents



EUREKA FINANCIAL CORP. AND SUBSIDIARY
 
 Consolidated Statements of Income
 (unaudited)
 Three Months Ended
    
    
    Six Months EndedMarch 31,
    
    
    March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010Interest IncomeLoans
    
    $
    1,527,154
    
    
    $
    1,472,351
    
    
    $
    3,026,329
    
    
    $
    2,960,954Investment securities and other interest-earning assets:Taxable
    
    
    136,202
    
    
    
    35,645
    
    
    
    237,307
    
    
    
    61,096Tax exempt
    
    
    7,218
    
    
    
    12,029
    
    
    
    14,520
    
    
    
    24,020Mortgage-backed securities
    
    
    604
    
    
    
    930
    
    
    
    1,273
    
    
    
    1,949Total Interest Income
    
    
    1,671,178
    
    
    
    1,520,955
    
    
    
    3,279,429
    
    
    
    3,048,019Interest ExpenseDeposits
    
    
    450,649
    
    
    
    501,670
    
    
    
    929,499
    
    
    
    1,031,283FHLB advances
    
    
    
    
    
    
    13,899
    
    
    
    7,259
    
    
    
    28,921Total Interest Expense
    
    
    450,649
    
    
    
    515,569
    
    
    
    936,758
    
    
    
    1,060,204Net Interest Income
    
    
    1,220,529
    
    
    
    1,005,386
    
    
    
    2,342,671
    
    
    
    1,987,815Provision for Loan Losses
    
    
    17,600
    
    
    
    15,000
    
    
    
    35,000
    
    
    
    20,000Net Interest Income after Provision for Loan Losses
    
    
    1,202,929
    
    
    
    990,386
    
    
    
    2,307,671
    
    
    
    1,967,815Non-Interest IncomeFees on NOW accounts
    
    
    6,714
    
    
    
    8,592
    
    
    
    15,176
    
    
    
    19,190Other income
    
    
    9,908
    
    
    
    6,323
    
    
    
    20,080
    
    
    
    13,588Total Non-Interest Income
    
    
    16,622
    
    
    
    14,915
    
    
    
    35,256
    
    
    
    32,778Non-Interest ExpensesSalaries and benefits
    
    
    429,898
    
    
    
    377,221
    
    
    
    865,383
    
    
    
    751,202Occupancy
    
    
    85,985
    
    
    
    84,296
    
    
    
    176,366
    
    
    
    168,757Computer
    
    
    52,360
    
    
    
    41,752
    
    
    
    98,905
    
    
    
    83,933Legal and accounting
    
    
    59,614
    
    
    
    72,369
    
    
    
    112,322
    
    
    
    124,403Donations
    
    
    4,750
    
    
    
    4,325
    
    
    
    6,050
    
    
    
    5,550FDIC insurance premiums
    
    
    35,827
    
    
    
    30,401
    
    
    
    73,180
    
    
    
    46,339Other
    
    
    45,530
    
    
    
    56,219
    
    
    
    93,174
    
    
    
    102,957Total Non-Interest Expenses
    
    
    713,964
    
    
    
    666,583
    
    
    
    1,425,380
    
    
    
    1,283,141Income before Income Tax Provision
    
    
    505,587
    
    
    
    338,718
    
    
    
    917,547
    
    
    
    717,452Income Tax Provision
    
    
    206,339
    
    
    
    115,256
    
    
    
    375,894
    
    
    
    259,656Net Income
    
    $
    299,248
    
    
    $
    223,462
    
    
    $
    541,653
    
    
    $
    457,796Earnings per Common Share  Basic and Diluted
    
    $
    0.23
    
    
    $
    0.17
    
    
    $
    0.41
    
    
    $
    0.35
 The accompanying notes are an integral part of these consolidated financial statements.
  2




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##### Table of Contents



EUREKA FINANCIAL CORP. AND SUBSIDIARY
 
 Consolidated Statement of Changes in Stockholders Equity
 For the Six Months Ended March 31, 2011
 (unaudited)
 AccumulatedOtherCommon
    
    
    Paid-In
    
    
    Retained
    
    
    Comprehensive
    
    
    Unearned
    
    
    TreasuryStock
    
    
    Capital
    
    
    Earnings
    
    
    Income
    
    
    ESOP Shares
    
    
    Stock
    
    
    TotalBalance September 30, 2010
    
    $
    137,781
    
    
    $
    6,348,745
    
    
    $
    9,111,556
    
    
    $
    97
    
    
    $
    
    
    
    $
    (1,468,855
    )
    
    $
    14,129,324Comprehensive Income:Net Income
    
    
    
    
    
    
    
    
    
    
    541,653
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    541,653Other comprehensive incomeUnrealized
gain on securities, net of deferred income tax of $1,099
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,751
    
    
    
    
    
    
    
    
    
    
    
    1,751Total Comprehensive Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    543,404Corporate ReorganizationPublic shares converted (530,992 at $0.10 par to
    551,070 at $0.01 par)
    
    
    (47,589
    )
    
    
    47,589Retirement of treasury shares (116,579)
    
    
    (11,658
    )
    
    
    (1,457,197
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,468,855
    )
     
    
    Sale of shares (763,635 shares, including 61,090
    shares to the ESOP)
    
    
    7,636
    
    
    
    6,688,724
    
    
    
    
    
    
    
    
    
    
    
    (610,900
    )
    
    
    
    
    
    
    6,085,460Cancellation of MHC shares
    
    
    (73,023
    )
    
    
    287,866
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    214,843ESOP shares earned
    
    
    
    
    
    
    763
    
    
    
    
    
    
    
    
    
    
    
    6,110
    
    
    
    
    
    
    
    6,873Dividends on common stock ($0.15/share and $0.07/share on 530,992 and 1,261,231 shares at December 31, 2010 and March 31, 2011, respectively)
    
    
    
    
    
    
    
    
    
    
    (171,679
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (171,679
    )Balance March 31, 2011
    
    $
    13,147
    
    
    $
    11,916,490
    
    
    $
    9,481,530
    
    
    $
    1,848
    
    
    $
    (604,790
    )
    
    $
    
    
    
    $
    20,808,225
 The accompanying notes are an integral part of these consolidated financial statements.
  3




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##### Table of Contents



EUREKA FINANCIAL CORP. AND SUBSIDIARY
 
 Consolidated Statements of Cash Flows
 (unaudited)
 Six Months EndedMarch 31,2011
    
    
    2010Cash Flows from Operating ActivitiesNet income
    
    $
    541,653
    
    
    $
    457,796Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation of premises and equipment
    
    
    80,015
    
    
    
    71,243Provision for loan losses
    
    
    35,000
    
    
    
    20,000Net accretion/amortization of discounts and premiums on
securities and unamortized loan fees and costs
    
    
    6,621
    
    
    
    7,259Noncash expense for ESOP
    
    
    6,873
    
    
    
    Deferred tax expense
    
    
    180,697
    
    
    
    216,391Decrease (increase) in accrued interest receivable
    
    
    (63,002
    )
    
    
    4Decrease (increase) in other assets
    
    
    750,928
    
    
    
    (642,425
    )Decrease in accrued interest payable
    
    
    (9,410
    )
    
    
    (10,284
    )Increase in other liabilities
    
    
    321,632
    
    
    
    104,879Net Cash Provided by Operating Activities
    
    
    1,851,007
    
    
    
    224,863Cash Flows from Investing ActivitiesProceeds from maturities and redemptions of investment
securities held to maturity
    
    
    3,500,000
    
    
    
    Purchase of investment securities held to maturity
    
    
    (7,227,531
    )
    
    
    (4,750,000
    )Redemption of FHLB stock
    
    
    77,800
    
    
    
    Net loans made to customers
    
    
    (1,933,821
    )
    
    
    (1,980,511
    )Net decrease (increase) in commercial leases
    
    
    (666,347
    )
    
    
    1,211,795Payments on mortgage-backed securities
    
    
    9,411
    
    
    
    9,376Premises and equipment expenditures
    
    
    (33,325
    )
    
    
    3,227Net Cash Used in Investing Activities
    
    
    (6,273,813
    )
    
    
    (5,506,113
    )Cash Flows from Financing ActivitiesNet increase in deposit accounts
    
    
    4,032,940
    
    
    
    14,050,122Net decrease in advances from borrowers for taxes and insurance
    
    
    (94,790
    )
    
    
    (115,042
    )Payment of long term FHLB advances
    
    
    (1,000,000
    )
    
    
    (1,000,000
    )Payment of dividends
    
    
    (171,679
    )
    
    
    (159,314
    )Reissuance
of treasury stock, net
    
    
    
    
    
    
    9,472Proceeds from stock offering, net of expenses
    
    
    6,085,460
    
    
    
    Proceeds from equity exchange of Eureka Bancorp, MHC
    
    
    214,843
    
    
    
    Net Cash Provided by Financing Activities
    
    
    9,066,774
    
    
    
    12,785,238Net Increase In Cash and Cash Equivalents
    
    
    4,643,968
    
    
    
    7,503,988Cash and Cash Equivalents  Beginning
    
    
    11,650,201
    
    
    
    5,417,845Cash and Cash Equivalents  Ending
    
    $
    16,294,169
    
    
    $
    12,921,833Supplementary Cash Flows InformationIncome taxes paid
    
    
    
    
    
    $
    35,200Interest paid
    
    $
    946,168
    
    
    $
    1,049,337
 The accompanying notes are an integral part of these consolidated financial statements.
  4




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##### Table of Contents



EUREKA FINANCIAL CORP. AND SUBSIDIARY

Notes to Consolidated Financial Statements
  Note 1  Nature of Operations and Significant Accounting Policies
   Unaudited Interim Financial Statements
   Principles of Consolidation
  Earnings Per Share
   5




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##### Table of Contents



Three Months Ended March 31, 2011Per ShareIncome
    
    
    Shares
    
    
    AmountBasic earnings per share
    
    $
    299,248
    
    
    
    1,295,885
    
    
    $
    0.23Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted earnings per share
    
    $
    299,248
    
    
    
    1,295,885
    
    
    $
    0.23
 Three Months Ended March 31, 2010Per ShareIncome
    
    
    Shares
    
    
    AmountBasic earnings per share
    
    $
    223,462
    
    
    
    1,318,927
    
    
    $
    0.17Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted earnings per share
    
    $
    223,462
    
    
    
    1,318,927
    
    
    $
    0.17
 Six Months Ended March 31, 2011Per ShareIncome
    
    
    Shares
    
    
    AmountBasic earnings per share
    
    $
    541,653
    
    
    
    1,307,503
    
    
    $
    0.41Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted earnings per share
    
    $
    541,653
    
    
    
    1,307,503
    
    
    $
    0.41
 Six Months Ended March 31, 2010Per ShareIncome
    
    
    Shares
    
    
    AmountBasic earnings per share
    
    $
    457,796
    
    
    
    1,318,445
    
    
    $
    0.35Effect of dilutive securities
    
    
    
    
    
    
    
    
    
    
    Diluted earnings per share
    
    $
    457,796
    
    
    
    1,318,445
    
    
    $
    0.35
 Subsequent Events
  Reclassifications
  Note 2  Conversion and Reorganization
   6




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##### Table of Contents



Note 3  Investment Securities
   March 31, 2011Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    UnrealizedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(Unaudited)Obligations of states and political subdivisions
    
    $
    497,569
    
    
    $
    
    
    
    $
    (7,569
    )
    
    $
    490,000Government agency debentures
    
    $
    13,713,124
    
    
    
    113,407
    
    
    
    (249,531
    )
    
    
    13,577,000$
    14,210,693
    
    
    $
    113,407
    
    
    $
    (257,100
    )
    
    $
    14,067,000
 September 30, 2010Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    UnrealizedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(Unaudited)Obligations of states and political subdivisions
    
    $
    497,465
    
    
    $
    
    
    
    $
    (25
    )
    
    $
    497,440Government agency debentures
    
    
    9,985,085
    
    
    
    51,803
    
    
    
    (11,975
    )
    
    
    10,024,913$
    10,482,550
    
    
    $
    51,803
    
    
    $
    (12,000
    )
    
    $
    10,522,353
   March 31, 2011Amortized
    
    
    FairCost
    
    
    ValueDue after five years through ten years
    
    $
    1,250,000
    
    
    $
    1,279,000Due after ten years
    
    
    12,960,693
    
    
    
    12,788,000$
    14,210,693
    
    
    $
    14,067,000
 September 30, 2010Amortized
    
    
    FairCost
    
    
    ValueDue after five years through ten years
    
    $
    3,000,000
    
    
    $
    3,017,280Due after ten years
    
    
    7,482,550
    
    
    
    7,505,073$
    10,482,550
    
    
    $
    10,522,353
  7




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##### Table of Contents



March 31, 2011Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesObligations of states and
political subdivisions
    
    $
    
    
    
    $
    
    
    
    $
    490,000
    
    
    $
    (7,569
    )
    
    $
    490,000
    
    
    $
    (7,569
    )Government agency debentures
    
    
    5,746,000
    
    
    
    (249,531
    )
    
    
    
    
    
    
    
    
    
    
    5,746,000
    
    
    
    (249,531
    )$
    5,746,000
    
    
    $
    (249,531
    )
    
    $
    490,000
    
    
    $
    (7,569
    )
    
    $
    6,236,000
    
    
    $
    (257,100
    )
 September 30, 2010Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesObligations of states and
political subdivisions
    
    $
    497,440
    
    
    $
    (25
    )
    
    $
    
    
    
    $
    
    
    
    $
    497,440
    
    
    $
    (25
    )Government agency debentures
    
    
    2,989,575
    
    
    
    (10,425
    )
    
    
    498,450
    
    
    
    (1,550
    )
    
    
    3,488,025
    
    
    
    (11,975
    )$
    3,487,015
    
    
    $
    (10.450
    )
    
    $
    498,450
    
    
    $
    (1,550
    )
    
    $
    3,985,465
    
    
    $
    (12,000
    )
  Note 4  Mortgage-Backed Securities
  March 31, 2011Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueFreddie Mac certificates
    
    $
    7,498
    
    
    $
    489
    
    
    $
    
    
    
    $
    7,987Fannie Mae certificates
    
    
    21,566
    
    
    
    2,508
    
    
    
    
    
    
    
    24,074$
    29,064
    
    
    $
    2,997
    
    
    $
    
    
    
    $
    32,061
 September 30, 2010Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    ValueFreddie Mac certificates
    
    $
    8,945
    
    
    $
    109
    
    
    $
    (30
    )
    
    $
    9,024Fannie Mae certificates
    
    
    29,503
    
    
    
    180
    
    
    
    (112
    )
    
    
    29,571$
    38,448
    
    
    $
    289
    
    
    $
    (142
    )
    
    $
    38,595
  March 31, 2011Amortized
    
    
    FairCost
    
    
    ValueDue after one year through five years
    
    $
    3,400
    
    
    $
    3,520Due after five years through ten years
    
    
    18,448
    
    
    
    20,494Due after ten years
    
    
    7,216
    
    
    
    8,047$
    29,064
    
    
    $
    32,061
  8




---



##### Table of Contents



September 30, 2010Less than 12 Months
    
    
    More than 12 Months
    
    
    TotalFair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    LossesFreddie Mac certificates
    
    $
    
    
    
    $
    
    
    
    $
    5,219
    
    
    $
    (30
    )
    
    $
    5,219
    
    
    $
    (30
    )Fannie Mae certificates
    
    
    
    
    
    
    
    
    
    
    20,147
    
    
    
    (112
    )
    
    
    20,147
    
    
    
    (112
    )$
    
    
    
    $
    
    
    
    $
    25,366
    
    
    $
    (142
    )
    
    $
    25,366
    
    
    $
    (142
    )
  Note 5  Loans
  March 31,
    
    
    September 30,2011
    
    
    2010One- to four-family real estate
    
    $
    42,896,419
    
    
    $
    41,341,759Construction
    
    
    2,176,685
    
    
    
    1,392,781Multi-family real estate
    
    
    14,659,136
    
    
    
    14,529,362Commercial real estate
    
    
    19,210,056
    
    
    
    19,363,550Home equity and second mortgages
    
    
    1,242,384
    
    
    
    1,586,407Secured loans
    
    
    354,356
    
    
    
    579,092Unsecured improvement loans
    
    
    490,054
    
    
    
    169,854Commercial leases
    
    
    16,826,880
    
    
    
    16,160,533Commercial lines of credit
    
    
    3,840,374
    
    
    
    3,966,326101,696,344
    
    
    
    99,089,664Plus:Unamortized loan premiums
    
    
    18,264
    
    
    
    26,493Less:Unamortized loan fees and costs, net
    
    
    (183,122
    )
    
    
    (177,579
    )Allowance for loan losses
    
    
    (940,038
    )
    
    
    (905,038
    )$
    100,591,448
    
    
    $
    98,033,540
 Loan Portfolio Composition
     9




---



##### Table of Contents



Credit Quality
  Rating 1  Pass
   10




---



##### Table of Contents



Rating 2  Special Mention
  Rating 3  Substandard
  Rating 4  Doubtful
  Rating 5  Loss
   SpecialPass
    
    
    Mention
    
    
    Substandard
    
    
    Doubtful
    
    
    TotalOne- to four-family real estate
    
    $
    42,749,693
    
    
    $
    70,192
    
    
    $
    76,534
    
    
    $
    
    
    
    $
    42,896,419Construction
    
    
    2,176,685
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,176,685Multi-family
    
    
    14,659,136
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,659,136Commercial real estate
    
    
    19,210,056
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,210,056Home equity and second mortgages
    
    
    1,242,384
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,242,384Secured loans
    
    
    354,356
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    354,356Unsecured improvement loans
    
    
    466,420
    
    
    
    
    
    
    
    23,634
    
    
    
    
    
    
    
    490,054Commercial leases
    
    
    16,370,382
    
    
    
    456,498
    
    
    
    
    
    
    
    
    
    
    
    16,826,880Commercial lines of credit
    
    
    3,370,676
    
    
    
    469,698
    
    
    
    
    
    
    
    
    
    
    
    3,840,374$
    100,599,788
    
    
    $
    996,388
    
    
    $
    100,168
    
    
    $
    
    
    
    $
    101,696,344
   11




---



##### Table of Contents



:
 Non-30-59 Days
    
    
    60-89 Days
    
    
    90 Days or
    
    
    Total Past
    
    
    
    
    
    
    Total Loans
    
    
    accrualPast Due
    
    
    Past Due
    
    
    More Past Due
    
    
    Due
    
    
    Current
    
    
    Receivables
    
    
    LoansOne- to four-family real estate
    
    $
    
    
    
    $
    1,120
    
    
    $
    46,357
    
    
    $
    47,477
    
    
    $
    42,848,942
    
    
    $
    42,896,419
    
    
    $
    46,357Construction
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,176,685
    
    
    
    2,176,685
    
    
    
    Multi-family real estate
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,659,136
    
    
    
    14,659,136
    
    
    
    Commercial real estate
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,210,056
    
    
    
    19,210,056
    
    
    
    Home equity and second
mortgages
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,242,384
    
    
    
    1,242,384
    
    
    
    Secured loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    354,356
    
    
    
    354,356
    
    
    
    Unsecured improvement loans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    490,054
    
    
    
    490,054
    
    
    
    Commercial leases
    
    
    456,498
    
    
    
    
    
    
    
    
    
    
    
    456,498
    
    
    
    16,370,382
    
    
    
    16,826,880
    
    
    
    Commercial lines of credit
    
    
    469,698
    
    
    
    
    
    
    
    
    
    
    
    469,698
    
    
    
    3,370,676
    
    
    
    3,840,374
    
    
    
    $
    926,196
    
    
    $
    1,120
    
    
    $
    46,357
    
    
    $
    973,673
    
    
    $
    100,722,671
    
    
    $
    101,696,344
    
    
    $
    46,357
   12




---



##### Table of Contents



HomeOne- to four
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    equity and
    
    
    
    
    
    
    Unsecured
    
    
    
    
    
    
    Commercialfamily real
    
    
    
    
    
    
    Multi-family
    
    
    Commercial
    
    
    second
    
    
    Secured
    
    
    improvement
    
    
    Commercial
    
    
    lines ofestate
    
    
    Construction
    
    
    real estate
    
    
    real estate
    
    
    mortgages
    
    
    loans
    
    
    loans
    
    
    leases
    
    
    credit
    
    
    Unallocated
    
    
    TotalAllowance for Credit Losses:Beginning Balance 1/1/2011
    
    $
    125,286
    
    
    $
    10,723
    
    
    $
    109,578
    
    
    $
    296,313
    
    
    $
    14,150
    
    
    
    
    
    
    
    
    
    
    $
    280,976
    
    
    $
    42,629
    
    
    $
    42,783
    
    
    $
    922,438Charge-offs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Recoveries
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Provisions (credits)
    
    
    27,416
    
    
    
    7,082
    
    
    
    366
    
    
    
    (7,065
    )
    
    
    681
    
    
    
    
    
    
    
    
    
    
    
    9,690
    
    
    
    3,164
    
    
    
    (23,734
    )
    
    
    17,600Ending Balance
    
    $
    152,702
    
    
    
    17,805
    
    
    
    109,944
    
    
    
    289,248
    
    
    
    14,831
    
    
    
    
    
    
    
    
    
    
    
    290,666
    
    
    
    45,793
    
    
    
    19,049
    
    
    
    940,038Ending Balance: Individually Evaluated for
Impairment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Ending Balance: Collectively Evaluated for
Impairment
    
    
    152,072
    
    
    
    17,805
    
    
    
    109,944
    
    
    
    289,248
    
    
    
    14,831
    
    
    
    
    
    
    
    
    
    
    
    290,666
    
    
    
    45,793
    
    
    
    19,049
    
    
    
    940,038Loans Receivable:Ending Balance
    
    
    42,896,419
    
    
    
    2,176,685
    
    
    
    14,659,136
    
    
    
    19,210,056
    
    
    
    1,242,384
    
    
    
    354,356
    
    
    
    490,054
    
    
    
    16,826,880
    
    
    
    3,840,374
    
    
    
    
    
    
    
    101,696,344Ending Balance: Individually Evaluated for
Impairment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Ending Balance: Collectively Evaluated for
Impairment
    
    $
    42,896,419
    
    
    $
    2,176,685
    
    
    $
    14,659,136
    
    
    $
    19,210,056
    
    
    $
    1,242,384
    
    
    $
    354,356
    
    
    $
    490,054
    
    
    $
    16,826,880
    
    
    $
    3,840,374
    
    
    $
    
    
    
    $
    101,696,344
   13




---



##### Table of Contents



Three Months
    
    
    Six MonthsEnded March 31,
    
    
    Ended March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010Balance  beginning of period
    
    $
    922,438
    
    
    $
    836,987
    
    
    $
    905,038
    
    
    $
    831,987Provision charged to operations
    
    
    17,600
    
    
    
    15,000
    
    
    
    35,000
    
    
    
    20,000Net charge-offs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance  end of period
    
    $
    940,038
    
    
    $
    851,987
    
    
    $
    940,038
    
    
    $
    851,987
 Note 6  Commitments
    Note 7  Fair Value Measurements and Fair Values of Financial Instruments
   Level 1:
 Level 2:
 Level 3:
   14




---



##### Table of Contents



(Level 1)Quoted Prices
    
    
    (Level 2)in Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantMarch 31,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2011
    
    
    Assets
    
    
    Inputs
    
    
    InputsMortgage-backed securities available for sale
    
    $
    32,061
    
    
    $
    
    
    
    $
    32,061
    
    
    $
    
 (Level 1)Quoted Prices
    
    
    (Level 2)in Active
    
    
    Significant
    
    
    (Level 3)Markets for
    
    
    Other
    
    
    SignificantSeptember 30,
    
    
    Identical
    
    
    Observable
    
    
    UnobservableDescription
    
    2010
    
    
    Assets
    
    
    Inputs
    
    
    InputsMortgage-backed securities available for sale
    
    $
    38,595
    
    
    $
    
    
    
    $
    38,595
    
    
    $
    
   15




---



##### Table of Contents



March 31,
    
    
    September 30,2011
    
    
    2010Carrying
    
    
    Fair Market
    
    
    Carrying
    
    
    Fair MarketAmount
    
    
    Value
    
    
    Amount
    
    
    ValueFinancial assets:Cash and cash equivalents
    
    $
    16,294,169
    
    
    $
    16,294,169
    
    
    $
    11,650,201
    
    
    $
    11,650,201Mortgage-backed securities
    
    
    32,061
    
    
    
    32,061
    
    
    
    38,595
    
    
    
    38,595Held to maturity securities
    
    
    14,210,693
    
    
    
    14,067,000
    
    
    
    10,482,550
    
    
    
    10,522,353Federal Home Loan Bank stock
    
    
    718,600
    
    
    
    718,600
    
    
    
    796,400
    
    
    
    796,400Loans receivable, net
    
    
    100,591,448
    
    
    
    104,230,000
    
    
    
    98,033,540
    
    
    
    102,239,000Accrued interest receivable
    
    
    530,349
    
    
    
    530,349
    
    
    
    467,347
    
    
    
    467,347Financial Liabilities:Deposits
    
    
    115,076,504
    
    
    
    117,894,000
    
    
    
    111,043,564
    
    
    
    112,630,000Advances from borrowers for taxes and
insurance
    
    
    335,026
    
    
    
    335,026
    
    
    
    429,816
    
    
    
    429,816FHLB advances
    
    
    
    
    
    
    
    
    
    
    1,000,000
    
    
    
    1,013,000Accrued interest payable
    
    
    143,854
    
    
    
    143,854
    
    
    
    153,264
    
    
    
    153,264Off-balance sheet commitments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
 Cash and Cash Equivalents
  Securities
  Federal Home Loan Bank Stock
  Loans Receivable
  Accrued Interest Receivable
   16




---



##### Table of Contents



Deposit Liabilities
  Advances from Borrowers for Taxes and Insurance
  Federal Home Loan Bank Advances
  Accrued Interest Payable
  Off-Balance Sheet Commitments
  Note 8  Capital Requirements
     17




---



##### Table of Contents



To be well Capitalizedunder PromptFor Capital Adequacy
    
    
    Corrective ActionActual
    
    
    Purposes
    
    
    ProvisionsAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    RatioAs of March 31, 2011Total capital (to risk-weighted assets)
    
    $
    18,179
    
    
    
    21.47
    %
    
    
    >$6,773
    
    
    
    > 8.00
    %
    
    
    >$8,466
    
    
    
    > 10.00
    %Tier 1 capital (to risk-weighted assets)
    
    
    17,239
    
    
    
    20.36
    
    
    
    > 3,386
    
    
    
    > 4.00
    
    
    
    > 5,079
    
    
    
    > 6.00Core (Tier 1) capital (to adjusted total assets)
    
    
    17,239
    
    
    
    12.66
    
    
    
    > 5,446
    
    
    
    > 4.00
    
    
    
    > 6,808
    
    
    
    > 5.00As of September 30, 2010Total capital (to risk-weighted assets)
    
    $
    13,644
    
    
    
    16.39
    %
    
    
    > $6,662
    
    
    
    > 8.00
    %
    
    
    > $8,327
    
    
    
    > 10.00
    %Tier 1 capital (to risk-weighted assets)
    
    
    12,739
    
    
    
    15.30
    
    
    
    > 3,331
    
    
    
    > 4.00
    
    
    
    > 4,996
    
    
    
    > 6.00Core (Tier 1) capital (to adjusted total assets)
    
    
    12,739
    
    
    
    10.10
    
    
    
    > 5,048
    
    
    
    > 4.00
    
    
    
    > 6,309
    
    
    
    > 5.00
  March 31,
    
    
    September 30,2011
    
    
    2010Total equity
    
    $
    18,343
    
    
    $
    13,841Unrealized gains on securities available-for-sale
    
    
    (2
    )
    
    
    Deferred tax asset  disallowed portion
    
    
    (1,102
    )
    
    
    (1,102
    )Tier 1 capital
    
    
    17,239
    
    
    
    12,739Other adjustments:Allowable allowances for loan and lease losses
    
    
    940
    
    
    
    905Total regulatory capital
    
    $
    18,179
    
    
    $
    13,644
 Note 9  Recent Accounting Pronouncements
    18




---



##### Table of Contents



Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operation
 Safe Harbor Statement for Forward-Looking Statements
   Critical Accounting Policies
   19




---



##### Table of Contents



Allowance for Loan Losses.
 Deferred Income Taxes.
 Valuation of Other-Than-Temporary Impairment of Investment Securities.
 Comparison of Financial Condition at March 31, 2011 and September 30, 2010
   20




---



##### Table of Contents



Results of Operations for the Three and Six Months Ended March 31, 2011 and 2010
 Overview.
 Three Months Ended March 31,2011
    
    
    2010(Dollars in thousands, exceptper share amounts)Net income
    
    $
    299
    
    
    $
    223Basic earnings per share
    
    
    0.23
    
    
    
    0.17Diluted earnings per share
    
    
    0.23
    
    
    
    0.17Average equity to average assets
    
    
    12.48
    %
    
    
    10.91
    %
 Six Months Ended March 31,2011
    
    
    2010(Dollars in thousands, exceptper share amounts)Net income
    
    $
    542
    
    
    $
    458Basic earnings per share
    
    
    0.41
    
    
    
    0.35Diluted earnings per share
    
    
    0.41
    
    
    
    0.35Average equity to average assets
    
    
    11.70
    %
    
    
    11.93
    %
  Net Interest Income.
  21




---



##### Table of Contents



Rate/Volume Analysis .
 Three Months EndedMarch 31, 2011Compared toThree Months EndedMarch 31, 2010Increase(Decrease)Due toRate
    
    
    Volume
    
    
    Net(In thousands)Interest income:Loans receivable
    
    $
    (29
    )
    
    $
    84
    
    
    $
    55Investment securities
    
    
    62
    
    
    
    33
    
    
    
    95Total interest-earning assets
    
    
    33
    
    
    
    117
    
    
    
    150Interest Expense:NOW money markets accounts
    
    
    (6
    )
    
    
    6
    
    
    
    0Passbook and club accounts
    
    
    (11
    )
    
    
    1
    
    
    
    (10
    )IRA accounts
    
    
    (15
    )
    
    
    13
    
    
    
    (2
    )Certificates of deposit
    
    
    (80
    )
    
    
    43
    
    
    
    (37
    )CDARS
    
    
    (2
    )
    
    
    (1
    )
    
    
    (3
    )Borrowings
    
    
    (8
    )
    
    
    (5
    )
    
    
    (13
    )Total interest-bearing liabilities
    
    
    (122
    )
    
    
    57
    
    
    
    (65
    )Net change in net interest income
    
    $
    155
    
    
    $
    60
    
    
    
    215
 Six Months EndedMarch 31, 2011Compared toSix Months EndedMarch 31, 2010Increase(Decrease)Due toRate
    
    
    Volume
    
    
    Net(In thousands)Interest income:Loans receivable
    
    $
    (57
    )
    
    $
    122
    
    
    $
    65Investment securities
    
    
    79
    
    
    
    87
    
    
    
    166Total interest-earning assets
    
    
    22
    
    
    
    209
    
    
    
    231Interest Expense:NOW money markets accounts
    
    
    (29
    )
    
    
    20
    
    
    
    (9
    )Passbook and club accounts
    
    
    (23
    )
    
    
    4
    
    
    
    (19
    )IRA accounts
    
    
    (32
    )
    
    
    27
    
    
    
    (5
    )Certificates of deposit
    
    
    (165
    )
    
    
    103
    
    
    
    (62
    )CDARS
    
    
    (6
    )
    
    
    (1
    )
    
    
    (7
    )Borrowings
    
    
    (6
    )
    
    
    (16
    )
    
    
    (22
    )Total interest-bearing liabilities
    
    
    (261
    )
    
    
    137
    
    
    
    (124
    )Net change in net interest income
    
    $
    283
    
    
    $
    72
    
    
    
    355
  22




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##### Table of Contents



Provision for Loan Losses.
  Non-interest Income.
 Three Months EndedMarch 31,2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeFees on NOW accounts
    
    $
    6,714
    
    
    $
    8,592
    
    
    $
    (1,878
    )
    
    
    (21.9
    )%Other income
    
    
    9,908
    
    
    
    6,323
    
    
    
    3,585
    
    
    
    56.7
    %Total non-interest income
    
    $
    16,622
    
    
    $
    14,915
    
    
    
    1,707
    
    
    
    11.4
    %
 Six Months EndedMarch 31,2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeFees on NOW accounts
    
    $
    15,176
    
    
    $
    19,190
    
    
    $
    (4,014
    )
    
    
    (20.9
    )%Other income
    
    
    20,080
    
    
    
    13,588
    
    
    
    6,492
    
    
    
    47.8
    %Total non-interest income
    
    $
    35,256
    
    
    $
    32,778
    
    
    
    2,478
    
    
    
    7.6
    %
 Non-interest Expense.
 Three Months EndedMarch 31,2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeSalary and benefits
    
    $
    429,898
    
    
    $
    377,221
    
    
    $
    52,617
    
    
    
    14.0
    %Occupancy
    
    
    85,985
    
    
    
    84,296
    
    
    
    1,689
    
    
    
    2.0Computer
    
    
    52,360
    
    
    
    41,752
    
    
    
    10,608
    
    
    
    25.4Legal and accounting
    
    
    59,614
    
    
    
    72,369
    
    
    
    (12,755
    )
    
    
    (17.6
    )Donations
    
    
    4,750
    
    
    
    4,325
    
    
    
    425
    
    
    
    9.8FDIC insurance premiums
    
    
    35,827
    
    
    
    30,401
    
    
    
    5,426
    
    
    
    17.8Other
    
    
    45,530
    
    
    
    56,219
    
    
    
    (10,689
    )
    
    
    (19.0
    )Total non-interest expense
    
    $
    713,964
    
    
    $
    666,583
    
    
    $
    47,381
    
    
    
    7.1
    %
  23




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##### Table of Contents



Six Months EndedMarch 31,2011
    
    
    2010
    
    
    $ Change
    
    
    % ChangeSalary and benefits
    
    $
    865,383
    
    
    $
    751,202
    
    
    $
    114,181
    
    
    
    15.2
    %Occupancy
    
    
    176,366
    
    
    
    168,757
    
    
    
    7,609
    
    
    
    4.5Computer
    
    
    98,905
    
    
    
    83,933
    
    
    
    14,972
    
    
    
    17.8Legal and accounting
    
    
    112,322
    
    
    
    124,403
    
    
    
    (12,081
    )
    
    
    (9.7
    )Donations
    
    
    6,050
    
    
    
    5,550
    
    
    
    500
    
    
    
    9.0FDIC insurance premiums
    
    
    73,180
    
    
    
    46,339
    
    
    
    26,841
    
    
    
    57.9Other
    
    
    93,174
    
    
    
    102,957
    
    
    
    (9,783
    )
    
    
    (9.5
    )Total non-interest expense
    
    $
    1,425,380
    
    
    $
    1,283,141
    
    
    $
    142,239
    
    
    
    11.1
    %
  Income Taxes.
 Liquidity and Capital Resources
 Liquidity Management.
     24




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##### Table of Contents



Capital Management.
   Off-Balance Sheet Arrangements
   
 Item 3.
    
    Quantitative and Qualitative Disclosure About Market Risk
   25




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##### Table of Contents



Item 4.
    
    Controls and Procedures
  
 PART II. OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
  
 Item 1A.
    
    Risk Factors
  
 Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
      26




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##### Table of Contents



Item 3.
    
    Defaults Upon Senior Securities
  
 Item 4.
    
    [Removed and Reserved]
 
 Item 5.
    
    Other Information.
  
 Item 6.
    
    Exhibits
 2.1
    
    
    Plan of Conversion and Reorganization (1)3.1
    
    
    Articles of Incorporation of Eureka Financial Corp. (1)3.2
    
    
    Bylaws of Eureka Financial Corp. (1)4.0
    
    
    Form of Stock Certificate of Eureka Financial Corp. (1)10.1
    
    
    Employment Agreement between Eureka Financial Corp. and Edward F. Seserko,
dated as of February 28, 201110.2
    
    
    Employment Agreement between Eureka Financial Corp. and Gary B. Pepper, dated
as of February 28, 201131.1
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer31.2
    
    
    Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer32.0
    
    
    Section 1350 Certification
 
 (1)
    
    Incorporated herein by reference to the exhibits to the Companys Registration
Statement on Form S-1 (File No. 333-169767), as amended, initially filed with the
Securities and Exchange Commission on October 5, 2010.  27




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##### Table of Contents



SIGNATURES
  EUREKA FINANCIAL CORP.Dated:      May 16, 2011
    By:
    /s/ Edward F. SeserkoEdward F. SeserkoPresident and Chief Executive Officer
(principal executive officer)Dated:      May 16, 2011
    By:
    /s/ Gary B. PepperGary B. PepperExecutive Vice President and Chief Financial Officer
(principal accounting and financial officer)  28