UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2008
 OR
 o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
 For the transition period from  to
 Commission
File Number: 000-51668
 GREENVILLE FEDERAL FINANCIAL CORPORATION
  Ohio
    
    20-3742295(State or other jurisdiction of
    
    (IRS Employer Identification No.)incorporation or organization)
  
   
   
  þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer
o(Do not check if a smaller reporting company)
    
    Smaller reporting company
þ
 o þ




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Greenville Federal Financial Corporation
  PagePART I  FINANCIAL INFORMATIONItem 1. Consolidated Balance Sheets
    
    
    3Consolidated Statements of Income
    
    
    4Consolidated Statements of Comprehensive Income
    
    
    5Consolidated Statements of Cash Flows
    
    
    6Notes to Consolidated Financial Statements
    
    
    8Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    19Item 4T. Controls and Procedures
    
    
    19PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    20Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    20Item 3. Defaults Upon Senior Securities
    
    
    20Item 4. Submission of Matters to a Vote of Security Holders
    
    
    20Item 5. Other Information
    
    
    20Item 6. Exhibits
    
    
    20SIGNATURES
    
    
    21
  2




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ITEM 1. Financial Statements
 Greenville Federal Financial Corporation
 
 Consolidated Balance Sheets
 (In thousands, except share data)
 March 31, 2008
    
    
    June 30, 2007(Unaudited)ASSETSCash and due from banks
    
    $
    2,072
    
    
    $
    2,030Interest-bearing deposits in other financial institutions
    
    
    3,995
    
    
    
    1,497Cash and cash equivalents
    
    
    6,067
    
    
    
    3,527Investment securities designated as available for sale  at market
    
    
    17,281
    
    
    
    17,013Investment securities designated as held to maturity  at amortized cost
    
    
    2,024
    
    
    
    11,031Mortgage-backed securities designated as held to maturity  at amortized cost
    
    
    1,402
    
    
    
    1,684Loans receivable  net of allowance for loan losses of $548 and $579 at
March 31, 2008 and June 30, 2007, respectively
    
    
    89,770
    
    
    
    87,413Office premises and equipment  at depreciated cost
    
    
    1,935
    
    
    
    2,022Real estate acquired through foreclosure
    
    
    141
    
    
    
    247Stock in Federal Home Loan Bank  at cost
    
    
    1,950
    
    
    
    1,925Cash surrender value of life insurance
    
    
    3,963
    
    
    
    3,849Accrued interest receivable on loans
    
    
    431
    
    
    
    442Accrued interest receivable on mortgage-backed securities
    
    
    8
    
    
    
    9Accrued interest receivable on investment securities and other
    
    
    88
    
    
    
    99Prepaid expenses and other assets
    
    
    401
    
    
    
    447Total assets
    
    $
    125,461
    
    
    $
    129,708LIABILITIES AND STOCKHOLDERS EQUITYDeposits
    
    $
    80,310
    
    
    $
    79,633Advances from the Federal Home Loan Bank
    
    
    20,979
    
    
    
    26,125Advances by borrowers for taxes and insurance
    
    
    297
    
    
    
    382Accrued interest payable
    
    
    169
    
    
    
    333Other liabilities
    
    
    925
    
    
    
    387Deferred federal income taxes
    
    
    75
    
    
    
    104Total liabilities
    
    
    102,755
    
    
    
    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 of $.01 par value; 2,298,411 shares
issued and outstanding
    
    
    23
    
    
    
    23Additional paid-in capital
    
    
    8,979
    
    
    
    9,145Retained earnings  restricted
    
    
    14,884
    
    
    
    14,636Shares acquired by Employee Stock Ownership Plan
    
    
    (721
    )
    
    
    (721
    )Accumulated comprehensive loss  unrealized losses on securities designated as
available for sale, net of related tax effects
    
    
    (459
    )
    
    
    (339
    )Total stockholders equity
    
    
    22,706
    
    
    
    22,744Total liabilities and stockholders equity
    
    $
    125,461
    
    
    $
    129,708
 See notes to consolidated financial statements.
 3




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Greenville Federal Financial Corporation
 
 Consolidated Statements of Income
 (In thousands, except share data)
 (Unaudited)
 Three months ended
    
    
    Nine months endedMarch 31,
    
    
    March 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Interest incomeLoans
    
    $
    1,500
    
    
    $
    1,460
    
    
    $
    4,541
    
    
    $
    4,336Mortgage-backed securities
    
    
    22
    
    
    
    26
    
    
    
    69
    
    
    
    81Investment securities
    
    
    254
    
    
    
    327
    
    
    
    898
    
    
    
    1,017Interest-bearing deposits and other
    
    
    45
    
    
    
    49
    
    
    
    149
    
    
    
    150Total interest income
    
    
    1,821
    
    
    
    1,862
    
    
    
    5,657
    
    
    
    5,584Interest expenseDeposits
    
    
    572
    
    
    
    569
    
    
    
    1,811
    
    
    
    1,672Borrowings
    
    
    256
    
    
    
    315
    
    
    
    885
    
    
    
    1,013Total interest expense
    
    
    828
    
    
    
    884
    
    
    
    2,696
    
    
    
    2,685Net interest income
    
    
    993
    
    
    
    978
    
    
    
    2,961
    
    
    
    2,899Provision for losses on loans
    
    
    
    
    
    
    3
    
    
    
    
    
    
    
    13Net interest income after
provision for losses on
loans
    
    
    993
    
    
    
    975
    
    
    
    2,961
    
    
    
    2,886Other incomeCustomer service charges
    
    
    142
    
    
    
    130
    
    
    
    457
    
    
    
    408Gain on sale of real estate acquired
through foreclosure
    
    
    1
    
    
    
    
    
    
    
    1
    
    
    
    Other operating
    
    
    63
    
    
    
    60
    
    
    
    193
    
    
    
    179Total other income
    
    
    206
    
    
    
    190
    
    
    
    651
    
    
    
    587General, administrative and other expenseEmployee compensation and benefits
    
    
    517
    
    
    
    525
    
    
    
    1,558
    
    
    
    1,539Occupancy and equipment
    
    
    96
    
    
    
    96
    
    
    
    282
    
    
    
    295Franchise taxes
    
    
    50
    
    
    
    58
    
    
    
    167
    
    
    
    153Data processing
    
    
    141
    
    
    
    120
    
    
    
    396
    
    
    
    339Advertising
    
    
    19
    
    
    
    12
    
    
    
    52
    
    
    
    52Other operating
    
    
    189
    
    
    
    150
    
    
    
    511
    
    
    
    490Total general,
administrative and other
expense
    
    
    1,012
    
    
    
    961
    
    
    
    2,966
    
    
    
    2,868Income before income taxes
    
    
    187
    
    
    
    204
    
    
    
    646
    
    
    
    605Federal incomes taxesCurrent
    
    
    (19
    )
    
    
    (40
    )
    
    
    148
    
    
    
    78Deferred
    
    
    70
    
    
    
    98
    
    
    
    33
    
    
    
    92Total federal income taxes
    
    
    51
    
    
    
    58
    
    
    
    181
    
    
    
    170NET INCOME
    
    $
    136
    
    
    $
    146
    
    
    $
    465
    
    
    $
    435Earnings per share  basic and diluted
    
    $
    0.06
    
    
    $
    0.07
    
    
    $
    0.21
    
    
    $
    0.20Dividends declared per share
    
    $
    0.07
    
    
    $
    0.07
    
    
    $
    0.21
    
    
    $
    0.21
 See notes to consolidated financial statements.
 4




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Greenville Federal Financial Corporation
 
 Consolidated Statements of Comprehensive Income
 (In thousands)
 (Unaudited)
 Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net income
    
    $
    136
    
    
    $
    146
    
    
    $
    465
    
    
    $
    435Other comprehensive income
(losses), net of related tax
benefits:Unrealized holding gains
(losses) on securities
during the period, net
of taxes (benefits) of
$(62), $6, $(62) and $17
for the respective
periods
    
    
    (120
    )
    
    
    12
    
    
    
    (120
    )
    
    
    34Comprehensive income
    
    $
    16
    
    
    $
    158
    
    
    $
    345
    
    
    $
    469Accumulated comprehensive loss
    
    $
    (459
    )
    
    $
    (281
    )
    
    $
    (459
    )
    
    $
    (281
    )
 See notes to consolidated financial statements.
 5




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Greenville Federal Financial Corporation
 
 Consolidated Statements of Cash Flows
 For the nine months ended March 31, 2008 and 2007
 (In thousands)
 (Unaudited)
 2008
    
    
    2007Cash flows from operating activities:Net income for the period
    
    $
    465
    
    
    $
    435Adjustments to reconcile net income to net cash provided by operating activities:Accretion and amortization of premiums and discounts on investments and
mortgage-backed securities  net
    
    
    (2
    )
    
    
    Amortization of deferred loan origination fees
    
    
    (33
    )
    
    
    (38
    )Depreciation and amortization
    
    
    94
    
    
    
    110Stock option expense
    
    
    17
    
    
    
    Amortization of mortgage servicing rights
    
    
    22
    
    
    
    28Provision for losses on loans
    
    
    
    
    
    
    13Provision for losses on real estate acquired through foreclosure
    
    
    22
    
    
    
    Gain on sale of real estate acquired through foreclosure
    
    
    (1
    )
    
    
    Federal Home Loan Bank stock dividends
    
    
    (25
    )
    
    
    (56
    )Increase in cash surrender value of life insurance
    
    
    (114
    )
    
    
    (107
    )Increase (decrease) in cash due to changes in:Accrued interest receivable on loans
    
    
    11
    
    
    
    3Accrued interest receivable on mortgage-backed securities
    
    
    1
    
    
    
    2Accrued interest receivable on investment securities and other
    
    
    11
    
    
    
    (15
    )Prepaid expenses and other assets
    
    
    24
    
    
    
    (221
    )Accrued interest payable
    
    
    (164
    )
    
    
    (9
    )Other liabilities
    
    
    538
    
    
    
    83Federal income taxesCurrent
    
    
    
    
    
    
    (230
    )Deferred
    
    
    33
    
    
    
    92Net cash provided by operating activities
    
    
    899
    
    
    
    90Cash flows used in investing activities:Purchases of investment securities designated as available for sale
    
    
    (450
    )
    
    
    (624
    )Proceeds from maturity of investment securities designated as held to maturity
    
    
    9,007
    
    
    
    5,007Proceeds from repayment of mortgage-backed securities
    
    
    284
    
    
    
    347Loan principal repayments
    
    
    9,675
    
    
    
    11,608Loan disbursements
    
    
    (11,999
    )
    
    
    (14,451
    )Purchase of office equipment
    
    
    (7
    )
    
    
    (64
    )Proceeds from sale of real estate acquired through foreclosure
    
    
    85
    
    
    
    499Net cash provided by investing activities
    
    
    6,595
    
    
    
    2,322Net cash provided by operating and investing activities
(balance carried forward)
    
    
    7,494
    
    
    
    2,412
 See notes to consolidated financial statements.
 6




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Greenville Federal Financial Corporation
Consolidated Statements of Cash Flows (Continued)
For the nine months ended March 31, 2008 and 2007
(In thousands)
(Unaudited)
 2008
    
    
    2007Net cash provided by operating and investing activities
(balance brought forward)
    
    $
    7,494
    
    
    $
    2,412Cash flows provided by financing activities:Net increase in deposit accounts
    
    
    677
    
    
    
    911Proceeds from Federal Home Loan Bank advances
    
    
    30,000
    
    
    
    30,115Repayments of Federal Home Loan Bank advances
    
    
    (35,146
    )
    
    
    (32,941
    )Advances by borrowers for taxes and insurance
    
    
    (85
    )
    
    
    (64
    )Shares acquired by 2006 Equity Plan
    
    
    (183
    )
    
    
    (93
    )Dividends on common stock
    
    
    (217
    )
    
    
    (217
    )Net cash used in financing activities
    
    
    (4,954
    )
    
    
    (2,289
    )Net increase in cash and cash equivalents
    
    
    2,540
    
    
    
    123Cash and cash equivalents at beginning of period
    
    
    3,527
    
    
    
    3,254Cash and cash equivalents at end of period
    
    $
    6,067
    
    
    $
    3,377Supplemental disclosure of cash flow information:Cash paid during the period for:Interest on deposits and borrowings
    
    $
    2,860
    
    
    $
    2,694Federal income taxes
    
    $
    83
    
    
    $
    308Supplemental disclosure of noncash investing activities:Transfers from loans to real estate acquired through foreclosure
    
    $
    
    
    
    $
    811Unrealized gains (losses) on securities designated as available
for sale, net of related tax effects
    
    $
    (120
    )
    
    $
    34
 See notes to consolidated financial statements.
 7




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Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
For the nine- and three-month periods ended March 31, 2008 and 2007
 Note 1: Basis of Presentation
    Note 2: Principles of Consolidation
  Note 3: Earnings Per Share
  8




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Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
For the nine- and three-month periods ended March 31, 2008 and 2007
   Note 4: Recent Accounting Developments
  
    
    Separately recognize financial assets as servicing assets or servicing liabilities, each
time it undertakes an obligation to service a financial asset by entering into certain
kinds of servicing contracts;
    
    Separately present servicing assets and liabilities subsequently measured at fair value
in the statement of financial condition and additional disclosures for all separately
recognized servicing assets and servicing liabilities; and
    
    Initially measure all separately recognized servicing assets and liabilities at fair
value, if practicable.
    9




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Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
For the nine- and three-month periods ended March 31, 2008 and 2007
       10




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Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
For the nine- and three-month periods ended March 31, 2008 and 2007
 Note 5: Stock-Based Compensation Plan
 
      11




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Greenville Federal Financial Corporation
Notes to Consolidated Financial Statements
For the nine- and three-month periods ended March 31, 2008 and 2007
 Note 6: Subsequent Event
    12




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Greenville Federal Financial Corporation
 
 ITEM 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations
 Forward Looking Statements
  Critical Accounting Policies
  Discussion of Financial Condition Changes from June 30, 2007 to March 31, 2008
    13




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition
and Results of Operations
     Comparison of Operating Results for the Three-Month Periods Ended March 31, 2008 and 2007
 General
  14




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition
and Results of Operations
 Net Interest Income
    Provision for Losses on Loans
  15




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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
  Federal Income Taxes
  Comparison of Operating Results for the Nine-Month Periods Ended March 31, 2008 and 2007
 General
  16




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition
and Results of Operations
 Net Interest Income
    Provision for Losses on Loans
  17




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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
  Federal Income Taxes
  18




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Greenville Federal Financial Corporation
Managements Discussion and Analysis of Financial Condition
and Results of Operations
 
 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
  
 ITEM 4T. Controls and Procedures
   19




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Greenville Federal Financial Corporation
 
 PART II  OTHER INFORMATION (CONTINUED)
 
 ITEM 1. Legal Proceedings
 Not applicable
 ITEM 1A. Risk Factors
 Not applicable
 
 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
 (a)
    
    None(b)
    
    None(c)
    
    None
 
 ITEM 3. Defaults Upon Senior Securities
 Not applicable
 
 ITEM 4. Submission of Matters to a Vote of Security Holders
 Not applicable
 
 ITEM 5. Other Information
 Not applicable
 
 ITEM 6. Exhibits
 3.1
    
    Greenville Federal Financial Corporation Federal Stock Subsidiary Holding Company Charter3.2
    
    Greenville Federal Financial Corporation Federal Stock Subsidiary Holding Company Bylaws31.1
    
    Chief Executive Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Chief Financial Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Chief Executive Officer certification pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Chief Financial Officer certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 20




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Greenville Federal Financial Corporation
 
 SIGNATURES
  GREENVILLE FEDERAL FINANCIAL CORPORATIONDate:    May 14, 2008
    By:
    /s/ David M. KeplerDavid M. KeplerPresident and Chief Executive OfficerDate:    May 14, 2008
    By:
    /s/ Susan J. AllreadSusan J. AllreadChief Financial Officer 21




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INDEX TO EXHIBITS
 3.1
    
    Greenville Federal Financial Corporation Federal Stock Subsidiary Holding Company Charter
(Incorporated by reference to Exhibit 2 to the Registration Statement on Form 8-A filed by the
Registrant with the Securities and Exchange Commission on December 14, 2006)3.2
    
    Greenville Federal Financial Corporation Federal Stock Subsidiary Holding Company Bylaws
(Incorporated by reference to Exhibit 3 to the Registration Statement on Form 8-A filed by the
Registrant with the Securities and Exchange Commission on December 14, 2006)31.1
    
    Chief Executive Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Chief Financial Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Chief Executive Officer certification pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Chief Financial Officer certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002