**UNITED      STATES**

**SECURITIES      AND EXCHANGE COMMISSION**

**WASHINGTON,      D.C. 20549**

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**FORM      10-QSB**

| x | QUARTERLY                REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF                1934 |
|---|-----------------------------------------------------------------------------------------------------------------|

|  ̈ | TRANSITION                REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT |
|--------|--------------------------------------------------------------------------------|

**EQUITABLE      FINANCIAL CORP. **

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| United                States                                                                 |   | 14-1941649                                                         |
|----------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------|
| (State                or other jurisdiction of incorporation                or organization) |   | (I.R.S.                Employer Identification                No.) |

**113      North Locust Street, Grand Island, Nebraska 68801 **

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**(308)      382-3136 **

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**Not      Applicable **

----

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**EQUITABLE      FINANCIAL CORP.**

**FORM      10-QSB**

**Index**

|                                               |                                                                                                                                                                                | ***Page                  No.*** |
|----------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------|
|                                               |                                                                                                                                                                                |                            |
| **PART                  I. FINANCIAL INFORMATION** |                                                                                                                                                                                |
|                                               |                                                                                                                                                                                |                            |
| Item                  1.                           | Financial                  Statements                                                                                                                                               | 1                               |
|                                               |                                                                                                                                                                                |                            |
|                                               | Consolidated                  Statements of Financial Condition at September 30, 2007 (Unaudited)                  and                  June 30, 2007                               | 1                               |
|                                               |                                                                                                                                                                                |                            |
|                                               | Consolidated                  Statements of Operations for the three months ended September 30,                  2007 and                  2006 (Unaudited)                         | 2                               |
|                                               |                                                                                                                                                                                |                            |
|                                               | Consolidated                  Statements of Stockholders’ Equity and Comprehensive Income for the three                  months ended September 30, 2007 and 2006 (Unaudited) | 3                               |
|                                               |                                                                                                                                                                                |                            |
|                                               | Consolidated                  Statements of Cash Flows for the three months ended September 30,                  2007 and                  2006 (Unaudited)                         | 4                               |
|                                               |                                                                                                                                                                                |                            |
|                                               | Notes                  to Consolidated Unaudited Financial Statements                                                                                                               | 5                               |
|                                               |                                                                                                                                                                                |                            |
| Item                  2.                           | Management’s                  Discussion and Analysis or Plan of Operation                                                                                                    | 10                              |
|                                               |                                                                                                                                                                                |                            |
| Item                  3.                           | Controls                  and Procedures                                                                                                                                            | 14                              |
|                                               |                                                                                                                                                                                |                            |
| **PART                  II. OTHER INFORMATION**    |                                                                                                                                                                                |
|                                               |                                                                                                                                                                                |                            |
| Item                  1.                           | Legal                  Proceedings                                                                                                                                                  | 14                              |
|                                               |                                                                                                                                                                                |                            |
| Item                  2.                           | Unregistered                  Sales of Equity Securities and Use of Proceeds                                                                                                        | 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                                                                                                                                                                            | 15                              |
|                                               |                                                                                                                                                                                |                            |
| **Signatures**                                     |                                                                                                                                                                                |

----

**PART      I. FINANCIAL INFORMATION**

**Item      1. Financial Statements**

**E**
**QUITABLE      FINANCIAL CORP.**

**Statements      of Financial Condition**

|                                                                                                                                                                        |   | **September 30,****2007** |        | **June 30,****2007** |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|-------------|---------------------------|--------|
|                                                                                                                                                                        |   | **(Unaudited)**                |        |                      |   |
| **ASSETS**                                                                                                                                                                  |   |                           |        |                      |   |   |   |
| Cash                and due from financial institutions                                                                                                                     |   | $                              | 2,638,556   |                      | $      | 2,382,234 |   |
| Federal                funds sold                                                                                                                                           |   |                           | 5,700,000   |                      |   | 7,100,000 |   |
| Cash                and cash equivalents                                                                                                                                    |   |                           | 8,338,556   |                      |   | 9,482,234 |   |
| Securities                available-for-sale, at fair value                                                                                                                 |   |                           | 6,088,118   |                      |   | 6,584,274 |   |
| Securities                held-to-maturity, fair value at September 30, 2007 - $669,602; and                June                30, 2007-$684,464                           |   |                           | 679,653     |                      |   | 702,030 |   |
| Federal                Home Loan Bank stock, at cost                                                                                                                        |   |                           | 2,481,500   |                      |   | 2,447,500 |   |
| Loans,                net of allowance for loan losses of $1,103,398 at September 30, 2007                and                $1,056,873 at June 30, 2007                    |   |                           | 154,955,608 |                      |   | 153,329,552 |   |
| Premises                and equipment, net                                                                                                                                  |   |                           | 6,770,582   |                      |   | 6,850,891 |   |
| Foreclosed                assets, net                                                                                                                                       |   |                           | 64,703      |                      |   | 82,900 |   |
| Accrued                interest receivable                                                                                                                                  |   |                           | 1,474,219   |                      |   | 1,235,278 |   |
| Other                assets                                                                                                                                                 |   |                           | 2,240,142   |                      |   | 2,119,652 |   |
| Total                assets                                                                                                                                                 |   | $                              | 183,093,081 |                      | $      | 182,834,311 |   |
|                                                                                                                                                                        |   |                           |        |                      |   |   |   |
| **LIABILITIES                AND STOCKHOLDERS’ EQUITY**                                                                                                               |   |                           |        |                      |   |   |   |
| Liabilities                                                                                                                                                                 |   |                           |        |                      |   |   |   |
| Deposits                                                                                                                                                                    |   |                           |        |                      |   |   |   |
| Noninterest-bearing                deposits                                                                                                                                 |   | $                              | 7,303,748   |                      | $      | 6,465,861 |   |
| Interest-bearing                deposits                                                                                                                                    |   |                           | 126,220,861 |                      |   | 121,279,000 |   |
| Total                deposits                                                                                                                                               |   |                           | 133,524,609 |                      |   | 127,744,861 |   |
| Federal                Home Loan Bank borrowings                                                                                                                            |   |                           | 25,271,618  |                      |   | 30,599,626 |   |
| Advance                payments from borrowers for taxes and insurance                                                                                                      |   |                           | 346,302     |                      |   | 794,930 |   |
| Accrued                interest payable and other liabilities                                                                                                               |   |                           | 981,794     |                      |   | 528,952 |   |
| Common                stock in ESOP subject to contingent repurchase obligation                                                                                             |   |                           | 172,515     |                      |   | 151,679 |   |
| Total                liabilities                                                                                                                                            |   |                           | 160,296,838 |                      |   | 159,820,048 |   |
| Commitments                and contingencies                                                                                                                                |   |                           |        |                      |   |   |   |
| Stockholders’                equity:                                                                                                                                  |   |                           |        |                      |   |   |   |
| Preferred                stock, $0.01 par value per share; authorized 1,000,000 shares, no                shares                are outstanding                             |   |                           | -           |                      |   | - |   |
| Common                stock, $0.01 par value, 14,000,000 shares authorized; 3,297,509 shares                issued and outstanding at September 30, 2007 and June 30, 2007. |   |                           | 32,975      |                      |   | 32,975 |   |
| Additional                paid-in capital                                                                                                                                   |   |                           | 13,618,584  |                      |   | 13,619,515 |   |
| Retained                earnings                                                                                                                                            |   |                           | 11,160,439  |                      |   | 11,421,576 |   |
| Unearned                ESOP shares                                                                                                                                         |   |                           | (1,112,730  | )                         |   | (1,135,440 | ) |
| Treasury                stock, 64,631 shares at cost                                                                                                                        |   |                           | (694,783    | )                         |   | (694,783 | ) |
| Accumulated                other comprehensive loss, net                                                                                                                    |   |                           | (35,727     | )                         |   | (77,901 | ) |
| Reclassification                of ESOP shares                                                                                                                              |   |                           | (172,515    | )                         |   | (151,679 | ) |
| Total                stockholders’ equity                                                                                                                             |   |                           | 22,796,243  |                      |   | 23,014,263 |   |
| Total                liabilities and stockholders’ equity                                                                                                             |   | $                              | 183,093,081 |                      | $      | 182,834,311 |   |

*See      Notes to the Unaudited Consolidated Financial Statements*

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**EQUITABLE      FINANCIAL CORP.**

**Statements      of Operations**

**(Unaudited)**

|                                                                           |   | **Three Months****Ended****September 30,****2007** |      | **Three Months****Ended****September 30,****2006** |   |
|--------------------------------------------------------------------------------|--------|--------------------------------------------------------------|-----------|--------------------------------------------------------------|--------|
| **Interest                Income**                                             |   |                                                         |      |                                                         |   |   |   |
| Loans                                                                          |   | $                                                            | 2,490,550 |                                                         | $      | 2,379,894 |   |
| Securities                                                                     |   |                                                         | 109,325   |                                                         |   | 136,918 |   |
| Other                                                                          |   |                                                         | 75,270    |                                                         |   | 14,755 |   |
| Total                interest income                                           |   |                                                         | 2,675,145 |                                                         |   | 2,531,567 |   |
|                                                                           |   |                                                         |      |                                                         |   |   |   |
| **Interest                Expense**                                            |   |                                                         |      |                                                         |   |   |   |
| Deposits                                                                       |   |                                                         | 1,334,507 |                                                         |   | 1,086,528 |   |
| Federal                Home Loan Bank borrowings                               |   |                                                         | 357,466   |                                                         |   | 459,274 |   |
| Total                interest expense                                          |   |                                                         | 1,691,973 |                                                         |   | 1,545,802 |   |
|                                                                           |   |                                                         |      |                                                         |   |   |   |
| **Net                interest income**                                    |   |                                                         | 983,172   |                                                         |   | 985,765 |   |
| Provision                for loan losses                                       |   |                                                         | 60,000    |                                                         |   | 30,000 |   |
|                                                                           |   |                                                         |      |                                                         |   |   |   |
| **Net                interest income after provision for loan losses**    |   |                                                         | 923,172   |                                                         |   | 955,765 |   |
| **Non-interest                income**                                         |   |                                                         |      |                                                         |   |   |   |
| Service                charges on deposit accounts                             |   |                                                         | 151,489   |                                                         |   | 75,814 |   |
| Brokerage                fee income                                            |   |                                                         | 211,053   |                                                         |   | 152,284 |   |
| Gain                on sale of loans                                           |   |                                                         | 26,630    |                                                         |   | 19,329 |   |
| Other                loan fees                                                 |   |                                                         | 7,225     |                                                         |   | 19,805 |   |
| Other                income                                                    |   |                                                         | 89,353    |                                                         |   | 24,689 |   |
| Total                non-interest income                                       |   |                                                         | 485,750   |                                                         |   | 291,921 |   |
|                                                                           |   |                                                         |      |                                                         |   |   |   |
| **Non-interest                expenses**                                       |   |                                                         |      |                                                         |   |   |   |
| Salaries                and employee benefits                                  |   |                                                         | 1,090,435 |                                                         |   | 902,106 |   |
| Director                and committee fees                                     |   |                                                         | 21,450    |                                                         |   | 24,450 |   |
| Data                processing fees                                            |   |                                                         | 131,346   |                                                         |   | 72,373 |   |
| Occupancy                and equipment                                         |   |                                                         | 230,739   |                                                         |   | 239,272 |   |
| Regulatory                fees and deposit insurance premium                   |   |                                                         | 17,779    |                                                         |   | 14,906 |   |
| Loss                on sale of foreclosed assets                               |   |                                                         | 4,293     |                                                         |   | - |   |
| Loss                on investment in low income housing partnerships           |   |                                                         | 7,500     |                                                         |   | - |   |
| Advertising                and public relations                                |   |                                                         | 41,788    |                                                         |   | 82,442 |   |
| Contributions                and donations                                     |   |                                                         | 13,633    |                                                         |   | 21,519 |   |
| Insurance                and surety bond premiums                              |   |                                                         | 65,585    |                                                         |   | 25,164 |   |
| Professional                fees                                               |   |                                                         | 100,978   |                                                         |   | 109,339 |   |
| Supplies,                telephone, postage                                    |   |                                                         | 54,406    |                                                         |   | 69,155 |   |
| ATM                expenses                                                    |   |                                                         | 8,059     |                                                         |   | 9,669 |   |
| Dues                and subscriptions                                          |   |                                                         | 7,304     |                                                         |   | 13,365 |   |
| Other                expenses                                                  |   |                                                         | 39,605    |                                                         |   | 66,145 |   |
| Total                non-interest expenses                                     |   |                                                         | 1,834,900 |                                                         |   | 1,649,905 |   |
|                                                                           |   |                                                         |      |                                                         |   |   |   |
| **Income                (loss) before income taxes**                      |   |                                                         | (425,978  | )                                                            |   | (402,219 | ) |
| Income                tax expense (benefit)                                    |   |                                                         | (164,841  | )                                                            |   | (128,996 | ) |
| **Net                income (loss)**                                      |   | $                                                            | (261,137  | )                                                            | $      | (273,223 | ) |
| **Basic                and diluted earnings (loss) per share** ** ** |   | $                                                            | (0.08     | )                                                            | $      | (0.09 | ) |

*See      Notes to the Unaudited Consolidated Financial Statements*

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**EQUITABLE      FINANCIAL CORP.**

**Consolidated      Statements of Stockholders’ Equity and Comprehensive      Income**

**Three      Month**
**s      Ended September 30, 2007 and 2006**

**(Unaudited)**

|                                                                                                                                                                                      |   | **Common Stock** |   | **Additional Paid-****In Capital** |   | **Retained****Earnings** |                     | **Unearned ESOP****Shares** |       | **Treasury Stock** |   | **Accumulated****Other****Comprehensive****Income** |          | **Amount****Reclassified on****ESOP Shares** |     | **Total**     |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------|--------|----------------------------------------------|--------|--------------------------|--------------------------|----------------------------------|------------|-------------------------|--------|-----------------------------------------------------|---------------|--------------------------------------------------------|----------|---------------|--------|
|                                                                                                                                                                                      |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |
| Balance                at June 30, 2006                                                                                                                                                   |   | $                     | 32,975 |                                         | $      | 13,617,427               |                     | $                                | 12,820,516 |                    | $      | (1,226,280                                          | )             | $                                                      | -        |          | $      | (149,962 | ) | $ | (61,033 | ) | $ | 25,033,643 |   |
| Comprehensive                loss:                                                                                                                                                        |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |   |   |   |   |   |   |   |   |
| Net                     loss                                                                                                                                                              |   |                  | -      |                                         |   | -                        |                     |                             | (273,223   | )                       |   | -                                                   |          |                                                   | -        |          |   | - |   |   | - |   |   | (273,223 | ) |
| Change                in net unrealized gain (loss) on securities available-for-sale, net                of                income taxes                                                   |   |                  | -      |                                         |   | -                        |                     |                             | -          |                    |   | -                                                   |          |                                                   | -        |          |   | 69,745 |   |   | - |   |   | 69,745 |   |
| Total                comprehensive loss, net                                                                                                                                              |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |   |   |   |   |   |   | (203,478 | ) |
| Release                of 2,271 unearned ESOP shares                                                                                                                                      |   |                  | -      |                                         |   | (1,773                   | )                        |                             | -          |                    |   | 22,710                                              |          |                                                   | -        |          |   | - |   |   | - |   |   | 20,937 |   |
| Reclassification                due to release and changes in fair value of common stock in ESOP                subject                to contingent repurchase obligation of ESOP shares |   |                  | -      |                                         |   | -                        |                     |                             | -          |                    |   | -                                                   |          |                                                   | -        |          |   | - |   |   | (28,017 | ) |   | (28,017 | ) |
| Balance                at September 30, 2006                                                                                                                                              |   | $                     | 32,975 |                                         | $      | 13,615,654               |                     | $                                | 12,547,293 |                    | $      | (1,203,570                                          | )             | $                                                      | -        |          | $      | (80,217 | ) | $ | (89,050 | ) | $ | 24,823,085 |   |
|                                                                                                                                                                                      |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |   |   |   |   |   |   |   |   |
| Balance                at June 30, 2007                                                                                                                                                   |   |                  | 32,975 |                                         |   | 13,619,515               |                     |                             | 11,421,576 |                    |   | (1,135,440                                          | )             |                                                   | (694,783 | )             |   | (77,901 | ) |   | (151,679 | ) |   | 23,014,263 |   |
| Comprehensive                loss:                                                                                                                                                        |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |   |   |   |   |   |   |   |   |
| Net                loss                                                                                                                                                                   |   |                  | -      |                                         |   | -                        |                     |                             | (261,137   | )                       |   | -                                                   |          |                                                   | -        |          |   | - |   |   | - |   |   | (261,137 | ) |
| Change                in net unrealized gain (loss) on securities available-for-sale, net                of                income taxes                                                   |   |                  | -      |                                         |   | -                        |                     |                             | -          |                    |   | -                                                   |          |                                                   | -        |          |   | 42,174 |   |   | - |   |   | 42,174 |   |
| Total                comprehensive loss, net                                                                                                                                              |   |                  |   |                                         |   |                     |                     |                             |       |                    |   |                                                |          |                                                   |     |          |   |   |   |   |   |   |   | (218,963 | ) |
| Release                of 2,271 unearned ESOP shares                                                                                                                                      |   |                  | -      |                                         |   | (931                     | )                        |                             | -          |                    |   | 22,710                                              |          |                                                   | -        |          |   | - |   |   | - |   |   | 21,779 |   |
| Reclassification                due to release and changes in fair value of common stock in ESOP                subject                to contingent repurchase obligation of ESOP shares |   |                  | -      |                                         |   | -                        |                     |                             | -          |                    |   | -                                                   |          |                                                   | -        |          |   | - |   |   | (20,836 | ) |   | (20,836 | ) |
| Balance                at September 30, 2007                                                                                                                                              |   | $                     | 32,975 |                          | $      | 13,618,584               |      | $                                | 11,160,439 |          | $      | (1,112,730                                          | )   | $                                                      | (694,783 | )   | $      | (35,727 | )   | $ | (172,515 | )   | $ | 22,796,243 |   |

*See      Notes to the Unaudited Consolidated Financial Statements*

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**EQUITABLE      FINANCIAL CORP.**

**Consolidated      Statements of Cash Flows**

**(Unaudited)**

|                                                                                    |   | **Three                Months Ended****September                30,** |       |
|-----------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------|------------|
|                                                                                    |   | **2007**                                                              |       | **2006** |   |
| **Cash                flows from operating activities:**                                |   |                                                                  |       |   |   |   |   |
| Net                loss                                                                 |   | $                                                                     | (261,137   | ) | $ | (273,223 | ) |
| Adjustments                to reconcile net loss to net cash from operating activities: |   |                                                                  |       |   |   |   |   |
| Depreciation                                                                            |   |                                                                  | 93,591     |   |   | 91,439 |   |
| Amortization                of premiums and discounts                                   |   |                                                                  | 1,997      |   |   | 3,875 |   |
| Federal                Home Loan Bank stock dividends                                   |   |                                                                  | (34,000    | ) |   | (32,500 | ) |
| ESOP                expense                                                             |   |                                                                  | 21,779     |   |   | 20,937 |   |
| Deferred                loan origination costs, net                                     |   |                                                                  | (33,350    | ) |   | (14,156 | ) |
| Provision                for loan losses                                                |   |                                                                  | 60,000     |   |   | 30,000 |   |
| Gain                on sale of loans                                                    |   |                                                                  | (26,630    | ) |   | (19,329 | ) |
| Deferred                taxes                                                           |   |                                                                  | (164,841   | ) |   | (162,066 | ) |
| Loans                originated for sale                                                |   |                                                                  | (1,500,870 | ) |   | (1,222,291 | ) |
| Proceeds                from sale of loans                                              |   |                                                                  | 2,257,531  |   |   | 1,241,620 |   |
| Loss                on sale of foreclosed asset                                         |   |                                                                  | 4,293      |   |   | - |   |
| Change                in:                                                               |   |                                                                  |       |   |   |   |   |
| Accrued                interest receivable                                              |   |                                                                  | (238,941   | ) |   | (108,449 | ) |
| Other                assets                                                             |   |                                                                  | 26,095     |   |   | (373,255 | ) |
| Accrued                interest payable and other liabilities                           |   |                                                                  | 452,842    |   |   | (46,350 | ) |
| Net                cash from operating activities                                       |   |                                                                  | 658,359    |   |   | (863,748 | ) |
|                                                                                    |   |                                                                  |       |   |   |   |   |
| **Cash                flows from investing activities:**                                |   |                                                                  |       |   |   |   |   |
| Net                change in loans                                                      |   |                                                                  | (2,450,911 | ) |   | (2,108,156 | ) |
| Proceeds                from sale of foreclosed asset                                   |   |                                                                  | 78,607     |   |   | - |   |
| Principal                repayments from securities available-for-sale                  |   |                                                                  | 558,463    |   |   | 84,977 |   |
| Principal                repayments from securities held-to-maturity                    |   |                                                                  | 21,974     |   |   | 49,628 |   |
| Purchases                of premises and equipment                                      |   |                                                                  | (13,282    | ) |   | (741,684 | ) |
| Net                cash from investing activities                                       |   |                                                                  | (1,805,149 | ) |   | (2,715,235 | ) |
|                                                                                    |   |                                                                  |       |   |   |   |   |
| **Cash                flows from financing activities:**                                |   |                                                                  |       |   |   |   |   |
| Net                change in deposits                                                   |   |                                                                  | 5,779,748  |   |   | (4,965,017 | ) |
| Proceeds                from Federal Home Loan Bank borrowings                          |   |                                                                  | -          |   |   | 8,500,000 |   |
| Repayments                of Federal Home Loan Bank borrowings                          |   |                                                                  | (5,328,008 | ) |   | (679,344 | ) |
| Net                change in advance payments from borrowers for taxes and insurance    |   |                                                                  | (448,628   | ) |   | (492,566 | ) |
| Net                cash from financing activities                                       |   |                                                                  | 3,112      |   |   | 2,363,073 |   |
| Increase                in cash and cash equivalents                                    |   |                                                                  | (1,143,678 | ) |   | (1,215,910 | ) |
| Cash                and cash equivalents, beginning of period                           |   |                                                                  | 9,482,234  |   |   | 4,092,931 |   |
| Cash                and cash equivalents, end of period                                 |   | $                                                                     | 8,338,556  |   | $ | 2,877,021 |   |
|                                                                                    |   |                                                                  |       |   |   |   |   |
| **Supplemental                cash flow information:**                                  |   |                                                                  |       |   |   |   |   |
| Interest                paid on deposits and borrowings                                 |   | $                                                                     | 1,626,264  |   | $ | 1,534,045 |   |
|                                                                                    |   |                                                                  |       |   |   |   |   |
| **Supplemental                noncash disclosure:**                                     |   |                                                                  |       |   |   |   |   |
| Common                stock in ESOP subject to contingent repurchase obligation         |   | $                                                                     | 172,515    |   | $ | 89,050 |   |
| Transfer                of loans to foreclosed real estate                              |   | $                                                                     | 64,703     |   | $ | - |   |

*See      Notes to the Unaudited Consolidated Financial Statements*

----

**EQUITABLE      FINANCIAL CORP.**

**Notes      to the Unaudited Consolidated Financial Statements**

**September      30, 2007**

**(1)**
**Basis      of Presentation**

**(2)**
**Critical      Accounting Policies**

*Allowance      for loan losses*

*Mortgage      Servicing Rights.*

----

**(3)**
**Earnings      Per Share**

|                                                               |   | **Three                Months Ended****September                30,** |      |
|--------------------------------------------------------------------|--------|-----------------------------------------------------------------------|-----------|
|                                                               |   | **2007**                                                              |      | **2006** |   |
| Net                (loss) for the three months ended               |   | $                                                                     | (261,137  | ) | $ | (273,223 | ) |
| Weighted                average shares outstanding for the quarter |   |                                                                  | 3,119,334 |   |   | 3,174,881 |   |
| (Loss)                per share                                    |   | $                                                                     | (0.08     | ) | $ | (0.09 | ) |

**(4)**
**Investment      and mortgage-backed securities**

|                                                                                              |   | **September                30, 2007** |      |
|---------------------------------------------------------------------------------------------------|--------|---------------------------------------|-----------|
|                                                                                              |   | **Amortized****Cost**                 |      | **Gross****Unrealized****Gains** |   | **Gross****Unrealized****Losses** |   | **Fair                Value** |   |
| Available                for sale:                                                                |   |                                  |      |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed                securities                                                         |   | $                                     | 1,664,186 |   | $ | 10,643 |   | $ | (43,583 | ) | $ | 1,631,246 |   |
| U.S.                government-sponsored entity securities                                        |   |                                  | 3,485,000 |   |   | - |   |   | (13,911 | ) |   | 3,471,089 |   |
| Municipal                obligations                                                              |   |                                  | 993,062   |   |   | - |   |   | (7,279 | ) |   | 985,783 |   |
| Total                investment and mortgage-backed securities, available for                sale |   | $                                     | 6,142,248 |   | $ | 10,643 |   | $ | (64,773 | ) | $ | 6,088,118 |   |

|                                                                                              |   | **June                30, 2007** |      |
|---------------------------------------------------------------------------------------------------|--------|----------------------------------|-----------|
|                                                                                              |   | **Amortized****Cost**            |      | **Gross****Unrealized****Gains** |   | **Gross****Unrealized****Losses** |   | **Fair****Value** |   |
| Available                for sale:                                                                |   |                             |      |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed                securities                                                         |   | $                                | 1,724,293 |   | $ | 10,494 |   | $ | (64,497 | ) | $ | 1,670,290 |   |
| U.S.                government-sponsored entity securities                                        |   |                             | 3,985,000 |   |   | - |   |   | (43,736 | ) |   | 3,941,264 |   |
| Municipal                obligations                                                              |   |                             | 993,012   |   |   | - |   |   | (20,292 | ) |   | 972,720 |   |
| Total                investment and mortgage-backed securities, available for                sale |   | $                                | 6,702,305 |   | $ | 10,494 |   | $ | (128,525 | ) | $ | 6,584,274 |   |

** **

----

**(5)**
**Loan      Portfolio Composition**

|                                                |   | **September                30, 2007**     |    | **June                30, 2007** |   |
|-----------------------------------------------------|--------|-------------------------------------------|---------|----------------------------------|--------|
|                                                |   | **Amount**                                |    | **Percent**                      |   | **Amount** |   | **Percent** |   |
|                                                |   | **(Dollars                in thousands)** |    |
| Real                estate-mortgage:                |   |                                      |    |                             |   |   |   |   |   |   |   |   |   |
| One-to-four                family                   |   | $                                         | 64,280  |                             |   | 41.3 | % | $ | 65,266 |   |   | 42.4 | % |
| Multi-family                                        |   |                                      | 7,304   |                             |   | 4.7 | % |   | 6,874 |   |   | 4.4 | % |
| Nonresidential                                      |   |                                      | 37,064  |                             |   | 23.8 | % |   | 37,019 |   |   | 24.1 | % |
| Total                real estate-mortgage loans     |   |                                      | 108,648 |                             |   | 69.8 | % |   | 109,159 |   |   | 70.9 | % |
| Construction                                        |   |                                      | 4,132   |                             |   | 2.7 | % |   | 4,810 |   |   | 3.1 | % |
| Commercial                                          |   |                                      | 25,292  |                             |   | 16.3 | % |   | 24,154 |   |   | 15.7 | % |
| Consumer:                                           |   |                                      |    |                             |   |   |   |   |   |   |   |   |   |
| Home                equity                          |   |                                      | 13,894  |                             |   | 8.9 | % |   | 12,323 |   |   | 8.0 | % |
| Other                consumer                       |   |                                      | 3,632   |                             |   | 2.3 | % |   | 3,513 |   |   | 2.3 | % |
| Total                consumer loans                 |   |                                      | 17,526  |                             |   | 11.2 | % |   | 15,836 |   |   | 10.3 | % |
| Total                loans                          |   |                                      | 155,598 |                             |   | 100.0 | % |   | 153,959 |   |   | 100.0 | % |
| Deferred                loan origination costs, net |   |                                      | 461     |                             |   |   |   |   | 428 |   |   |   |   |
| Allowance                for loan losses            |   |                                      | (1,103  | )                                |   |   |   |   | (1,057 | ) |   |   |   |
| Loans,                net                           |   | $                                         | 154,956 |                             |   |   |   | $ | 153,330 |   |   |   |   |

**(6)**
**Allowance      for Loan Losses**

|                                                                          |   | **Three                Months Ended**     |   |
|-------------------------------------------------------------------------------|--------|-------------------------------------------|--------|
|                                                                          |   | **September                30,**          |   |
|                                                                          |   | **2007**                                  |   | **2006** |   |
|                                                                          |   | **(Dollars                in thousands)** |   |
| Allowance                at beginning of period                               |   | $                                         | 1,057  |   | $ | 926 |   |
| Provision                for loan losses                                      |   |                                      | 60     |   |   | 30 |   |
| Charge-offs                                                                   |   |                                      | (26    | ) |   | (2 | ) |
| Recoveries                                                                    |   |                                      | 12     |   |   | 1 |   |
| Allowance                at end of period                                     |   | $                                         | 1,103  |   | $ | 955 |   |
| Allowance                to nonaccrual loans                                  |   |                                      | 199.1  | % |   | 256.7 | % |
| Allowance                to total loans outstanding at the end of the period  |   |                                      | 0.7    | % |   | 0.6 | % |
| Net                charge-offs to average loans outstanding during the period |   |                                      | 0.0    | % |   | 0.0 | % |

**(7)**
**Deposits**

----

|                                        |   | **September                30, 2007**     |    | **June                30, 2007** |   |
|---------------------------------------------|--------|-------------------------------------------|---------|----------------------------------|--------|
|                                        |   | **Amount**                                |    | **Percent**                      |   | **Amount** |   | **Percent** |   |
|                                        |   | **(Dollars                in thousands)** |    |
| Noninterest-bearing                accounts |   | $                                         | 7,304   |                             |   | 5.5 | % | $ | 6,466 |   |   | 5.1 | % |
| Interest-bearing                NOW         |   |                                      | 11,851  |                             |   | 8.9 | % |   | 12,424 |   |   | 9.7 | % |
| Money                market                 |   |                                      | 21,899  |                             |   | 16.4 | % |   | 14,317 |   |   | 11.2 | % |
| Savings                accounts             |   |                                      | 4,013   |                             |   | 3.0 | % |   | 4,398 |   |   | 3.4 | % |
| Certificates                of deposit      |   |                                      | 88,458  |                             |   | 66.2 | % |   | 90,140 |   |   | 70.6 | % |
| Total                                       |   | $                                         | 133,525 |                             |   | 100.0 | % | $ | 127,745 |   |   | 100.0 | % |

**(8)**
**Employee      Stock Ownership Plan**

*Employers’      Accounting for Employee Stock Ownership Plans*

|                                                  |   | **For                the Three Months** |      |
|-------------------------------------------------------|--------|-----------------------------------------|-----------|
|                                                  |   | **Ended                September 30,**  |      |
|                                                  |   | **2007**                                |      | **2006** |   |
| ESOP                compensation expense              |   | $                                       | 21,779    |   | $ | 20,937 |   |
| ESOP                shares allocated to employees     |   |                                    | 2,271     |   |   | 2,271 |   |
| ESOP                shares allocated in prior periods |   |                                    | 15,718    |   |   | 6,634 |   |
| ESOP                shares unallocated                |   |                                    | 111,273   |   |   | 120,357 |   |
| Fair                value of ESOP shares unallocated  |   | $                                       | 1,067,108 |   | $ | 1,203,570 |   |

**(9)**
**Equity      Incentive Plan**

----

**(10)**
**Income      Taxes**

**(11)**
**Recent      Accounting Pronouncements **

----

**(12)**
**Subsequent      Events **

**Item      2. Management’s Discussion and Analysis or Plan of      Operation**

**Forward-Looking      Statements**

**General**

**Statement      of Financial Condition Analysis**

***Overview***
**.      **

----

***Loans.***
* *

***Non-performing      Assets.***

|                                                       |   | **September 30,**               |   | **June 30,** |   |
|------------------------------------------------------------|--------|--------------------------------------|--------|-------------------|--------|
|                                                       |   | **2007**                             |   | **2007**          |   |
|                                                       |   | **(Dollars in thousands)** |   |
| Non-accrual loans:                                    |   |                                 |   |              |   |   |   |
| Real                estate-mortgage                        |   | $                                    | 516    |              | $      | 466 |   |
| Commercial                                                 |   |                                 | 15     |              |   | - |   |
| Consumer                                                   |   |                                 | 23     |              |   | 3 |   |
| Total                non-accrual loans                     |   |                                 | 554    |              |   | 469 |   |
| Foreclosed                assets, net                      |   |                                 | 65     |              |   | 83 |   |
| Total                non-performing assets                 |   | $                                    | 619    |              | $      | 552 |   |
| Total                non-accrual loans to total loans      |   |                                 | 0.4    | %                 |   | 0.3 | % |
| Total                non-accrual loans to total assets     |   |                                 | 0.3    | %                 |   | 0.3 | % |
| Total                non-performing assets to total assets |   |                                 | 0.3    | %                 |   | 0.3 | % |

***Securities.***

***Deposits.***

----

***Borrowings***

**Results      of Operations for the Three Months Ended September 30, 2007 and      2006**

***Overview.***

***Net      Interest Income.***

|                                  |   | **Three                Months Ended****September                30,** |   |     |   |
|---------------------------------------|--------|-----------------------------------------------------------------------|--------|----------|--------|
|                                  |   | **2007**                                                              |   | **2006** |   | **%                Change** |   |
| Interest                Income:       |   |                                                                  |   |     |   |   |   |   |   |   |
| Loans                                 |   | $                                                                     | 2,491  |     | $      | 2,380 |   |   | 4.7 | % |
| Securities                            |   |                                                                  | 109    |     |   | 137 |   |   | (20.4 | ) |
| Other                                 |   |                                                                  | 75     |     |   | 14 |   |   | 435.7 |   |
| Total                interest income  |   |                                                                  | 2,675  |     |   | 2,531 |   |   | 5.7 |   |
| Interest                Expense       |   |                                                                  |   |     |   |   |   |   |   |   |
| Deposits                              |   |                                                                  | 1,335  |     |   | 1,087 |   |   | 22.8 |   |
| Federal                Home Loan Bank |   |                                                                  | 357    |     |   | 459 |   |   | (22.2 | ) |
| Total                interest expense |   | $                                                                     | 1,692  |     | $      | 1,546 |   |   | 9.4 |   |
| Net                interest income    |   | $                                                                     | 983    |     | $      | 985 |   |   | (0.2 | ) |

|                                              |   | **Three                Months Ended September 30,** |    |
|---------------------------------------------------|--------|-----------------------------------------------------|---------|
|                                              |   | **2007**                                            |    |   | **2006** |   |
|                                              |   | **Average****Balance**                              |    | **Interest****Income** |   | **Yield/ Cost** |   |   | **AverageBalance** |   | **Interest Income** |   | **Yield/ Cost** |   |
|                                              |   | **(Dollars                in thousands)**           |    |
| Loans,                net                         |   | $                                                   | 152,111 |   | $ | 2,491 |   |   | 6.55 | % |   | $ | 154,853 |   | $ | 2,380 |   |   | 6.15 | % |
| Securities                and other               |   |                                                | 15,056  |   |   | 184 |   |   | 4.89 | % |   |   | 12,851 |   |   | 152 |   |   | 4.73 | % |
| Total                interest-bearing assets      |   |                                                | 167,167 |   |   | 2,675 |   |   | 6.40 | % |   |   | 167,704 |   |   | 2,532 |   |   | 6.04 | % |
|                                              |   |                                                |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                interest-bearing deposits    |   |                                                | 122,325 |   |   | 1,335 |   |   | 4.37 | % |   |   | 116,130 |   |   | 1,087 |   |   | 3.74 | % |
| FHLB                borrowings                    |   |                                                | 26,429  |   |   | 357 |   |   | 5.40 | % |   |   | 35,048 |   |   | 459 |   |   | 5.24 | % |
| Total                interest-bearing liabilities |   | $                                                   | 148,754 |   | $ | 1,692 |   |   | 4.55 | % |   | $ | 151,178 |   | $ | 1,546 |   |   | 4.09 | % |
|                                              |   |                                                |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                rate spread               |   |                                                |    |   |   |   |   |   | 1.85 | % |   |   |   |   |   |   |   |   | 1.95 | % |
| Net                interest margin                |   |                                                |    |   |   |   |   |   | 2.35 | % |   |   |   |   |   |   |   |   | 2.35 | % |

----

***Provision      for Loan Losses.***

***Non-interest      Income.***

***Non-interest      Expenses.***
** **

***Income      Taxes.***

**Liquidity      and Capital Management**

***Liquidity      Management.***

----

***Capital      Management.***

**Off-Balance      Sheet Arrangements**

**Commitments**

**Item      3. Controls and Procedures**

**PART      II. OTHER INFORMATION**

**Item      1.**
**      Legal Proceedings**

----

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

**Item      3.**
**      Defaults upon Senior Securities**

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

**Item      5.**
**      Other Information**

**Item      6.**
**      Exhibits**

|   | 3.1 | Charter                of Equitable Financial Corp. (1) |
|--------|-----|---------------------------------------------------------|

|   | 3.2 | Bylaws                of Equitable Financial Corp. (1) |
|--------|-----|--------------------------------------------------------|

|   | 4.0 | Stock                Certificate of Equitable Financial Corp.                (2) |
|--------|-----|----------------------------------------------------------------------------------|

|   | 31.1 | Rule                13a-14(a)/15d-14(a) Certification of Chief Executive                Officer |
|--------|------|-------------------------------------------------------------------------------------------------|

|   | 31.2 | Rule                13a-14(a)/15d-14(a) Certification of Chief Financial                Officer |
|--------|------|-------------------------------------------------------------------------------------------------|

|   | 32.0 | Section                1350 Certification |
|--------|------|-------------------------------------------|

----

|   | (1) | Incorporated                by reference into this document from the Exhibits filed with the                Securities and Exchange Commission on the Quarterly Report on Form                10-QSB                on February 14, 2006.  |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Incorporated                by reference into this document from the Exhibits filed with the                Securities and Exchange Commission on the Registration Statement                on Form                SB-2, and any amendments thereto, Registration No. 333-126617.  |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

**SIGNATURES**

|                                    | EQUITABLE                FINANCIAL CORP. |
|-----------------------------------------|------------------------------------------|
|                                    |                                     |   |
| Dated:                November 13, 2007 | By:                                      | /s/              Richard              L. Harbaugh |
|                                    |                                     | Richard                L. Harbaugh |
|                                    |                                     | President                and Chief Executive Officer |
|                                    |                                     | (principal                executive officer) |
|                                    |                                     |   |
| Dated:                November 13, 2007 | By:                                      | /s/                Kim E. Marco |
|                                    |                                     | Kim                E. Marco |
|                                    |                                     | Executive                Vice President and Chief Financial Officer |
|                                    |                                     | (principal                financial and accounting officer) |

----