##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-QSB
 (Mark One)
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended December 31, 2005
 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
incorporation or organization)
    
    (IRS Employer Identification No.)
  
   
   
   o þ
  o þ
  o þ




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PagePART I  FINANCIAL INFORMATIONITEM 1 Financial StatementsConsolidated Statements of Financial Condition
    
    
    3Consolidated Statements of Earnings
    
    
    4Consolidated Statements of Comprehensive Income
    
    
    5Consolidated Statements of Cash Flows
    
    
    6Notes to Consolidated Financial Statements
    
    
    8ITEM 2 Managements Discussion and Analysis or Plan of Operations
    
    
    10ITEM 3 Controls and ProceduresPART II  OTHER INFORMATION
    
    
    15ITEM 1 Legal ProceedingsITEM 2 Unregistered Sales of Equity Securities and Use of ProceedsITEM 3 Defaults Upon Senior SecuritiesITEM 4 Submission of Matters to a Vote of Security HoldersITEM 5 Other InformationITEM 6 ExhibitsSIGNATURES
    
    
    16EX-3.1EX-3.2EX-31.1EX-31.2EX-32.1EX-32.2
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ITEM 1. FINANCIAL STATEMENTS
 GREENVILLE FEDERAL
 
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
  December 31,
    
    
    June 30,2005
    
    
    2005(Unaudited)ASSETSCash and due from banks
    
    $
    2,365
    
    
    $
    2,119Interest-bearing deposits in other financial institutions
    
    
    8,371
    
    
    
    1,597Cash and cash equivalents
    
    
    10,736
    
    
    
    3,716Investment securities designated as available for sale  at market
    
    
    15,921
    
    
    
    15,717Investment securities designated as held to maturity  at amortized cost,
approximate market value of $16,666 and $17,852
as of December 31, 2005 and June 30, 2005, respectively
    
    
    17,045
    
    
    
    18,050Mortgage-backed securities designated as held to maturity  at amortized
cost, approximate market value of $1,448 and $1,755
as of December 31, 2005 and June 30, 2005, respectively
    
    
    1,439
    
    
    
    1,737Loans receivable  net
    
    
    81,803
    
    
    
    78,189Office premises and equipment  at depreciated cost
    
    
    2,047
    
    
    
    2,133Real estate acquired through foreclosure
    
    
    33
    
    
    
    81Stock in Federal Home Loan Bank  at cost
    
    
    1,817
    
    
    
    1,769Cash surrender value of life insurance
    
    
    3,638
    
    
    
    3,571Accrued interest receivable on loans
    
    
    413
    
    
    
    418Accrued interest receivable on mortgage-backed securities
    
    
    7
    
    
    
    8Accrued interest receivable on investment securities and other
    
    
    145
    
    
    
    146Prepaid expenses and other assets
    
    
    560
    
    
    
    513Total assets
    
    $
    135,604
    
    
    $
    126,048LIABILITIES AND RETAINED EARNINGSDeposits
    
    $
    90,703
    
    
    $
    78,898Advances from the Federal Home Loan Bank
    
    
    29,823
    
    
    
    32,243Advances by borrowers for taxes and insurance
    
    
    396
    
    
    
    333Accrued interest payable
    
    
    232
    
    
    
    205Other liabilities
    
    
    516
    
    
    
    589Accrued federal income taxes
    
    
    37
    
    
    
    23Deferred federal income taxes
    
    
    12
    
    
    
    98Total liabilities
    
    
    121,719
    
    
    
    112,389Commitments and contingencies
    
    
    
    
    
    
    Retained earnings  restricted
    
    
    14,156
    
    
    
    13,866Accumulated comprehensive loss  unrealized losses on securities
designated as available for sale, net of related tax benefits
    
    
    (271
    )
    
    
    (207
    )Total retained earnings
    
    
    13,885
    
    
    
    13,659Total liabilities and retained earnings
    
    $
    135,604
    
    
    $
    126,048
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GREENVILLE FEDERAL
 
 CONSOLIDATED STATEMENTS OF EARNINGS
 
 For the three months
    
    
    For the six monthsended December 31,
    
    
    ended December 31,2005
    
    
    2004
    
    
    2005
    
    
    2004Interest incomeLoans
    
    $
    1,350
    
    
    $
    1,229
    
    
    $
    2,660
    
    
    $
    2,439Mortgage-backed securities
    
    
    17
    
    
    
    22
    
    
    
    35
    
    
    
    47Investment securities
    
    
    304
    
    
    
    259
    
    
    
    597
    
    
    
    518Interest-bearing deposits and other
    
    
    58
    
    
    
    27
    
    
    
    96
    
    
    
    58Total interest income
    
    
    1,729
    
    
    
    1,537
    
    
    
    3,388
    
    
    
    3,062Interest expenseDeposits
    
    
    457
    
    
    
    407
    
    
    
    875
    
    
    
    820Borrowings
    
    
    368
    
    
    
    332
    
    
    
    736
    
    
    
    673Total interest expense
    
    
    825
    
    
    
    739
    
    
    
    1,611
    
    
    
    1,493Net interest income
    
    
    904
    
    
    
    798
    
    
    
    1,777
    
    
    
    1,569Provision for losses on loans
    
    
    9
    
    
    
    9
    
    
    
    17
    
    
    
    15Net interest income after provision for
losses on loans
    
    
    895
    
    
    
    789
    
    
    
    1,760
    
    
    
    1,554Other incomeCustomer service charges
    
    
    138
    
    
    
    121
    
    
    
    274
    
    
    
    248Gain on sale of real estate acquired through foreclosure
    
    
    9
    
    
    
    
    
    
    
    9
    
    
    
    23Gain on redemption of investment security
    
    
    
    
    
    
    
    
    
    
    16
    
    
    
    Other operating
    
    
    60
    
    
    
    57
    
    
    
    114
    
    
    
    111Total other income
    
    
    207
    
    
    
    178
    
    
    
    413
    
    
    
    382General, administrative and other expenseEmployee compensation and benefits
    
    
    505
    
    
    
    541
    
    
    
    982
    
    
    
    1,077Occupancy and equipment
    
    
    116
    
    
    
    108
    
    
    
    231
    
    
    
    217Franchise taxes
    
    
    45
    
    
    
    47
    
    
    
    90
    
    
    
    93Data processing
    
    
    101
    
    
    
    93
    
    
    
    199
    
    
    
    184Advertising
    
    
    20
    
    
    
    29
    
    
    
    37
    
    
    
    49Other operating
    
    
    129
    
    
    
    104
    
    
    
    237
    
    
    
    210Total general, administrative and other expense
    
    
    916
    
    
    
    922
    
    
    
    1,776
    
    
    
    1,830Earnings before income taxes
    
    
    186
    
    
    
    45
    
    
    
    397
    
    
    
    106Federal income taxesCurrent
    
    
    87
    
    
    
    4
    
    
    
    160
    
    
    
    13Deferred
    
    
    (37
    )
    
    
    
    
    
    
    (53
    )
    
    
    Total federal income taxes
    
    
    50
    
    
    
    4
    
    
    
    107
    
    
    
    13NET EARNINGS
    
    $
    136
    
    
    $
    41
    
    
    $
    290
    
    
    $
    93
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GREENVILLE FEDERAL
 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
 
 For the three months
    
    
    For the six monthsended December 31,
    
    
    ended December 31,2005
    
    
    2004
    
    
    2005
    
    
    2004Net earnings
    
    $
    136
    
    
    $
    41
    
    
    $
    290
    
    
    $
    93Other comprehensive losses, net of related tax benefits:Unrealized holding losses on securities during the period,
net of tax benefits of $11, $5, $33 and $5
for the respective periods
    
    
    (22
    )
    
    
    (10
    )
    
    
    (64
    )
    
    
    (10
    )Comprehensive income
    
    $
    114
    
    
    $
    31
    
    
    $
    226
    
    
    $
    83Accumulated comprehensive loss
    
    $
    (271
    )
    
    $
    (133
    )
    
    $
    (271
    )
    
    $
    (133
    )
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GREENVILLE FEDERAL
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 
 2005
    
    
    2004Cash flows from operating activities:Net earnings for the period
    
    $
    290
    
    
    $
    93Adjustments to reconcile net earnings to net cash
provided by (used in) operating activities:Accretion and amortization of premiums and discounts on
investment and mortgage-backed securities  net
    
    
    1
    
    
    
    Amortization of deferred loan origination fees
    
    
    (29
    )
    
    
    (45
    )Depreciation and amortization
    
    
    99
    
    
    
    103Amortization of mortgage servicing rights
    
    
    14
    
    
    
    17Provision for losses on loans
    
    
    17
    
    
    
    15Gain on sale of real estate acquired through foreclosure
    
    
    (9
    )
    
    
    (23
    )Federal Home Loan Bank stock dividends
    
    
    (48
    )
    
    
    (36
    )Increase in cash surrender value of life insurance
    
    
    (67
    )
    
    
    (70
    )Increase (decrease) in cash due to changes in:Accrued interest receivable on loans
    
    
    5
    
    
    
    46Accrued interest receivable on mortgage-backed securities
    
    
    1
    
    
    
    3Accrued interest receivable on investment securities and other
    
    
    1
    
    
    
    Prepaid expenses and other assets
    
    
    (61
    )
    
    
    (65
    )Accrued interest payable
    
    
    27
    
    
    
    (34
    )Other liabilities
    
    
    (66
    )
    
    
    (207
    )Federal income taxesCurrent
    
    
    14
    
    
    
    13Deferred
    
    
    (53
    )
    
    
    Net cash provided by (used in) operating activities
    
    
    136
    
    
    
    (190
    )Cash flows used in investing activities:Purchases of investment securities designated as available for sale
    
    
    (301
    )
    
    
    (197
    )Purchases of investment securities designated as held to maturity
    
    
    
    
    
    
    (2,000
    )Proceeds from maturity of investment securities designated
as held to maturity
    
    
    1,005
    
    
    
    3,000Proceeds from repayment of mortgage-backed securities
    
    
    297
    
    
    
    534Loan principal repayments
    
    
    10,159
    
    
    
    10,377Loan disbursements
    
    
    (13,732
    )
    
    
    (13,639
    )Purchase of office equipment
    
    
    (13
    )
    
    
    (25
    )Proceeds from sale of real estate acquired through foreclosure
    
    
    21
    
    
    
    33Decrease in certificates of deposit in other financial institutions
    
    
    
    
    
    
    297Net cash used in investing activities
    
    
    (2,564
    )
    
    
    (1,620
    )Cash flows provided by (used in) financing activities:Net increase (decrease) in deposit accounts
    
    
    11,805
    
    
    
    (2,401
    )Proceeds from Federal Home Loan Bank advances
    
    
    9,500
    
    
    
    2,000Repayment of Federal Home Loan Bank advances
    
    
    (11,920
    )
    
    
    (2,339
    )Advances by borrowers for taxes and insurance
    
    
    63
    
    
    
    45Net cash provided by (used in) financing activities
    
    
    9,448
    
    
    
    (2,695
    )Net increase (decrease) in cash and cash equivalents
    
    
    7,020
    
    
    
    (4,505
    )Cash and cash equivalents at beginning of period
    
    
    3,716
    
    
    
    7,902Cash and cash equivalents at end of period
    
    $
    10,736
    
    
    $
    3,397
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GREENVILLE FEDERAL
 CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
 
 2005
    
    
    2004Supplemental disclosure of cash flow information:Cash paid during the period for:Interest on deposits and borrowings
    
    $
    1,584
    
    
    $
    1,493Federal income taxes
    
    $
    145
    
    
    $
    Supplemental disclosure of noncash investing activities:Transfers from loans to real estate acquired through foreclosure
    
    $
    54
    
    
    $
    218Loans originated upon sale of real estate acquired through
foreclosure
    
    $
    83
    
    
    $
    143Unrealized losses on securities designated as available for
sale, net of related tax benefits
    
    $
    (64
    )
    
    $
    (10
    )
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GREENVILLE FEDERAL
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
  Basis of Presentation
    Principles of Consolidation
  8




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GREENVILLE FEDERAL
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
  Earnings Per Share
  Recent Accounting Developments
     9




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GREENVILLE FEDERAL
 
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATIONS
 Forward Looking Statements
  Discussion of Financial Condition Changes from June 30, 2005 to December 31, 2005
     10




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GREENVILLE FEDERAL
 MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATIONS (CONTINUED)
 Discussion of Financial Condition Changes from June 30, 2005 to December 31, 2005
     Comparison of Operating Results for the Three-Month Periods Ended December 31, 2005 and
2004
 General
  Net Interest Income
   11




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GREENVILLE FEDERAL
 MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATIONS (CONTINUED)
 Comparison of Operating Results for the Three-Month Periods Ended December 31, 2005 and 2004
 Net Interest Income
  Provision for Losses on Loans
  Other Income
  General, Administrative and Other Expense
  Federal Income Taxes
  12




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GREENVILLE FEDERAL
 MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATIONS (CONTINUED)
 Comparison of Operating Results for the Six-Month Periods Ended December 31, 2005 and 2004
 General
  Net Interest Income
    Provision for Losses on Loans
  Other Income
  13




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GREENVILLE
FEDERAL
 MANAGEMENTS DISCUSSION AND ANALYSIS OR PLAN
OF OPERATIONS (CONTINUED)
 Comparison of Operating Results for the Six-Month Periods Ended December 31, 2005 and 2004
 General, Administrative and Other Expense
  Federal Income Taxes
  
 Controls and Procedures
   14




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Greenville Federal Financial Corporation
 
  
 Legal Proceedings
 Not applicable
 
 Unregistered Sales of Equity Securities and Use of Proceeds
    
 Defaults Upon Senior Securities
  
 Submission of Matters to a Vote of Security Holders
  
 Other Information
  
 Exhibits
 3.1
    
    
    Greenville Federal Financial Corporation Federal Stock Subsidiary Holding Company Charter3.2
    
    
    Greenville Federal Financial
Corporation Federal Stock Subsidiary Holding Company Bylaws10.1
    
    
    Employment Agreement with David M. Kepler (incorporated by reference to
Exhibit 10.1 to the Corporations Current Report on Form 8-K filed with the Securities
and Exchange Commission on January 19, 2006)10.2
    
    
    Employment Agreement with Susan J. Allread (incorporated by reference to
Exhibit 10.2 to the Corporations Current Report on Form 8-K filed with the Securities
and Exchange Commission on January 19, 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
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Greenville Federal Financial Corporation
 
 SIGNATURES
  GREENVILLE FEDERAL FINANCIAL CORPORATIONDate:    February 10, 2006
    By:

/s/ David M. KeplerDavid M. KeplerPresident and Chief Executive OfficerDate:    February 10, 2006
    By:

/s/ Susan J. AllreadSusan J. AllreadChief Financial Officer 16