<PAGE>
     
                                 UNITED STATES             The following item
                      SECURITIES AND EXCHANGE COMMISSION   was the subject of 
                            Washington, D.C. 20549         a Form 12b-25 and is 
                                                           included herein: 
                                   FORM 10-K/A             Exhibit 13 to Item
                                (Amendment No. 2)          14(A)(3).      
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
    OF 1934
For the fiscal year ended June 30, 1996
                          -------------
                                       or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934
For the transition period from ______________ to __________________

                         Commission File Number 0-27142
                                                -------

                             L & B Financial, Inc.
                             ---------------------
             (Exact name of registrant as specified in its charter)

Texas                                           75-0591450
-------------------------------                 ----------------------
(State or other jurisdiction of                 (I.R.S. Employer
incorporation or organization)                  Identification number)

306 North Davis Street, Sulphur Springs, Texas       75482
----------------------------------------------    -----------
(Address)                                         (Zip Code)

Registrant's telephone number, including area code : (903) 885-2121
                                                     --------------
    
Securities registered pursuant to Section 12(g) of the Act: None      
                                                            ----

Securities registered pursuant to Section 12(b) of the Act:

                     Common Stock, par value $.01 per share
                     --------------------------------------
                                (Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports required
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months ( or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes    X   No 
     -----    -----     

Indicate by check mark if the disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporate by reference in Part III of this Form 10-K, or any
amendment to this         Form 10-K. [ ]

As of September 19, 1996, the aggregate value of the 1,495,435 shares of Common
Stock of the Registrant issued and outstanding on such date, which excludes
88,690 shares held by all directors and officers of the Registrant as a group,
was approximately $25,142,001 (1,495,435 shares at $16.8125 per share)

                      DOCUMENTS INCORPORATED BY REFERENCE

     List hereunder the following documents incorporated by reference and the
Part of the Form 10-K into which the document is incorporated.

(1) Portions of the Annual Report to Stockholders for the year ended June 30,
1996, are incorporated into Part II, Items 5 through 8 of this Form 10-K.

(2) Portions of the definitive proxy statement for the 1995 Annual Meeting of
Stockholders to be filed within 120 days of June 30, 1996 are incorporated into
Part III, Items 9 through 13 of this Form 10-K.

         
<PAGE>
 

    
     Part IV, Item 14 is amended to provide as follows:      

                                    PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
-------------------------------------------------------------------------

     (A)  DOCUMENTS FILED AS PART OF THIS REPORT
          --------------------------------------

(1)  The following financial statements are incorporated by reference from Item
8 hereof (see Exhibit 13):

     Independent Auditors' Report.
     Consolidated Statements of Financial Condition at June 30, 1996 and 1995.
     Consolidated Statements of Operations for the Years Ended June 30, 1996,
     1995 and 1994.
     Consolidated Statements of Changes in Stockholders' Equity for the Years
     Ended June 30, 1996, 1995 and 1994.
     Consolidated Statements of Cash Flows for the Years Ended June 30, 1996,
     1995 and 1994.
     Notes to Consolidated Financial Statements.

(2)  All schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are omitted because of the
absence of conditions under which they are required or because the required
information is included in the financial statements and related notes thereto.

(3) The following exhibits are filed as part of this Form 10-K:

     Exhibit No.
     ---------- 
     
     3.2  Articles of Incorporation of Registrant

     3.3  Bylaws of Registrant

     10.2 Agreement and Plan of Merger by and among L & B Financial, Inc., a
          Texas corporation, and Jefferson Savings Bancorp, Inc., a Delaware
          corporation, and Jefferson Savings Acquisition Co., Inc., a Missouri
          corporation dated September 25, 1996

     13.  1996 Annual Report to Shareholders (1)

     21.  Loan and Building State Savings Bank, a savings bank organized under
          the laws of the state of Texas, is a wholly-owned and operating
          subsidiary of the Registrant

     23.  Consent of Oakerson, Arnold, Walker & Co. to incorporation by
          reference

     24.  Powers of attorney

     27.  Financial Data Schedule
<PAGE>
 
     99.1 Sulphur Springs Loan and Building Association 1995 Stock Option
          Plan (2)

     99.2 Sulphur Springs Loan and Building Association Recognition and
          Retention Plan and Trust Agreement (3)
    
          (1) Filed herewith.      

          (2) Incorporated by reference to Exhibit No. 99.1 to the
              Registrant's Form S-8 Registration Statement No. 333-2574

          (3) Incorporated by reference to Exhibit B to Registrant's Proxy
              Statement dated February 3, 1995.

     (B)  REPORTS ON FORM 8-K
          -------------------

          During the fourth quarter of the Registrant's 1996 fiscal year, the
          Registrant filed one Form 8-K Report. That report was dated May 7,
          1996, and disclosed the commencement of preliminary negotiations with
          a possible acquirer.
<PAGE>
 
                                   SIGNATURES

     Pursuant to the requirements of Section 13 of 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Form 10-K/A Report
(Amendment No. 2) to be signed on its behalf by the undersigned, thereunto duly
authorized.


                                           L&B FINANCIAL, INC.

    
Date: October 10, 1996                   By: /s/ C. Glynn Lowe
                                               -------------------------------
                                               C. Glynn Lowe
                                               President and Chief
                                               Executive Officer      


     Pursuant to the requirements of the Securities Exchange Act of 1934, this
Form 10-K/A Report (Amendment No. 2) has been signed below by the following
persons on behalf of the Registrant and in the capacities and on the dates
indicated.

    
 
/s/ C. Glynn Lowe                               /s/ Enos L. Ashcroft
----------------------------------------      ---------------------------------
C. Glynn Lowe                                 Enos L. Ashcroft
Chief Executive Officer                       Chairman of the Board
                                             
Date: October 10, 1996                      Date: October 10, 1996
                                             
                                             
/s/ Jeffrey C. David                          W. T. Allison *
----------------------------------------      ---------------------------------
Jeffrey C. David                              W. T. Allison
Principal Financial and Accounting Officer    Director
                                            
Date: October 10, 1996                      Date: October 10, 1996
                                            

Daniel L. Bonner *                            Bob J. Burgin *
----------------------------------------      ---------------------------------
Daniel L. Bonner                              Bob J. Burgin
Director                                      Director
                                             
Date: October 10, 1996                      Date: October 10, 1996
                                             
James H. Connelly *                           Wayne H. Gaylean *
----------------------------------------      ---------------------------------
James H. Connelly                             Wayne H. Gaylean
Director                                      Director
                                             
Date: October 10, 1996                      Date: October 10, 1996
                                             
Thomas J. Payne *                            
----------------------------------------     
Thomas J. Payne
Director
 
Date: October 10, 1996      
 


* By    /s/ C. Glynn Lowe
    ------------------------------------
     C. Glynn Lowe
     Attorney-in-fact
     under power of attorney