<PAGE>
 
                                   FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C.  20549



 X   Quarterly report pursuant to Section 13 or 15(d) of the Securities
---  Exchange Act of 1934

For the quarterly period ended September 30, 1997 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:  0-16918


            AMERICA FIRST FINANCIAL FUND 1987-A LIMITED PARTNERSHIP
             (Exact name of registrant as specified in its charter)



     Delaware                                              47-0713310
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(State or other jurisdiction                            (IRS Employer
of incorporation or organization)                       Identification No.)

1004 Farnam Street, Omaha, Nebraska                           68102
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(Address of principal executive offices)                    (Zip Code)

                                 (402) 444-1630
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              (Registrant's telephone number, including area code)

  Indicate by check mark whether the registrant (1) has filed all reports
required to be filed 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
                               ---                  ---
<PAGE>
 
     AMERICA FIRST FINANCIAL FUND 1987-A LIMITED PARTNERSHIP AND SUBSIDIARY

                                   FORM 10-Q


                               September 30, 1997



                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                 PAGE
PART I.      FINANCIAL INFORMATION
<C>          <S>                                                                                  <C>
Item 1.      Financial Statements

             Consolidated Balance Sheets
             September 30, 1997 and December 31, 1996.......................................      1

             Consolidated Statements of Operations
             For the quarters ended September 30, 1997 and  September 30, 1996
             and for the nine months ended September 30, 1997 and September 30, 1996........      2

             Consolidated Statement of Partners' Capital
             For the nine months ended September 30, 1997...................................      3

             Consolidated Statements of Cash Flows
             For the nine months ended September 30, 1997 and September 30, 1996............      4

             Notes to Consolidated Financial Statements.....................................      5


Item 2.      Management's Discussion and Analysis of Financial
             Condition and Results of Operations............................................      8

PART II.     OTHER INFORMATION

Item 6.      Exhibits and Reports on Form 8-K...............................................     17

SIGNATURES..................................................................................     20

</TABLE>
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

PART I - FINANCIAL INFORMATION
Item 1. - Financial Statements

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
                          CONSOLIDATED BALANCE SHEETS
                            (dollars in thousands)
--------------------------------------------------------------------------------------------------
                                                       September 30, 1997        December 31, 1996
--------------------------------------------------------------------------------------------------
<S>                                                          <C>                      <C>
Assets
 Cash and amounts due from depository institutions           $   39,249               $   30,827
 Federal funds sold                                              24,900                   20,000
 Securities purchased under agreements to resell                 38,415                    5,300
 Mortgage-backed securities, net
  Held to maturity                                              506,779                  630,106
  Available-for-sale                                             41,285                   44,489
Loans receivable, net                                         1,524,335                1,403,483
Loans held for sale                                               1,551                      370
Accrued interest receivable                                      12,834                   12,217
Premises and equipment, net                                       8,394                    8,888
Federal Home Loan Bank stock, at cost                            20,236                   21,827
Real estate held for sale or investment, net                      1,328                    1,328
Real estate owned, net                                            1,958                    1,438
Deferred tax assets, net                                         22,053                   22,643
 Other assets                                                     7,200                    6,135
--------------------------------------------------------------------------------------------------
  Total Assets                                               $2,250,517               $2,209,051
--------------------------------------------------------------------------------------------------
Liabilities and Partners' Capital
 Customer deposits                                           $1,965,961               $1,840,485
 Securities sold under agreements to repurchase                       -                   44,353
 Other borrowings                                                68,481                  106,998
 Distributions payable                                            2,437                    2,437
 Other liabilities and accrued expenses                          16,217                   19,583
--------------------------------------------------------------------------------------------------
  Total Liabilities                                           2,053,096                2,013,856
--------------------------------------------------------------------------------------------------
Redeemable Preferred Stock; Series A, no par value;
  100,000 shares outstanding, $10 million liquidation value
  at September 30, 1997; and 200,000 shares outstanding, $20
  million liquidation value at December 31, 1996                  9,153                   17,748

Partners' Capital:
 General Partner                                                 11,520                    9,155
 Beneficial Unit Certificate (BUC) Holders
 6,010,589 BUCs authorized, issued and outstanding              176,748                  168,292
--------------------------------------------------------------------------------------------------
  Total Partners' Capital                                       188,268                  177,447
--------------------------------------------------------------------------------------------------
Total Liabilities and Partners' Capital                      $2,250,517               $2,209,051
--------------------------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

                                       1
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                 (dollars in thousands except per BUC amounts)
-----------------------------------------------------------------------------------------------------------------------
                                                           For the          For the       For the Nine    For the Nine
                                                        Quarter Ended    Quarter Ended    Months Ended    Months Ended
                                                        Sept. 30, 1997  Sept. 30, 1996   Sept. 30, 1997  Sept. 30, 1996
-----------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>             <C>              <C>             <C>
Interest income
 Interest and fees on loans                                    $28,814         $26,570         $ 83,408        $ 80,321
 Interest on mortgage-backed securities                         10,093          12,108           32,117          38,625
 Interest and dividends on investment                              894           1,111            2,298           3,481
-----------------------------------------------------------------------------------------------------------------------
 Total interest income                                          39,801          39,789          117,823         122,427
-----------------------------------------------------------------------------------------------------------------------
Interest expense
 Interest on deposits                                           22,921          20,835           66,375          60,894
 Interest on borrowings                                          1,068           3,488            3,928          14,815
 Preferred Stock accretion                                         299             560            1,405           1,627
-----------------------------------------------------------------------------------------------------------------------
 Total interest expense                                         24,288          24,883           71,708          77,336
-----------------------------------------------------------------------------------------------------------------------
Net interest income before provision for loan losses            15,513          14,906           46,115          45,091
 Provision for loan losses                                         250              71              752             852
-----------------------------------------------------------------------------------------------------------------------
Net interest income after provision for loan losses             15,263          14,835           45,363          44,239
-----------------------------------------------------------------------------------------------------------------------
Non-interest income
 Deposit related fees                                              492             471            1,399           1,393
 Loan related fees                                                 298             326              906           1,038
 Gain on disposition of loans                                       67              56              234             210
 Other income                                                    1,554             855            5,090           2,372
-----------------------------------------------------------------------------------------------------------------------
 Total non-interest income                                       2,411           1,708            7,629           5,013
-----------------------------------------------------------------------------------------------------------------------
Non-interest expense
 Compensation and benefits                                       6,733           5,350           18,371          16,017
 Occupancy and equipment                                         2,002           2,018            5,934           6,331
 FDIC premiums and special assessments                             384          12,123            1,151          14,303
 Professional services                                             441             305            1,455             843
 Advertising and promotion                                         169             235              883             761
 Provision for loss (recovery) on interest
   rate exchange agreements                                         22             147               17            (422)
 Other expense                                                   2,359           1,944            6,427           6,158
-----------------------------------------------------------------------------------------------------------------------
 Total non-interest expense                                     12,110          22,122           34,238          43,991
-----------------------------------------------------------------------------------------------------------------------
Income (loss) before income taxes                                5,564          (5,579)          18,754           5,261
 Provision for income taxes                                        320               -              960               -
-----------------------------------------------------------------------------------------------------------------------
Net income (loss)                                              $ 5,244         $(5,579)        $ 17,794        $  5,261
-----------------------------------------------------------------------------------------------------------------------
Net income (loss) allocated to:
 General Partner                                               $   621         $(1,620)        $  2,378        $   (459)
 BUC Holders                                                     4,623          (3,959)          15,416           5,720
-----------------------------------------------------------------------------------------------------------------------
                                                                $5,244         $(5,579)         $17,794          $5,261
-----------------------------------------------------------------------------------------------------------------------
Net income (loss) per BUC                                       $  .77         $  (.66)         $  2.56        $    .95
-----------------------------------------------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

                                       2
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

                CONSOLIDATED STATEMENT OF PARTNERS' CAPITAL 
                For the Nine Months Ended September 30, 1997
                           (dollars in thousands)



<TABLE>
<CAPTION>
------------------------------------------------------------------------------
                                             General
                                             Partner    BUC Holders   Total
------------------------------------------------------------------------------
<S>                                         <C>        <C>          <C>
Balance at December 31, 1996                $ 9,155     $168,292     $177,447
Net income                                    2,378       15,416       17,794
Cash distributions paid or accrued              (97)      (7,213)      (7,310)
Net unrealized gain on available-for-sale                          
   mortgage-backed securities                    84        253          337
------------------------------------------------------------------------------
Balance at September 30, 1997               $11,520      $176,748    $188,268
------------------------------------------------------------------------------
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

                                       3
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                            (dollars in thousands)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------- 
                                                                           For the Nine         For the Nine
                                                                           Months Ended          Months Ended
                                                                        September 30, 1997    September 30, 1996 
---------------------------------------------------------------------------------------------------------------- 
<S>                                                                     <C>                   <C>
Cash flows from operating activities                                                             
Net income                                                                   $ 17,794              $  5,261
Adjustments to reconcile net income to net cash                                                  
 provided by operating activities                                                                
 Amortization of:                                                                                
   Investments and mortgage-backed securities net premium                       1,567                 2,002
   Loan premium                                                                    60                   699
   Intangibles                                                                    869                   923
 Proceeds from sale of loans                                                   12,739                13,710
 Originations of loans held for sale                                          (13,686)              (13,996)
 Net gain on sale of real estate owned and held for sale or investment         (1,571)                  (22)
 Gain on sale of loans                                                           (234)                 (210)
 Provision for loan losses                                                        752                   852
 Provision for loss (recovery) on interest rate exchange agreements                17                  (422)
 (Increase) decrease in accrued interest receivable                              (617)                  406
 Decrease in accrued interest payable                                          (1,316)               (2,581)
 Depreciation and amortization of premises and equipment                        1,261                 1,280
 Net provision for income taxes                                                   960                     -
 Increase in other assets                                                      (2,125)               (2,995)
 (Decrease) increase in other liabilities                                      (2,368)               10,335
 Other, net                                                                      (182)                1,819
---------------------------------------------------------------------------------------------------------------- 
                                                                                                 
Total adjustments                                                              (3,874)               11,800
---------------------------------------------------------------------------------------------------------------- 
 Net cash provided by operating activities                                     13,920                17,061
---------------------------------------------------------------------------------------------------------------- 
Cash flows from investing activities                                                               
 Originations of loans held for investment                                   (326,327)             (169,027)
 Purchases of mortgage-backed securities held for investment                        -               (14,548)
 Purchases of real estate loans                                                (7,438)              (23,341)
 Purchases of premises and equipment                                             (817)                 (903)
 Principal payments on mortgage-backed securities                             125,302               154,023
 Principal payments on loans                                                  210,248               210,069
 Proceeds from sales of real estate owned and held for sale or investment       2,870                 3,115
 Proceeds from sale of Federal Home Loan Bank Stock                             2,599                   911
 Other, net                                                                       786                   326
---------------------------------------------------------------------------------------------------------------- 
 Net cash provided by investing activities                                      7,223               160,625                   
---------------------------------------------------------------------------------------------------------------- 
Cash flows from financing activities                                                             
 Net increase in checking, money market accounts                                                 
   and passbook savings                                                        82,123                75,842
 Proceeds from issuance of certificates of deposits                           226,103               192,836
 Payments for maturing or early withdrawal                                                       
   of certificates of deposits                                               (182,751)             (166,178)
 Redemption of preferred stock                                                (10,000)                    -
 Net decrease in short-term repurchase agreements                             (44,353)              (47,255)
 Net decrease in Federal Home Loan Bank advances                              (38,518)             (250,952)
 Capital distributions                                                         (7,310)               (7,310)
---------------------------------------------------------------------------------------------------------------- 
 Net cash (used) provided by financing activities                              25,294              (203,017)
---------------------------------------------------------------------------------------------------------------- 
Net increase (decrease) in cash and cash equivalents                           46,437               (25,331)
Cash and cash equivalents at beginning of period                               56,127                72,316
---------------------------------------------------------------------------------------------------------------- 
Cash and cash equivalents at end of period                                   $102,564               $46,985
---------------------------------------------------------------------------------------------------------------- 
Supplemental disclosure of cash flow information:                                                
Non cash investing and financing activities:                                                     
   Additions to real estate acquired through foreclosure                      $ 2,037               $ 4,242
 Cash paid for interest (including interest credited)                         $73,023               $80,135
 Cash paid for alternative income and minimum                                                       
    franchise taxes                                                           $   370               $   545
---------------------------------------------------------------------------------------------------------------- 
</TABLE>

The accompanying notes are an integral part of the consolidated financial
statements.

                                       4
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 1997

1.  ORGANIZATION

    America First Financial Fund 1987-A Limited Partnership (the "Partnership")
    was formed on April 14, 1987 under the Delaware Revised Uniform Limited
    Partnership Act for the purpose of acquiring one or more federally insured
    financial institutions through supervisory assisted acquisitions. The
    Partnership formed a subsidiary corporation, America First Eureka Holdings,
    Inc. ("AFEH") for the purpose of owning and managing one or more acquired
    financial institutions. The Partnership will terminate on December 31, 2036,
    unless terminated earlier under the provisions of the Partnership Agreement.
    The general partner of the Partnership is America First Capital Associates
    Limited Partnership Five ("AFCA-5") whose managing general partner is AFCA-5
    Management Corporation.

2.  BASIS OF PRESENTATION

    The consolidated financial statements of the Partnership include the
    accounts of the Partnership, AFEH (its wholly-owned subsidiary) and AFEH's
    wholly-owned subsidiary, EurekaBank ("Eureka") and its subsidiaries. All
    significant intercompany transactions have been eliminated.

    In the opinion of management, the accompanying unaudited consolidated
    financial statements contain all adjustments (primarily consisting of normal
    recurring accruals) necessary for a fair presentation of the Partnership's
    financial condition as of September 30, 1997, and the results of its
    operations for the three and nine month periods ended September 30, 1997 and
    1996.

3.  ALLOWANCE FOR LOAN LOSSES

    The Partnership recorded loan loss provisions of approximately $250,000 and
    $752,000 for the quarter and nine months ended September 30, 1997,
    respectively, compared to approximately $71,000 and $852,000 for the same
    periods in 1996. At September 30, 1997 and December 31, 1996, the allowance
    for loan losses was approximately $7.4 million and $7.1 million,
    respectively. Management believes that the allowance for loan losses was
    adequate given the composition, credit characteristics and loss experience
    of the loan portfolio.
 
4.  INTEREST RATE EXCHANGE AGREEMENTS

    Prior to 1993, the Partnership entered into interest rate exchange
    agreements to reduce the impact of future fluctuations in interest rates on
    fixed rate mortgages funded by variable rate liabilities. The floating rates
    to be received by the Partnership under the terms of these agreements are
    reset monthly, quarterly or semi-annually and are generally indexed to the
    FHLB Eleventh District Cost of Funds index or the one or three month London
    Interbank Offered Rate ("LIBOR").

    In 1993, the sustained decline in interest rates in the general economy and
    the resulting prepayment of mortgage loans associated with the interest rate
    exchange agreements caused Eureka to establish a liability based on the
    estimated fair value of interest rate exchange agreements that were no
    longer deemed effective as hedges. During the quarter ended September 30,
    1997, Eureka recorded a provision to non-interest expense on interest rate
    exchange agreements of approximately $22,000 to reflect the effect of
    interest rate decreases on the market value of Eureka's related obligations.
    A net provision of approximately $17,000 was recorded for the nine months
    ended September 30, 1997. During the quarter and nine months ended September
    30, 1996, Eureka recorded to non-interest expense provisions (recoveries) on
    interest rate exchange agreements of approximately $147,000 and ($422,000),
    respectively, to reflect the effect of interest rate changes on the market
    value of Eureka's related obligations. The recorded liability for the
    interest rate exchange agreements totaled approximately $379,000 and $1.2
    million at September 30, 1997 and December 31, 1996, respectively. Net
    interest payable on interest rate exchange agreements

                                       5
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

    was $395,000 and $629,000 at September 30, 1997 and December 31, 1996,
    respectively, and was included in other liabilities and accrued expenses.

    For the quarter and nine months ended September 30, 1997, net interest
    expense on interest rate exchange agreements (after amortization of the
    interest rate exchange agreement liability of $253,000 and $872,000,
    respectively) totaled approximately $130,000 and $550,000, respectively. For
    the quarter and nine months ended September 30, 1996, net interest expense
    on interest rate exchange agreements (after amortization of the interest
    rate exchange agreement liability of $351,000 and $1.4 million,
    respectively) totaled approximately $238,000 and $622,000, respectively. Net
    interest expense on interest rate exchange agreements is included as an
    adjustment to interest income on loans. The notional amount of interest rate
    exchange agreements outstanding was $55 million at September 30, 1997. The
    notional amount of interest rate exchange agreements outstanding at December
    31, 1996 was $100 million.

5.  INCOME TAXES

    The Partnership files calendar year federal and state Partnership
    information returns, reporting its operations on an accrual basis. The
    consolidated financial statement provisions for income tax for the quarter
    and nine months ended September 30, 1997 and 1996 relate to the
    Partnership's subsidiary, AFEH and its subsidiaries. AFEH and its
    subsidiaries file calendar year consolidated federal income and combined
    California franchise tax returns.

    Deferred tax assets were initially recognized for net operating loss and tax
    credit carryforwards and differences between the financial statements
    carrying amount and the tax bases of assets and liabilities which would
    result in future deduction amounts. A valuation allowance is established to
    reduce the deferred tax assets to the level at which it is more likely than
    not that the tax benefits will be recognized.

    A valuation allowance is recorded if it is more likely than not that some
    portion or all of the deferred tax assets will not be realized based on a
    review of available evidence. The allowance is subject to ongoing
    adjustments based on changes in circumstances that affect management's
    assessment of the realizability of the deferred tax assets. Adjustments to
    increase or decrease the valuation allowance are charged or credited,
    respectively, to income tax expense (benefit).

6.  PROPOSED MERGER WITH BAY VIEW CAPITAL CORPORATION

    On May 8, 1997, the Partnership announced that it had entered into a
    definitive agreement with Bay View Capital Corporation with respect to a
    merger of its subsidiary America First Eureka Holdings with Bay View (the
    "Merger Agreement"). Under the terms of the Merger Agreement, the
    Partnership will receive $90 million in cash and $210 million in Bay View
    common stock (subject to a minimum of 8,076,923 shares and a maximum of
    10,000,000 shares) for all of its interest in America First Eureka Holdings,
    which owns Eureka. If the market price of Bay View common stock (based on
    the average closing prices over a specified period) is less than $21.00 per
    share, the Partnership has the right to terminate the Merger Agreement
    unless the total value of the shares of Bay View common stock to be received
    is $210 million in addition to the cash portion of $90 million. The
    transaction is expected to close on or about January 2, 1998, and is subject
    to customary conditions, including approval by the BUC holders and Bay View
    stockholders. Approval for the merger was received from the Office of Thrift
    Supervision during the third quarter of 1997. Please refer to the
    Partnership's Form 8-K dated May 16, 1997 for further information. The
    number of Bay View shares to be received by the Partnership under the terms
    of the Merger Agreement are adjusted for a Bay View 100% stock dividend
    declared on April 14, 1997 to Bay View stockholders of record on May 9,
    1997.

    In May 1997, $10 million of the preferred stock issued to the FDIC was
    redeemed. The $10 million in mandatorily redeemable non-voting Series A
    Preferred Stock which remains outstanding would have been redeemed in May
    1998, but will be redeemed when the merger is completed.

                                       6
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY


    Under the terms of the Assistance Agreement, and as a result of the Merger
    Agreement discussed above, the Partnership expects to pay a final
    participation payment to the FDIC of approximately a range currently
    estimated to be $8.5 million to $12.8 million from cash received at the time
    of the merger. The final participation payment is in addition to the
    redemption of the remaining $10 million in outstanding Series A Preferred
    Stock.

                                       7
<PAGE>
 
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY

--------------------------------------------------------------------------------
ITEM 2:  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS
--------------------------------------------------------------------------------


FORWARD-LOOKING STATEMENTS

In addition to the historical information contained in this Management's
Discussion and Analysis section, certain discussions contain forward-looking
statements that involve risks and uncertainties.  A number of important factors
could cause the actual results of operations and other information to differ
materially from those results of operations and other information discussed in
those forward-looking statements.  Those factors include fluctuations in
interest rates, inflation, the impact of federal government legislation and
regulations (including changes in legislation and regulation), and economic
conditions and competition in the geographic and business area in which the
Partnership conducts its operations.  The forward-looking statements are made as
of the date of this Form 10-Q and the Partnership undertakes no obligation to
publicly update such forward-looking statements to reflect subsequent events or
circumstances.  The interim information discussed below should be read in
conjunction with the Partnership's 1996 Form 10-K, in particular the forward-
looking statements contained in Management's Discussion and Analysis of
Financial Condition and Results of Operations.

PROPOSED MERGER WITH BAY VIEW CAPITAL CORPORATION

On May 8, 1997, the Partnership announced that it had entered into a definitive
agreement with Bay View Capital Corporation ("Bay View") with respect to a
merger of its subsidiary America First Eureka Holdings with Bay View (the
"Merger Agreement").  Under the terms of the Merger Agreement, the Partnership
will receive $90 million in cash and $210 million in Bay View common stock
(subject to a minimum of 8,076,923 shares and a maximum of 10,000,000 shares)
for all of  its interest in America First Eureka Holdings, which owns Eureka.
If the market price of Bay View common stock (based on the average closing
prices over a specified period) is less than $21.00 per share, the Partnership
has the right to terminate the Merger Agreement unless the total value of the
shares of Bay View common stock to be received is $210 million in addition to
the cash portion of $90 million.  The transaction is expected to close on or
about January 2, 1998, and is subject to customary conditions, including
approval by the BUC holders and Bay View stockholders.  Approval for the merger
was received from the Office of Thrift Supervision during the third quarter of
1997.  The number of Bay View shares to be received by the Partnership under the
terms of the Merger Agreement are adjusted to reflect a Bay View 100% stock
dividend declared on April 14, 1997 to Bay View stockholders of record on May 9,
1997.  Please refer to the Partnership's Form 8-K dated May 16, 1997 for further
information regarding the merger.  Excluding the FDIC final payment discussed in
"Assistance Agreement" below, and assuming a Bay View share price of $26,
expenses which will be recorded at the effective date of the merger are
estimated to be $33 million. See "Non-Interest Expense" for further discussion
on merger expenses. Actual expenses for merger related transactions
may be higher or lower than this estimate.

FINANCIAL CONDITION

At September 30, 1997, Partnership assets were approximately $2.3 billion, which
was approximately $41 million more than Partnership assets at December 31, 1996,
and consisted primarily of the assets of Eureka.  Significant changes in the
composition of the balance sheet included the following:

 .  Net loans receivable, loans held for sale and net mortgage-backed securities
   ("MBS") decreased nominally during the nine months ended September 30, 1997.
   The net decrease in the loan and MBS portfolios were primarily due to
   prepayments. During the nine months ended September 30, 1997, Eureka
   originated (net of sales) $76 million and $249 million in retail and
   wholesale loans, respectively. Wholesale loan originations enable Eureka to
   add assets that meet its credit quality guidelines within its market area,
   and management believes that wholesale loan originations will continue to be
   a significant percentage of total originations through 1997. Mortgage loans
   purchased during the nine months ended September 30, 1997 totaled $7 million.
   There were no MBS additions during the first nine months of 1997. Repayments
   and other deductions of $206 million and $125 million were

                                       8
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
   recorded in the mortgage loan and MBS portfolios, respectively, during the
   nine months ended September 30, 1997.

 .  Retail deposits increased approximately $125 million since December 31, 1996,
   and totaled $2.0 billion at September 30, 1997. This increase is primarily
   due to deposit promotion and retention incentives. The increases were
   primarily in time deposits.

 .  Securities sold under agreements to repurchase and other borrowings decreased
   approximately $83 million during the first nine months of 1997 to $68 million
   at September 30, 1997. As of September 30, 1997, other liabilities decreased
   approximately $3.4 million from December 31, 1996, primarily due to
   reductions for accrued interest on borrowings and interest rate exchange
   agreements, and other payables.

At September 30, 1997 and December 31, 1996, the loan-to-deposit ratios were 78%
and 76%, respectively.  Loans, MBS, federal funds sold, and securities purchased
under agreements to resell comprised approximately 95% of Partnership assets at
September 30, 1997 and December 31, 1996.  As of September 30, 1997, short-term
advances/borrowings were essentially zero.

Cash distributions paid or accrued during the quarter ended September 30, 1997
totaled $.40 per BUC.  The amount of cash distributions paid or accrued for the
third quarter of 1997 is consistent with the same period in 1996.  Future
distributions are expected to be made principally from dividends paid to the
Partnership by AFEH.  AFEH funds these dividends by receipt of dividends from
Eureka, the payment of which is subject to regulatory limitation.  Accordingly,
it is not possible to estimate the level of cash distributions to BUC Holders in
the future.

ASSET QUALITY

The allowance for loan losses was $7.4 million and $7.1 million, or .48% and
 .50% of gross loans outstanding at September 30, 1997 and December 31, 1996,
respectively.  Net non-performing assets (loans which were 90 or more days
delinquent and real estate acquired through foreclosure) were approximately $4.9
million and $5.7 million, or .22% and .26% of total assets at September 30, 1997
and December 31, 1996, respectively.  This compares favorably to 1.24% for non-
performing assets as of June 30, 1997, for thrifts located in California as
reported by the Office of Thrift Supervision ("OTS").  The allowance for loan
losses as a percentage of non-performing loans was approximately 253% at
September 30, 1997 compared to approximately 159% at December 31, 1996.
Management believes that reserves are adequate given the composition, credit
characteristics and loss experience of the loan portfolio.

The level of loans 30 days or more delinquent was approximately $5.3 million or
 .35% of loans at September 30, 1997, compared to approximately $7.4 million or
 .53% of loans at December 31, 1996.  This compares favorably to 2.25% for loans
30 days or more delinquent as of June 30, 1997, for thrifts located in
California as reported by the OTS.

RESULTS OF OPERATIONS

Net income (loss) for the quarter and nine months ended September 30, 1997 was
approximately $5.2 million and $17.8 million, respectively, as compared to
($5.6) million and $5.3 million for the same periods in 1996. Net income (loss)
per BUC for the quarter and nine months ended September 30, 1997 was $.77 and
$2.56, respectively, as compared to ($.66) and $.95 for the same periods in
1996. The increase in net income and net income per BUC for the quarter and nine
months ended September 30, 1997 as compared to the same periods in 1996 is
primarily due to the one-time Savings Association Insurance Fund ("SAIF")
assessment of $11 million recorded at September 30, 1996. The one-time SAIF
assessment reduced 1996 operations from approximately $16.3 million to $5.3
million during the first nine months. See "Deposit Insurance and Other Matters"
for further discussion of the SAIF

                                       9
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
assessment.

NET INTEREST INCOME

Net interest income before the provision for loan losses for the quarter and
nine months ended September 30, 1997, was approximately $15.5 million and $46.1
million, respectively, as compared to $14.9 million and $45.1 million for the
same periods in 1996.  Net interest income is the Partnership's principal income
component and is determined by the relative levels of, and interest rates paid
on, interest earning assets and interest bearing liabilities.  Average interest
earning assets were approximately $2.2 billion for the quarter and nine months
ended September 30, 1997, compared to approximately $2.2 billion and $2.3
billion, respectively, for the quarter and nine months ended September 30, 1996.

The net interest margin, the net yield on average assets, for the quarter and
nine months ended September 30, 1997 was 2.82% and 2.77%, respectively, as
compared to 2.65% and 2.58% for the same periods in 1996.  The net interest
margin improved in the quarter and nine months ended September 30, 1997 as
compared to the same periods in 1996, as earnings on adjustable rate mortgage
loans remained stable and the cost of funds was lower.  The 1997 cost of funds
was lower than 1996 due to the increase in lower-cost deposit liabilities which
offset the reduction of high-cost borrowed funds.  The notional amount of
interest rate exchange agreements decreased from $100 million at December 31,
1996 to $55 million at September 30, 1997.  Lower accretion of the recorded
liability for interest rate exchange agreements, offset by the expiration of
some of these agreements, decreased the net interest expense on interest rate
exchange agreements to $130,000 for the quarter ended September 30, 1997, as
compared to $238,000 for the third quarter of 1996.  The net interest expense
for the nine months ended September 30, 1997 was $550,000, as compared to
$622,000 for the nine months ended September 30,1996.

PROVISION FOR LOAN LOSSES

The Partnership recorded loan loss provisions of approximately $250,000 and
$752,000 for the quarter and nine months ended September 30, 1997, respectively,
as compared to $71,000 and $852,000 for the same periods in 1996.  Asset quality
has continued to improve throughout 1997, resulting in a total decrease of
$100,000 from 1996 in the loan loss provision.  See "Asset Quality" above for a
discussion of this matter.  Net loan charge-offs, primarily on mortgage loans,
were $43,000 and $252,000 for the quarter and nine months ended September 30,
1997, respectively, as compared to $95,000 and $459,000 for the same periods in
1996.

Eureka's determination of the allowance for loan losses and the resulting
provision for loan losses are based upon judgments and assumptions regarding
various factors including general economic conditions, internal asset review
findings, composition of the loan portfolio, historical loss experience and
estimates of potential future losses.  Management believes that it has recorded
adequate provisions to the allowance for loan losses to cover potential losses,
particularly considering the low level of delinquencies and charge-offs
experienced by Eureka over the past five years and continued adherence to strict
credit quality control guidelines.  The decrease in the provision for the first
nine months of 1997 is primarily due to strong asset quality and continued
improvement in the asset quality ratios as described above.  Management will
continue to evaluate the appropriate level of the allowance for loan losses
based on outstanding loan balances, net charge-offs and trends in asset quality.
However, future loss experience related to changes in the economy and interest
rate environment may vary.

NON-INTEREST INCOME

The principal components of non-interest income are deposit and loan related fee
income, gains on the disposition of loans and other income. Total non-interest
income increased to approximately $2.4 million and $7.6 million for the quarter
and nine months ended September 30, 1997, respectively, compared to $1.7 million
and $5.0 million for the same periods in 1996, as a result primarily of gains on
real estate sales and other income adjustments discussed below.

                                       10
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
Deposit and loan related fees for the quarter and nine months ended September
30, 1997 were approximately $790,000 and $2.3 million, respectively, compared to
$797,000 and $2.4 million for the same periods in 1996.

Eureka originates "conforming loans" (fixed rate loans which meet the FHLMC
lending requirements) for sale in the secondary mortgage market.  The net gain
from Eureka's loan sale activities was approximately $67,000 and $234,000 for
the quarter and nine months ended September 30, 1997, respectively, on loan
sales of approximately $3.3 million and $11.8 million, respectively.  During the
comparable periods a year earlier, Eureka sold conforming loans with principal
balances which totaled $3.4 million and $13.5 million, respectively, at a net
gain of approximately $56,000 and $210,000, respectively.  The net gain from
loan sale activities for the nine months ended September 30, 1997 and 1996
includes $107,000 and $121,000, respectively, of capitalized originated mortgage
servicing rights retained by Eureka.

Other non-interest income for the quarter and nine months ended September 30,
1997 was approximately $1.6 million, and $5.1 million, respectively, compared to
$855,000 and $2.4 million for the same periods in 1996.  The increase over 1996
for the first nine months in 1997 is primarily due to a gain of $1.5 million on
the sale of real estate investments, and various miscellaneous recoveries
including policy adjustments of $330,000 for insurance premiums, $150,000 for
contingencies, and $1.1 million for the reduction of previously established
reserves no longer considered necessary.  Approximately $959,000 of the above
gains and miscellaneous recoveries was recorded during the third quarter of
1997.

NON-INTEREST EXPENSE

The principal components of non-interest expense are compensation and benefits
expense, occupancy and equipment expense, FDIC insurance premiums, professional
and advertising expense, provision for loss (recovery) on interest rate exchange
agreements and other administrative expenses.  Non-interest expense for the
quarter and nine months ended September 30, 1997 was approximately $12.1 million
and $34.2 million, respectively.  The quarter and nine months ended September
30, 1997 included $389,000 and $886,000, respectively, of merger expenses for
professional services and personnel expenses.  Excluding these expenses, non-
interest expense for the quarter and nine months ended September 30, 1997 was
approximately $11.7 million and $33.3 million, respectively, as compared to
$22.1 million and $44.0 million for the same periods in 1996.  The third quarter
of 1996, however, included a SAIF assessment of $11.0 million which had a
material impact on the quarter and annual earnings in 1996.  Excluding the SAIF
one-time assessment, non-interest expense for the quarter and nine months ended
September 30, 1996 was $11.1 million and $33.0 million, respectively.

Compensation and benefits expenses were approximately $6.7 million and $18.4
million for the quarter and nine months ended September 30, 1997, respectively,
compared to approximately $5.4 million and $16.0 million for the same periods in
1996.  The increase in 1997 expenses is primarily due to increases in base
compensation and adjustments to accruals for bonuses and incentive awards.
Incentives to retain employees through the merger closing date increased
compensation expenses by $193,000 for the quarter and nine months ended
September 30, 1997.  Further, upon consummation of the Merger, the Partnership
expects to pay additional compensation under the terms of its two incentive
compensation plans of approximately $25 million based upon a Bay View share
price of $26.  The additional compensation expense under the plans is contingent
upon completion of the merger.  See "Proposed Merger with Bay View Capital
Corporation" for further discussion on this matter.

Occupancy and equipment expenses totaled $2.0 million and $5.9 million for the
quarter and nine months ended September 30, 1997, respectively, as compared to
$2.0 million and $6.3 million for the same periods in 1996. FDIC insurance
premiums, professional and advertising expenses were approximately $994,000 and
$3.5 million for the quarter and nine months ended September 30, 1997, which
included merger related expenses for professional and other administrative
services of $196,000 and $693,000 for the same periods. FDIC insurance premiums,
professional and advertisement expenses in 1996 were $12.7 million and $15.9
million for the quarter and nine months ended September 30, 1996; as noted
above, the 1996 periods' expenses included the one-time SAIF premium of $11.0

                                       11
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
million. See "Deposit Insurance and Other Matters" for a further discussion of
deposit insurance.

Non-interest expense for the quarter and nine months ended September 30, 1997
included adjustments to the interest rate exchange agreements liability
established in 1993.  During the quarter and nine months ended September 30,
1997, net provisions of approximately $22,000 and $17,000, respectively, were
recorded to increase the interest rate exchange agreements liability to reflect
the effect of interest rate decreases on the market value of Eureka's
obligations under the interest rate exchange agreements.  During the quarter and
nine months ended September 30, 1996, provisions (recoveries) of approximately
$147,000 and ($422,000), respectively, were recorded to reflect the effect of
interest rate changes on the market value of Eureka's obligations under the
interest rate exchange agreements.

Other non-interest expense for the quarter and nine months ended September 30,
1997 totaled $2.4 million and $6.4 million, respectively, compared to $1.9
million and $6.2 million for the same periods in 1996.  The increase in other
non-interest expense in 1997 compared to 1996 is due mostly to broker fees on
wholesale loans as a result of increases in wholesale loan originations in 1997
versus 1996.

PROVISION FOR INCOME TAXES AND DEFERRED TAX ASSETS

Due to the net operating loss carryforwards available to AFEH arising from the
acquisition of Eureka, AFEH does not expect to pay any regular income taxes in
1997.  AFEH paid no alternative minimum taxes in the quarter and $370,000 in the
nine months ended September 30, 1997, as compared to $165,000 and $545,000 in
the quarter and nine months ended September 30, 1996.  Alternative minimum taxes
paid by AFEH are recorded as deferred tax assets as they result in tax credits
with an indefinite life and will be used to offset future regular and income tax
liabilities.

As required by Statement of Financial Accounting Standard  No. 109 ("SFAS No.
109"), management periodically reevaluates the realizability of the deferred tax
assets and adjusts the valuation allowance so that the resulting level of the
net deferred tax assets will, more likely than not, be realized.  As of December
31, 1996, an adjustment of $26.2 million was recorded to reduce the valuation
allowance for net deferred tax assets primarily for the recognition of estimated
benefits from net operating loss carryforwards.  In addition, an additional
adjustment of $6.9 million was recorded to reduce the valuation allowance
through September 30, 1997.

The reevaluation and resulting adjustment of the deferred tax asset valuation
allowance occurred due to a number of factors which arose during the latter
portion of 1996.  With the enactment in August 1996 of legislation which
repealed the tax deduction for bad debt reserves, and the later enactment of the
SAIF recapitalization legislation which resulted in the special one-time
assessment paid by Eureka (and all other SAIF-insured institutions), Eureka
determined that it may be able to utilize net operating loss carryforward
benefits that had previously been reserved against in the valuation allowance.
Further, Eureka's strong financial results in 1996 and its consistent financial
performance during the preceding two fiscal years, coupled with the forecast of
a stable interest rate environment in the short term, separately indicated the
likelihood that Eureka might be able to utilize additional net operating loss
carryforward benefits against net pre-tax income generated in future financial
reporting periods. Accordingly, Eureka reassessed the recoverability of the net
deferred tax assets in the fourth quarter of 1996 and concluded that a downward
adjustment in the valuation allowance for net operating loss carryforwards, as
of the end of 1996, was appropriate. Federal net operating loss carryforwards
were approximately $209 million at December 31, 1996, with various expiration
dates through 2007. State net operating loss carryforwards were approximately
$29 million at December 31, 1996, and expire in 1997. To the extent such
carryforwards are used by AFEH, the FDIC may be entitled to share in the benefit
of the utilization. See "Assistance Agreement" below for further discussion.

Net deferred tax assets totaled $22.1 million and $22.6 million at September 30,
1997 and December 31, 1996, respectively. A valuation allowance is recorded if
it is more likely than not that some portion or all of the deferred tax assets
will not be realized based on a review of available evidence.  The allowance is
subject to ongoing adjustments

                                       12
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
based on changes in circumstances that affect management's assessment of the
realizability of the deferred tax assets. Adjustments to increase or decrease
the valuation allowance are charged or credited, respectively, to income tax
expense (benefit).

ASSISTANCE AGREEMENT

Under the terms of the Assistance Agreement between Eureka and the FDIC entered
into in 1988 in connection with the assisted acquisition of the assets and
liabilities of Eureka Federal Savings and Loan Association, $50 million in
preferred stock was issued to the FDIC.  In 1990, $30 million of the preferred
stock was redeemed by the FDIC, and in May 1997, an additional $10 million of
the preferred stock was redeemed.   The $10 million in non-voting Series A
Preferred Stock which remains outstanding is mandatorily redeemable in May 1998,
and has a liquidation value of $100 per share.  The holder of this preferred
stock is not entitled to dividends.  The remaining preferred stock is being
accreted through the redemption date of 1998, and the accretion is recorded as
interest expense on other borrowings. The accretion for the quarter and nine
months ended September 30, 1997 totaled approximately $299,000 and $1.4 million,
respectively, as compared to $560,000 and $1.6 million for the same periods in
1996, and is included in interest expense.

Upon completion of the merger between AFEH and Bay View, the outstanding
mandatorily redeemable non-voting Series A Preferred Stock will be redeemed
prior to its scheduled maturity of May 1998.  Under the terms of the Assistance
Agreement, and as a result of the Merger Agreement discussed above, the
Partnership also expects to pay a final participation payment to the FDIC of
approximately a range currently estimated to be $8.5 million to $12.8 million
from cash received at the time of the merger, depending upon the resolution of
tax matters. The final participation payment is in addition to the redemption of
the remaining $10 million in outstanding Series A Preferred Stock.

ASSET/LIABILITY MANAGEMENT AND INTEREST RATE RISK

Eureka's Asset and Liability Management Committee ("ALCO") is a board of
directors committee responsible for managing Eureka's assets and liabilities in
a manner which balances profitability and risks, including interest rate risk
("IRR").  ALCO operates within policies and risk limits prescribed and reviewed
regularly by the board of directors.  IRR is the impact of market interest rates
on Eureka's net income, both in the short-term and long-term.  Interest rate
changes impact earnings in several ways, including an effect upon the yields on
variable rate loans, and the cost of deposits and other sources of funds.  In
addition, borrowers are more motivated to repay and refinance loans when rates
decline, and the market values of securities and other investments fluctuate
based on interest rate changes.

Eureka manages interest rate fluctuations by simulating (modeling) the impact of
a variety of potential interest rate movements, customer behaviors, and market
conditions to identify conditions under which profitability would be adversely
affected.  The simulation of various interest rate movements is used in
determining appropriate loan pricing and terms, and also to estimate prepayments
of loans in a declining rate environment.  Various scenarios are simulated to
determine an appropriate asset and liability mix which protects capital funds
even under stress from unexpected changes in interest rates.

A common measure of financial institution IRR is the interest rate "gap." This
is the difference between the amount of assets and liabilities which are
expected to mature or reprice within a specific time period (such as one or
three years). A gap is considered positive when the amount of interest-rate
sensitive assets exceeds the amount of interest-rate sensitive liabilities, and
is considered negative when the amount of interest rate sensitive liabilities
exceeds the amount of interest-rate sensitive assets maturing or repricing
within a given period. At September 30, 1997, Eureka's cumulative one-year and
three-year interest rate gaps were 0% and a negative 3% of total assets,
respectively. In the case of the one-year gap, this suggests that the net
interest margin would be unchanged if interest rates were to rise. At September
30, 1996, Eureka's cumulative one-year and three-year interest rate gaps were a
positive 3% and a

                                       13
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
negative 1% of total assets, respectively. In the case of the one-year gap, this
suggests that the net interest margin would be increased if interest rates were
to rise.

Management is of the opinion that simulating various interest rate scenarios is
a significantly more effective measure of IRR because it incorporates specific
assumptions not considered in the "gap" analyses.  The assumptions which are
excluded from "gap" analyses include:  (a) how rate movements affect important
borrower prepayment behavior, (b) that all loans and deposits will not reprice
to the same degree or by the same magnitude or at the same time, (c) that rate
changes for assets and liabilities in the "over one year" category have a
greater long-term earnings impact than those assets and liabilities "under one
year," and (d) some liabilities (such as checking accounts) do not have
"repricing" maturities but are significantly affected by interest rate
movements.

The exposure to IRR as of September 30, 1997 is within the limits established by
the board of directors, and the level of IRR is considered acceptable in view of
expected market conditions and the potential for adverse developments in
interest rate levels.

LIQUIDITY

Eureka derives its primary liquidity from loan repayments, customer deposits,
FHLB advances and securities sold under agreements to repurchase.  Eureka
manages liquidity by coordinating the relative maturities of assets and
liabilities.  A much larger source of liquidity is the base of readily
marketable assets, as well as ready access to secured borrowings.  The sources
of liquidity are influenced by various uncertainties, primarily market interest
rates.  Eureka continually evaluates its sources of funds, and a decline in any
one source of funds generally can be offset by an alternate source, although
potentially at a different cost.  At September 30, 1997, Eureka had outstanding
loan funding commitments of approximately $89 million.  Management believes that
existing liquidity and other capital resources are adequate to fund existing and
anticipated commitments at September 30, 1997.

Regulations require a savings institution to maintain a liquidity ratio of at
least five percent of cash and specified securities to net withdrawable accounts
and borrowings due in one year.  For the month of September 1997, Eureka's
liquidity ratio was 6.00% compared to 5.86% for the month of December 1996.

                                       14
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
CAPITAL REQUIREMENTS

Federal regulations also require that savings institutions meet three separate
capital tests:  a  tangible capital standard, a core capital standard and a
risk-based capital standard.  At September 30, 1997, Eureka maintained
regulatory capital as follows:
<TABLE>
<CAPTION>

                                                                   (000's)
                                     --------------------------------------------------------------------
                                           Tangible                 Core                 Risk-Based
                                           Capital                 Capital                 Capital
                                     --------------------   --------------------  -----------------------
                                                                                                 % of
                                                    %                      %                  Risk-Based
                                      Amount    of Assets    Amount    of Assets    Amount      Assets
                                     ---------  ----------  ---------  ----------  ---------  -----------
<S>                                  <C>        <C>         <C>        <C>         <C>        <C>
GAAP capital.......................  $181,296               $181,296               $181,296
Non-allowable assets:
 Excess deferred tax assets........   (13,599)               (13,599)               (13,599)
 Intangible and mortgage
   servicing assets................    (2,474)                (2,474)                (2,474)
 Non-includable Subsidiaries.......    (3,716)                (3,716)                (3,716)
Net unrealized gain on securities
 available-for-sale................       (99)                   (99)                   (99)
Allowance for loan losses..........         -                      -                  7,359
                                     --------               --------               --------
Computed regulatory capital........   161,408        7.27%   161,408        7.27%   168,767        16.53%
Minimum capital requirement........    33,318        1.50%    66,636        3.00%    81,682         8.00%
                                     --------        ----   --------   ---------   --------   ----------
Excess regulatory capital..........  $128,090        5.77%  $ 94,772        4.27%  $ 87,085         8.53%
                                     ========        ====   ========   =========   ========   ==========
</TABLE>

RECENT ACCOUNTING PRONOUNCEMENTS

In February 1997, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standard No. 128 ("SFAS No. 128"), "Earnings
Per Share."  This statement specifies the computation, presentation, and
disclosure requirements for earnings per share ("EPS").  It replaces the
computation of primary EPS with the computation of basic EPS (net income
applicable to common stock divided by average common shares outstanding).  This
statement also requires the dual presentation of basic and diluted EPS on the
face of the income statement and a reconciliation of the numerator and
denominator of both EPS computations.

SFAS No. 128 is effective with the Partnership's year-end 1997 financial
statements; earlier application is not permitted, however the statement requires
restatement of all prior period EPS data presented including interim periods.
The basic and diluted EPS as calculated under SFAS No. 128 for the Partnership's
quarter and nine-month period ended September 30, 1997 would not differ
materially from the existing earnings per BUC as presently calculated under APB
15.

In February 1997, the FASB issued Statement of Financial Accounting Standard No.
129 ("SFAS No. 129"), "Disclosure of Information about Capital Structure."  This
statement establishes standards for disclosing information about an entity's
capital structure.  SFAS No. 129 is effective with the Partnership's year-end
1997 financial statements and interim periods thereafter.

In June 1997, the FASB issued Statement of Financial Accounting Standard No. 130
("SFAS No. 130"), "Reporting Comprehensive Income." This statement establishes
standards for reporting and display of comprehensive income and its components.
It requires that the Partnership classify items of other comprehensive income,
as defined by accounting standards, by their nature in a financial statement,
but does not specify a particular format for the

                                       15
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
statement. The Partnership is in the process of determining the format it will
employ. The statement also requires that the accumulated balance of other
comprehensive income be displayed as a separate component of partners' capital
in the balance sheet.

SFAS No. 130 is effective with the Partnership's year-end 1998 financial
statements; however, a total for comprehensive income is required in the
financial statements beginning with the first quarter of 1998.  Reclassification
of financial statements for earlier periods provided for comparative purposes is
required.

In June 1997, the FASB issued Statement of Financial Accounting Standard No. 131
("SFAS No. 131"), "Disclosures about Segments of an Enterprise and Related
Information."  This statement establishes standards for the way that public
business enterprises report information about operating segments in annual
financial statements and requires that those enterprises report selected
information about operating segments in interim financial reports issued to
shareholders.  It also establishes standards for related disclosure about
products and services, geographic areas, and major customers.  SFAS No. 131 is
effective with the Partnership's year-end 1998 financial statements and interim
periods thereafter.

In January, 1997, the Securities and Exchange Commission ("SEC") adopted rule
amendments to enhance existing disclosure requirements for derivative financial
instruments as well as for market risks to which registrants are exposed.  The
enhanced accounting policy disclosure requirements are effective for the
quarterly periods in 1997. Since the Partnership believes that the derivative
financial instrument disclosures contained within the notes to the consolidated
financial statements of its 1996 Form 10-K substantially conform with the
accounting policy requirements of these rule amendments, no further interim
period disclosure has been provided.  The rule amendments that require enhanced
disclosure about market risk are effective with the 1997 Form 10-K.

DEPOSIT INSURANCE AND OTHER MATTERS

Eureka's deposits are insured by the Federal Deposit Insurance Corporation
("FDIC") up to the maximum amount provided by law through the SAIF.  For the
quarter and nine months ended September 30, 1997, Eureka paid deposit insurance
premiums to the SAIF of $295,000 and $882,000, respectively, based on an annual
assessment rate of approximately .065% of covered deposits for the first quarter
of 1997, and .063% of covered deposits for the second and third quarters of
1997.

For the quarter and nine months ended September 30, 1996, excluding the one-time
SAIF assessment discussed below, Eureka paid deposit insurance premiums to the
SAIF of $1.0 and $2.9 million, respectively, based on an annual assessment rate
of approximately .23% of covered deposits through September 30, 1996.

On September 30, 1996, the President signed an appropriations bill which
included provisions to recapitalize the SAIF. Under the provisions of the bill,
the SAIF was recapitalized through a combined approach of imposing a one-time
special assessment on SAIF-insured institutions, and an incremental pro-rata
charge on SAIF-insured institutions and commercial banks insured under the Bank
Insurance Fund ("BIF"), to be used to pay the interest on Financing Corporation
("FICO") bonds issued as part of the 1989 savings association rescue package
adopted under the Financial Institutions Reform, Recovery, and Enforcement Act
of 1989 ("FIRREA"). The SAIF recapitalization provisions imposed a one-time
special assessment of 65.7 basis points (approximately $11 million for Eureka)
on deposits held by SAIF-insured institutions as of March 31, 1995, payable not
later than 60 days after the enactment of the legislation, and reduced the
annual assessment rate for SAIF-insured institutions from 23 basis points to 6.4
basis points (a reduction of approximately $3 million annually based upon
Eureka's insured deposits at September 30, 1996) beginning in 1997. Although
deposit premiums for thrifts will continue to be higher than the banking
industry's through the year 2000, the premium reduction significantly reduced
the inequity of Eureka paying a deposit premium significantly higher than that
of a similarly sized commercial bank. Beginning January 1, 2000, SAIF-insured
and

                                       16
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
BIF-insured deposits alike will be assessed on a pro-rata basis (expected to be
at a rate of approximately 2.4 basis points) to repay the FICO bonds until the
year 2017, and thereafter phased out, with the phase-out being completed in
2019.

The BIF/SAIF recapitalization legislation also provides for a merger of the BIF
and SAIF on January 1, 1999, if no SAIF-insured institutions exist on that date.
This provision, therefore, will not become effective unless Congress enacts
additional legislation abolishing the savings association charter effective
prior to January 1, 1999.  In this regard, Congress currently is considering
comprehensive financial services reform measures involving, among other things,
the merger of the BIF and SAIF, and abolition of the thrift charter.  Prospects
for enactment of this legislation in 1997 are highly uncertain; if legislation
is not passed in 1997, however, Congress is expected to take up consideration of
financial services reform legislation in 1998.

Other provisions of the 1996 legislation: (i) authorized the bank regulatory
agencies to take action to prevent depository institutions from taking advantage
of the BIF/SAIF premium disparity by "deposit-shifting" from the SAIF to the
BIF; (ii) strengthened existing prohibitions on the FDIC's increasing the risk-
based premiums for deposit insurance which would result in the statutory
Designated Reserve Ratio for the two federal deposit insurance funds (calculated
as a percentage of insured deposits for each fund) exceeding 1.25%; (iii)
authorized the FDIC to refund assessments paid in excess of amounts due; and
(iv) prohibit the FDIC, prior to January 1, 1999, from setting SAIF premiums at
levels less than BIF premiums.

In August 1996, the President signed legislation which included provisions that
repeal the thrift bad debt reserve method of calculation under the Internal
Revenue Code, effective for tax years beginning after December 31, 1995.  Most
large savings associations (including Eureka) are required to change to the
specific charge-off method of accounting for bad debts and will be required to
recapture statutory "excess reserves" as provided in the legislation.  In the
case of an institution that meets certain residential lending requirements of
the legislation, recapture of statutory "excess reserves" can be deferred for up
to two years.  Eureka met the residential lending requirements of the
legislation for 1996.  Eureka's management expects to meet the residential
lending requirements of the legislation and to defer the recapture of the
statutory "excess reserves" for 1997.  Management expects that the above
provisions will not have a significant impact on Eureka due to the substantial
amount of net operating loss carryforwards which are available.

PART II.  OTHER INFORMATION

Item 6.  Exhibits and Reports on Form 8-K
         --------------------------------

  (a) Exhibits:

      4(a)  Amended and Restated Limited Partnership Agreement dated June 30,
            1987 (incorporated herein by reference to Form 10-K dated December
            31, 1987 filed pursuant to section 13 or 15(d) of the Securities
            Exchange Act of 1934 by America First Financial Fund 1987-A Limited
            Partnership (Commission File No. 0-16918)).

                                       17
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
      4(b)  Form of Certificate of Beneficial Unit Certificate (incorporated
            herein by reference to Amendment No. 3 to the Registration Statement
            on Form S-1 filed March 31, 1987 with the Securities and Exchange
            Commission by America First Financial Fund 1987-A Limited
            Partnership (Commission File No. 33-10286)).

     10(a). Custody Agreement dated August 3, 1987 (incorporated herein by
            reference to Form 10-K dated December 31, 1987 filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).

     10(b). Agreement between America First Capital Associates Limited
            Partnership Five and Stephen McLin (incorporated herein by reference
            to Amendment No. 3 to the Registration Statement on Form S-1 filed
            March 31, 1987 with the Securities and Exchange Commission by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 33-10286)).

     10(c). Assistance Agreement dated May 27, 1988 (incorporated herein by
            reference to Form 8 filed June 15, 1988 pursuant to Section 13 or
            15(d) of the Securities Exchange Act by America First Financial Fund
            1987-A Limited Partnership (Commission File No. 0-16918)).

     10(d). Assignment Agreement dated May 27, 1988 (incorporated herein by
            reference to Form 10-K dated December 31, 1988, filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).

     10(e). Capital Maintenance Agreement dated May 27, 1988 (incorporated
            herein by reference to Form 10-K dated December 31, 1988, filed
            pursuant to Section 13 or 15(d) of the Securities Exchange Act of
            1934 by America First Financial Fund 1987-A Limited Partnership
            (Commission File No. 0-16918)).

     10(f). Asset Purchase Agreement dated May 27, 1988 (incorporated herein by
            reference to Form 10-K dated December 31, 1988, filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).

     10(g). Employment Agreement between America First Holdings, Inc. (now
            America First Eureka Holdings, Inc.) and Stephen T. McLin dated
            January 24, 1989 (incorporated herein by reference to Form 10-K
            dated December 31, 1988, filed pursuant to Section 13 or 15(d) of
            the Securities Exchange Act of 1934 by America First Financial Fund
            1987-A Limited Partnership (Commission File No. 0-16918)).

     10(h). Long-Term Incentive Compensation Plan of EurekaBank (as amended and
            restated effective January 1, 1991) (incorporated herein by
            reference to Form 10-Q dated August 13, 1991, filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).

     10(i). Form of Agreement between EurekaBank and certain executive officers
            and directors which effectively amends certain provisions of the
            Long-Term Incentive Compensation Plan (incorporated herein by
            reference to Form 10-K dated December 31, 1996, filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).

                                       18
<PAGE>
   AMERICA FIRST FINANCIAL FUND 1987 - A LIMITED PARTNERSHIP AND SUBSIDIARY
 
     10(j). Form of Supplemental Agreement between EurekaBank and certain
            executive officers and directors which effectively amends certain
            provisions of the Long-Term Incentive Compensation Plan
            (incorporated herein by reference to Form 10-K dated December 31,
            1996, filed pursuant to Section 13 or 15(d) of the Securities
            Exchange Act of 1934 by America First Financial Fund 1987-A Limited
            Partnership (Commission File No. 0-16918)).

     10(k). EurekaBank Equity Appreciation Plan Effective April 1, 1996, for the
            benefit of certain officers, directors and employees of EurekaBank
            and America First Eureka Holdings, Inc. (incorporated herein by
            reference to Form 10-Q dated March 31, 1997, filed pursuant to
            Section 13 or 15(d) of the Securities Exchange Act of 1934 by
            America First Financial Fund 1987-A Limited Partnership (Commission
            File No. 0-16918)).
 
      27.  Financial Data Schedule.


  (b) The Partnership did not file any Current Reports on Form 8-K during the
      third quarter of 1997.

                                       19
<PAGE>
 
                                   SIGNATURES

  Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                       AMERICA FIRST FINANCIAL FUND
                                       1987-A LIMITED PARTNERSHIP

                                       By  America First Capital Associates
                                           Limited Partnership Five, General
                                           Partner of the Registrant

                                       By  AFCA-5 Management Corporation,
                                           General Partner of America First
                                           Capital Associates Limited
                                           Partnership Five



Date: November 12, 1997                By  /s/ George H. Krauss
                                           -----------------------------------
                                         George H. Krauss
                                         Chairman of the Board of Directors
                                          and Secretary (Principal Executive
                                          Officer)



Date: November 12, 1997                By  /s/ J. Paul Bagley
                                           -----------------------------------
                                         J. Paul Bagley
                                         Director, President and Treasurer
                                         (Principal Financial Officer)

                                       20