2003

                          ANNUAL REPORT TO SHAREHOLDERS




                          -----------------------------

                     INSERT EUREKA FINANCIAL CORP. LOGO HERE

                          -----------------------------

<PAGE>

                             EUREKA FINANCIAL CORP.
                                  ANNUAL REPORT



TABLE OF CONTENTS



President's Message........................................................    1


Corporate Profile and Stock Market Information.............................    2


Management's Discussion and Analysis of
 Financial Condition and Results of Operations.............................    4


Report of Independent Auditors..............................................  13


Consolidated Financial Statements...........................................  14


Notes to Consolidated Financial Statements..................................  19


Office Location and Other Corporate Information................Inside Back Cover

<PAGE>

                       [Eureka Financial Corp. Letterhead]



Dear Fellow Stockholders:

         On behalf of our Board of Directors  and  employees,  we are pleased to
present the 2003 Annual Report to Stockholders of Eureka Financial Corp.

         2003 was a  significant  year for us. On March 31,  2003,  Eureka  Bank
completed its  reorganization  and formed Eureka  Financial  Corp. as its parent
holding  company.  As part of the  reorganization,  Eureka  Bank's  stockholders
became  our  stockholders   and  Eureka   Bankcorp,   MHC  became  our  majority
stockholder. Our common stock continues to trade on the OTC Bulletin Board under
the stock  symbol  EKFC.  We  believe  that this new form of  organization  will
provide us  additional  authority  and  flexibility  to expand our  business and
services.

         Fiscal 2003 was a  challenging  year as we  continued to manage our net
interest margin.  Prepayments and refinancings on mortgages and leases increased
as a result of historically low interest rates. Consequently,  both net interest
income and net loans  receivable  showed only a modest  increase  from the prior
fiscal year.

         For the fiscal year ended  September 30, 2003, we earned  $795,000,  or
$.63 per diluted share, as compared to $834,000,  or $.66 per diluted share, for
the fiscal year ended September 30, 2002.  Assets  increased $4 million to $83.3
million  over fiscal 2002.  This growth was fueled by deposit  increases of $4.1
million.

         We are proud to report  that over the past year we  increased  our cash
dividend  from $0.785 to $0.975,  representing  an increase of over 24% from the
previous year. This dividend is consistent  with our steady  performance and our
commitment to return value to our stockholders.

         We thank you for your  continuous  support and look  forward to serving
you in fiscal 2004!

                                                 Sincerely,


                                                 /s/Edward F. Seserko
                                                 Edward F. Seserko
                                                 President and CEO

<PAGE>

                             Eureka Financial Corp.

Corporate Profile

         On March 31, 2003, our wholly owned subsidiary,  Eureka Bank, completed
its  reorganization  to add a middle tier stock holding company and formed us as
its  parent  holding  company.  As part  of the  reorganization,  Eureka  Bank's
stockholders became our stockholders and Eureka Bancorp, MHC became our majority
stockholder.  Eureka  Bancorp,  MHC,  which  is  owned  and  controlled  by  the
depositors of Eureka Bank, was formed as Eureka Bank's mutual holding company in
1999. Eureka Bancorp,  MHC conducts no significant business or operations of its
own.

         We currently conduct our business through Eureka Bank which was founded
in 1886 and primarily  serves the Oakland  section of Pittsburgh,  Pennsylvania.
Eureka Bank is a community and customer  oriented federal stock savings bank and
provides  financial  services  primarily  to  individuals,  families  and  small
businesses.  Our business  consists of accepting  deposits  from  customers  and
investing  those funds,  primarily in residential  loans,  equipment  leases and
multi-family real estate loans. To a lesser extent, we also originate commercial
real  estate  and  consumer  loans.  At  September  30,  2003,  we had assets of
approximately  $83  million,   deposits  of  approximately   $62  million,   and
stockholders equity of approximately $19 million.

Stock Market Information

         Our common  stock  began  trading on the OTC  Bulletin  Board under the
trading  symbol of "EKFC" on March 31, 2003.  Prior to March 31, 2003, the stock
of Eureka Bank also traded on the OTC  Bulletin  Board under the symbol  "EKAB".
The following table reflects high and low bid quotations. The quotations reflect
inter-dealer prices, without retail mark-up,  mark-down, or commission,  and may
not represent actual transactions.

                                                                     Dividends
                Date                        High ($)      Low ($)    Declared($)
                ----                        --------      -------    -----------
  October 1, 2001 to December 31, 2001       13.75         13.00         .34
  January 1, 2002 to March 31, 2002          17.50         13.25         .15
  April 1, 2002 to June 30, 2002             19.00         17.00         .15
  June 30, 2002 to September 30, 2002        20.00         17.30         .15
  October 1, 2002 to December 31, 2002       18.20         17.60         .45
  January 1, 2003 to March 31, 2003          22.00         18.25        .175
  April 1, 2003 to June 30, 2003             23.00         20.00        .175
  June 30, 2003 to September 30, 2003        23.00         21.50        .175

                                       2
<PAGE>

         The  number of  shareholders  of record of common  shares of the record
date of  December  5, 2003,  was  approximately  300.  This does not reflect the
number of persons or entities who held stock in nominee or "street" name through
various brokerage firms. At December 5, 2003, there were 1,226,538 common shares
outstanding.  We may not declare or pay a cash  dividend on any of our shares if
the effect of the declaration or payment of dividends would cause our regulatory
capital to be reduced below (1) the amount required for the liquidation  account
established in connection with the reorganization, or (2) the regulatory capital
requirements imposed by the Office of Thrift Supervision.

                                       3
<PAGE>

         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                              RESULTS OF OPERATIONS

The  Private  Securities  Litigation  Reform Act of 1995  contains  safe  harbor
provisions regarding forward-looking  statements.  When used in this discussion,
the words  "believes",  "anticipates",  "contemplates",  "expects",  and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties  which could cause actual results
to differ materially from those projected. Those risks and uncertainties include
changes in interest  rates,  risks  associated with the ability to control costs
and expenses,  and general  economic  conditions.  We undertake no obligation to
publicly  release  the  results  of  any  revisions  to  those  forward  looking
statements which may be made to reflect events or  circumstances  after the date
hereof or to reflect the occurrence of unanticipated events.

         References to "we",  "us", and "our",  refer to Eureka  Financial Corp.
Eureka  Bancorp,  MHC,  our mutual  holding  company,  conducts  no  significant
business  or  operations  of its  own  other  than  holding  a  majority  of our
outstanding common stock.

OVERVIEW

         During  fiscal year 2003,  in an effort to stimulate  the economy,  the
Federal Reserve  continued to reduce interest  rates,  with an additional  three
interest rate  reductions.  These  reductions  caused the prime interest rate to
decline 75 basis  points from fiscal  2002.  Over the past three  fiscal  years,
fourteen  interest  rate  reductions  have  caused the prime rate to decline 550
basis points. Because of such events, our net income,  typically,  has increased
from the prior years as a result of interest-bearing  liabilities repricing much
quicker  than  interest-bearing  assets.  However,  for the  fiscal  year  ended
September 30, 2003, we earned  $795,000 or $.63 per diluted share as compared to
$834,000,  or $.66 per  diluted  share for the fiscal year ended  September  30,
2002.  This slight  reduction  in net income can be primarily  attributed  to an
increase  in  expenses  associated  with  the  mid-tier  reorganization  and  an
accelerated  repayment of the ESOP loan. Assets increased $4.0 million over last
year to $83.3 million. Asset quality continues to remain excellent.

Management of Interest Rate Risk and Market Risk

         Because the  majority of our assets and  liabilities  are  sensitive to
changes in interest rates,  our most significant form of market risk is interest
rate risk,  or changes in interest  rates.  We are  vulnerable  to a decrease in
interest rates to the extent that it reflects an overall decline in the economy.
Our  lending   activities  have  historically   emphasized  the  origination  of
long-term,  adjustable  rate and  fixed  rate  loans  secured  by  single-family
residences.  The primary  source of funds has been deposits  with  substantially
shorter maturities.

                                       4

<PAGE>

         To reduce the effect of interest  rate changes on net interest  income,
we have  adopted  various  strategies  to enable us to improve  the  matching of
interest-earning asset maturities to interest-bearing  liability maturities. The
principal elements of these strategies include seeking to:

o    originate  multi-family  and commercial  real estate loans with  adjustable
     rate features or fixed rate loans with short maturities and higher interest
     rates than one-to four family residential mortgages;

o    purchase commercial real estate leasing loans with adjustable rate features
     or fixed rate loans with short  maturities  and higher  interest rates than
     one-to four family residential mortgages;

o    attract low cost checking and  transaction  accounts  which tend to be less
     interest rate sensitive when interest rates decline;

o    maintain  interest-bearing  deposits,  federal  funds  and U.S.  Government
     securities with short to intermediate terms to maturities; and

o    maintain an investment  portfolio that provides a stable cash flow, thereby
     providing investable funds in varying interest rate cycles.

         We have made a  significant  effort to maintain our level of lower cost
deposits as a method of enhancing  profitability.  At September 30, 2003, we had
41% of our deposits in lower-cost passbook and  interest-bearing  checking (NOW)
and  non-interest  bearing  demand  accounts.  Such deposits have  traditionally
remained  relatively stable and would be expected to be moderately affected in a
period of declining  interest  rates.  Because of this  relative  stability in a
significant  portion of our deposits and our high level of capital, we have been
able to offset the impact of repricing rates in other deposit accounts. However,
because of a continued low interest rate  environment,  we will experience lower
asset yields due to the repricing and prepayment of higher yielding multi-family
mortgage  loans,   commercial  lease  loans  and  mortgage-related   securities.
Accordingly,  proceeds from the repayment and maturity of loans and  investments
will be reinvested  at  significantly  lower yields,  which will result in lower
asset yields on our interest earning assets.

Net Portfolio Value

         Exposure to interest rate risk is actively monitored by our management.
Our  objective  is to  maintain  a  consistent  level  of  profitability  within
acceptable  risk  tolerances  across a broad range of  potential  interest  rate
environments.  We use the  Office  of Thrift  Supervision  Net  Portfolio  Value
("NPV")  Model to monitor our exposure to interest rate risk,  which  calculates
changes in net portfolio value.  Reports generated from assumptions provided and
modified by management are reviewed by the Asset/Liability  Management Committee
and reported to the Board of Directors quarterly.  The Interest Rate Sensitivity
of the NPV  Report  shows the degree to which  balance  sheet line items and net
portfolio

                                       5

<PAGE>

value  are  potentially  affected  by a 100 to 300  basis  point  (1/100th  of a
percentage  point)  upward and downward  parallel  shift (shock) in the Treasury
yield curve.

         The following  table  represents our NPV at September 30, 2003. The NPV
was  calculated  by  the  Office  of  Thrift  Supervision  ("OTS"),  based  upon
information we provided to the OTS.


                  -------------------- ---------------- ----------------
                          Changes              NPV
                           in Rate            Ratio(1)         Change(2)
                  -------------------- ---------------- ----------------
                          +300 bp              22.03%           -448 bp
                  -------------------- ---------------- ----------------
                          +200 bp              23.67%           -284 bp
                  -------------------- ---------------- ----------------
                          +100 bp              25.25%           -127 bp
                  -------------------- ---------------- ----------------
                             0 bp              26.51%              0 bp
                  -------------------- ---------------- ----------------
                          -100 bp              27.16%            +65 bp
                  -------------------- ---------------- ----------------
                          -200 bp                N/A             N/A
                  -------------------- ---------------- ----------------
                          -300 bp                N/A             N/A
                  -------------------- ---------------- ----------------

(1)      Calculated as the estimated NPV divided by present value of assets.
(2)      Calculated  as the excess  (deficiency)  of the NPV ratio  assuming the
         indicated  change  in  interest  rates  over the  estimated  NPV  ratio
         assuming no change in interest rates.
N/A      There is no longer a calculation available from the OTS.

         Computations  of  prospective  effects of  hypothetical  interest  rate
changes are based on numerous  assumptions,  including relative levels of market
interest rates,  prepayments and deposit  run-offs and should not be relied upon
as  indicative  of actual  results.  Certain  shortcomings  are inherent in such
computations.  Although certain assets and liabilities may have similar maturity
or periods  of  repricing  they may react at  different  times and in  different
degrees to changes in the market interest  rates.  The interest rates on certain
types of assets and  liabilities  may  fluctuate in advance of changes in market
interest  rates,  while rates on other types of assets and  liabilities  may lag
behind changes in market interest rates. Certain assets, such as adjustable rate
mortgages, generally have features which restrict changes in interest rates on a
short  term  basis and over the life of the  asset.  In the event of a change in
interest  rates,   prepayments  and  early   withdrawal   levels  could  deviate
significantly  from  those  assumed  in making  calculations  set  forth  above.
Additionally,  an  increased  credit  risk may  result  as the  ability  of many
borrowers to service  their debt may  decrease in the event of an interest  rate
increase.

                                       6
<PAGE>

FINANCIAL CONDITION

         At September  30, 2003,  total assets  increased  $4.0 million to $83.3
million from $79.3 million at September 30, 2002.  Of this  increase,  net loans
receivable  increased $1.2 million and the total securities and  mortgage-backed
securities portfolios (the "investment portfolio") increased $2.7 million.

         The increase in the net loan  portfolio was primarily due to the growth
of $3.1 million in commercial real estate loans, which was partially offset by a
$1.7  million  increase  in loans in process and unused  lines of credit.  These
increases  were funded by an increase of $4.4  million in deposit  accounts,  as
noted below.

         At September  30, 2003,  total  liabilities  increased  $4.1 million to
$64.2  million  from $60.1  million at  September  30,  2002.  Such  increase in
liabilities  was reflected in deposit growth of $4.4 million to $61.8 million at
September  30,  2003  from  $57.4  million  at  September  30,  2002.  The  most
significant  areas of increase in deposits  were in the  Certificate  of Deposit
accounts, which reached $33.9 million at September 30, 2003, an increase of $2.6
million over last year and the Passbook  Savings  accounts,  which reached $19.5
million at  September  30,  2003,  an increase of $1.9  million  over last year.
Customers  continue  to  be  attracted  to  the  deposit  products  due  to  the
competitive rates being offered and the services that are being provided such as
internet banking, telephone banking and bill payment capabilities.

         Our net worth remained the same at $19.1 million at September 30, 2003.
Certain  components  of net worth were  increased as a result of $795,000 of net
income for the 2003 fiscal  year,  increases  of $122,000  and $39,000 were also
recognized  due to the reduction in our Employee Stock Option Plan ("ESOP") loan
and from the  amortization of the Restricted  Stock Plan ("RSP"),  respectively,
and an increase of $196,000 in additional  paid-in capital  resulted from market
value  adjustments  related to the stock plans.  Offsetting these increases were
cash dividends paid to our minority  stockholders of $473,000 and a reduction of
$442,000 in accumulated other  comprehensive  income. A net increase of $307,000
in Treasury stock was the result of a stock  repurchase of 15,000 shares and the
exercise of 2,220 shares of stock options.

         The decrease in accumulated  other  comprehensive  income resulted from
the  fluctuation  in  market  value  of our  investment  in  available  for sale
securities. Because of interest rate volatility, accumulated other comprehensive
income and  stockholders'  equity could  materially  fluctuate  for each interim
period and year-end period.

                                       7

<PAGE>

RESULTS OF OPERATIONS

Net Income. At September 30, 2003, net income decreased $39,000 to $795,000 from
$834,000 for the comparable  2002 fiscal year. In general,  lower net income for
the current year over the prior year was  primarily the result of an increase in
other expenses and a decrease in interest income  partially offset by a decrease
in interest expense on deposits.

Interest Income.  Total interest income decreased  $111,000 to $4.70 million for
the 2003 fiscal year from $4.81  million for the  comparable  2002 fiscal  year.
Interest on loans decreased  $259,000 for fiscal year 2003 which was a result of
a 43 basis  point  reduction  in the  average  yield on  loans  receivable.  The
decrease in interest on loans was offset by an increase in investment  income of
$148,000 for fiscal year 2003,  which was a result of a $3.8 million increase in
the average balance of the investment  portfolio.  Additionally,  because of the
lower  interest rate  environment,  average  yields in  interest-earning  assets
decreased 42 basis points to 6.02% in fiscal 2003 from 6.44% in fiscal 2002.

Interest Expense.  At September 30, 2003, interest expense decreased $275,000 to
$1.67  million from $1.94 million in fiscal 2002.  Our average  interest-bearing
liabilities  increased  $3.0 million in fiscal 2003 to $57.6  million from $54.6
million in fiscal 2002 and the average  cost of  interest  -bearing  liabilities
decreased 66 basis points to 2.89% from 3.55% in fiscal 2002.

Net Interest Income. Net interest income increased $163,000 to $3.03 million for
the 2003 fiscal year from $2.87 million for the comparable 2002 fiscal year. The
interest  rate  spread,  which is the  difference  between  the yield on average
interest-earning  assets and the  percentage  cost of  average  interest-bearing
liabilities,  increased  24 basis  points in fiscal 2003 to 3.13% from 2.89% for
fiscal 2002.  The increase in the interest  rate spread is primarily  due to the
Federal  Reserve  reduction in interest rates which lowered the average yield of
the interest-bearing liabilities.

Average Balance Sheet

         The  following  table sets forth  information  relating  to our average
balance  sheet and  reflects  the average  yield on assets and  average  cost of
liabilities at and for the periods indicated.  Such yields and costs are derived
by dividing  income or expense by the average  balance of assets or liabilities,
respectively,  for the periods  presented.  Average  balances  are derived  from
month-end  balances.  Management  does not  believe  that  the use of  month-end
balances instead of daily average  balances has caused any material  differences
in the information presented.

                                       8
<PAGE>

<TABLE>
<CAPTION>
                                                            At September 30,               Year Ended September
                                                            ---------------- --------------------------------------------------
                                                                 2003                  2003                     2002
                                                            ---------------- ------------------------- ------------------------
                                                                     Actual                    Average                 Average
                                                            Actual   Yield/   Average           Yield/ Average          Yield/
                                                            Balance   Cost    Balance Interest   Cost  Balance Interest  Cost
                                                            -------   ----    ----------------   ----  ----------------  ----
                                                                                        (Dollars in thousands)
<S>                                                       <C>        <C>    <C>       <C>      <C>   <C>      <C>       <C>
      Interest-earning assets:
       Loans receivable net(1)......................        $53,288    6.43%  $51,950   $3,606   6.94% $52,449  $3,865    7.37%
       Investment securities(2).....................         27,545    3.97    26,125    1,093   4.18   22,275     946    4.25
                                                            -------           -------   ------         -------  ------
          Total interest-earning assets.............         80,833    5.59    78,075    4,699   6.02   74,724   4,811    6.44
                                                                                        ------                  ------
      Non-interest-earning assets...................          2,488             2,108                    2,139
                                                            -------           -------                  -------
          Total assets..............................        $83,321           $80,183                  $76,863
                                                            =======           =======                  =======
      Interest-bearing liabilities:
        NOW accounts................................        $ 3,823    1.25    $4,238   $   61   1.44   $3,832  $   77    2.01
        Passbook and club accounts..................         19,488    1.77    18,785      368   1.96   17,372     403    2.32
        IRA accounts................................          2,723    4.20     2,485      113   4.55    2,069     111    5.36
        Certificates of deposit.....................         33,918    2.98    30,946    1,062   3.43   30,125   1,281    4.25
        Other liabilities...........................          1,040    5.50     1,107       61   5.51    1,203      68    5.65
                                                            -------           -------   ------         -------  ------
        Total interest-bearing liabilities..........         60,992    2.58    57,561    1,665   2.89   54,601   1,940    3.55
                                                                                        ------                  ------
      Non-interest-bearing liabilities..............          3,258             3,291                    3,352
                                                            -------           -------                  -------
        Total liabilities...........................         64,250            60,852                   57,953
        Retained earnings (5).......................         19,071            19,331                   18,910
                                                            -------           -------                  -------
          Total liabilities and retained earnings...        $83,321           $80,183                  $76,863
                                                            =======           =======                  =======
      Net interest income...........................                                    $3,034                  $2,871
                                                                                        ======                  ======
      Interest rate spread (3)......................                                             3.13%                    2.89%
                                                                                               ======                   ======
      Net yield on interest-earning assets (4)......                                             3.89%                    3.84%
                                                                                               ======                   ======
      Ratio of average interest-earning assets to
        average interest-bearing liabilities........                                           135.64%                  136.85%
                                                                                               ======                   ======
</TABLE>
-------------------
(1)  Average balances include  non-accrual loans with respect to which income is
     recognized on a cash basis.
(2)  Includes   interest-bearing   deposits  in  other  financial  institutions,
     mortgage-backed securities, and FHLB stock.
(3)  Interest-rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(4)  Net yield on  interest-earning  assets  represents net interest income as a
     percentage of average interest-earning assets.
(5)  Includes unrealized gains on available for sale securities.

                                       9
<PAGE>

Rate/Volume Analysis

         The  following  table  presents the extent to which changes in interest
rates and changes in the volume of interest-earning  assets and interest-bearing
liabilities  have affected our interest  income and interest  expense during the
periods indicated. Information is provided in each category with respect to: (i)
changes attributable to changes in volume (changes in volume multiplied by prior
rate); (ii) changes  attributable to changes in rate (changes in rate multiplied
by prior  volume);  and (iii)  changes  attributable  to the combined  impact of
volume and rate changes (changes in rate multiplied by change in volume).


                                              Year Ended September 30,
                                        ------------------------------------
                                                 2003 vs. 2002
                                        ------------------------------------
                                              Increase (Decrease)
                                                     Due to
                                        ------------------------------------
                                        Volume    Rate    Rate/Volume  Total
                                        ------    ----    -----------  -----
                                                   (In thousands)
Interest income:
 Loans receivable                       $ (37)   $(225)     $   3      $(259)
 Investment securities                    164      (15)        (2)       147
                                        -----    -----      -----      -----
    Total interest-earning assets         127     (240)         1       (112)
                                        -----    -----      -----      -----
Interest expense:
  NOW accounts                              8      (22)        (2)       (16)
  Passbook and club accounts               33      (63)        (5)       (35)
  Money market accounts                    22      (17)        (3)         2
  Certificates of deposit                  35     (246)        (8)      (219)
  Other liabilities                        (5)      (2)         0         (7)
                                        -----    -----      -----      -----
   Total interest-bearing liabilities      93     (350)       (18)      (275)
                                        -----    -----      -----      -----
Net change in interest income           $  34    $ 110      $  19      $ 163
                                        =====    =====      =====      =====

                                       10

<PAGE>

Provision for Loan Losses.  At September 30, 2003, the provision for loan losses
decreased $50,000 to $10,000 from $60,000 in the 2002 year. Non-performing loans
increased  $84,000 to $377,000 in fiscal 2003 from $293,000 in fiscal 2002.  The
decrease in the provision for loan losses was attributed to a smaller commercial
lease portfolio.

         Management  regularly  performs an analysis  to identify  the  inherent
risks of loss in its loan  portfolio.  This  analysis  includes  evaluations  of
concentrations  of credit,  past loss experience,  current economic  conditions,
amount and composition of the loan portfolio (including loans being specifically
monitored by management),  estimated fair value of underlying  collateral,  loan
commitments  outstanding,  delinquencies and other information available at such
time.

         The allowance for loan losses is maintained at a level that  represents
management's best estimates of losses in the loan portfolio at the balance sheet
date.  However,  there can be no assurance that the allowance for losses will be
adequate to cover losses which may be realized in the future and that additional
provisions for losses will not be required.

Other Expense. Total non-interest expense for the year ended September 30, 2003,
increased  $295,000 to $2.13 million from $1.84 million for the comparable  2002
period.  The most significant  increases in non-interest  expense in fiscal 2003
were salaries and benefits, ESOP contribution and other expenses.

         Salaries and benefits  increased  $105,000 over last year due to normal
salary  increases and increased  expenses  associated  with benefit  plans.  The
$14,000  increase  in legal  and  accounting  expenses  from last year is due to
higher  professional  fees for additional  services  necessitated  by regulatory
requirements   and  also  includes  a  portion  of  the  cost  of  the  mid-tier
reorganization.  ESOP  contributions  increased $99,000 over last year due to an
accelerated  repayment  stream and  increased  market  values of the Bank stock.
Other  operating  expenses  increased  $60,000 from last year primarily due to a
$57,000 increase in retirement fund contributions from the previous year.

Income Taxes.  Income tax expense for the twelve months ended September 30, 2003
was $202,000 compared to $238,000 for the same period in 2002. The effective tax
rate for the 2003 fiscal  year was 17.60%  compared to 20.20% for the 2002 year.
Such  decrease in the effective tax rate for the 2003 fiscal year was the result
of an increase in  investments  in  FNMA/FHLMC  preferred  stocks  resulting  in
dividend  income which is subject to a partial  exclusion for income taxes.  See
Note O to the financial statements.

                                       11
<PAGE>

Liquidity and Capital Resources

         We are required under federal  regulations to monitor certain levels of
liquid assets,  which include certain United States  government  obligations and
other approved investments.  Current regulations require that we maintain liquid
assets of not less than 4%.  This  calculation,  which  varies from time to time
depending upon economic conditions and deposit flows, is based upon a percentage
of our deposits  and  short-term  borrowings.  As of  September  30,  2003,  our
regulatory liquidity was 21.58%. We are also subject to federal regulations that
impose  certain  minimum  capital  requirements.  See  Note R to  the  financial
statements.

         Net cash  provided by  operating  activities  was $1.1 million and $1.2
million, respectively, for fiscal 2003 and 2002.

         Net cash used by  investment  activities  for fiscal 2003  totaled $4.4
million,  an increase of $400,000  from $4.0  million for fiscal  2002.  The net
increase in cash used was  primarily  due to  reinvesting  the proceeds from the
maturities and calls of investment  securities,  as well as loan proceeds,  back
into investment securities.

         Net cash provided by financing  activities for fiscal 2003 totaled $3.6
million  compared  to $4.3  million in fiscal  2002.  During  fiscal  2003,  the
decrease  resulted  primarily  from a  $335,000  net  decrease  in the change in
deposit  accounts over the prior period,  a $327,000  purchase of treasury stock
and a $96,000 increase in the amount of dividends paid over the prior period.

         We monitor  projected  liquidity needs and determine the levels desired
based upon our  commitments  to make loans and our  ability to  generate  funds.
Liquidity may be adversely  affected by unexpected  deposit outflows,  excessive
interest rates paid by competitors,  adverse  publicity  relating to the savings
and loan industry and similar matters.

                                       12

<PAGE>


                          INDEPENDENT AUDITORS' REPORT





To the Board of Directors
Eureka Financial Corporation and Subsidiary
Pittsburgh, Pennsylvania


We have audited the accompanying consolidated balance sheets of Eureka Financial
Corporation  and  Subsidiary  (the  "Holding  Company")  and  Subsidiary,  as of
September 30, 2003 and 2002 and the related  consolidated  statements of income,
changes in stockholders'  equity and cash flows for the years then ended.  These
financial  statements  are the  responsibility  of the  Bank's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audit to obtain reasonable  assurance about whether the consolidated
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  consolidated  financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the financial  position of Eureka Financial
Corporation  and Subsidiary as of September 30, 2003 and 2002 and the results of
its  operations  and cash flows for the years then  ended,  in  conformity  with
accounting principles generally accepted in the United States of America.




/s/Edwards Sauer & Owens, PC

Pittsburgh, Pennsylvania
November 13, 2003


<PAGE>

CONSOLIDATED BALANCE SHEETS

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

<TABLE>
<CAPTION>
                                                                      September 30,
                                                               ----------------------------
                                                                   2003            2002
                                                               ------------    ------------
<S>                                                          <C>             <C>
ASSETS
   Cash and due from banks                                     $    496,589    $    720,601
   Interest-bearing deposits in other banks                       8,340,784       7,927,834
   Securities available for sale                                 11,877,487       8,454,099
   Securities held to maturity
     (Market values of $5,865,608 and
      $5,541,372 respectively)                                    5,629,750       5,144,112
   Mortgage-backed securities, available for sale                 1,364,782       2,583,390
   Federal Home Loan Bank stock, at cost                            332,600         382,900
   Loans receivable, net                                         53,288,111      52,142,231
   Premises and equipment, net                                    1,241,032       1,207,622
   Other assets                                                     750,066         703,166
                                                               ------------    ------------
Total Assets                                                   $ 83,321,201    $ 79,265,955
                                                               ============    ============

LIABILITIES AND STOCKHOLERS' EQUITY

   Liabilities
   Deposit accounts
      Non-interest bearing                                        1,887,906       1,466,297
      Interest bearing                                           59,952,093      55,942,741
                                                               ------------    ------------
           Total deposit accounts                                61,839,999      57,409,038
   Advances from borrowers for taxes
        and insurance                                               334,252         297,678
   FHLB advances                                                  1,000,000       1,000,000
   Guarantee of employee stock ownership plan (ESOP) debt            40,258         161,802
   Other liabilities                                              1,035,752       1,256,555
                                                               ------------    ------------

Total liabilities                                                64,250,261      60,125,073

Stockholders' Equity
   Common Stock ($.10 par value,
       4,000,000 shares authorized, 1,377,810 shares
       issued, 1,226,538 and 1,239,318 shares
       outstanding, respectively)                                   137,781         137,781
   Additional paid-in capital                                     6,234,226       6,037,703
   Retained earnings-substantially restricted                    13,213,697      12,891,928
   Unearned employee stock ownership plan (ESOP) shares             (40,258)       (161,802)
   Unearned compensation-restricted stock plan                      (67,733)       (107,294)
   Accumulated other comprehensive income                         1,210,684       1,652,676
                                                               ------------    ------------
                                                                 20,688,397      20,450,992

   Less: Treasury stock, 151,272 and 138,492 shares at cost,
      respectively                                               (1,617,457)     (1,310,110)
                                                               ------------    ------------
Total stockholders' equity                                       19,070,940      19,140,882
                                                               ------------    ------------
Total Liabilities and Stockholders' Equity                     $ 83,321,201    $ 79,265,955
                                                               ============    ============
</TABLE>

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

                                       14
<PAGE>

CONSOLIDATED STATEMENTS OF INCOME

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

                                                    Years Ended September 30,
                                                    -------------------------
                                                         2003         2002
                                                    ------------   ----------
 Interest Income
   Loans                                              $3,606,018   $3,865,264
   Investment securities                                 963,974      734,840
   Mortgage-backed securities                            129,522      210,706
                                                      ----------   ----------

   Total interest income                               4,699,514    4,810,810

Interest Expense
   Deposits                                            1,603,870    1,872,235
   FHLB advances                                          56,372       56,372
   Other                                                   4,941       11,277
                                                      ----------   ----------

   Total interest expense                              1,665,183    1,939,884
                                                      ----------   ----------

Net Interest Income                                    3,034,331    2,870,926

Provision for Loan Losses                                 10,000       60,000
                                                      ----------   ----------

Net Interest Income after
   Provision for Loan Losses                           3,024,331    2,810,926

Other Income
   Fees on Now Accounts                                   57,870       52,837
   Other income                                           47,657       45,474
                                                      ----------   ----------
   Total other income                                    105,527       98,311

Other Expenses
   Salaries and benefits                               1,028,765      923,668
   Occupancy expense                                     208,242      198,069
   Computer expense                                      105,567       97,690
   Legal and accounting                                  152,997      139,208
   ESOP Contribution                                     253,709      155,113
   Donations                                              52,234       53,251
   Retirement fund contributions                          76,221       19,408
   Other                                                 254,759      250,337
                                                      ----------   ----------

   Total other expenses                                2,132,494    1,836,744
                                                      ----------   ----------

Income Before Income Taxes                               997,364    1,072,493

Provision for Income Taxes                               202,071      237,996
                                                      ----------   ----------

Net Income                                            $  795,293   $  834,497
                                                      ==========   ==========

Earnings per common share - BASIC                     $     0.65   $      .68
                                                      ==========   ==========
Earnings per common share - DILUTED                   $     0.63   $      .66
                                                      ==========   ==========

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

                                       15
<PAGE>

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002

<TABLE>
<CAPTION>
                                                                                                Accumulated
                                                                                       Unearned   Other
                                                       Additional            Unearned  Compen-   Compre-
                                               Common   Paid-in    Retained    ESOP    sation    hensive    Treasury
                                               Stock    Capital    Earnings   Shares     RSP      Income      Stock       Total
                                               ------- ---------  ----------  -------- --------  --------- ----------  -----------
<S>                                          <C>     <C>        <C>         <C>      <C>       <C>       <C>         <C>
BALANCE AT
September 30, 2001                             137,781 5,930,919  12,435,203 (258,205) (146,568) 1,821,547 (1,310,110) $18,610,567
    Comprehensive Income
        Net income                                                   834,497                                               834,497
        Other comprehensive income:
            Changes in unrealized gains on
              securities, net of deferred
               income tax of $86,994                                                              (168,871)               (168,871)
                                                                                                                       -----------
        Total Comprehensive Income                                                                                         665,626
                                                                                                                       -----------
        ESOP Shares allocated                             58,710               96,403                                      155,113
        Amortization of restricted stock plan             48,074                         39,274                             87,348
        Dividends on common stock                                   (377,772)                                             (377,772)
        Purchase of treasury stock
                                               ------- ---------  ----------  -------   -------  --------- ----------  -----------
BALANCE AT
September 30, 2002                             137,781 6,037,703  12,891,928 (161,802) (107,294) 1,652,676 (1,310,110)  19,140,882
    Comprehensive Income
        Net income                                                   795,293                                               795,293
        Other comprehensive income:
            Changes in unrealized gains on
              securities, net of deferred
               income tax of $227,692                                                             (441,992)               (441,992)
                                                                                                                       -----------
        Total Comprehensive Income                                                                                         353,301
                                                                                                                       -----------
        ESOP Shares allocated                            132,168              121,544                                      253,712
        Amortization of restricted stock plan             64,355                         39,561                            103,916
        Dividends on common stock                                   (473,524)                                             (473,524)
        Reissuance of treasury stock                                                                           19,653       19,653
        Purchase of treasury stock                                                                           (327,000)    (327,000)
                                               ------- ---------  ----------  -------   -------  --------- ----------  -----------
BALANCE AT
September 30, 2003                             137,781 6,234,226  13,213,697  (40,258)  (67,733) 1,210,684 (1,617,457) $19,070,940
                                               ======= =========  ==========  =======   =======  ========= ==========  ===========
</TABLE>

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

                                       16
<PAGE>

CONSOLIDATED STATEMENTS OF CASH FLOWS

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

<TABLE>
<CAPTION>
                                                               Years Ended September 30,
                                                                    2003           2002
                                                               -----------    -----------
<S>                                                          <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                                     $   795,293    $   834,497
Adjustments to reconcile net cash from operating activities:
       Unearned ESOP shares                                        253,712        155,113
       Compensation expense related to RSP                         103,916         87,348
       Depreciation                                                 99,605        104,846
       Provision for loan loss                                      10,000         60,000
       Net accretion/amortization of discounts and
         premiums on mortgage-backed securities,
         investment securities and loans                           (93,974)       (40,372)
       Unamortized loan fees                                       (60,157)        (4,091)
       Increase (decrease) in cash due to
       changes in assets and liabilities:
       Other assets                                                (46,900)       (21,070)
       Other liabilities                                             6,890         44,529
                                                               -----------    -----------
   Net Cash from Operating Activities                            1,068,385      1,220,800

CASH FLOWS FROM INVESTING ACTIVITIES
   Proceeds from sale and maturity of securities
       available for sale                                               --        500,000
   Proceeds from maturities and redemptions of
       securities held to maturity                               2,265,000      2,420,000
   Purchase of securities available for sale                    (3,945,000)    (1,480,000)
   Purchase of securities held to maturity                      (2,750,000)    (2,047,102)
   Redemption (purchase) of FHLB stock                              50,300        (69,600)
   Net loans made to customers                                  (1,636,303)    (4,873,201)
   Net decrease (increase) in commercial leases                    540,580        411,788
   Net paydowns in mortgage-backed securities                    1,163,871      1,141,931
   Premises and equipment expenditures                            (133,015)       (36,861)
                                                               -----------    -----------
   Net Cash Used by Investing Activities                        (4,444,567)    (4,033,045)

CASH FLOWS FROM FINANCING ACTIVITIES
   Net increase in deposit accounts                              4,430,961      4,766,255
   Net increase in advances from
       borrowers for taxes and insurance                            36,574         56,947
   Payment of dividends                                           (473,524)      (377,772)
   Repayment of ESOP loan                                         (121,544)       (96,403)
   Purchase of Treasury Stock                                     (327,000)            --
   Reissuance of Treasury Stock                                     19,653             --
                                                               -----------    -----------
   Net Cash From Financing Activities                            3,565,120      4,349,027
                                                               -----------    -----------

Net Change in Cash and Cash Equivalents                            188,938      1,536,782

Cash and Cash Equivalents at Beginning of Year                   8,648,435      7,111,653
                                                               -----------    -----------

Cash and Cash Equivalents at End of Year                       $ 8,837,373    $ 8,648,435
                                                               ===========    ===========
</TABLE>


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

                                       17
<PAGE>

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

                                                 Years Ended September 30,
                                                 -------------------------
                                                     2003         2002
                                                  ----------   ----------
SUPPLEMENTAL DISCLOSURE

   Cash payments for:
       Interest                                   $1,666,287   $1,893,409

        Income taxes                              $  329,397   $  169,405

NON-CASH TRANSACTIONS

    Recorded unrealized holding gains
       on securities available for sale
       September 30, 2003 and 2002                $1,834,370   $2,504,054

    Deferred income tax on recorded
       unrealized gains on securities available
       for sale at September 30, 2003 and 2002    $  623,686   $  851,378



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

                                       18

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE A - SIGNIFICANT ACCOUNTING POLICIES

Nature of  Operation:  The Bank  provides a variety  of  financial  services  to
individuals  and  corporate   customers  through  its  main  office  located  in
Southwestern   Pennsylvania.   The   Bank's   primary   deposit   products   are
interest-bearing  checking  accounts,   savings  accounts  and  certificates  of
deposit.  Its primary  lending  products are  single-family  residential  loans,
multi-family residential loans and commercial leases.

Conversion to Mutual Holding Company Form of Ownership:  On January 6, 1999, the
Bank converted to a Mutual Holding Company form of  organization.  In connection
with the conversion,  the Bank issued and sold 647,571 shares of common stock at
a price of $10 per share for a total net proceeds of $6,081,919 after conversion
expenses of $393,791.  The remaining  730,239 shares of common stock were issued
to Eureka Bancorp, the newly formed Mutual Holding company.

At the time of  conversion,  the Bank  established a  liquidation  account in an
amount equal to its retained  income as  reflected in the latest  balance  sheet
used in the final conversion  prospectus.  The liquidation account is maintained
for the  benefit of eligible  account  holders  who  continue to maintain  their
deposit  accounts  in the Bank  after  conversion.  In the  event of a  complete
liquidation  of the Bank (and only in such an event),  eligible  depositors  who
continue to maintain  accounts shall be entitled to receive a distribution  from
the  liquidation  account  before any  liquidation  may be made with  respect to
common stock.

The Bank may not  declare or pay a cash  dividend  if the effect  thereof  would
cause its net worth to be reduced  below  either the  amounts  required  for the
liquidation  account  discussed  below or the  regulatory  capital  requirements
imposed by federal and state regulations.

On April 1, 2003,  the Bank  formed  Eureka  Financial  Corporation,  a mid-tier
holding  company,  to own 100% of the  outstanding  stock of  Eureka  Bank.  All
shareholders,  including the MHC, may relinquish their Eureka Bank  certificates
for Eureka  Financial  Corporation  stock  certificates on a 1-for-1 basis.  The
formation of the mid-tier  holding  company was funded from Eureka Bank retained
earnings and the effects of this transaction are eliminated in consolidation.

Principles of  Consolidation:  The  consolidated  financial  statements  include
accounts  of  the  mid-tier  holding  company  and  the  Bank.  All  significant
intercompany accounts have been eliminated in the consolidation.

Restricted Cash: Under terms of a sweep account agreement with another bank, the
Bank is  required to  maintain a minimum  balance as part of the demand  deposit
account, to offset fees charged. As of September 30, 2003 and 2002, cash and due
from banks includes cash restricted for this purpose of $175,000.

Investment  Securities:  All investments in debt and equity securities are to be
classified  into three  categories.  Securities  which  management  has positive
intent and ability to hold until  maturity are  classified  as held to maturity.
Securities  held to maturity are stated at cost,  adjusted for  amortization  of
premium and  accretion of discount  which are realized  using the straight  line
method.  Securities  that are bought  and held  principally  for the  purpose of
selling them in the near term are  classified as trading  securities.  All other
securities are classified as available-for-sale  securities.  Unrealized holding
gains and losses for trading  securities  are included in  earnings.  Unrealized
holding  gains and losses for  available-for-sale  securities  are excluded from
earnings  and  reported  net  of  income  taxes  as  a  separate   component  of
stockholders' equity until realized.

                                       19
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE A - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Interest and dividends on securities are reported as interest income.  Gains and
losses  realized on sales of securities  represent the  differences  between net
proceeds and carrying values determined by the specific identification method.

Mortgage-Backed Securities: The carrying amount of mortgage-backed securities is
market  value  with  unrealized  gains and losses  excluded  from  earnings  and
reported net of income taxes as a separate  component of  stockholders'  equity.
Should any be sold,  gains and losses will be  recognized  based on the specific
identification  method.  Amortization of premiums and accretion of discounts are
realized using the level yield method.

Loans and Allowance for Loan Losses:  Loans are stated at their unpaid principal
balance  less any  undisbursed  portion  of  loans,  unamortized  loan  fees and
allowances for losses.  Allowances for losses on loans are established through a
provision  for loan  losses  charged to expense.  Loans are charged  against the
allowance  for loan  losses when the loan  balance  exceeds  the  estimated  net
realizable  value  or when,  in the  opinion  of  management,  current  economic
conditions or other factors  warrant such charges.  Amortization  of premiums on
loans are realized using the straight line method.

Provisions  are made for  uncollected  interest on loans which are delinquent in
excess of ninety days.

Loan origination fees, as well as certain direct origination costs, are deferred
and recognized over the  contractual  life of the loan as an adjustment of yield
(interest income).

Premises  and  Equipment:  Premises  and  equipment  are  stated  at  cost  less
accumulated  depreciation.  Depreciation  is  generally  computed  on  both  the
straight-line  and  accelerated  methods over the estimated  useful lives of the
assets. Costs for maintenance and repairs are expensed currently. Costs of major
additions or improvements are capitalized.

Other Real Estate Owned (REO):  Real estate  properties  acquired  through or in
lieu of loan  foreclosure  are  initially  recorded  at the lower of the  Bank's
carrying  amount  or fair  value  less  estimated  selling  cost at the  date of
foreclosure.  Any  write-downs  based on the  asset's  fair value at the date of
acquisition  are charged to the  allowance for loan losses.  After  foreclosure,
these assets are carried at the lower of their new cost basis or fair value less
cost to sell.  Costs  of  significant  property  improvements  are  capitalized,
whereas costs relating to holding property are expensed. The portion of interest
costs  relating to  development  of real estate is  capitalized.  Valuations are
periodically  performed  by  management,  and  any  subsequent  write-downs  are
recorded as a charge to operations,  if necessary,  to reduce the carrying value
of a property to the lower of its cost or fair value less cost to sell.

Income  Taxes:  The Bank  uses an asset  and  liability  approach  to  financial
accounting  and  reporting   income  taxes.   Deferred  income  tax  assets  and
liabilities  are  computed  annually  for  differences   between  the  financial
statement and tax basis of assets and liabilities that will result in taxable or
deductible  amounts in the future based on enacted tax laws and rates applicable
to the periods in which the  differences  are expected to affect taxable income.
Valuation  allowances  are  established  when  necessary to reduce  deferred tax
assets to the amount  expected  to be  realized.  Income tax  expense is the tax
payable or refundable  for the period plus or minus the change during the period
in deferred tax assets and liabilities.

                                       20

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE A - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Use of Estimates:  The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

Material  estimates that are  particularly  susceptible  to  significant  change
relate  to the  determination  of the  allowance  for  losses  on loans  and the
valuation  of  real  estate  acquired  in  connection  with  foreclosures  or in
satisfaction of loans. In connection  with the  determination  of the allowances
for losses on loans and foreclosed real estate,  management obtains  independent
appraisals for significant properties.

Advertising  Costs:  Advertising  costs are  expensed as  incurred.  Advertising
expense  totaled  $22,695 and $25,056 for the years ended September 30, 2003 and
2002, respectively.

Earnings Per Share:  Basic EPS excludes dilution and is computed by dividing net
income by  weighted-average  shares  outstanding.  Diluted  EPS is  computed  by
dividing net income by weighted-average shares outstanding plus potential common
stock  resulting  from dilutive  stock options and  Restricted  Stock Plan (RSP)
shares that have not yet vested.

For  purposes of  computing  weighted-average  shares  outstanding,  unallocated
shares  under  the  Bank's  employee  stock  ownership  plan are not  considered
outstanding until they are committed to be released for allocation.

The following is a  reconciliation  of the  numerators and  denominators  of the
basic and diluted EPS computations for income from continuing operations for the
years ended September 30, 2003 and 2002:


                                                   September 30, 2003
                                  ----------------------------------------------
                                        Income           Shares        Per-Share
                                     (Numerator)      (Denominator)     Amount
                                     -----------      -------------     ------
Basic EPS                         $     795,293          1,226,644     $   0.65
Effect of dilutive securities               --              37,325        (0.02)
                                  -------------          ---------     --------
Diluted EPS                       $     795,293          1,263,969     $   0.63
                                  =============          =========     ========

                                                   September 30, 2002
                                  ----------------------------------------------
                                        Income           Shares        Per-Share
                                     (Numerator)      (Denominator)      Amount
                                     -----------      -------------      ------
Basic EPS                         $     834,497          1,218,539     $    .68
Effect of dilutive securities                 -             42,152         (.02)
                                  -------------          ---------     --------
Diluted EPS                       $     834,497          1,260,691     $    .66
                                  =============          =========     ========


                                       21

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002

NOTE A - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Cash  Equivalents:  For  purposes  of the  Statements  of Cash  Flows,  the Bank
considers  all cash and  amounts due from banks,  interest  bearing  deposits in
other  Banks,  federal  funds  sold,  and all  highly  liquid  debt  instruments
purchased with a maturity of three months or less to be cash equivalents.

Reclassification  of Prior Year's Statements:  Certain previously reported items
may have been reclassified to conform to the current year's classifications. The
reclassifications  have  no  effect  on  total  assets,  total  liabilities  and
stockholders' equity, or net income.


NOTE B - INVESTMENT SECURITIES

Securities available for sale consist of the following:

<TABLE>
<CAPTION>
                                              September 30, 2003
                            -------------------------------------------------------
                                              Gross         Gross
                            Amortized       Unrealized    Unrealized      Market
                              Cost            Gains         Losses        Value
                            -----------    ------------  -----------    -----------
<S>                       <C>            <C>           <C>            <C>
FNMA preferred stock        $ 1,478,644                  $  (128,644)   $ 1,350,000
FHLMC preferred stock         8,604,916    $     71,584     (355,250)     8,321,250
FHLMC voting common stock        41,266       2,164,971            -      2,206,237
                            -----------    ------------  -----------    -----------
                            $10,124,826    $  2,236,555  $  (483,894)   $11,877,487
                            ===========    ============  ===========    ===========
</TABLE>

<TABLE>
<CAPTION>

                                              September 30, 2002
                            -------------------------------------------------------
                                              Gross         Gross
                            Amortized       Unrealized    Unrealized      Market
                              Cost            Gains         Losses        Value
                           -----------     ------------  -----------    -----------
<S>                       <C>            <C>           <C>            <C>
FHLMC preferred stock      $ 6,049,137     $    152,862  $  (103,750)   $ 6,098,249
FHLMC voting common stock       41,266        2,314,584            -      2,355,850
                           -----------     ------------  -----------    -----------
                           $ 6,090,403     $  2,467,446  $  (103,750)   $ 8,454,099
                           ===========     ============  ===========    ===========
</TABLE>

                                       22

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE B - INVESTMENT SECURITIES (CONTINUED)

Securities held to maturity consist of the following:

<TABLE>
<CAPTION>

                                              September 30, 2003
                               -------------------------------------------------------
                                                 Gross         Gross
                               Amortized       Unrealized    Unrealized      Market
                                 Cost            Gains         Losses        Value
                              -----------     ---------     ----------    -----------
<S>                         <C>             <C>           <C>           <C>
Obligations of states and
  political subdivisions      $ 2,879,750     $ 197,888     $       --    $ 3,077,638
Government agency debentures    2,750,000        37,970             --      2,787,970
                              -----------     ---------     ----------    -----------
                              $ 5,629,750     $ 235,858     $       --    $ 5,865,608
                              ===========     =========     ==========    ===========
</TABLE>

<TABLE>
<CAPTION>
                                                 September 30, 2002
                               -------------------------------------------------------
                                                 Gross         Gross
                               Amortized       Unrealized    Unrealized      Market
                                 Cost            Gains         Losses        Value
                              -----------     ---------     ----------    -----------
<S>                         <C>             <C>           <C>           <C>
Obligations of states and
  political subdivisions      $ 2,894,112     $ 206,525     $       --    $ 3,100,637
Government agency debentures    2,250,000       190,735             --      2,440,735
                              -----------     ---------     ----------    -----------
                              $ 5,144,112     $ 397,260     $       --    $ 5,541,372
                              ===========     =========     ==========    ===========
</TABLE>


At September 30, 2003, all government agency debentures were pledged as security
for public monies held by the Bank.

The amortized cost and estimated  market value of securities held to maturity at
September  30,  2003,  by  contractual  maturity,   are  shown  below.  Expected
maturities will differ from contractual  maturities  because  borrowers may have
the right to call or  prepay  obligations  with or  without  call or  prepayment
penalties.

                                                 Amortized             Market
                                                    Cost               Value
                                                -----------         -----------

   Due in one year or less                      $    35,125         $    35,876
   Due after one year through five years            328,640             358,449
   Due after five years through ten years           650,000             699,857
   Due after ten years                            4,615,985           4,771,426
                                                -----------         -----------
                                                $ 5,629,750         $ 5,865,608
                                                ===========         ===========

Proceeds from the sales and maturities of available-for-sale  and the maturities
and calls of  held-to-maturity  securities  during the years ended September 30,
2003 and 2002 were $2,265,000 and $2,920,000,  with realized gains of $0 for the
years ended September 30, 2003 and 2002, respectively.

                                       23
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE C - MORTGAGE-BACKED SECURITIES

The  amortized  cost  and  market  values  of  mortgage-backed   securities  are
summarized as follows:

                                 September 30, 2003 - Available for Sale
                       ---------------------------------------------------------
                                          Gross        Gross
                         Amortized     Unrealized    Unrealized         Market
                           Cost           Gains        Losses           Value
                       -----------      ---------     --------       -----------

GNMA certificates      $     2,629      $      69     $      --      $     2,698
FHLMC certificates         215,531         17,772            --          233,303
FNMA certificates        1,064,913         63,868            --        1,128,781
                       -----------      ---------     --------       -----------
                       $ 1,283,073      $  81,709     $      --      $ 1,364,782
                       ===========      =========     ========       ===========


                                 September 30, 2002 - Available for Sale
                       ---------------------------------------------------------
                                          Gross        Gross
                         Amortized     Unrealized    Unrealized         Market
                           Cost           Gains        Losses           Value
                       -----------      ---------     --------       -----------

GNMA certificates      $     4,320      $   1,086     $     --       $     5,406
FHLMC certificates         407,960         32,023           --           439,983
FNMA certificates        2,030,752        107,249           --         2,138,001
                       -----------      ---------     --------       -----------
                       $ 2,443,032      $ 140,358     $     --       $ 2,583,390
                       ===========      =========     ========       ===========


At September 30, 2003, all  mortgage-backed  securities were pledged as security
for public monies held by the Bank.

The amortized cost and estimated market values of mortgage-backed  securities at
September 30, 2003, by contractual maturity are shown below. Expected maturities
will differ from  contractual  maturities  because  borrowers  have the right to
repay  obligations  without  penalty.  Amounts  have been rounded to the nearest
dollar.

                                                      Amortized        Market
                                                         Cost          Value
                                                         ----          -----

       Due in one year or less                      $        --     $        --
       Due after one year through five years            202,851         214,578
       Due after five years through ten years           754,233         801,341
       Due after ten years                              325,989         348,863
                                                    -----------     -----------
                                                    $ 1,283,073     $ 1,364,782
                                                    ===========     ===========

                                       24
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE D - LOANS

Major classifications of loans are as follows:

<TABLE>
<CAPTION>
                                                                  September 30,
                                                            ----------------------------
                                                                2003            2002
                                                            ------------    ------------
<S>                                                       <C>             <C>
1-4 family real estate                                      $ 24,049,549    $ 24,612,281
Multi-family real estate                                      11,016,542      10,997,785
Commercial real estate                                         7,623,365       4,527,401
Home equity loans and second mortgages                         1,484,224       1,367,033
Share loans                                                      356,050         417,405
Unsecured improvement loans                                      187,220         158,089
Commercial leases                                              7,744,604       8,285,184
Commercial lines of credit                                     5,211,000       4,445,750
                                                            ------------    ------------
                                                              57,672,554      54,810,928
 Less:
      Undisbursed portion of loans                             3,813,693       2,104,435
     Unamortized loan fees                                        82,003          78,893
      Allowance for loan losses                                  488,747         485,369
                                                            ------------    ------------
                                                            $ 53,288,111    $ 52,142,231
                                                            ============    ============
</TABLE>

Changes in the allowance for loan losses were as follows:

<TABLE>
<CAPTION>
                                                              Years Ended September 30,
                                                                2003            2002
                                                            ------------    ------------
<S>                                                       <C>             <C>
Balance, beginning of year                                  $    485,369    $    421,257
Provision charged to operations                                   10,000          60,000
Net recoveries / (charge-offs)                                    (6,622)          4,112
                                                            ------------    ------------
Balance, end of year                                        $    488,747    $    485,369
                                                            ============    ============
</TABLE>


The  Bank   primarily   grants  loans  to  customers   throughout   Southwestern
Pennsylvania. The Bank maintains a diversified loan portfolio and the ability of
its debtors to honor their  obligations  is not  substantially  dependent on any
particular  economic business sector.  Loans on non-accrual  status at September
30, 2003 and 2002 approximated $377,000 and $293,000, respectively.

There were no loans  determined to be impaired as of September 30, 2003 and 2002
in accordance with SFAS Nos. 114 and 118.

                                       25
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE E - PREMISES AND EQUIPMENT

Premises and equipment, which are stated at cost, are as follows:

                                                    September 30,
                                               -----------------------
                                                  2003         2002
                                               ----------   ----------

Land, building and improvements                $1,694,648   $1,614,048

Furniture and fixtures                            417,656      365,242
                                               ----------   ----------
                                                2,112,304    1,979,290
   Less:  Accumulated depreciation                871,272      771,668
                                               ----------   ----------
                                               $1,241,032   $1,207,622
                                               ==========   ==========

Depreciation  expense was $99,605 and $104,846 for the years ended September 30,
2003 and 2002, respectively.


NOTE F - FHLB STOCK AND ADVANCES

The Bank is  required  to purchase  common  stock of the Federal  Home Loan Bank
(FHLB) based on a percentage of net residential  mortgage loans  outstanding and
advances made to the Bank by FHLB. The amount of common stock owned was $332,600
and $382,900 at September 30, 2003 and 2002, respectively.

The Bank had a  $1,000,000  advance  from FHLB at  September  30, 2003 and 2002,
respectively.  The Bank pledged  approximately 125% of the amount of the advance
out of their general asset pool as collateral for the advance.

When the advance becomes due, the amount will be automatically  transferred from
the Bank's demand  deposit  account placed with FHLB. The scheduled due date and
the interest rate charged on the advance at September 30, 2003 is as follows:


                  Due Date                Interest Rate             Amount
                  --------                -------------             ------

                November 17, 2010             5.56%               $1,000,000

                                       26

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002

NOTE G - DEPOSIT ACCOUNTS

Interest-bearing  deposit  accounts  consisted of the following at September 30,
2003 and 2002:

<TABLE>
<CAPTION>
                                     Weighted                          September 30,
                                  Average Rate at      -------------------------------------------
                                 September 30, 2003               2003               2002
                                 ------------------    --------------------- ---------------------
<S>                                  <C>             <C>             <C>    <C>            <C>
Regular Passbook Savings
   and Christmas Club                  1.77%           $ 19,487,900    32.5%  $17,635,182    31.5%

NOW  accounts                          1.25%              3,823,305     6.4%    4,760,801     8.5%
Certificate Accounts:
          6 month                      1.52%              8,510,524    14.2%   10,409,551    18.6%
          1 year                       2.53%             12,783,219    21.3%   10,484,546    18.7%
          2 years                      3.11%              2,991,947     5.0%    1,412,905     2.6%
          3 years                      4.43%              3,951,361     6.6%    3,863,180     6.9%
          4 years                      4.04%                887,081     1.5%      972,390     1.7%
          6 years                      5.40%              1,716,290     2.9%    1,550,838     2.8%
          8 years                      5.22%              3,077,437     5.1%    2,593,222     4.6%
                                                       ------------     ---   -----------     ---
                                                         33,917,859    56.6%   31,286,632    55.9%
   Individual retirement
     accounts                          4.20%              2,723,029     4.5%    2,260,126     4.1%
                                                       ------------     ---   -----------     ---
   Total Interest-Bearing Deposits                     $ 59,952,093     100%  $55,942,741     100%
                                                       ============     ===   ===========     ===
</TABLE>

Certificate Accounts and Individual Retirement Accounts maturing in years ending
September 30, as of September 30, 2003 are summarized as follows:

                     2004                    $      25,773,502
                     2005                            3,918,870
                     2006                            2,123,278
                     2007                            1,470,336
                     2008                              915,373
                     2009 and thereafter             2,439,529
                                             -----------------
                                             $      36,640,888
                                             =================

The Bank held  related  party  deposits of  approximately  $150,000 and $110,000
September 30, 2003 and 2002 respectively.

At September 30, 2003 and 2002,  deposit accounts exceeding $100,000 amounted to
$15,258,706 and $14,518,677 respectively. Deposits in excess of $100,000 are not
insured by the  Savings  Association  Insurance  Fund,  (reference  note B and C
regarding  public monies).  The Bank had no brokered  deposits for either period
presented.

Interest expense on deposits consists of:           Years Ended September 30,
                                                    -------------------------
                                                        2003           2002
                                                   -----------     -----------

Regular passbook savings and Christmas Club        $   367,668     $   403,251
NOW accounts                                            61,176          76,500
Certificate accounts                                 1,062,280       1,281,142
Individual Retirement accounts                         112,746         111,342
                                                   -----------     -----------
                                                   $ 1,603,870     $ 1,872,235
                                                   ===========     ===========

                                       27
<PAGE>


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE H - PENSION PLAN

The Bank is a participant in the Financial Institutions  Retirement Fund (FIRF).
FIRF is a multi-employer  defined benefit retirement  program,  which has as its
participating  employers thrift  institutions  such as the Bank. The plan covers
substantially all employees.  FIRF utilizes a common trust fund wherein separate
valuations  are not  made  for  each  participating  employer,  nor are  assets,
liabilities  or costs  segregated  by employer.  As a result,  disclosure of the
accumulated  benefit  obligations,  plan  assets  and the  components  of annual
pension  expense  attributable  to the Bank,  required by Statement of Financial
Standards   No.  132,   "Employers'   Disclosures   about   Pensions  and  Other
Postretirement Benefits (SFAS 132)" are not reported.

For the year ended September 30, 2003, pension  contributions charged to expense
amounted  to  $64,478.  For the  year  ended  September  30,  2002,  no  pension
contributions  were charged to operating  expense,  as the Bank was advised that
there was no accumulated underfunded pension liability.  The Bank has since been
informed that as of June 30, 2004, (the plan year-end for the retirement  plan),
the Bank's portion of an accumulated  underfunded pension liability is projected
to  be  approximately  $100,000.  In  anticipation  of a  projected  underfunded
liability, for the year ended September 30, 2004, the Bank will charge a pension
contribution of approximately $26,000 per quarter to operating expense.


NOTE I - RETIREMENT SAVINGS PLAN

The Bank has  established the Eureka Bank (formerly  Eureka Federal)  Retirement
Savings  Plan which covers  substantially  all of its  employees.  The plan is a
qualified 401 (k) Salary Reduction Plan that permits  participants to contribute
up to ten  percent  (10%) of their  salary to the plan.  Additionally,  the Bank
provided matching  contributions of 125% of the first 6% contributed through the
period  ended  December  31,  1998 at which time  contributions  were  suspended
indefinitely.  During the years ended September 30, 2003 and 2002, there were no
contributions  by the Bank to the plan.  These  funds were  invested at the Bank
until  December 31, 1998, at which time they were used to purchase  stock in the
Bank. All earnings on the stock are invested at the Bank.


NOTE J - EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)

An Employee  Stock  Ownership  Plan  (ESOP)  exists for all  employees  who have
completed one year of service and have attained the age of 21. The ESOP borrowed
$518,060 from a third party lender with the Bank guaranteeing repayment and used
the funds to purchase  51,806  shares of common  stock of the Bank issued in the
offering.  The loan will be repaid principally from the Bank's  contributions to
the ESOP over a period of 10  years.  On  September  30,  2003,  the loan had an
outstanding  balance  of  $40,258  and an  interest  rate  of  4.00%.  The  loan
obligation  of the  ESOP is  considered  unearned  compensation  and,  as  such,
recorded  as a  reduction  of the  Bank's  stockholders'  equity.  Both the loan
obligation and the unearned  compensation  are reduced by the amount of the loan
repayments made by the ESOP. Shares purchased with the loan proceeds are held in
a suspense  account for  allocation  among  participants  as the loan is repaid.
Contributions  to the ESOP and shares  released  from the  suspense  account are
allocated  among  participants  on the  basis  of  compensation  in the  year of
allocation.  Benefits become fully vested at the end of 5 years of service under
the terms of the ESOP Plan.  Benefits  may be payable  upon  retirement,  death,
disability,  or separation from service.  Since the Bank's annual  contributions
are discretionary, benefits payable under the ESOP cannot be estimated.

                                       28

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002



NOTE J - EMPLOYEE STOCK OWNERSHIP PLAN (ESOP) (CONTINUED)

Minimum annual principal payments due on the ESOP loan are as follows:

            Year Ended September 30,               Amount
            ------------------------               ------

                         2004                     $ 40,258
                         2005                           --
                         2006                           --
                         2007                           --
                                                  --------
                        Total                     $ 40,258
                                                  ========


At September  30, 2003 and 2002,  31,609 and 28,045 ESOP  shares,  respectively,
were  allocated  to the  participating  employees.  The Bank is  recognizing  as
compensation  expense the fair market value of the Bank's common stock scheduled
to be allocated to participating  employees.  Compensation expense recognized by
the Bank during the years ended  September  30, 2003 and 2002 was  $253,709  and
$155,113, respectively.


NOTE K - STOCK OPTION PLAN

In July 1999,  the Bank approved a stock option plan (the "Option Plan") whereby
64,757  authorized shares are reserved for issuance by the Bank upon exercise of
stock  options  granted to officers,  directors,  and employees of the Bank from
time to time.  Options constitute both incentive stock options and non-incentive
stock options.  Options  awarded are  exercisable at a rate of 20% annually with
the first 20% excercisable on the one-year anniversary of the date of grant. Any
shares subject to an award which expires or is terminated unexercised will again
be  available  for  issuance.  The Option  Plan has a term of ten years,  unless
sooner  terminated.  The exercise price for the purchase of shares subject to an
incentive stock option may not be less than 100 percent of the fair market value
of the common stock on the date of grant of such option.  The exercise price per
share for  non-incentive  stock  options  shall be the price as determined by an
option committee, but not less than the fair market value of the common stock on
the date of the grant.

Stock option activity is a follows:
                                                       Year ended September 30,
                                                          2003         2002
                                                         ------        ------
Options outstanding at beginning
    of year                                              64,757        64,757
Options granted                                               -             -
Options exercised                                        (2,220)            -
Options canceled                                              -             -
                                                         ------        ------
Options outstanding at end of year                       62,537        64,757
                                                         ======        ======

Options exercisable at end of year                       41,162        32,372
                                                         ======        ======

                                       29

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE K - STOCK OPTION PLAN (CONTINUED)


Weighted-average option prices per share:
Options outstanding at beginning
       of year                                        $   8.50        $   8.50
Options granted during
       the year                                              -               -
Options exercised during
       the year                                           8.50               -
Options canceled during
       the year                                              -               -
Options  outstanding at
       end of year                                    $   8.50        $   8.50

The options outstanding at September 30, 2003 had a weighted-average contractual
maturity of 5.80 years and an exercise price of $8.50.

The per share  weighted-average  fair  value of stock  options  granted  with an
exercise price equal to market for the year ended  September 30, 2003 was $9.80,
using the Black Scholes option pricing model with the following weighted-average
assumptions for 2003: expected life of 2.75 years, expected annual dividend rate
of 9.75%, risk-free interest rate of 3.07%, and an expected volatility of 23%.

The Bank applies  Accounting  Principles  Board Opinion No. 25 in accounting for
stock options and has modified the  September  30, 2002  pro-forma net income to
reflect  the  non-cumulative  effect  of  SFAS  123.  Had  the  Bank  determined
compensation  cost  based on the  fair  value at the  grant  date for its  stock
options under SFAS No. 123, the Bank's net income would have been reduced to the
pro forma amounts indicated below:

                                             Year ended September 30,
                                         --------------------------------
                                             2003                2002
                                         ------------       -------------
Net income:
       As reported                       $    795,293       $     834,497
       Pro Forma                         $    738,414       $     790,690
   Net income per share:
       As reported:
          Basic                          $       0.65       $        0.68
          Diluted                        $       0.63       $        0.66
       Pro Forma:
          Basic                          $       0.60       $        0.65
          Diluted                        $       0.58       $        0.63


                                       30

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE L- RESTRICTED STOCK PLAN

In July 1999, the Bank  established a Restricted  Stock Plan ("RSP").  Under the
terms of the  RSP,  a total of  25,900  shares  of the  Bank's  common  stock is
available for the granting of awards to officers, directors and employees during
a period of five years,  unless sooner terminated.  Stock awarded is earned at a
rate of 20% annually  with the first 20% earned on the one-year  anniversary  of
the date of grant.  The market value of the common stock at the date of award is
included  as a reduction  of  stockholders'  equity in the balance  sheet and is
recorded as compensation expense using the straight-line method over the vesting
period  of the  awards.  The  awards  vest  pro  rata  over  five  years at each
anniversary of the award.  On July 19, 1999,  25,900 shares of the Bank's common
stock were  awarded  under the RSP. The fair market value of the Bank's stock on
July 19, 1999, was $8.50 per share.  Aggregate compensation expense with respect
to the  foregoing  awards was  approximately  $104,000 and $87,000 for the years
ended September 30, 2003 and 2002, respectively.

Summary  information  regarding  outstanding RSP awards at September 30, 2003 is
presented below:

   Period in which                   Market Value     Shares Subject    Vesting
   Awards granted                    at award date         to award      period
   --------------                    -------------         --------      ------

   Year ended September 30, 1999     $      8.50            25,900       5 Years


NOTE M - DEFERRED COMPENSATION ARRANGEMENTS

The Bank has in place a non-qualified  deferred  compensation  arrangement  with
participating  members of  management  under which future  defined  benefits are
funded  principally  by  individual  life  insurance  policies.  An  actuarially
determined charge,  which is included in other operating  expense,  is made each
year based on the future benefits to be paid under the plan. The amounts accrued
during the years ended September 30, 2003 and 2002, were  approximately  $15,000
and $14,000, respectively.


NOTE N - COMMITMENTS

In the normal course of business,  there are various outstanding commitments and
contingent liabilities,  such as commitments to extend credit. These commitments
involve,  to  varying  degrees,  elements  of credit  risk in excess of  amounts
recognized in the balance sheets.

Loan  commitments  are made to  accommodate  the  financial  needs of the Bank's
customers.  These  arrangements  have credit risk  essentially  the same as that
involved in extending  loans to customers  and are subject to the Bank's  normal
credit policies and loan underwriting standards. Collateral is obtained based on
management's credit assessment of the customer.  Management currently expects no
loss from these activities.

The  Bank's  maximum  exposure  to credit  loss for loan and  lease  commitments
(unfunded  loans and leases) at September 30, 2003 and 2002,  was  approximately
$6,816,000 and $4,307,000 respectively with fixed rates of interest ranging from
4 1/2% to 7 3/4% and 6% to 8 1/2%,  respectively.  There were no  commitments to
purchase investment securities at September 30, 2003 and 2002.

                                       31

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002

NOTE O - INCOME TAXES

The provision for income taxes consist of:

                                                Years Ended September 30,
                                              ----------------------------
                                                  2003              2002
                                              ----------        ----------

Federal currently payable                     $  174,267        $  238,417
State currently payable                           30,819            27,000
Deferred tax benefit                              (3,015)          (27,421)
                                              ----------        ----------
  Total                                       $  202,071        $  237,996
                                              ==========        ==========

State  tax   liabilities   reflect  tax  credits   recovered  by  the  bank  for
participating in the Educational Improvement Tax Credit Program.

<TABLE>
<CAPTION>
                                                          Years Ended September 30,
                                              ---------------------------------------------------------
                                                       2003                            2002
                                              ----------------------        ---------------------------
Reconciliation of federal effective rate                       % of                              %
                                                              Pretax                           Pretax
                                              Amount          Income            Amount         Income
                                              ------          ------            ------         ------
<S>                                       <C>               <C>           <C>                <C>
Provision at statutory rate                 $  328,625        34.00%        $    355,467       34.00%
Effect of tax free income                      (65,357)      (6.76)%             (73,827)      (7.06)%
Dividends received deduction                  (108,127)     (11.19)%             (74,858)      (7.16)%
Other                                           16,111         1.56%               4,214         .40%
                                            ----------        -----         ------------       -----
  Actual tax expense and effective rate     $  171,252        17.61%        $    210,996       20.18%
                                            ==========        =====         ============       =====
</TABLE>

The deferred tax assets and  deferred  tax  liabilities  recorded on the balance
sheet are as follows:

<TABLE>
<CAPTION>
                                  September 30, 2003           September 30, 2002
                               --------------------------    -----------------------
                                 Assets       Liabilities       Assets   Liabilities
                                 ------       -----------       ------   -----------
<S>                          <C>            <C>             <C>         <C>
Provision for loan losses      $ 117,604      $       -       $ 115,903   $        -
Depreciation                           -          1,368           9,846            -
Deferred loan fees                72,232              -          55,988            -
Other                             35,011              -          38,727            -
Deferred loan costs                    -         20,916               -       20,916
SFAS 115                               -        623,686               -      851,378
                               ---------      ---------       ---------   ----------
                               $ 224,847      $ 645,970       $ 220,464   $  872,294
                               =========      =========       =========   ==========
</TABLE>

The Bank is  permitted  a special  bad debt  deduction  for  federal  income tax
purposes which is limited  generally in the current year to an amount calculated
under the  experience  method as defined in Section 585 of the Internal  Revenue
Code. With the passage of the Small Business Jobs Protection Act of 1996, thrift
institutions  are no longer  permitted to use the  percentage of taxable  income
method of computing additions to their bad debt reserves as provided for in Code
Section 593. In addition,  the excess of the  thrift's  bad debt  reserves  over
those permitted, as defined under the provisions of the new act, are required to
be recaptured into income for federal income tax purposes  beginning in calendar
years after 1995 over a six year period.  Excess  reserves are those reserves in
excess of the base year reserves generally defined as the balance of reserves as
of December  31,  1987.  In  accordance  with SFAS 109,  "Accounting  for Income
Taxes", a deferred  liability has not been established for the tax bad debt base
year  reserves of the bank, as described in the  preceding  paragraph.  The Bank
determined  that it had no  excess  reserves  for  which  recapture  income  was
required to be reported in its federal  income tax return for calendar year 1996
and future years.

                                       32
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002

NOTE P - DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS

The following  methods and  assumptions  were used to estimate the fair value of
each class of financial instruments for which it is practicable to estimate that
value.

Cash and cash equivalents:  The carrying amount is a reasonable estimate of fair
value.

Investment  securities:  The fair value of  securities is equal to the available
quoted  market  price.  If no quoted  market price is  available,  fair value is
estimated using the quoted market price for similar securities.

Federal  Home  Loan  Bank  Stock:  The  carrying  value of the  FHLB  stock is a
reasonable estimate of fair value due to restrictions on the securities.

Loans  receivable:  For certain  homogeneous  categories of loans, fair value is
estimated using the quoted market prices for securities  backed by similar loans
adjusted for differences in loan characteristics.  The fair value of other types
of loans is  estimated  by  discounting  the future cash flows using the current
rates at which similar  loans would be made to borrowers for the same  remaining
maturities.

Deposit  liabilities:  The fair value of demand  deposits,  savings accounts and
money market deposits is the amount payable on demand at the reporting date. The
fair  market  of   fixed-maturity   certificates  of  deposit  is  estimated  by
discounting the future cash flows using the rates currently offered for deposits
of similar remaining maturities.

Advances From Borrowers for Taxes and Insurance: The fair value of advances from
borrowers  for  taxes  and  insurance  is the  amount  payable  on demand at the
reporting date.

Federal Home Loan Bank  Advances and ESOP Loan:  The fair value of FHLB advances
was determined  using the FHLB pricing table as of 9/30/02,  while the ESOP loan
was valued  using a discounted  cash flow  analysis  based on current  rates for
advances with similar maturities.

The estimated fair value of the Bank's financial instruments are as follows:

                                                        September 30, 2003
                                                   ---------------------------
                                                     Carrying         Fair
                                                       Amount         Value
                                                   ------------   ------------
Financial assets:
   Cash and cash equivalents                       $  8,837,373   $  8,837,373

   Investments and mortgage backed securities      $ 18,872,019   $ 19,033,434

   Federal Home Loan Bank stock                    $    332,600   $    332,600

   Loans receivable, net                           $ 53,288,111   $ 55,261,000

Financial liabilities:
   Deposits                                        $ 61,839,999   $ 62,333,000

   Advances from borrowers
      for taxes and insurance                      $    334,252   $    334,252

   FHLB advances and ESOP loan                     $  1,040,258   $  1,185,000

                                       33
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE Q - CONCENTRATION OF CREDIT

The Bank primarily grants loans to customers in Southwestern  Pennsylvania,  and
maintains a diversified  loan  portfolio and the ability of its debtors to honor
their  contracts  is not  substantially  dependent  on any  particular  economic
business  sector. A substantial  portion of the Bank's  investments in municipal
securities  are  obligations of state or political  subdivisions  located within
Pennsylvania.  As a whole,  the Bank's loan and investment  portfolios  could be
affected by the general economic conditions of Pennsylvania.  In addition, as of
September  30,  2003 and 2002,  a  significant  portion of the Bank's  "due from
banks" was maintained with large financial  institutions located in Southwestern
Pennsylvania.  The Bank maintains cash balances with financial institutions that
exceed the  $100,000  amount  that is insured by the FDIC.  Amounts in excess of
insured limits, per the institution's records, were approximately $8,494,695 and
$8,327,000  at  September  30, 2003 and 2002,  respectively.  Of those  amounts,
approximately  $560,690 and $1,287,000  were on deposit at the FHLB at September
30, 2003 and 2002, respectively.

NOTE R - CAPITAL REQUIREMENTS

The Bank is subject to various regulatory capital  requirements  administered by
the federal banking agencies.  Failure to meet maximum capital  requirements can
initiate certain mandatory,  and possibly additional  discretionary,  actions by
regulators  that,  if  undertaken,  could have a direct  material  effect on the
Bank's  financial   statements.   Under  capital  adequacy  guidelines  and  the
regulatory  framework for prompt corrective  action, the Bank must meet specific
capital  guidelines  that  involve  quantitative  measures of the Bank's  assets
liabilities and certain  off-balance  sheet items as calculated under regulatory
accounting  practices.  The Bank's capital amounts and  classification  are also
subject to  qualitative  judgments  by the  regulators  about  components,  risk
weightings and other factors.

As of January 6, 2003,  the most recent  notification  from the Office of Thrift
Supervision  (OTS)  categorized  the  Bank  as "  well  capitalized"  under  the
regulatory  framework for prompt  corrective  action. To be categorized as "well
capitalized" the Bank must maintain minimum total risk based,  core and tangible
ratios as set forth in the accompanying table. There are no conditions or events
since the notification  that management  believed has changed the  institution's
category.  The following shows the Bank's  compliance  with  regulatory  capital
standards:

                                       34


<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE R - CAPITAL REQUIREMENTS (CONTINUED)

<TABLE>
<CAPTION>
                                     September 30, 2003             September 30, 2002
                                -----------------------------     --------------------------
                                  Amount          Percent of        Amount       Percent of
                                (dollars in        Adjusted       (dollars in    Adjusted
                                 thousands)      Total Assets      thousands)   Total Assets
                                 ----------      ------------      ----------   ------------
<S>                           <C>                 <C>           <C>            <C>
GAAP capital                     $ 19,071            23.38%        $ 19,141       24.89%
                                 ========            =====         ========       =====

Tangible capital                   17,915            21.96%          17,581       22.86%
Tangible capital requirement        2,447             3.00%           2,301        3.00%
                                 --------            -----         --------       -----
Excess                           $ 15,468            18.96%        $ 15,280       19.86%
                                 ========            =====         ========       =====

Core capital                     $ 17,915            21.96%        $ 17,581       22.86%
Core capital requirement            2,447             3.00%           2,301        3.00%
                                 --------            -----         --------       -----
Excess                           $ 15,468            18.96%        $ 15,280       19.86%
                                 ========            =====         ========       =====

Risk-based capital               $ 19,192            36.34%        $ 19,130       40.56%
Minimum risk-based
  capital requirement               4,225             8.00%           3,773        8.00%
                                 --------            -----         --------       -----
Excess                           $ 14,967            28.34%        $ 15,357       32.56%
                                 ========            =====         ========       =====
</TABLE>


Risk-based capital at September 30, 2003 and 2002 includes supplementary capital
of $489,000,  and $485,000,  respectively,  representing  the general  valuation
portion of the allowance for loan losses. The 36.34% and 40.56%, shown above for
each respective  year,  represents  risk-based  capital as a percentage of total
risk-weighted assets and not adjusted total assets.


NOTE S - RECENT ACCOUNTING PRONOUNCEMENTS

In December  2002,  the FASB issued FASB 148,  an  amendment  of FASB 123.  This
statement permits two additional  transition methods for entities that adopt the
preferable method of accounting for stock-based employee compensation,  which is
based on the fair value.  Both of these  methods  avoid the  complications  that
arise from prospective  application of the fair value based method. In addition,
to avoid a lack of comparability  created by multiple transition  methods,  this
statement does not permit the use of the original FASB statement 123 prospective
method of  transition  for changes to the fair value based method made in fiscal
years beginning after December 15, 2003.  Also,  since this new statement causes
an absence of a single accounting method for stock-based employee  compensation,
required  disclosures of comparable  information for all companies regardless of
whether, when or how an entity adopts the preferable, fair value based method of
accounting is necessary. This statement is effective for all fiscal years ending
after December 15, 2002. This statement has no current impact on the Bank, since
current  disclosures  of  stock-based  compensation  adhere  to  the  provisions
outlined.

                                       35

<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUREKA FINANCIAL CORPORATION AND SUBSIDIARY

Years Ended September 30, 2003 and 2002


NOTE S - RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

In April 2003,  the FASB issued FASB 149,  which amends and clarifies  FASB 133.
This  statement  amends FASB 133 for decisions  made as part of the  Derivatives
Implementation  Group process that effectively  required amendments to statement
133, in connection with other Board projects dealing with financial instruments,
and  in  connection  with  implementation  issues  raised  in  relation  to  the
application  of the definition of a derivative.  In  particular,  this statement
clarifies  under what  circumstances  a contract with an initial net  investment
meets the characteristic of a derivative,  as well as when a derivative contains
a financing component.  The amendment also focuses on changing the definition of
an underlying  derivative to conform it to language used in FASB  Interpretation
45, as well as changes to other  existing  pronouncements.  These  changes  will
result in more consistent reporting of contracts as either derivatives or hybrid
instruments.  This statement is effective for contracts entered into or modified
after June 30, 2003. This statement has no current impact on the Bank.

In May 2003,  the FASB issued FASB 150, which  establishes  standards for how an
issuer   classifies   and   measures   certain   financial    instruments   with
characteristics of both liabilities and equity.  This statement requires that an
issuer  classify a financial  instrument  within its scope as a liability (or an
asset in some circumstances).  The scope of this statement pertains to financial
instruments  which 1) are  issued  in the form of  shares  that are  mandatorily
redeemable, 2) other than an outstanding share, that, at inception,  embodies an
obligation to repurchase the issuer's  equity  shares,  or is indexed to such an
obligation,   and  that  requires  the  issuer  to  settle  the   obligation  by
transferring assets, or 3) embodies an unconditional  obligation, or a financial
instrument  other  than  an  outstanding   share  that  embodies  a  conditional
obligation,  that the issuer must or may settle by issuing a variable  number of
its equity  shares,  if at inception,  the monetary  value of the  obligation is
based solely or predominately on a fixed monetary amount known at inception,  or
variations  in  something  other  than  the  fair  value of  equity  shares,  or
variations inversely related to changes in the fair value of the issuer's equity
shares.  This statement is effective for financial  instruments  entered into or
modified after May 31, 2003. This statement has no current impact on the Bank.

                                       36
<PAGE>

                             EUREKA FINANCIAL CORP.

OFFICE AND BRANCH LOCATION                       STOCK LISTING
3455 Forbes Avenue at McKee Place                OTC Bulletin Board
Pittsburgh, Pennsylvania  15213                  Under the Symbol:"EKFC"
(412) 681-8400


SPECIAL COUNSEL                                  MARKET MAKERS
Malizia Spidi & Fisch, PC                        Trident Securities, Inc.
1100 New York Avenue, N.W.                       4601 Six Forks Road, Suite 400
Suite 340 West                                   Raleigh, North Carolina  27609
Washington, D.C.  20005                          (800) 340 - 6321


INDEPENDENT ACCOUNTANTS                          E.E. Powell & Co., Inc.
Edwards, Sauer & Owens                           1100 Gulf Tower
500 Warner Center                                Pittsburgh, Pennsylvania  15219
332 Fifth Avenue                                 (800) 289-7865
Pittsburgh, Pennsylvania  15222


TRANSFER AGENT                                   GENERAL COUNSEL
Illinois Stock Transfer Company                  Yarsky & Brown, L.L.P.
209 West Jackson Boulevard                       404 Grant Building
Suite 903                                        330 Grant Street
Chicago, Illinois  60606                         Pittsburgh, Pennsylvania  15219


                    BOARD OF DIRECTORS AND EXECUTIVE OFFICERS

              Robert J. Malone, Chairman of the Board of Directors
       Edward F. Seserko, President, Chief Executive Officer and Director
      Gary B. Pepper, Executive Vice President and Chief Financial Officer
                            Mark B. Devlin, Director
                            Paul M. Matvey, Director
                           Dennis P. McManus, Director
                            William F. Ryan, Director

--------------------------------------------------------------------------------

Our  Annual  Report  for the  year  ended  September  30,  2003  filed  with the
Securities  and Exchange  Commission  on Form  10-KSB,  including  exhibits,  is
available  without charge upon written request.  For a copy of the Form10-KSB or
any other investor information, please contact Gary B. Pepper at our office. The
Annual Meeting of  Stockholders  will be held on January 26, 2004, at 10:00 a.m.
at  the  Wyndham  Garden  Hotel,  Forbes  Avenue  at  McKee  Place,  Pittsburgh,
Pennsylvania 15213.


<PAGE>


                                     [LOGO]


                        3455 Forbes Avenue at McKee Place
                            Pittsburgh, Pennsylvania


                              Phone: (412) 681-8400
                               Fax: (412) 681-6625
                         E-Mail: info@eurekabancorp.com
                         Web Site: www.eurekabancorp.com


               Stock Listing on OTC Bulletin Board - Symbol "EKFC"