UNITED STATES                             
              SECURITIES AND EXCHANGE COMMISSION                  
                      450 5TH STREET, N.W.                        
                    WASHINGTON, D. C. 20549                       
          
                        FORM 10-QSB
(Mark One)                                                        
            
 X    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE     
      SECURITIES EXCHANGE ACT OF 1934
                                                                  
        For the quarterly period ended June 30, 1998
                                                                  
                                OR                                
        TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  
           SECURITIES EXCHANGE ACT OF 1934                        
                                                                
For the transition period from ________ to ______                 
                                   Commission File No. 025088

                    PERRY COUNTY FINANCIAL CORPORATION
         (Exact name of registrant as specified in its charter)

             Missouri                             43-1694505      
       
(State or other jurisdiction of              (I.R.S. Employer 
incorporation or organization)               Identification No.)  
                                                               
14 North Jackson Street, Perryville, Missouri          63775-1334 
 (Address of principal executive office)              (Zip Code)
                                                                  
Registrant's telephone number, including area code (573) 547-4581
                                                                  
Not applicable                                                    
                                
(Former name, former address and former fiscal year, if changed
since last report)                                                
                                                                  
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes   X  .  No      .         
                                                                  
Indicate the number of shares outstanding of the issuer's classes
of common stock, as of the latest practicable date.
                                                                  
Class                                Outstanding July 31, 1998
Common Stock, par value                                           
$.01 per share                             827,897                
                                                                  
                                                                  
                                                                  
             PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY
                                                                  
                         FORM 10-QSB                              
                                                                  
               FOR THE QUARTER ENDED JUNE 30, 1998                
                                                                  
                            INDEX                                 
<TABLE>
                                                                  
                                                                  
                                                       PAGE NO.

<S>                                                        <C>
PART I - Financial Information (Unaudited)                        
                                                                  
  Consolidated Balance Sheets                              1      
                                                                  
  Consolidated Statements of Earnings                      2      
                                                                  
  Consolidated Statements of Cash Flows                    3
                                                                 
  Notes to Consolidated Financial Statements               4      
                                                                  
  Management's Discussion and Analysis of                         
    Financial Condition and Results of Operations          5      
                                                                  
                                                                  
PART II - Other Information                                9      
                                   
</TABLE>
                                                                  
                                                                  
                                                                  
                                                                       
<PAGE>                          1                                          
                                                                  
                                                                  
                                                                  
              PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY   
                                                                  
                         Consolidated Balance Sheets              
                               (Unaudited)                        
                                                                  
<TABLE>
                                                                  
                                                                  
                                                                  
                                       June 30,     September 30, 
Assets                                   1998           1997      
<S>                                  <C>              <C>             
Cash and cash equivalents             $ 6,301,795      2,552,167
Securities available for sale,                                    
  at market value (amortized cost                                 
  of $35,407,106 and $35,557,757,                                 
  respectively)                        35,388,676     35,411,629
Federal Home Loan Bank Stock              425,000        601,500  
Mortgage backed securities                                        
  available for sale, at market                                   
  value (amortized cost of                                       
  $30,507,026 and $30,499,492,                                    
  respectively)                        30,770,643     30,631,091  
     Loans receivable, net             15,720,367     13,910,147 
Premises and equipment, net               323,306        287,495  
Accrued interest receivable:                                      
  Securities                              540,182        474,971  
  Mortgage backed securities              172,837        173,771 
  Loans receivable                         69,722         60,255  
  Other assets                             48,147         32,178  
                                                                  
        Total assets                  $89,760,675     84,135,204  
                                                                  
Liabilities and Stockholders' Equity                              
                                                                  
Deposits                              $64,108,823     61,071,074  
Accrued interest on deposits              121,156        122,156
Advances from FHLB of Des Moines        8,500,000      6,500,000
Advances from borrowers for taxes                                 
  and insurance                           150,413        158,236  
Other liabilities                          29,056         25,636 
Income taxes payable                      273,758        209,502
Total liabilities                      73,183,206     68,086,604  
Commitments and contingencies                                     
Stockholders' equity:                                             
 Serial preferred stock, $.01 par                                
 value; 1,000,000 shares authorized;                            
 shares issued and outstanding: none                            
Common stock, $.01 par value;
  5,000,000 shares authorized;
   856,452 share issued 
    and outstanding                         8,565          8,565  
Additional paid in capital              8,156,391      8,110,852  
Common stock acquired by ESOP            (512,738)      (547,216) 
Common stock acquired by MRP             (198,702)      (257,269) 
Unrealized gain (loss) on securities                              
  and mortgage backed securities                                  
  available for sale, net                 154,468         (9,153) 
Treasury stock, at cost, 28,555 shares   (499,815)      (499,815) 
Retained earnings _  substantially                                
  restricted                            9,469,300      9,242,636  
   Total stockholders' equity          16,577,469     16,048,600  
   Total liabilities and stockholders'                            
     equity                           $89,760,675     84,135,204  
 
</TABLE>
                                                                 
See accompanying notes to consolidated financial statements.      

<PAGE>                           2
                                                                  
                                                                  
              PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY   
                                                                  
                    Consolidated Statements of Earnings
                              (Unaudited)                         
<TABLE>
                                                                  
                                           Three Months Ended     
                                                June 30,          
                                            1998         1997     
<S>                                      <C>         <C>                       
Interest income:                                                  
  Loans receivable                        $304,839     257,184    
  Mortgage-backed securities               497,467     511,707    
  Securities                               592,079     599,231    
  Other interest-earning assets             91,719      19,934    
    Total interest income                1,486,104   1,388,056    
Interest expense:                                                 
  Deposits                                 824,511     747,850    
  Advances from FHLB                       112,016      47,809    
    Total interest expense                 936,527     795,659    
      Net interest income                  549,577     592,397    
Provision for loan losses                        0           0    
    Net interest income after                                     
      provision for loan losses            549,577     592,397    
Noninterest income:                                               
  Gain (loss) on sale of securities                               
    available for sale                                 (12,500)   
  Gain (loss) on sale of mortgage                                 
    backed securities available for                               
    sale                                     3,760       8,415    
  Service charges on NOW accounts            7,188       6,815    
  Other                                       (127)        964    
    Total noninterest income                10,821       3,694   
Noninterest expense:                                              
  Compensation and benefits                144,941     137,218    
  Occupancy expense                          8,204       6,920    
  Equipment and data processing expense     18,454      18,967    
  SAIF deposit insurance premium             9,565      10,098    
  Professional services                     27,366      32,086    
  Other                                     11,715      12,854   
Total noninterest expense                  220,245     218,143    
     Earnings before income taxes          340,153     377,948    
Income taxes                               134,307     147,700   
Net earnings                             $ 205,846     230,248    
                                                                  
Basic earnings per common share          $     .27         .30    
                                                                  
Diluted earnings per common share        $     .26         .30    
                                                                  
Dividends per share                      $     .00         .00    
                                                                  
</TABLE>

See accompanying notes to consolidated financial statements.      

<PAGE>                          2
                                                                  
                                                                  
    PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY             
                                                                  
          Consolidated Statements of Earnings                     
                    (Unaudited)                                   
<TABLE>
                                                                  
                                             Nine Months Ended    
                                                 June 30,        
                                             1998       1997    
<S>                                      <C>          <C>  
Interest income:                                                  
  Loans receivable                       $  902,837     740,722   
  Mortgage backed securities              1,493,154   1,514,837   
  Securities                              1,796,665   1,706,143   
  Other interest earning asset              211,147     148,041 
   Total interest income                  4,403,803   4,109,743  
Interest expense:                                                 
  Deposits                                2,423,252   2,263,399   
  Advances from FHLB                        307,554     122,625   
    Total interest expense                2,730,806   2,386,024   
    Net interest income                   1,672,997   1,723,719   
Provision for loan losses                         0           0   
    Net interest income after                                     
      provision for loan losses           1,672,997   1,723,719   
Noninterest income:
 Gain (loss) on sale of securities
   available for sale                             0     (17,500) 
 Gain (loss) on sale of mortgage-backed
   securities available for sale              3,760     148,070  
 Service charges on NOW accounts             22,371      20,237   
  Other                                       5,197       6,831
   Total noninterest income                  31,328     157,638  
Noninterest expense:                                              
 Compensation and benefits                  446,409     417,024   
 Occupancy expense                           23,088      20,897   
 Equipment and data processing expense       61,508      59,165 
 SAIF deposit insurance premium              28,699      45,508  
 Professional services                       78,793      72,160   
 Other                                       51,804      52,453   
   Total noninterest expense                690,301     667,207   
   Earnings before income taxes           1,014,024   1,214,150  
Income taxes                                400,772     458,859   
   Net earnings                            $613,252     755,291   
                                                                  
Basic earnings per common share                $.79         .99   
            
Diluted earnings per common share              $.78         .98
Dividends per share                            $.50         .40   


</TABLE>

                                                                
See accompanying notes to consolidated financial statements.      

<PAGE>                          3                                       
                                                                  
    PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY             
                                                                  
         Consolidated Statements of Cash Flows                    
                    (Unaudited)                                
<TABLE>
                                                                  
                                              Nine Months Ended   
                                                    June 30,      
                                               1998       1997 
<S>                                    <C>            <C>               
Cash flows from operating activities:                             
  Net earnings                              $613,252     755,291  
  Adjustments to reconcile net earnings
   to net cash provided by (used for)                               
    operating activities:                                         
      Depreciation expense                    10,974      10,925  
      ESOP expense                            80,017      62,645  
      MRP expense                             58,567      58,567  
     Amortization of premiums                                     
       (discounts), net                     (233,527)   (134,343) 
      Loss (gain) on sale of securities                           
        available for sale                         0      17,500  
      Loss (gain) on sale of mortgage
        backed securities
         available for sale                   (3,760)   (148,070) 
    Decrease (increase) in:                                       
      Accrued interest receivable            (73,744)   (102,403) 
      Other assets                           (15,969)    145,860  
    Increase (decrease) in:                                       
      Accrued interest on deposits and                            
        other liabilities                      2,420    (421,115) 
      Income taxes payable                   (31,839)    (86,463) 
        Net cash provided by (used for)                           
          operating activities               406,391     158,394 
Cash flows from investing activities:                             
  Loans originated, net of principal                              
    collections on loans                  (1,810,220) (1,587,538)  
  Mortgage backed securities available                            
    for sale:                                                     
      Purchased                           (4,995,682) (5,259,212)  
      Principal collections                4,092,172   2,961,817   
     Proceeds from sale                      901,069   4,594,985   
       Securities available for sale:                             
       Purchased                         (16,467,155) (8,500,000)  
       Proceeds from maturity or call     16,050,000   6,500,000   
       Proceeds from sale                    800,000   1,982,500   
   Redemption of FHLB stock, net             176,500           0   
   Purchase of premises and equipment,                            
     net                                     (46,785)       (543)  
      Net cash provided by (used for)                             
        investing activities              (1,300,101)    692,009  
Cash flows from financing activities:                             
  Net increase (decrease) in:                                     
    Deposits                               3,037,749  (2,019,253)  
    Advances from borrowers for taxes                             
      and insurance                           (7,823)    (15,363)  
  Proceeds from advance from FHLB                                 
    of Des Moines                          8,500,000   4,500,000   
  Payment of advance from FHLB                                    
    of Des Moines                         (6,500,000) (2,500,000)  
  Exercise of stock options                        0     406,809   
  Purchase of treasury stock                       0    (802,121)  
  Dividends paid to shareholders            (386,588)   (299,667)  
     Net cash provided by (used for)                              
       financing activities                4,643,338    (729,595)  
     Net increase (decrease) in cash                              
       and cash equivalents                3,749,628     120,808 
Cash and cash equivalents at                                      
   beginning of period                     2,552,167   3,236,497  
Cash and cash equivalents at                                      
   end of period                           6,301,795   3,357,305
Supplemental disclosures of cash flow                             
   information:                                                   
     Cash paid during the period for:                             
       Interest on deposits            $   2,424,252   2,280,219   
      Interest on advances from FHLB                              
        of Des Moines                        307,554     122,625   
       Federal and state income taxes  $     432,611     403,740   
                    

</TABLE>
                                              
See accompanying notes to consolidated financial statements.      
                                                                  
<PAGE>                          4                                     
                                                                  
        PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY         
                                                                  
            Notes to Consolidated Financial Statements            
                         (Unaudited)                              
                                                                  
(1)  The information contained in the accompanying consolidated
financial statements is unaudited.  In the opinion of management,
the consolidated financial statements contain all adjustments
(none of which were other than normal recurring entries)
necessary for a fair statement of the results of operations for
the interim periods.  The results of operations for the interim
periods are not necessarily indicative of the results which may
be expected for the entire fiscal year.  These consolidated
financial statements should be read in conjunction with the
consolidated financial statements of the Company for the year
ended September 30, 1997 contained in the 1997 Annual Report to
Stockholders which is filed as an exhibit to the Company's Annual
Report on Form 10 KSB.                                            
                                                                  
(2)  In February 1997, the FASB issued SFAS No. 128, "Earnings
per Share" and SFAS No. 129, "Disclosure of Information about
Capital Structure."  The Statements supersede APB Opinion No. 15,
amend certain other accounting pronouncements, and modify the
presentation of earnings per share.  The Statements are effective
for financial statements for both interim periods and years
ending after December 15, 1997.  Following is a summary of basic
and diluted earnings per common share for the three and nine
months ended June 30, 1998 and the three and nine months ended
June 30, 1997, as restated, under SFAS No. 128:                   
                                                                  
                                              Three Months Ended  
                                                   June 30,       
                                                1998      1997    
<TABLE>
<S>                                         <C>          <C>                   
Net earnings                                $ 205,846    230,248  
                                                                  
Weighted average shares Basic EPS             776,049    761,085  
Stock options  treasury stock method            9,668        956  
Weighted average shares Diluted EPS           785,717    762,041  
                                                                  
Basic earnings per common share             $     .27        .30  
                                                                
Diluted earnings per common share           $     .26        .30  
</TABLE>
                                                                  
                                                                  
                                               Nine Months Ended  
                                                    June 30,      
                                                  1998      1997
<TABLE>
  
<S>                                         <C>          <C>                   
Net earnings                                $  613,252   755,291  
                                                                  
Weighted average shares Basic EPS              774,899   766,377  
Stock options treasury stock method              9,668       956 
Weighted average shares Diluted EPS            784,567   767,333  
                                                                  
Basic earnings per common share             $      .79       .99  
                                                            
Diluted earnings per common share           $      .78       .98  
</TABLE>
                                                                  

<PAGE>                          5

                                                                  
                PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY 
                                                                  
                     Management's Discussion and Analysis of      
                 Financial Condition and Results of Operations    
                                                                  
                                                                  
General                                                           
                                                                  
Perry County Financial Corporation (Company) has no significant
assets other than common stock of Perry County Savings Bank, FSB
(Bank), the loan to the ESOP and net proceeds retained by the
Company following the conversion.  The Company's principal
business is the business of the Bank.  Therefore, the discussion
in the Management's Discussion and Analysis of Financial
Condition and Results of Operations relates to the Bank and its
operations.                                                       
                                                                  
Certain statements in this report which relate to the Company's
plans, objectives or future performance may be deemed to be
forward looking statements within the meaning of the Private
Securities Litigation Act of 1995.  Such statements are based on
management's current expectations.  Actual strategies and results
in future periods may differ materially from those currently
expected because of various risks and uncertainties.  Additional
discussion of factors affecting the Company's business and
prospects is contained in periodic filings with the Securities
and Exchange Commission.                                          
                                                                  
Asset and Liability Management and Market Risk                    
                                                                  
The Bank's net interest income is dependent primarily upon the
difference or spread between the average yield earned on loans,
securities and MBS and the average rate paid on deposits, as well
as the relative amounts of such assets and liabilities.  The
Bank, as other thrift institutions, is subject to interest rate
risk to the degree that its interest bearing liabilities mature
or reprice at different times, or on a different basis, than its
interest earning assets.  The Bank does not purchase derivative
financial instruments or other financial instruments for trading
purposes.  Further, the Bank is not subject to any foreign
currency exchange rate risk, commodity price risk or equity price
risk.                                                             
                                                                  
The Bank's principal financial objective is to achieve long term
profitability while managing its exposure to fluctuating interest
rates.  The Bank has an exposure to interest rate risk, including
short term U.S. prime interest rates.  The Bank has employed
various strategies intended to minimize the adverse effect of
interest rate risk on future operations by providing a better
match between the interest rate sensitivity of its assets and
liabilities.  In particular, the Bank's strategies are intended
to stabilize net interest income for the long term by protecting
its interest rate spread against increases in interest rates. 
Such strategies include the purchase of short and intermediate
term securities and adjustable rate mortgage backed securities. 
Although the Bank has originated adjustable rate mortgage loans
(AMLs) in the past, during the nine months ended June 30, 1998,
the Bank originated primarily 20 year, fixed rate loans. 
Management does not anticipate that either financial objectives,
strategies or instruments used to manage its interest rate risk
exposure will change significantly in the near future.            
                                                                  
The OTS provides a net market value methodology to measure the
interest rate risk exposure of thrift institutions.  This
exposure is a measure of the potential decline in the net
portfolio value (NPV) of the institution based upon the effect of
an assumed 200 basis point increase or decrease in interest
rates.  NPV is the present value of the expected net cash flows
from the institution's financial instruments (assets, liabilities
and off balance sheet contracts).  Loans, deposits, and
investments are valued taking into consideration similar
maturities, related discount rates and applicable prepayment
assumptions.  Under OTS regulations, an institution's normal
level of interest rate risk in the event of this assumed change
in interest rates is a decrease in the institution's NPV in an
amount not exceeding 2% of the present value of its assets.  This
procedure for measuring interest rate risk was developed by the
OTS to replace the gap analysis (the difference between interest
earning assets and interest bearing liabilities that mature or
reprice within a specific time period).                           

<PAGE>                          6

           PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY

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


                                                                  
Year 2000                                                         
                                                                  
The Bank is reviewing computer applications with its outside data
processing service bureau and other software vendors to ensure
operational and financial systems are not adversely affected by
"year 2000" software failures.  All major customer applications
are processed through the outside service bureau.  The service
bureau has indicated that it expects to modify existing programs
to make them year 2000 compliant.  Management of the Bank is
unable to estimate any additional expense related to this issue. 
Any year 2000 compliance failures could result in additional
expense to the Bank.                                              
                                                                  
Liquidity and Capital Resources                                   
                                                                  
The Bank's principal sources of funds are cash receipts from
deposits, security maturities, principal collections on mortgage
backed securities (MBSs), loan repayments by borrowers and net
earnings.  The Bank has an agreement with the Federal Home Loan
Bank of Des Moines to provide cash advances, should the Bank need
additional funds.                                                 
                                                                  
During November, 1997, the Office of Thrift Supervision (OTS)
lowered the liquidity requirement for savings institutions from
5% to 4% of the liquidity base.  The Bank's liquidity ratio
exceeded the regulatory requirement at June 30, 1998.             
                                                                  
The Bank is required to maintain certain minimum capital
requirements under OTS regulations.  Failure by a savings
institution to meet minimum capital requirements can result in
certain mandatory and possible discretionary actions by
regulators which, if undertaken, could have a direct material
effect on the Bank's financial statements.  Under the capital
adequacy guidelines and 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 capital amounts and
classifications are also subject to judgments by the regulators
about components, risk-weightings and other factors.              
                                                                  
The Bank's regulatory capital and minimum capital requirements at
June 30, 1998 are summarized as follows:                          
                                                                  
                                                Minimum Required  
                                                   for Capital    
                                       Actual       Adequacy      
                                    Amount  Ratio  Amount  Ratio  
                                     (Dollars in Thousands)       
<TABLE>

<S>                                 <C>      <C>    <C>     <C>               
Consolidated stockholders' equity   $16,577                       
Stockholders' equity of Company      (3,207)                      
Unrealized gain on securities          (154)                      
Tangible capital                     13,216   5.2%  $1,307  1.5%  
General valuation allowance              25                       
Total capital to risk weighted                                    
  assets                            $13,241  65.5%  $1,617  8.0% 
                                                                  
Tier 1 capital to risk weighted                                   
  assets                            $13,216  65.4%  $  808  4.0%  
                                                                  
Tier 1 capital to total assets      $13,216  15.2%  $2,613  3.0%  
                                                                  
</TABLE>
                                                                  
                                             Minimum Required     
                                                to be "Well       
                                               Capitalized"       
                                              Amount  Ratio       
                                         (Dollars in Thousands)   
<TABLE>
                                                                  
                                            Amount     Ratio      
<S>                                        <C>          <C>              
Total capital to risk weighted assets      $ 2,021      10.0%     
                                                                  
Tier 1 capital to risk weighted                                   
  assets                                   $ 1,213       6.0%     
                                                                  
Tier 1 capital to total assets             $ 4,356       5.0%     

</TABLE>
                                                              
Commitments to originate mortgage loans and fund loans in process
at June 30, 1998 amounted to $739,000, expiring in 180 days or
less.  Commitments to purchase securities amounted to $1,000,000
at June 30, 1998.                                                 

<PAGE>                          7

       PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY

            Management's Discussion and Analysis of
          Financial Condition and Results of Operations                
                                                                  
                   Financial Condition                            
                                                                  
                   Assets increased from $84.1 million at
September 30, 1997 to  $89.8 million at June 30, 1998.  Proceeds
from net savings deposits and advances from the Federal Home Loan
Bank (FHLB) were used to fund loans and increase cash and cash
equivalents.   Loans increased from $13.9 million at September
30, 1997 to $15.7 million at June 30, 1998.  The Bank is
originating primarily 20 year fixed rate loans at the present
time.  Accrued interest on securities increased due to the timing
of interest payments dates.                                       
                                                                  
Asset Quality                                                     
                                                                  
Loans are placed on a nonaccrual status when contractually
delinquent more than ninety days.  There were no nonaccrual loans
at September 30, 1997 or June 30, 1998.                           
                                                                  
Following is a summary of the allowance for loan losses:          
                                                                  
Balance, September 30, 1997                $ 25,000               
Charge offs                                       0               
Recoveries                                        0               
Provision for loan losses                         0               
Balance, June 30, 1998                      $25,000               
                                                                  
                           Results of Operation                   
Net Earnings                                                      
                                                                  
Net earnings decreased from $230,000 for the three months ended
June 30, 1997 to $206,000 for the three months ended June 30,
1998.  Net earnings decreased from $755,000 for the nine months
ended June 30, 1997 to $613,000 for the nine months ended June
30, 1998.  Net earnings for the three months ended June 30, 1998
decreased from the comparable period in 1997 due to lower net
interest income.  Net earnings for the nine months ended June 30,
1998 decreased from the comparable period in 1997 as a result of
net gain on sale of securities and MBSs of $131,000, which was
recognized in 1997, lower net interest income and higher
noninterest expense in 1998.                                      
                                                                  
Net Interest Income                                               
                                                                  
Net interest income decreased from $592,000 for the three months
ended June 30, 1997 to $550,000 for the three months ended June
30, 1998.  Net interest income decreased from $1,724,000 for the
nine months ended June 30, 1997 to $1,673,000 for the nine months
ended June 30, 1998.  Interest income increased as a result of a
higher level of loans and other interest-earning assets.  Loans
receivable, net have increased substantially in recent years. 
Components of interest income vary from time to time based on the
availability and interest rates of loans, securities, mortgage
backed securities (MBSs), and other interest bearing assets. 
Interest expense increased as a result of a higher average
balance of FHLB advances outstanding and a higher weighted
average rate on deposits.                                         
                                                                  
Provision for Loan Losses                                         
                                                                  
Provision for loan losses is based upon management's
consideration of economic conditions which may affect the ability
of borrowers to repay loans.  Management also reviews individual
loans for which full collectibility may not be reasonably assured
and considers, among other matters, the risks inherent in the
Bank's portfolio and the estimated fair value of the underlying
collateral.  This evaluation is ongoing and results in variations
in the Bank's provision for loan losses.  As a result of this
evaluation, the Bank

<PAGE>                          8 

 made no provision for loan losses for the
three and nine months ended June 30, 1997 and 1998.               
                                                                  
Noninterest Income                                                
                                                                  
During the nine months ended June 30, 1997, securities available
for sale with a carrying value of $2.0 million were sold at a
loss of $17,500 and MBSs with a carrying value of $4.6 million
were sold at a  gain of $148,000.  The sales were primarily small
balance pools and one collateralized mortgage obligation of
$500,000.  During the nine months ended June 30, 1998, securities
with a carrying value of $800,000 were sold at no gain nor loss
and MBSs with a carrying value of $897,000 were sold at a net
gain of $4,000.                                                   
                                                                  
Noninterest Expense                                               
                                                                  
Noninterest expense increased from $218,000 for the three months
ended June 30, 1997 to $220,000 for the three months ended June
30, 1998.  Noninterest expense increased from $667,000 for the
nine months ended June 30, 1997 to $690,000 for the nine months
ended June 30, 1998.  The increase for the nine months was
primarily a result of higher compensation and benefits offset by
lower SAIF deposit insurance premium.  Compensation and benefits
increased largely due to higher ESOP expense, which increased
from $64,000 for the nine months ended June 30, 1997 to $82,000
for the nine months ended June 30, 1998.  Under generally
accepted accounting principles, expense of the ESOP is affected
by changes in the market price of the Bank's stock.  SAIF deposit
insurance premium for the nine months ended June 30, 1998
decreased from the comparable period in 1997 as a result of a
lower assessment rate.                                            
                                                                  
Income Taxes                                                      
                                                                  
Income taxes decreased due to lower earnings before income taxes. 
                                                                  
<PAGE>                          9                       
                                                                  
             PERRY COUNTY FINANCIAL CORPORATION AND SUBSIDIARY    
                                                                  
                      PART II - Other Information                 
                                                                  
                                                                  
Item 1   Legal Proceeding                                         
                                                                  
         There are no material legal proceedings to which the     
         Holding Company or the Bank is a party or of which any   
         of their property is subject.  From time to time, the    
         Bank is a party to various legal proceedings incident to 
        its business.                                             
                                                                 
Item 2   Changes in Securities                                    
                                                                  
         None.                                                    
                                                                  
Item 3   Defaults upon Senior Securities                          
                                                                  
         Not applicable.                                          
                                                                  
Item 4   Submission of Matters to a Vote of Security Holders      
                                                                  
         None                                                     
                                                                  
Item 5   Other Information                                        
                                                                  
         None.                                                    
                                                                  
Item 6   Exhibits and Reports on Form 8-K.                        
                                                                  
         (a) Exhibits: none                                       
                                                                  
         (b) Reports on Form 8-K: None                            
                                                                  
                                  SIGNATURES                      
                                                                  
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.          
                                                                  
                              PERRY COUNTY FINANCIAL CORPORATION  
                                       (Registrant)               
                                                                 
DATE: August 3, 1998            BY: Leo J. Rozier                 
                                    Leo J. Rozier, President,     
                                Chief Executive Officer and       
                              Duly Authorized Officer