SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



---

FORM 10-QSB

|[X]  | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|---- | ---------------------------------------------------------------------------------
|     | For the quarterly period ended September 30,  2002                               
|[  ] | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT                  
|     | For the transition period from ______ to ________                                

Commission file number 0-25070.

**LSB FINANCIAL CORP.**

(Exact Name of Small Business Issuer as Specified in its Charter)

|Indiana(State or other jurisdiction ofIncorporation or organization)        |  | 35-1934975(I.R.S. EmployerIdentification No.)
|--------------------------------------------------------------------------- |  | ---------------------------------------------
|101 Main Street, Lafayette, Indiana(Address or principal executive offices) |  | 47902(Zip Code)                              

Issuer's telephone number, including area code: (765) 742-1064

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:

|CLASS                                  |  | OUTSTANDING AT NOVEMBER 7, 2002
|-------------------------------------- |  | -------------------------------
|Common stock, par value $.01 per share |  | 1,379,167                      

Transitional Small Business Disclosure Format:	YES [  ]  NO [X]

LSB FINANCIAL CORP.

INDEX

|PART I.                                                    | FINANCIAL INFORMATION                               | 1    
|---------------------------------------------------------- | --------------------------------------------------- | -----
|Item 1.                                                    | Financial Statements (Unaudited)                    | 1    
|Consolidated Statements of Financial Condition             | 1                                                  
|Consolidated Statements of Income and Comprehensive Income | 2                                                  
|Consolidated Statements of Changes in Shareholders' Equity | 3                                                  
|Consolidated Statements of Cash Flows                      | 4                                                  
|Notes to Consolidated Financial Statements                 | 5-6                                                
|Item 2.                                                    | Management's Discussion of Recent Operating Results | 7-13 
|Item 3.                                                    | Controls and procedures                             | 14   
|PART II.                                                   | OTHER INFORMATION                                   | 15   
|                                                           | SIGNATURES                                          | 16   
|                                                           | CERTIFICATION PAGES                                 | 17-20
|                                                           | EXHIBIT INDEX                                       | 21   

|**PART I.  FINANCIAL INFORMATION**                
|--------------------------------------------------
|                                                  
|**Item I.  FINANCIAL STATEMENTS**                 
|                                                  
|LSB FINANCIAL CORP.                               
|CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION    
|(Dollars in thousands)                            
|                                                  
|                                                  
|                                                  
|Assets:                                           
|Cash and due from banks                           
|Short-term investments                            
|Available-for-sale securities                     
|Loans held for sale                               
|Portfolio loans                                   
|Less: Allowance for loan losses                   
|Net portfolio loans                               
|                                                  
|Premises and equipment, net                       
|FHLB stock, at cost                               
|Accrued interest receivable and other assets      
|Total assets                                      
|                                                  
|Liabilities and Shareholders' Equity:             
|                                                  
|Liabilities:                                      
|Deposits                                          
|Advances from FHLB                                
|Accrued interest payable and other liabilities    
|Total liabilities                                 
|                                                  
|                                                  
|Shareholders' Equity                              
|Common stock                                      
|Additional paid-in-capital                        
|Retained earnings                                 
|Unearned ESOP shares                              
|Unamortized cost of recognition and retention plan
|Accumulated other comprehensive income            
|Total shareholders' equity                        
|Total liabilities and shareholders' equity        
|                                                  
|Book value per share                              

|LSB FINANCIAL CORP.CONSOLIDATED STATEMENTS OF INCOME(Dollars in thousands, except per share data)(Unaudited)
|------------------------------------------------------------------------------------------------------------
|                                                                                                            
|                                                                                                            
|                                                                                                            
|                                                                                                            
|                                                                                                            
|Interest Income                                                                                             
|Loans, including related fees                                                                               
|Available-for-sale securities                                                                               
|FHLB stock                                                                                                  
|Total interest income                                                                                       
|                                                                                                            
|Interest Expense                                                                                            
|Deposits                                                                                                    
|Borrowings                                                                                                  
|Total interest expense                                                                                      
|                                                                                                            
|Net interest income                                                                                         
|Provision for loan losses                                                                                   
|Net interest income after provision for loan losses                                                         
|                                                                                                            
|Non-interest Income                                                                                         
|Service charges and fees                                                                                    
|Net gain on mortgage loans originated for sale                                                              
|Gain on sale of securities                                                                                  
|Other                                                                                                       
|Total non-interest income                                                                                   
|                                                                                                            
|Non-interest Expense                                                                                        
|Salaries and benefits                                                                                       
|Occupancy and equipment, net                                                                                
|Computer service                                                                                            
|Advertising                                                                                                 
|Other                                                                                                       
|Total non-interest expense                                                                                  
|                                                                                                            
|Income before income taxes                                                                                  
|Less: income taxes                                                                                          
|Net income                                                                                                  
|                                                                                                            
|Total Comprehensive Income                                                                                  
|                                                                                                            
|Earnings per share (Note 3)                                                                                 
|Diluted Earnings per Share                                                                                  

|LSB FINANCIAL CORP.CONSOLIDATED STATEMENTS OF CHANGESIN SHAREHOLDERS' EQUITY(Dollars in thousands)(Unaudited)
|-------------------------------------------------------------------------------------------------------------
|                                                                                                             
|                                                                                                             
|Balance at January 1, 2001                                                                                   
|Exercise of stock options                                                                                    
|ESOP shares earned                                                                                           
|Grant of RRP shares                                                                                          
|Forfeiture of RRP shares                                                                                     
|RRP expense                                                                                                  
|Treasury stock acquired and retired                                                                          
|Dividends paid                                                                                               
|Comprehensive income                                                                                         
|Net income                                                                                                   
|Change in unrealized gain/(loss)                                                                             
|Total comprehensive income                                                                                   
|                                                                                                             
|Balance at September 30, 2001                                                                                
|                                                                                                             
|Balance at January 1, 2002                                                                                   
|Exercise of stock options                                                                                    
|ESOP shares earned                                                                                           
|RRP expense                                                                                                  
|Treasury stock acquired and retired                                                                          
|Dividends paid                                                                                               
|Comprehensive income                                                                                         
|Net income                                                                                                   
|Change in unrealized gain/(loss)                                                                             
|Total comprehensive income                                                                                   
|                                                                                                             
|Balance at September 30, 2002                                                                                

|LSB FINANCIAL CORP.CONSOLIDATED STATEMENTS OF CASH FLOWS(Dollars in thousands)(Unaudited)
|-----------------------------------------------------------------------------------------
|                                                                                         
|                                                                                         
|                                                                                         
|Cash Flows from Operating Activities                                                     
|Net Income                                                                               
|Adjustments to reconcile net income to net                                               
|cash from operating activities                                                           
|Depreciation and amortization                                                            
|Net amortization/(accretion) on securities                                               
|Gain on sale of securities                                                               
|Gain on sale of loans                                                                    
|Loans originated for sale, net of sales proceeds                                         
|Provision for loan losses                                                                
|Employee stock ownership plan shares earned                                              
|Change in assets and liabilities                                                         
|Accrued interest receivable and other assets                                             
|Accrued interest payable and other liabilities                                           
|Net cash provided by operating activities                                                
|                                                                                         
|Cash Flows from Investing Activities                                                     
|Purchases of available-for-sale securities                                               
|Proceeds from paydowns and maturities of   available-for-sale securities                 
|Sales of available-for-sale securities                                                   
|Purchase of Federal Home Loan Bank stock                                                 
|Loans made to customers net of payments
received                                         
|Property and equipment expenditures                                                      
|Net cash (used in) provided by investing activities                                      
|                                                                                         
|Cash Flows from Financing Activities                                                     
|Net change in deposits                                                                   
|Proceeds from Federal Home Loan Bank advances                                            
|Payments on Federal Home Loan Bank advances                                              
|Treasury Stock Purchased                                                                 
|Dividends paid                                                                           
|Stock options exercised                                                                  
|Net cash provided by financing activities                                                
|                                                                                         
|Net change in cash and equivalents                                                       
|Cash and equivalents at January 1                                                        
|                                                                                         
|Cash and equivalents at September 30                                                     



Note 1 - General

The financial statements were prepared in accordance with the instructions for Form 10-QSB and, therefore, do not include all of the disclosures necessary for a complete
presentation of financial position, results of operations and cash flows in conformity with
accounting principles, generally accepted in the United States of America.  These interim
financial statements have been prepared on a basis consistent with the annual financial
statements and include, in the opinion of management, all adjustments, consisting of only
normal recurring adjustments, necessary for a fair presentation of the results of operations
and financial position for and at the end of such interim periods.

Note 2 - Principles of Consolidation

The accompanying financial statements include the accounts of LSB Financial Corp., its
wholly owned subsidiary Lafayette Savings Bank, FSB, and Lafayette Savings' wholly
owned subsidiaries, LSB Service Corporation and Lafayette Insurance and Investments,
Inc.  All significant intercompany transactions have been eliminated upon consolidation.

Note 3 - Earnings per share

Earnings per share are based upon the weighted average number of shares outstanding
during the period.  Diluted earnings per share further assume the issuance of any
potentially dilutive shares.   Unearned ESOP shares are not considered to be outstanding
for the earnings per share computation.  The following table presents information about the
number of shares used to compute earnings per share and the results of the computations:

|                                                                      | **Quarter endedSeptember 30,** | **Year-to-Date EndedSeptember 30,**
|--------------------------------------------------------------------- | ------------------------------ | -----------------------------------
|                                                                      | **2002**                       | **2001**                           
|Weighted average shares
outstanding  (excluding unearned ESOP
shares) | 1,339,331                      | 1,336,842                          
|Shares used to compute diluted  earnings per share                    | 1,384,120                      | 1,366,448                          
|Earnings per share                                                    | $0.48                          | $0.42                              
|Diluted earnings per share                                            | $0.47                          | $0.41                              

Note 4 - New and proposed accounting standards:

A new accounting standard dealing with asset retirement obligations will apply for 2003.  The company does
not believe this standard will have a material effect on its financial position or results of operations.

Effective January 1, 2002, the Company adopted a new standard issued by the FASB on impairment and
disposal of long-lived assets.  The effect of this standard on the financial position and results of operations
of the Company was not material.

New accounting standards require all business combinations to be recorded using the purchase method of
accounting for any transaction initiated after September 30, 2001.  Under the purchase method, all
identifiable tangible and intangible assets and liabilities of the acquired company must be recorded at fair
value at date of acquisition, and the excess of cost over fair value of net assets acquired is recorded as
goodwill.  Identifiable intangible asserts with finite useful lives will be amortized under the new standard,
whereas goodwill, both amounts previously recorded and future amounts purchased, will cease being
amortized starting in 2002.  Unidentifiable intangible assets from financial institution branch business
combinations is reclassified to goodwill as of January 1, 2002.   Annual impairment testing will be required
for goodwill with impairment being recorded if the carrying amount of goodwill exceeds its implied fair
value.  Adoption of these standards had no effect on the Company's financial statements.

**Item 2.	      MANAGEMENT'S DISCUSSION OF RECENT OPERATING RESULTS**

All references in this quarterly report to "we," "us," "our," and the "Company" refer to LSB
Financial Corp. and/or Lafayette Savings Bank, FSB, as the context requires.

**Financial Condition**

***Comparison of Financial Condition at September 30, 2002 and December 31, 2001.***

Our total assets increased $32.4 million during the nine months from December 31, 2001 to
September 30, 2002.  This increase was primarily due to a $29.3 million increase in total net loans.
Management attributes the increases primarily to the large volume of refinancing resulting from the
continuing low interest rate environment.  Available for sale securities and short term investments
increased $2.5 million as excess funding was invested in interest earning securities until it was able
to be invested in higher yielding loan products.  The increase in assets was funded by a $16.0 million
increase in deposits and a $14.0 million increase in Federal Home Loan Bank advances.
Management attributes the growth of deposits to its ongoing marketing efforts and to the appeal of
the safety of bank deposits to investors with funds in more volatile non-deposit investment products,
and to the use of brokered deposit products and public funds which are used to provide funding when
the cost of gathering deposits from our market area becomes unacceptably high.   Shareholders'
equity increased from $23.4 million at December 31, 2001 to $25.3 million at September 30, 2002,
an increase of $1.9 million due primarily to net income, offset in part by the payment of a cash
dividend.

Non-performing loans increased from $2.7 million at December 31, 2001 to $2.9 million at
September 30, 2002.  The non-performing loans at September 30, 2002 were comprised of non-accruing loans of $2.0 million of loans on  residential real estate, $431,000 in loans on land or
commercial property, $116,000 in commercial business loans, and $93,000 in consumer loans and
$220,000 in foreclosed assets.  At September 30, 2002, our allowance for loan losses equaled 0.62%
of total loans compared to 0.59% at December 31, 2001, and 59.8% of non-performing assets at
September 30, 2002 compared to 52.3% at December 31, 2001.   Although we believe we use the
best information available to determine the adequacy of our allowance for loan losses, future
adjustments to the allowance may be necessary, and net income could be significantly affected, if
circumstances and/or economic conditions cause substantial changes in the estimates we use in
making the determinations about the levels of the allowance for losses.  Additionally, various
regulatory agencies, as an integral part of their examination process, periodically review our
allowance for loan losses.  These agencies may require the recognition of additions to the allowance
based upon their judgements of information available at the time of their examination.

**Results of Operations**

***Comparison of Operating Results for the Nine Months and the Quarter Ended September 30,
2002 and September 30, 2001.***

***General.***   Net income for the nine months ended September 30, 2002 was $2.1 million,
an increase of $447,000 or 27.47%, over the nine months ended September 30, 2001.  This increase
was primarily due to a $1.1 million increase in net interest income driven by better margins and a
$169,000 increase in the gain on sale of loans due to the increased originations and refinancings of
fixed rate mortgage loans and the sale of such loans on the secondary market.  This increase was
partially offset by a $294,000 increase in noninterest expenses due largely to salaries and benefits
associated with the staffing of the bank's new branch office which opened in May, 2001, a $267,000
increase in the provision for loan losses based on an analysis of risk factors in the loan portfolio, and
a $299,000 increase in taxes on income.

***Net Interest Income.***   Net interest income for the nine months ended September 30, 2002
increased  $1.1 million, or 18.14%, over the same period in 2001.  Net interest income for the third
quarter of 2002 increased $576,000, or 28.00%, compared to the same period in 2001.  These
increases were primarily due to lower interest rates paid on interest bearing liabilities. While average
interest-earning assets increased from $276.1 million for the first nine months of 2001 to $285.1
million for the first nine months of 2002, our net interest margin (net interest income divided by
average interest-earning assets) increased from 3.05% for the nine months ended September 30, 2001
to 3.49% for the nine months ended September 30, 2002.  Similarly while average interest-earning
assets increased from $275.9 million for the third quarter of 2001 to $295.0 million for the third
quarter of 2002, our net interest margin increased from 2.98% to 3.57% over the same period.  The
increase in net interest margin is primarily the result of the rapid decline in short term market interest
rates in the second half of 2001 which decreased the average rate paid on deposits from 5.05% for
the nine months ended September 30, 2001 to 3.69% for the nine months ended September 30, 2002.

Interest income on loans decreased $1.1 million or 7.17% for the nine months ended
September 30, 2002 compared to the same nine months in 2001.  This decrease was the result of a
decrease in the average yield on loans from 8.29% for the first nine months of 2001 to 7.44% for the
first nine months of 2002, due to lower interest rates in the economy, partially offset by an $8.5
million increase in average loans outstanding.  The increase in the loan portfolio was due largely to
borrowers continuing to take advantage of relatively low market interest rates to refinance existing
mortgages.  While we typically sell the majority of our fixed rate  one-to-four family mortgage loans
in the secondary market, the low interest rates spurred activity in all lending segments.  Interest
income on loans decreased $161,000 for the third quarter of 2002 compared to the third quarter of
2001 due primarily to the reasons noted above.  Going forward, in order to ensure continued loan
portfolio growth, we intend to begin limiting sales of fixed rate loans as the demand for mortgage
loan refinancing declines.  Our interest rate risk sensitivity is currently well below board limits and
peer levels, but we intend to monitor this risk carefully.

Interest earned on other investments and Federal Home Loan Bank stock decreased by
$239,000 for the nine months ended September 30, 2002 compared to the same period in 2001.  This
was the result of a decrease in the average yield on the average balance of other investments and

Federal Home Loan Bank stock from 4.28% for the first nine months of 2001 to 3.07% over the
same period in 2002, offset by an increase in average balances of $543,000.  The yield decrease was
generally due to the temporary increase in lower yielding short-term investments as the increase in
deposits and the funds received from the sale of fixed rate loans is held in short term investments
until they can be reinvested in longer term loans or investments.  Interest income on other
investments and Federal Home Loan Bank stock decreased $76,000 for the third quarter of 2002
compared to the third quarter of 2001 due to a decrease in the average yield on the average balance
of other investments and Federal Home Loan Bank stock from 3.89% for the third quarter of 2001
to 3.02% over the same period in 2002, and by a decrease in average balances of $1.7 million

Interest expense for the nine months ended September 30, 2002 decreased $2.5 million, or
24.92%, over the same period in 2001.  This decrease was due to a decrease in the average rate paid
on interest bearing liabilities from 5.05% for the first nine months of 2001 to 3.69% for the first nine
months of 2002 and to a $7.3 million increase in average interest-bearing liabilities consisting of a
$9.0 million increase in lower rate deposits compared to a $1.7 million decrease in the average
balance in higher rate, longer term Federal Home Loan Bank advances.   Interest expense decreased
$813,000 for the third quarter of 2002 over the same period in 2001 primarily due to a decrease in
the average rate paid on average interest-bearing liabilities from 4.96% for the three month period
in 2001 to 3.51% for the same period in 2002, offset by a $16.0 million increase in average interest-bearing liabilities for same period.

***Provision for Loan Losses.***  We establish our provision for loan losses based on a
systematic analysis of risk factors in the loan portfolio.  The analysis includes consideration of
concentrations of credit, past loss experience, current economic conditions, the amount and
composition of the loan portfolio, estimated fair value of the underlying collateral, loan
commitments outstanding, delinquencies and industry standards.  From time to time, we also use the
services of a consultant to assist in the evaluation of our growing commercial loan portfolio.  On at
least a quarterly basis, a formal analysis of the adequacy of the allowance is prepared and reviewed
by management and the Board of Directors.  This analysis serves as a point in time assessment of
the level of the allowance and serves as a basis for provisions for loan losses.

More specifically, our analysis of the loan portfolio will begin at the time the loan is
originated, when each loan is assigned a risk rating.  If the loan is a commercial credit, the borrower
will also be assigned a similar rating.  Loans that continue to perform as agreed will be included in
one of ten non-classified loan categories.   Portions of the allowance are allocated to loan portfolios
in the various risk grades, based upon a variety of factors including, historical loss experience, trends
in the type and volume of the loan portfolios, trends in delinquent and non-performing loans, and
economic trends affecting our market.  Loans no longer performing as agreed are assigned a lower
risk rating, eventually resulting in their being regarded as classified loans.  A collateral re-evaluation
is completed on all classified loans.  This process results in the allocation of specific amounts of the
allowance to individual problem loans, generally based on an analysis of the collateral securing those
loans.  These components are added together and compared to the balance of our allowance at the
evaluation date.

Non-classified loan categories include first mortgage loans on the following types of
properties: one-to-four family owner occupied, one-to-four family non-owner occupied, multi family,
non-residential, land and land development, and construction.  Additional categories include: second
mortgage and home equity loans, unsecured commercial business loans, secured commercial
business loans, and consumer loans.

The provision for loan losses for the nine months ended September 30, 2002 was $375,000
compared to $108,000 for the same period in 2001.  The increase in the provision in 2002 was based
on our analysis of our loan portfolios and was primarily due to the higher level of loans categorized
as special mention at September 30, 2002 compared to September  30, 2001 which, while still
performing as agreed, exhibit weaknesses related to the continuing slow economy, as well as to the
overall growth of our loan portfolios, particularly our commercial real estate loan portfolio.
Nonperforming loans decreased from $3.2 million on September 30, 2001 to $2.9 million on
September 30, 2002.

***Non-Interest Income***.  Non-interest income for the nine months ended September 30, 2002
increased by $160,000, or 12.04%, compared to the same period in 2001.  This was primarily due
to a $169,000 increase in the gain on the sale of mortgage loans in the secondary market resulting
from the increased sales.  Non-interest income for the third quarter of 2002 decreased by $90,000
over the same period in 2001, due primarily to a $69,000 decrease  in the gain on the sale of
mortgage loans in the secondary market resulting from decreased sales.

***Non-Interest Expense.***  Non-interest expense for the nine months ended September 30,
2002 increased $294,000 over the same period in 2001, due primarily to a $281,000 increase in
salaries and benefits and a $169,000 increase in occupancy expenses, relating to the opening of our
fifth office in May 2001.  These increases were offset in part by a $203,000 decrease in other
expenses resulting from management's success in instituting cost savings initiatives in an effort to
improve the bank's efficiency ratio, including bringing additional internal audit functions in-house,
increased collection efforts, settlement of stale-dated checks and duplicate checks, and centralized
purchasing and tracking of office supplies, among others.  Non-interest expense for the third quarter
of 2002 increased by $111,000 over the same period in 2001, due largely to the matters mentioned
above.

***Income Tax Expense.***  Our income tax provision increased by $299,000 for the nine months
ended September 30, 2002 compared to the nine months ended September 30, 2001 and by $99,000
for the third quarter of 2002 compared to the same period in 2001 primarily due to the increase in
income before income taxes, somewhat offset by the effect of apportionment on state tax.

***Liquidity.***  Liquidity management is both a daily and long-term function for our senior
management. We adjust our investment strategy, within the limits established by the investment
policy, based upon assessments of expected loan demand, expected cash flows, Federal Home Loan
Bank advance opportunities, market yields and objectives of our asset/liability management program.
Base levels of liquidity have generally been invested in interest-earning overnight and time deposits

with the Federal Home Loan Bank of Indianapolis.  Funds for which a demand is not foreseen in the
near future are invested in investment and other securities for the purpose of yield enhancement and
asset/liability management.

Our current internal policy for liquidity, defined as cash and salable investment securities
with terms up to five years divided by deposits and  Federal Home Loan Bank advances with a
remaining maturity of one year or less, is for minimum liquidity of 6.0% of total assets.  Our
liquidity ratios at December 31, 2001 and September 30, 2002 were 10.33% and 10.27%,
respectively compared to a regulatory liquidity base, and 6.71% and 7.39% compared to total assets.

We anticipate that we will have sufficient funds available to meet current funding
commitments.  At September 30, 2002, we had outstanding commitments to originate loans and
available lines of credit totaling $55.4 million and commitments to provide funds to complete current
construction projects in the amount of $5.1 million.  Certificates of deposit which will mature in one
year or less at September 30, 2002 totaled $90.2 million.  Based on our experience, our certificates
of deposit have been a relatively stable source of long-term funds as such certificates are generally
renewed upon maturity since we have established long-term banking relationships with our
customers.  Therefore, we believe a significant portion of such deposits will remain with us, although
this cannot be assured.  We also have $22.2  million of Federal Home Loan Bank advances maturing
in the next twelve months.

***Capital Resources.***  Shareholders' equity totaled $25.3 million at September 30, 2002
compared to $23.4 million at December 31, 2001, an increase of $1.9 million or 7.98%, due to net
income of $2.1 million, offset by $445,000 of cash dividends paid to shareholders.

Federal insured savings institutions are required to maintain a minimum level of regulatory
capital.  If the requirement is not met, regulatory authorities may take legal or administrative actions,
including restrictions on growth or operations or, in extreme cases, seizure.  As of December 31,
2001 and September 30, 2002, Lafayette Savings Bank was categorized as well capitalized.  Our
actual and required capital amounts and ratios at December 31, 2001 and September 30, 2002 are
presented below:

|                                                 | Actual                 | OTSFor CapitalAdequacyPurposes | FDICTo Be WellCapitalized UnderCorrective ActionProvisions
|------------------------------------------------ | ---------------------- | ------------------------------ | ----------------------------------------------------------
|                                                 | Amount                 | Ratio                          | Amount                                                    
|                                                 | (Dollars in thousands)
|**As of December 31, 2001**                     
|Total Capital (to risk-weighted assets)          | $22,789                | 11.71%                         | $16,249                                                   
|Tier 1 (Core) Capital (to risk weighted assets)  | 22,357                 | 11.01%                         | 8,125                                                     
|Tier 1 (Core) Capital (to adjusted total assets) | 22,357                 | 7.95%                          | 8,436                                                     
|Tangible Capital (to adjusted assets)            | 22,357                 | 7.95%                          | 4,218                                                     
|                                                
|**As of September 30, 2002**                    
|Total Capital (to risk-weighted assets)          | $25,930                | 11.78%                         | $17,627                                                   
|Tier 1 (Core) Capital (to risk weighted assets)  | 24,256                 | 11.01%                         | 8,814                                                     
|Tier 1 (Core) Capital (to adjusted total assets) | 24,256                 | 7.75%                          | 9,389                                                     
|Tangible Capital (to adjusted assets)            | 24,256                 | 7.75%                          | 4,697                                                     

This document, including information included or incorporated by reference, contains, and
future filings by LSB Financial on Form 10-KSB, Form 10-QSB and Form 8-K and future oral and
written statements by LSB Financial and our management may contain, forward-looking statements
about LSB Financial and its subsidiaries which we believe are within the meaning of the Private
Securities Litigation Reform Act of 1995.  These forward-looking statements include, without
limitation, statements with respect to anticipated future operating and financial performance, growth
opportunities, interest rates, cost savings and funding advantages expected or anticipated to be
realized by management.  Words such as  "may", "could", "should", "would", "believe",
"anticipate", "estimate", "expect", "intend", "plan" and similar expressions are intended to identify
forward-looking statements.  Forward-looking statements by LSB Financial and its management are
based on beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions of
management and are not guarantees of future performance.  We disclaim any obligation to update
or revise any forward-looking statements based on the occurrence of future events, the receipt of new
information or otherwise.  The important factors we discuss below and elsewhere

in this document,
as well as other factors discussed under the caption "Management's Discussion of Recent Operating
Results" in this document and identified in our filings with the SEC and those presented elsewhere
by our management from time to time, could cause actual results to differ materially from those
indicated by the forward-looking statements made in this document.

The following factors, many of which are subject to change based on various other factors
beyond our control, could cause our financial performance to differ materially from the plans,
objectives, expectations, estimates and intentions expressed in such forward-looking statements:

- the strength of the United States economy in general and the strength of the local
economies in which we conduct our operations;
- the effects of, and changes in, trade, monetary and fiscal policies and laws; including
interest rate policies of the Federal Reserve Board;
- inflation, interest rate, market and monetary fluctuations;
- the timely development of and acceptance of our new products and services of
Lafayette Savings and the perceived overall value of these products and services by
users, including the features, pricing and quality compared to competitors' products
and services;
- the willingness of users to substitute our products and services for the products and
services of our competitors;
- the  success of Lafayette Savings in gaining regulatory approval of its products and
services, when required;
- the impact of changes in financial services' laws and regulations (including laws
concerning taxes, banking, securities and insurance);
- the impact of technological changes;
- acquisitions;
- changes in consumer spending and saving habits; and
- our success at managing the risks involved in the foregoing.

**Item 3.  CONTROLS AND PROCEDURES**.

(a)  Evaluation of Disclosure Controls and Procedures: An evaluation of the Company's
disclosure controls and procedures (as defined in Section 13(a)-14(c) of the Securities Exchange Act
of 1934 (the "Act")) was carried out under the supervision and with the participation of the
Company's Chief Executive Officer, Chief Financial Officer and several other members of the
Company's senior management within the 90-day period preceding the filing date of this quarterly
report.  The Company's Chief Executive Officer and Chief Financial Officer concluded that the
Company's disclosure controls and procedures currently in effect are effective in ensuring that the
information required to be disclosed by the Company in the reports it files or submits under the Act
is (i) accumulated and communicated to the Company's management (including the Chief Executive
Officer and Chief Financial Officer) in a timely manner and (ii) recorded, processed, summarized
and reported within the time periods specified in the SEC's rules and forms.

(b)  Changes in Internal Controls: In the quarter ended September 30, 2002, the Company did
not make any significant changes in, nor take any corrective actions regarding, its internal controls
or other factors that could significantly affect these controls.

**PART II - OTHER INFORMATION**

Item 1.  LEGAL PROCEEDINGS

The Company, from time to time, is involved as plaintiff or defendant in various legal actions arising in the normal course of business.  While the ultimate outcome of these proceedings cannot be predicted with certainty, it is the opinion of management, after consultation with counsel representing the Company in the proceedings, that the resolution of any prior and pending proceedings should not have a material effect on the Company or the Bank's financial condition or results of operations.

Item 2.  CHANGES IN SECURITIES

None to be reported.

Item 3.  DEFAULTS UPON SENIOR SECURITIES

None to be reported.

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None to be reported.

Item 5.  OTHER INFORMATION

None.

Item 6.  EXHIBITS AND REPORTS ON FORM 8-K



> (a)   Exhibits:
> 
> See Exhibit Index
> 
> (b)   Reports on Form 8-K
> 
> None to be reported.

**SIGNATURES**

In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

|     |                   |  | LSB FINANCIAL CORP.
      (Registrant)                              
|---- | ----------------- |  | --------------------------------------------------------------------
|Date | November 14, 2002 |  | /S/ RANDOLPH F. WILLIAMS                                            
|     |                   |  | Randolph F. Williams, President
(Principal Executive Officer)       
|Date | November 14, 2002 |  | /S/ MARY JO DAVID                                                   
|     |                   |  | Mary Jo David, Treasurer[Principal Financial and Accounting Officer)

CERTIFICATION

I, Randolph F. Williams, principal executive officer, certify that:

1.    I have reviewed this quarterly report on Form 10-QSB of LSB Financial Corp. (the
"Registrant");

2.   Based on my knowledge, this quarterly report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statement were made, not misleading with respect to the period
covered by this quarterly report;

3.   Based on my knowledge, the consolidated  financial statements, and other financial
information included in this quarterly report, fairly present in all material respects the consolidated
financial condition, results of operations and cash flows of the Registrant as of, and for, the periods
presented in this quarterly report;

4.   The Registrant's other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and
15d-14) for the registrant and we have:

> a)   designed such disclosure controls and procedures to ensure that material
> information relating to the Registrant, including its consolidated subsidiaries, is made known to us
> by others within those entities, particularly during the period in which this quarterly report os being
> prepared;
> 
> b)   evaluated the effectiveness of the Registrant's disclosure controls and
> procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation
> Date"); and
> 
> c)   presented in this quarterly report our conclusions about the effectiveness of the
> disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.    The Registrant's other certifying officer and I have disclosed, based on our most
recent evaluation, to the Registrant's auditors and the audit committee of Registrant's board of
directors (or persons performing the equivalent function):

> a)   all significant deficiencies in the design or operation of internal controls which
> could adversely affect the Registrant's ability to record, process, summarize and report financial data
> and have identified for the Registrant's auditors any material weaknesses in internal controls; and
> 
> b)   Any fraud, whether of not material, that involves management or other
> employees who have a significant role in the Registrant's internal controls; and

6.   The Registrant's other certifying officer and I have indicated in this quarterly report
whether or not there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material weaknesses.

|Date: November 14, 2002 |  | /s/ Randolph F. WilliamsRandolph F. WilliamsPrincipal Executive Officer
|----------------------- |  | -----------------------------------------------------------------------

CERTIFICATION

I, Mary Jo David, principal financial officer, certify that:

1.    I have reviewed this quarterly report on Form 10-QSB of LSB Financial Corp. (the
"Registrant");

2.   Based on my knowledge, this quarterly report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statement were made, not misleading with respect to the period
covered by this quarterly report;

3.   Based on my knowledge, the consolidated  financial statements, and other financial
information included in this quarterly report, fairly present in all material respects the consolidated
financial condition, results of operations and cash flows of the Registrant as of, and for, the periods
presented in this quarterly report;

4.   The Registrant's other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and
15d-14) for the registrant and we have:

> a)   designed such disclosure controls and procedures to ensure that material
> information relating to the Registrant, including its consolidated subsidiaries, is made known to us
> by others within those entities, particularly during the period in which this quarterly report os being
> prepared;
> 
> b)   evaluated the effectiveness of the Registrant's disclosure controls and
> procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation
> Date"); and
> 
> c)   presented in this quarterly report our conclusions about the effectiveness of the
> disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5.    The Registrant's other certifying officer and I have disclosed, based on our most
recent evaluation, to the Registrant's auditors and the audit committee of Registrant's board of
directors (or persons performing the equivalent function):

> a)   all significant deficiencies in the design or operation of internal controls which
> could adversely affect the Registrant's ability to record, process, summarize and report financial data
> and have identified for the Registrant's auditors any material weaknesses in internal controls; and
> 
> b)   Any fraud, whether of not material, that involves management or other
> employees who have a significant role in the Registrant's internal controls; and

6.   The Registrant's other certifying officer and I have indicated in this quarterly report
whether or not there were significant changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date of our most recent evaluation, including
any corrective actions with regard to significant deficiencies and material weaknesses.

|Date: November 14, 2002 |  | /s/ Mary Jo DavidMary Jo DavidPrincipal Financial Officer
|----------------------- |  | ---------------------------------------------------------

**INDEX TO EXHIBITS**

|RegulationS-K ExhibitNumber | Document                                                                                                                                                                                                     
|--------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                           
|3.1                         | Registrant's Articles of Incorporation, filed on September 21, 1994, as an exhibit to
Registrant's Registration Statement on Form S-1 (File No. 33-84266), are incorporated
by reference.                    
|3.2                         | Registrant's Bylaws, as amended and restated, filed as Exhibit 3.2 to Registrant's Report
on Form 10-KSB for the fiscal year ended December 31, 2001 (File No. 0-25070), is
incorporated herein by reference.
|4                           | Registrant's Specimen Stock Certificate, filed on September 21, 1994 as exhibits to
Registrant's Registration Statement on Form S-1 (File No. 33-84266), is incorporated by
reference.                       
|10.1                        | Registrant's 1995 Stock Option and Incentive Plan, filed on July 11, 1995 as Appendix
A to  Registrant's  Proxy Statement on Schedule 14A (File No. 0-25070), is incorporated
herein by reference.           
|10.3                        | Registrant's 1995 Recognition and Retention Plan, filed on July 11, 1995 as Appendix B
to  Registrant's  Proxy Statement on Schedule 14A (File No. 0-25070), is incorporated
herein by reference.            
|11                          | Statement re computation of per share earnings                                                                                                                                                               
|99.1                        | Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.