| ý |   | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE             |   |
|--------|--------|---------------------------------------------------------------------|--------|
|   |   | SECURITIES EXCHANGE ACT OF 1934                                     |   |
|   |   |                                                                |   |
|   |   | For the quarterly period ended March 31, 2010                       |   |
|   |   |                                                                |   |
|   |   | OR                                                                  |   |
|   |   |                                                                |   |
| o      |   | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE            |   |
|   |   | SECURITIES EXCHANGE ACT OF 1934                                     |   |
|   |   |                                                                |   |
|   |   | For the transition period from ________________ to ________________ |   |

|                                                           |   |                                 |
|----------------------------------------------------------------|--------|--------------------------------------|
| Indiana                                                        |   | 35-1934975                           |
| (State or other jurisdiction of incorporation or organization) |   | (I.R.S. Employer Identification No.) |
|                                                           |   |                                 |
| 101 Main Street, Lafayette, Indiana                            |   | 47901                                |
| (Address of principal executive offices)                       |   | (Zip Code)                           |

| Large Accelerated Filer o                                            | Accelerated Filer o              |
|----------------------------------------------------------------------|----------------------------------|
| Non-Accelerated Filer o(Do not check if a smaller reporting company) | Smaller Reporting Company ý |

| Class                                  |   | Outstanding at April 23, 2010 |
|----------------------------------------|--------|-------------------------------|
| Common Stock, $.01 par value per share |   | 1,553,525 shares              |

----

| PART I FINANCIAL INFORMATION | 1                                                                                           |
|------------------------------|---------------------------------------------------------------------------------------------|
|                         |                                                                                        |   |
| Item 1.                      | Financial Statements                                                                        | 1 |
|                         |                                                                                        |   |
|                         | Consolidated Condensed Balance Sheets                                                       | 1 |
|                         |                                                                                        |   |
|                         | Consolidated Condensed Statements of Income                                                 | 2 |
|                         |                                                                                        |   |
|                         | Consolidated Condensed Statements of Changes in Shareholders’ Equity                  | 3 |
|                         |                                                                                        |   |
|                         | Consolidated Condensed Statements of Cash Flows                                             | 4 |
|                         |                                                                                        |   |
|                         | Notes to Consolidated Condensed Financial Statements                                        | 5 |
|                         |                                                                                        |   |
| Item 2.                      | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 12 |
|                         |                                                                                        |   |
| Item 3.                      | Quantitative and Qualitative Disclosures About Market Risk                                  | 26 |
|                         |                                                                                        |   |
| Item 4T.                     | Controls and Procedures.                                                                    | 26 |
|                         |                                                                                        |
| PART II. OTHER INFORMATION   | 26                                                                                          |
|                         |                                                                                        |   |
| Item 1.                      | Legal Proceedings                                                                           | 26 |
|                         |                                                                                        |   |
| Item 1A.                     | Risk Factors                                                                                | 26 |
|                         |                                                                                        |   |
| Item 2.                      | Unregistered Sales of Equity Securities and Use of Proceeds                                 | 27 |
|                         |                                                                                        |   |
| Item 3.                      | Defaults Upon Senior Securities                                                             | 27 |
|                         |                                                                                        |   |
| Item 4.                      | [Removed and Reserved]                                                                      | 27 |
|                         |                                                                                        |   |
| Item 5.                      | Other Information                                                                           | 27 |
|                         |                                                                                        |   |
| Item 6.                      | Exhibits                                                                                    | 27 |
|                         |                                                                                        |
| SIGNATURES                   | 28                                                                                          |

----

| Item 1. | Financial Statements |
|---------|----------------------|

|                                                                    |   | March 31,2010 |    |   | December 31,2009 |   |
|-------------------------------------------------------------------------|--------|---------------|---------|--------|------------------|--------|
|                                                                    |   | (unaudited)   |    |   |             |   |
| Assets                                                                  |   |          |    |   |             |   |
| Cash and due from banks                                                 |   | $             | 8,345   |   |             | $      | 8,084 |   |
| Short-term investments                                                  |   |          | 5,397   |   |             |   | 4,817 |   |
| Cash and cash equivalents                                               |   |          | 13,742  |   |             |   | 12,901 |   |
| Available-for-sale securities                                           |   |          | 10,978  |   |             |   | 11,345 |   |
| Loans held for sale                                                     |   |          | 611     |   |             |   | 3,303 |   |
| Total loans                                                             |   |          | 325,174 |   |             |   | 321,597 |   |
| Less: Allowance for loan losses                                         |   |          | (4,121  | )      |             |   | (3,737 | ) |
| Net loans                                                               |   |          | 321,053 |   |             |   | 317,860 |   |
| Premises and equipment, net                                             |   |          | 6,167   |   |             |   | 6,209 |   |
| Federal Home Loan Bank stock, at cost                                   |   |          | 3,997   |   |             |   | 3,997 |   |
| Bank owned life insurance                                               |   |          | 6,122   |   |             |   | 6,071 |   |
| Interest receivable and other assets                                    |   |          | 9,037   |   |             |   | 9,364 |   |
| Total Assets                                                            |   | $             | 371,707 |   |             | $      | 371,050 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Liabilities and Shareholders’ Equity                              |   |          |    |   |             |   |   |   |
| Liabilities                                                             |   |          |    |   |             |   |   |   |
| Deposits                                                                |   | $             | 290,959 |   |             | $      | 277,866 |   |
| Federal Home Loan Bank advances                                         |   |          | 44,000  |   |             |   | 57,000 |   |
| Interest payable and other liabilities                                  |   |          | 2,528   |   |             |   | 2,300 |   |
| Total liabilities                                                       |   |          | 337,487 |   |             |   | 337,166 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Commitments and Contingencies                                           |   |          |    |   |             |   |   |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Shareholders’ Equity                                              |   |          |    |   |             |   |   |   |
| Common stock, $.01 par value                                            |   |          |    |   |             |   |   |   |
| Authorized - 7,000,000 shares                                           |   |          |    |   |             |   |   |   |
| Issued and outstanding 2010 - 1,553,525 shares, 2009 - 1,553,525 shares |   |          | 15      |   |             |   | 15 |   |
| Additional paid-in-capital                                              |   |          | 10,986  |   |             |   | 10,985 |   |
| Retained earnings                                                       |   |          | 22,983  |   |             |   | 22,646 |   |
| Accumulated other comprehensive income                                  |   |          | 236     |   |             |   | 238 |   |
| Total shareholders’ equity                                        |   |          | 34,220  |   |             |   | 33,884 |   |
|                                                                    |   |          |    |   |             |   |   |   |
| Total liabilities and shareholders’ equity                        |   | $             | 371,707 |   |             | $      | 371,050 |   |

----

|                                                |   | Three months ended March 31, |   |
|-----------------------------------------------------|--------|------------------------------|--------|
|                                                |   | 2010                         |   |   | 2009 |   |
| Interest and Dividend Income                        |   |                         |   |   |   |   |
| Loans                                               |   | $                            | 4,544  |   |   | $ | 4,856 |   |
| Securities                                          |   |                         |   |   |   |   |   |   |
| Taxable                                             |   |                         | 59     |   |   |   | 47 |   |
| Tax-exempt                                          |   |                         | 62     |   |   |   | 67 |   |
| Other                                               |   |                         | 6      |   |   |   | 3 |   |
| Total interest and dividend income                  |   |                         | 4,671  |   |   |   | 4,973 |   |
| Interest Expense                                    |   |                         |   |   |   |   |   |   |
| Deposits                                            |   |                         | 1,271  |   |   |   | 1,815 |   |
| Borrowings                                          |   |                         | 452    |   |   |   | 771 |   |
| Total interest expense                              |   |                         | 1,723  |   |   |   | 2,586 |   |
| Net Interest Income                                 |   |                         | 2,948  |   |   |   | 2,387 |   |
| Provision for Loan Losses                           |   |                         | 434    |   |   |   | 569 |   |
| Net Interest Income After Provision for Loan Losses |   |                         | 2,514  |   |   |   | 1,818 |   |
|                                                |   |                         |   |   |   |   |   |   |
| Non-interest Income                                 |   |                         |   |   |   |   |   |   |
| Deposit account service charges and fees            |   |                         | 367    |   |   |   | 336 |   |
| Net gains on loan sales                             |   |                         | 85     |   |   |   | 523 |   |
| Gain (loss) on sale other real estate owned         |   |                         | (33    | ) |   |   | 33 |   |
| Other                                               |   |                         | 275    |   |   |   | 244 |   |
| Total non-interest income                           |   |                         | 694    |   |   |   | 1,136 |   |
|                                                |   |                         |   |   |   |   |   |   |
| Non-Interest Expense                                |   |                         |   |   |   |   |   |   |
| Salaries and employee benefits                      |   |                         | 1,292  |   |   |   | 1,352 |   |
| Net occupancy and equipment expense                 |   |                         | 339    |   |   |   | 352 |   |
| Computer service                                    |   |                         | 127    |   |   |   | 134 |   |
| Advertising                                         |   |                         | 56     |   |   |   | 57 |   |
| FDIC insurance premiums                             |   |                         | 159    |   |   |   | 133 |   |
| Other                                               |   |                         | 440    |   |   |   | 519 |   |
| Total non-interest expense                          |   |                         | 2,413  |   |   |   | 2,547 |   |
|                                                |   |                         |   |   |   |   |   |   |
| Income Before Income Taxes                          |   |                         | 795    |   |   |   | 407 |   |
| Provision for Income Taxes                          |   |                         | 263    |   |   |   | 105 |   |
| Net Income                                          |   | $                            | 532    |   |   | $ | 302 |   |
| Basic Earnings Per Share                            |   | $                            | 0.34   |   |   | $ | 0.20 |   |
| Diluted Earnings Per Share                          |   | $                            | 0.34   |   |   | $ | 0.20 |   |
| Dividends Declared Per Share                        |   | $                            | 0.125  |   |   | $ | 0.125 |   |
|                                                |   |                         |   |   |   |   |   |   |

----

|                                                                             |   | Common Stock |   |   | Additional Paid-In Capital |   |   | Retained Earnings |         |   | Accumulated Other Comprehensive Income |         |   | Total  |   |
|----------------------------------------------------------------------------------|--------|--------------|--------|--------|----------------------------|--------|--------|-------------------|--------------|--------|----------------------------------------|--------------|--------|--------|--------|
|                                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |
| Balance, January 1, 2009                                                         |   | $            | 15     |   |                       | $      | 10,983 |              |         | $      | 22,961                                 |         |   | $      | 116    |   |   | $ | 34,075 |   |
| Comprehensive income                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   |   |   |
| Net income                                                                       |   |         |   |   |                       |   |   |              |         |   | 302                                    |         |   |   |   |   |   |   | 302 |   |
| Change in unrealized appreciation on available-for-sale securities, net of taxes |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   | 13     |   |   |   | 13 |   |
| Total comprehensive income                                                       |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   | 315 |   |
| Dividends on common stock, $0.125 per share                                      |   |         |   |   |                       |   |   |              |         |   | (193                                   | )            |   |   |   |   |   |   | (193 | ) |
| Share-based compensation expense                                                 |   |    |   |   |                       | 1      |   |              |    |   |                                   |    |   |   |   | 1 |   |
| Balance, March 31, 2009                                                          |   | $            | 15     |   |                       | $      | 10,984 |              |         | $      | 23,070                                 |         |   | $      | 129    |   |   | $ | 34,198 |   |
|                                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   |   |   |
|                                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   |   |   |
|                                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   |   |   |
| Balance, January 1, 2010                                                         |   | $            | 15     |   |                       | $      | 10,985 |              |         | $      | 22,646                                 |         |   | $      | 238    |   |   | $ | 33,884 |   |
| Comprehensive income                                                             |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   |   |   |
| Net income                                                                       |   |         |   |   |                       |   |   |              |         |   | 532                                    |         |   |   |   |   |   |   | 532 |   |
| Change in unrealized depreciation on available-for-sale securities, net of taxes |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   | (2     | ) |   |   | (2 | ) |
| Total comprehensive income                                                       |   |         |   |   |                       |   |   |              |         |   |                                   |         |   |   |   |   |   |   | 530 |   |
| Dividends on common stock, $0.125 per share                                      |   |         |   |   |                       |   |   |              |         |   | (195                                   | )            |   |   |   |   |   |   | (195 | ) |
| Share-based compensation expense                                                 |   |    |   |   |                       | 1      |   |              |    |   |                                   |    |   |   |   | 1 |   |
| Balance, March 31, 2010                                                          |   | $            | 15     |   |                       | $      | 10,986 |              |         | $      | 22,983                                 |         |   | $      | 236    |   |   | $ | 34,220 |   |

----

|                                                                  |   | Three months ended March 31, |    |
|-----------------------------------------------------------------------|--------|------------------------------|---------|
|                                                                  |   | 2010                         |    |   | 2009 |   |
| Operating Activities                                                  |   |                         |    |   |   |   |
| Net income                                                            |   | $                            | 532     |   |   | $ | 302 |   |
| Items not requiring (providing) cash                                  |   |                         |    |   |   |   |   |   |
| Depreciation                                                          |   |                         | 110     |   |   |   | 122 |   |
| Provision for loan losses                                             |   |                         | 434     |   |   |   | 569 |   |
| Amortization of premiums and discounts on securities                  |   |                         | 10      |   |   |   | 5 |   |
| (Gain)loss on sale of other real estate owned                         |   |                         | 33      |   |   |   | (33 | ) |
| Gain on sale of loans                                                 |   |                         | (74     | ) |   |   | (389 | ) |
| Loans originated for sale                                             |   |                         | (5,426  | ) |   |   | (22,733 | ) |
| Proceeds on loans sold                                                |   |                         | 8,192   |   |   |   | 21,502 |   |
| Amortization of stock options                                         |   |                         | 1       |   |   |   | 1 |   |
| Changes in                                                            |   |                         |    |   |   |   |   |   |
| Interest receivable and other assets                                  |   |                         | 170     |   |   |   | 783 |   |
| Interest payable and other liabilities                                |   |                         | 230     |   |   |   | 350 |   |
| Net cash provided by operating activities                             |   |                         | 4,212   |   |   |   | 479 |   |
|                                                                  |   |                         |    |   |   |   |   |   |
| Investing Activities                                                  |   |                         |    |   |   |   |   |   |
| Purchases of available-for-sale securities                            |   |                         | ---     |   |   |   | (701 | ) |
| Proceeds from maturities of available-for-sale securities             |   |                         | 353     |   |   |   | 567 |   |
| Net change in loans                                                   |   |                         | (3,759  | ) |   |   | 4,445 |   |
| Proceeds from sale of OREO                                            |   |                         | 205     |   |   |   | 371 |   |
| Purchase of premises and equipment                                    |   |                         | (68     | ) |   |   | (104 | ) |
| Net cash (used in)provided by investing activities                    |   |                         | (3,269  | ) |   |   | 4,578 |   |
|                                                                  |   |                         |    |   |   |   |   |   |
| Financing Activities                                                  |   |                         |    |   |   |   |   |   |
| Net change in demand deposits, money market, NOW and savings accounts |   |                         | 10,575  |   |   |   | 10,479 |   |
| Net change in certificates of deposit                                 |   |                         | 2,518   |   |   |   | 6,617 |   |
| Proceeds from Federal Home Loan Bank advances                         |   |                         | 8,000   |   |   |   | --- |   |
| Repayment of Federal Home Loan Bank advances                          |   |                         | (21,000 | ) |   |   | (7,000 | ) |
| Dividends paid                                                        |   |                         | (195    | ) |   |   | (193 | ) |
| Net cash (used in)provided by financing activities                    |   |                         | (102    | ) |   |   | 9,903 |   |
|                                                                  |   |                         |    |   |   |   |   |   |
| Increase in Cash and Cash Equivalents                                 |   |                         | 841     |   |   |   | 14,960 |   |
| Cash and Cash Equivalents, Beginning of Period                        |   |                         | 12,901  |   |   |   | 11,225 |   |
| Cash and Cash Equivalents, End of Period                              |   | $                            | 13,742  |   |   | $ | 26,185 |   |
|                                                                  |   |                         |    |   |   |   |   |   |
| Supplemental Cash Flows Information                                   |   |                         |    |   |   |   |   |   |
| Interest paid                                                         |   | $                            | 1,723   |   |   | $ | 2,615 |   |
| Income taxes paid                                                     |   |                         | 140     |   |   |   | 100 |   |
|                                                                  |   |                         |    |   |   |   |   |   |
| Supplemental Non-Cash Disclosures                                     |   |                         |    |   |   |   |   |   |
| Capitalization of mortgage servicing rights                           |   |                         | 11      |   |   |   | 135 |   |

----

----

|   |                                                         |   | Three months ended March 31, |      |
|--------|--------------------------------------------------------------|--------|------------------------------|-----------|
|   |                                                         |   | 2010                         |      |   | 2009 |   |
|   |                                                         |   |                         |      |   |   |   |
|   | Weighted average shares outstanding                          |   |                         | 1,553,525 |   |   |   | 1,553,502 |   |
|   | Shares used to compute diluted  earnings per share |   |                         | 1,554,059 |   |   |   | 1,553,525 |   |
|   | Earnings per share                                           |   | $                            | 0.34      |   |   | $ | 0.20 |   |
|   | Diluted earnings per share                                   |   | $                            | 0.34      |   |   | $ | 0.20 |   |

|   |                             |   | Amortized Cost |   |   | Gross Unrealized Gains |   |      | Gross Unrealized Losses |   |   | Approximate Fair Value |   |
|--------|----------------------------------|--------|----------------|--------|--------|------------------------|--------|-----------|-------------------------|--------|--------|------------------------|--------|
|   |                             |   |           |   |   | (in Thousands)         |   |      |                    |   |
|   | Available-for-sale Securities:   |   |           |   |   |                   |   |      |                    |   |   |                   |   |
|   | March 31, 2010:                  |   |           |   |   |                   |   |      |                    |   |   |                   |   |
|   | U.S. Government agencies         |   | $              | 525    |   |                   | $      | 6         |                    |   | $      | ---                    |   |   |   | 531 |   |
|   | Mortgage-backed securities       |   |           | 2,993  |   |                   |   | 153       |                    |   |   | ---                    |   |   |   | 3,146 |   |
|   | State and political subdivisions |   |           | 7,066  |   |                   |   |  235 |                    |   |   |  ---              |   |   |   |  7,301 |   |
|   |                             |   | $              | 10,584 |   |                   | $      | 394       |                    |   | $      | ---                    |   |   | $ | 10,978 |   |
|   |                             |   |           |   |   |                   |   |      |                    |   |   |                   |   |   |   |   |   |
|   | December 31, 2009:               |   |           |   |   |                   |   |      |                    |   |   |                   |   |   |   |   |   |
|   | U.S. Government agencies         |   | $              | 529    |   |                   | $      | 7         |                    |   | $      | ---                    |   |   | $ | 536 |   |
|   | Mortgage-backed securities       |   |           | 3,131  |   |                   |   | 176       |                    |   |   | ---                    |   |   |   | 3,307 |   |
|   | State and political subdivisions |   |           | 7,288  |   |                   |   | 214       |                    |   |   | ---                    |   |   |   | 7,502 |   |
|   |                             |   | $              | 10,948 |   |                   | $      | 397       |                    |   | $      | ---                    |   |   | $ | 11,345 |   |

----

|   |                       |   | Available for Sale |        |
|--------|----------------------------|--------|--------------------|-------------|
|   |                       |   | Amortized Cost     |        |   | Fair Value |   |
|   |                       |   | March 31, 2010     |        |
|   |                       |   |               |        |   |   |   |
|   | Within one year            |   | $                  | 2,285       |   |   | $ | 2,308 |   |
|   | One to five years          |   |               | 3,224       |   |   |   | 3,340 |   |
|   | Five to ten years          |   |               | 1,939       |   |   |   | 2,040 |   |
|   | After ten years            |   |               | 143         |   |   |   | 144 |   |
|   |                       |   |               | 7,591       |   |   |   | 7,832 |   |
|   |                       |   |               |        |   |   |   |   |   |
|   | Mortgage-backed securities |   |               |  2,993 |   |   |   | 3,146 |   |
|   |                       |   |               |        |   |   |   |   |   |
|   | Totals                     |   | $                  | 10,584      |   |   | $ | 10,978 |   |

|   |                                                        |   | 2010           |   |   | 2009   |   |
|--------|-------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|   |                                                        |   | (in Thousands) |   |
|   |                                                        |   |           |   |   |   |   |
|   | Net unrealized gain (loss) on securities available-for-sale |   | $              | (3     | )      |   | $      | 22 |   |
|   | Tax expense (benefit)                                       |   |           | (1     | )      |   |   | 9 |   |
|   |                                                        |   |           |   |   |   |   |   |   |
|   | Other comprehensive income (loss)                           |   | $              | (2     | )      |   | $      | 13 |   |

----

|   | Level 1 | Quoted prices in active markets for identical assets or liabilities |
|--------|---------|---------------------------------------------------------------------|

|   | Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   |                             |   |       |   |   | Fair Value Measurements Using                                 |   |
|--------|----------------------------------|--------|------------|--------|--------|---------------------------------------------------------------|--------|
|   |                             |   | Fair Value |   |   | Quoted Prices in Active Markets for Identical Assets(Level 1) |   |   | Significant Other Observable Inputs(Level 2) |   |   | Significant Unobservable Inputs(Level 3) |   |
|   |                             |   |       |   |   |                                                          |   |   | (in Thousands) |   |   |   |   |
|   | Available-for-sale securities    |   |       |   |   |                                                          |   |   |   |   |   |   |   |
|   | March 31, 2010                   |   |       |   |   |                                                          |   |   |   |   |   |   |   |
|   | U.S. government agencies         |   | $          | 531    |   |                                                          | $      | --- |   |   | $ | 531 |   |   | $ | --- |   |
|   | Mortgage-backed securities       |   |       | 3,146  |   |                                                          |   | --- |   |   |   | 3,146 |   |   |   | --- |   |
|   | State and political subdivisions |   |       | 7,301  |   |                                                          |   | --- |   |   |   | 7,301 |   |   |   | --- |   |
|   | Totals                           |   |       | 10,978 |   |                                                          |   | --- |   |   |   | 10,978 |   |   |   | --- |   |
|   |                             |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
|   | Available-for-sale securities    |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
|   | December 31, 2009                |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
|   | U.S. government agencies         |   | $          | 536    |   |                                                          | $      | --- |   |   | $ | 536 |   |   | $ | --- |   |
|   | Mortgage-backed securities       |   |       | 3,307  |   |                                                          |   | --- |   |   |   | 3,307 |   |   |   | --- |   |
|   | State and political subdivisions |   |       | 7,502  |   |                                                          |   | --- |   |   |   | 7,502 |   |   |   | --- |   |
|   | Totals                           |   |       | 11,345 |   |                                                          |   | --- |   |   |   | 11,345 |   |   |   | --- |   |
|   |                             |   |       |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |

----

|   |                             |   |           |   |   | Fair Value Measurements Using                                 |   |
|--------|----------------------------------|--------|----------------|--------|--------|---------------------------------------------------------------|--------|
|   |                             |   | Fair Value     |   |   | Quoted Prices in Active Markets for Identical Assets(Level 1) |   |   | Significant Other Observable Inputs(Level 2) |   |   | Significant Unobservable Inputs(Level 3) |   |
|   |                             |   | (in Thousands) |   |
|   |                             |   |           |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
|   | Impaired loans March 31, 2010    |   | $              | 3,454  |   |                                                          | $      | --- |   |   | $ | --- |   |   | $ | 3,454 |   |
|   |                             |   |           |   |   |                                                          |   |   |   |   |   |   |   |   |   |   |   |
|   | Impaired loans December 31, 2009 |   | $              | 9,218  |   |                                                          | $      | --- |   |   | $ | --- |   |   | $ | 9,218 |   |

----

|   |                                                                  |   | March 31, 2010  |    |   | December 31, 2009 |   |
|--------|-----------------------------------------------------------------------|--------|-----------------|---------|--------|-------------------|--------|
|   |                                                                  |   | Carrying Amount |    |   | Fair Value        |   |   | Carrying Amount |   |   | Fair Value |   |
|   |                                                                  |   | (in Thousands)  |    |
|   | Financial assets                                                      |   |            |    |   |              |   |   |   |   |   |   |   |
|   | Cash and cash equivalents                                             |   | $               | 13,742  |   |              | $      | 13,742 |   |   | $ | 12,901 |   |   | $ | 12,901 |   |
|   | Available-for-sale securities                                         |   |            | 10,978  |   |              |   | 10,978 |   |   |   | 11,345 |   |   |   | 11,345 |   |
|   | Loans including loans held for sale, net of allowance for loan losses |   |            | 321,664 |   |              |   | 332,785 |   |   |   | 321,163 |   |   |   | 331,739 |   |
|   | Federal Home Loan Bank stock                                          |   |            | 3,997   |   |              |   | 3,997 |   |   |   | 3,997 |   |   |   | 3,997 |   |
|   | Interest receivable                                                   |   |            | 1,572   |   |              |   | 1,572 |   |   |   | 1,447 |   |   |   | 1,447 |   |
|   |                                                                  |   |            |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
|   | Financial liabilities                                                 |   |            |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
|   | Deposits                                                              |   |            | 290,959 |   |              |   | 294,670 |   |   |   | 277,866 |   |   |   | 281,663 |   |
|   | Federal Home Loan Bank advances                                       |   |            | 44,000  |   |              |   | 44,964 |   |   |   | 57,000 |   |   |   | 57,993 |   |
|   | Interest payable                                                      |   |            | 124     |   |              |   | 124 |   |   |   | 171 |   |   |   | 171 |   |

----

| Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|----------------------------------------------------------------------------------------------------------------|

----

----

----

| 31, 2009. Certain policies are considered critical because they are highly dependent upon subjective or complex judgments, assumptions and estimates. Changes in such estimates may have a significant impact on the financial statements. Management has reviewed the application of these policies with the Audit Committee of LSB Financial’s Board of Directors. These policies include the following: |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| The allowance for loan losses represents management’s estimate of probable losses inherent in Lafayette Savings’ loan portfolios. In determining the appropriate amount of the allowance for loan losses, management makes numerous assumptions, estimates and assessments.  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| The strategy also emphasizes diversification on an industry and customer level, regular credit quality reviews and quarterly management reviews of large credit exposures and loans experiencing deterioration of credit quality.  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Lafayette Savings’ allowance consists of three components: probable losses estimated from individual reviews of specific loans, probable losses estimated from historical loss rates, and probable losses resulting from economic or other deterioration above and beyond what is reflected in the first two components of the allowance.  |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Larger commercial loans that exhibit probable or observed credit weaknesses and all loans that are rated substandard or lower are subject to individual review. Where appropriate, reserves are allocated to individual loans based on management’s estimate of the borrower’s ability to repay the loan given the availability of collateral, other sources of cash flow and legal options available to the Bank. Included in the review of individual loans are those that are impaired as provided in FASB ASC 310-10 (formerly FAS 114, Accounting by Creditors for Impairment of a Loan). Any allowances for impaired loans are determined by the present value of expected future cash flows discounted at the loan’s effective interest rate or fair value of the underlying collateral based on the discounted appraised value.   Historical loss rates are applied to other commercial loans not subject to specific reserve allocations.  |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Homogenous smaller balance loans, such as consumer installment and residential mortgage loans are not individually risk graded. Reserves are established for each pool of loans based on the expected net charge-offs for one year. Loss rates are based on the average net charge-off history by loan category.  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Historical loss rates for commercial and consumer loans may be adjusted for significant factors that, in management’s judgment, reflect the impact of any current conditions on loss recognition.  Factors which management considers in the analysis include the effects of the national and local economies, trends in the nature and volume of loans (delinquencies, charge-offs and nonaccrual loans), changes in mix, asset quality trends, risk management and loan administration, changes in the internal lending policies and credit standards, collection practices, examination results from bank regulatory agencies and Lafayette Savings’ internal loan review.  |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Allowances on individual loans are reviewed quarterly and historical loss rates are reviewed annually and adjusted as necessary based on changing borrower and/or collateral conditions and actual collection and charge-off experience.  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Lafayette Savings’ primary market area for lending is Tippecanoe County, Indiana and to a lesser extent the eight surrounding counties. When evaluating the adequacy of allowance, consideration is given to this regional geographic concentration and the closely associated effect of changing economic conditions on Lafayette Savings’ customers. |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

| Shareholders’ equity increased from $33.9 million at December 31, 2009 to $34.2 million at March 31, 2010, an increase of $336,000, or 0.99%, primarily as a result of net income of $532,000, partially offset by our payment of $195,000 of dividends on common stock.  Shareholders’ equity to total assets was 9.21% at March 31, 2010 compared to 9.13% at December 31, 2009. |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                    |   | Three months ended March 31, 2010 |    |   | Three months ended March 31, 2009 |   |
|-------------------------------------------------------------------------|--------|----------------------------------------|---------|--------|----------------------------------------|--------|
|                                                                    |   | AverageOutstandingBalance              |    |   | InterestEarned/Paid                    |   |   | Yield/Rate |   |   | AverageOutstandingBalance |   |   | InterestEarned/Paid |   |   | Yield/Rate |   |
|                                                                    |   | (Dollars in Thousands)                 |    |
| Interest-Earning Assets:                                                |   |                                   |    |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans receivable(1)                                                     |   | $                                      | 320,762 |   |                                   | $      | 4,544 |   |   |   | 5.67 | % |   | $ | 324,078 |   |   | $ | 4,856 |   |   |   | 5.99 | % |
| Other investments                                                       |   |                                   | 20,719  |   |                                   |   | 127 |   |   |   | 2.45 |   |   |   | 33,532 |   |   |   | 117 |   |   |   | 1.40 |   |
| Total interest-earning assets                                           |   |                                   | 341,481 |   |                                   |   | 4,671 |   |   |   | 5.47 |   |   |   | 357,610 |   |   |   | 4,973 |   |   |   | 5.56 |   |
|                                                                    |   |                                   |    |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savings deposits                                                        |   | $                                      | 25,816  |   |                                   |   | 39 |   |   |   | 0.60 |   |   | $ | 23,889 |   |   |   | 61 |   |   |   | 1.02 |   |
| Demand and NOW deposits                                                 |   |                                   | 88,083  |   |                                   |   | 140 |   |   |   | 0.64 |   |   |   | 63,431 |   |   |   | 112 |   |   |   | 0.71 |   |
| Time deposits                                                           |   |                                   | 173,000 |   |                                   |   | 1,092 |   |   |   | 2.52 |   |   |   | 182,574 |   |   |   | 1,642 |   |   |   | 3.60 |   |
| Borrowings                                                              |   |                                   | 52,000  |   |                                   |   | 452 |   |   |   | 3.48 |   |   |   | 71,500 |   |   |   | 771 |   |   |   | 4.31 |   |
| Total interest-bearing liabilities                                      |   |                                   | 338,899 |   |                                   |   | 1,723 |   |   |   | 2.03 |   |   |   | 341,394 |   |   |   | 2,586 |   |   |   | 3.03 |   |
|                                                                    |   |                                   |    |   |                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                     |   |                                   |    |   |                                   | $      | 2,948 |   |   |   |   |   |   |   |   |   |   | $ | 2,389 |   |   |   |   |   |
| Net interest rate spread                                                |   |                                   |    |   |                                   |   |   |   |   |   | 3.44 | % |   |   |   |   |   |   |   |   |   |   | 2.53 | % |
| Net earning assets                                                      |   | $                                      | 2,582   |   |                                   |   |   |   |   |   |   |   |   | $ | 16,216 |   |   |   |   |   |   |   |   |   |
| Net yield on average interest-earning assets                            |   |                                   |    |   |                                   |   |   |   |   |   | 3.45 | % |   |   |   |   |   |   |   |   |   |   | 2.67 | % |
| Average interest-earning assets to average interest-bearing liabilities |   |                                   | 1.01    | x      |                                   |   |   |   |   |   |   |   |   |   | 1.05 | x |   |   |   |   |   |   |   |   |

| (1) | Calculated net of deferred loan fees, loan discounts, loans in process and loss reserves. |
|-----|-------------------------------------------------------------------------------------------|

----

----

|   |                                         |   | 03/31/10       |   |   | 12/31/09 |   |   | 03/31/09 |   |
|--------|----------------------------------------------|--------|----------------|--------|--------|----------|--------|--------|----------|--------|
|   |                                         |   | (in Thousands) |   |
|   | Loans delinquent 30-59 days                  |   | $              | 427    |   |     | $      | 677    |     |   | $ | 721 |   |
|   | Loans delinquent 60-89 days                  |   |           | 2,262  |   |     |   | 3,169  |     |   |   | 3,758 |   |
|   | Total delinquencies  under 90 days |   |           | 2,689  |   |     |   | 3,846  |     |   |   | 4,479 |   |
|   |                                         |   |           |   |   |     |   |   |     |   |   |   |   |
|   | Accruing loans past due 90 days              |   |           | 1,927  |   |     |   | 0      |     |   |   | 656 |   |
|   | Non-accruing loans                           |   |           | 15,226 |   |     |   | 12,554 |     |   |   | 10,320 |   |
|   | Total non-performing loans                   |   |           | 17,153 |   |     |   | 12,554 |     |   |   | 10,976 |   |
|   | OREO                                         |   |           | 1,785  |   |     |   | 1,892  |     |   |   | 1,897 |   |
|   | Total non-performing assets                  |   | $              | 18,938 |   |     | $      | 14,446 |     |   | $ | 12,873 |   |

----

----

|   | (Dollars in Thousands) |   | 2010   |   |   | 2009   |   |
|--------|------------------------|--------|--------|--------|--------|--------|--------|
|   |                   |   |   |   |   |   |   |   |   |
|   | Balance at January 1   |   | $      | 3,737  |   |   | $      | 3,697 |   |
|   | Loans charged off      |   |   | (50    | )      |   |   | (351 | ) |
|   | Recoveries             |   |   | 0      |   |   |   | 5 |   |
|   | Provision              |   |   | 434    |   |   |   | 569 |   |
|   | Balance at March 31    |   | $      | 4,121  |   |   | $      | 3,920 |   |

----

----

|                                              |   | Actual                 |   |   | For Capital Adequacy Purposes |   |   | To Be Well Capitalized Under Prompt Corrective Action Provisions |   |
|---------------------------------------------------|--------|------------------------|--------|--------|-------------------------------|--------|--------|------------------------------------------------------------------|--------|
|                                              |   | Amount                 |   |   | Ratio                         |   |   | Amount                                                           |   |   | Ratio |   |   | Amount |   |   | Ratio |   |
| As of March 31, 2010                              |   | (Dollars in Thousands) |   |
| Total risk-based capital(to risk-weighted assets) |   | $                      | 37,609 |   |                          |   | 13.0   | %                                                                |   | $ | 23,170 |   |   |   | 8.0 | % |   | $ | 28,962 |   |   |   | 10.0 | % |
| Tier I capital(to risk-weighted assets)           |   |                   | 33,989 |   |                          |   | 11.7   |                                                             |   |   | 11,585 |   |   |   | 4.0 |   |   |   | 17,377 |   |   |   | 6.0 |   |
| Tier I capital(to adjusted total assets)          |   |                   | 33,989 |   |                          |   | 9.2    |                                                             |   |   | 11,141 |   |   |   | 3.0 |   |   |   | 18,569 |   |   |   | 5.0 |   |
| Tier I capital(to adjusted tangible assets)       |   |                   | 33,989 |   |                          |   | 9.2    |                                                             |   |   | 7,428 |   |   |   | 2.0 |   |   |   | N/A |   |   |   | N/A |   |
| Tangible capital(to adjusted tangible assets)     |   |                   | 33,989 |   |                          |   | 9.2    |                                                             |   |   | 5,571 |   |   |   | 1.5 |   |   |   | N/A |   |   |   | N/A |   |
|                                              |   |                   |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2009                           |   |                   |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total risk-based capital(to risk-weighted assets) |   | $                      | 37,223 |   |                          |   | 12.9   | %                                                                |   | $ | 23,132 |   |   |   | 8.0 | % |   | $ | 28,915 |   |   |   | 10.0 | % |
| Tier I capital(to risk-weighted assets)           |   |                   | 33,609 |   |                          |   | 11.6   |                                                             |   |   | 11,566 |   |   |   | 4.0 |   |   |   | 17,349 |   |   |   | 6.0 |   |
| Tier I capital(to adjusted total assets)          |   |                   | 33,609 |   |                          |   | 9.1    |                                                             |   |   | 11,123 |   |   |   | 3.0 |   |   |   | 18,538 |   |   |   | 5.0 |   |
| Tier I capital(to adjusted tangible assets)       |   |                   | 33,609 |   |                          |   | 9.1    |                                                             |   |   | 7,415 |   |   |   | 2.0 |   |   |   | N/A |   |   |   | N/A |   |
| Tangible capital(to adjusted tangible assets)     |   |                   | 33,609 |   |                          |   | 9.1    |                                                             |   |   | 5,561 |   |   |   | 1.5 |   |   |   | N/A |   |   |   | N/A |   |

----

|   | · | 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; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | financial market, monetary and interest rate fluctuations, particularly the relative relationship of short-term interest rates to long-term interest rates; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | 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 competitors’ products and services for our products and services; |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | the impact of changes in financial services laws and regulations (including laws concerning taxes, accounting standards, 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. | Quantitative and Qualitative Disclosures About Market Risk |
|---------|------------------------------------------------------------|

|   | Not Applicable. |
|--------|-----------------|

| Item 4T. | Controls and Procedures. |
|----------|--------------------------|

| Item 1. | Legal Proceedings |
|---------|-------------------|

| Item 1A. | Risk Factors |
|----------|--------------|

----

| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
|---------|-------------------------------------------------------------|

| Issuer Purchases of Equity Securities |
|---------------------------------------|
| Month of Purchase                     |   | Total Number of Shares Purchased1 |   | Average Price Paid per Share |   | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs2 |   | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs2 |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| January 1 – January 31, 2010    |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| February 1 – February 28, 2010  |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| March 1 – March 31, 2010        |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |
|                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                 |   |   | --- |   |   |   | --- |   |   |   | --- |   |   |   | 52,817 |   |

| Item 3. | Defaults Upon Senior Securities |
|---------|---------------------------------|

|   | None.  |
|--------|-------------|

| Item 4. | [Removed and Reserved] |
|---------|------------------------|

| Item 5. | Other Information |
|---------|-------------------|

|   | None.  |
|--------|-------------|

| Item 6. | Exhibits |
|---------|----------|

|   | The exhibits listed in the Index to Exhibits are incorporated herein by reference. |
|--------|------------------------------------------------------------------------------------|

----

| 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.  |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                           | LSB FINANCIAL CORP. |
|--------------------------------|---------------------|
|                           | (Registrant)        |
|                           |                |   |
|                           |                |   |
| Date:   May 17, 2010 | By:                 | /s/ Randolph F. Williams |
|                           |                | Randolph F. Williams, President |
|                           |                | (Principal Executive Officer) |
|                           |                |   |
|                           |                |   |
| Date:   May 17, 2010 | By:                 | /s/ Mary Jo David |
|                           |                | Mary Jo David, Treasurer |
|                           |                | (Principal Financial and Accounting Officer) |

----

| RegulationS-K Exhibit Number |   | Document                                                 |
|------------------------------|--------|----------------------------------------------------------|
| 31.1                         |   | Rule 13(a)-14(a) Certification (Chief Executive Officer) |
| 31.2                         |   | Rule 13(a)-14(a) Certification (Chief Financial Officer) |
| 32                           |   | Section 906 Certification                                |