UNITED STATES

                       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 March 31, 2000

                                       OR

              [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                           Commission File No. 0-20956

                            HFB FINANCIAL CORPORATION

A Tennessee Corporation                      I.R.S. Employer Identification
                                                    No. 61-1228266

Address                                                Telephone Number
-------                                                ----------------

1602 Cumberland Avenue                                  (606) 248-1095
Middlesboro, Kentucky 40965

Indicate by check mark whether the registrant (1) has filed all reports required
by Section 13 or 15(d) of the  Securities  and  Exchange  Act of 1934 during the
preceding  twelve  months (or for such shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No __.

The number of shares of the  registrant's $1 par value common stock  outstanding
at May 12, 2000 was 1,079,557.

There are a total of 15 pages filed in this document.

<PAGE>
                            HFB FINANCIAL CORPORATION

                                   I N D E X
                                   ---------

                                                                         PAGE NO
                                                                         -------

PART I - FINANCIAL INFORMATION

  Item  1.  Financial Statements

                 Consolidated Balance Sheet                                    3

                 Consolidated Statement of Income                              4

                 Consolidated Statement of Stockholders' Equity                5

                 Consolidated Statement of Cash Flows                          6

                 Notes to Consolidated Financial Statements                  7-8

  Item  2.  Management's Discussion and Analysis of
            Financial Condition and Results of Operations                   9-12

  Item  3.  Quantative/Qualitive Disclosures about Market Risk                13

PART II - OTHER INFORMATION                                                   14

SIGNATURES                                                                    15

                                       2
<PAGE>
<TABLE>
<CAPTION>
                    HFB FINANCIAL CORPORATION AND SUBSIDIARY
                           Consolidated Balance Sheet
                                   (Unaudited)
                                                                   MARCH 31,         JUNE 30,
                                                                     2000              1999
ASSETS
<S>                                                             <C>              <C>
     Cash and cash equivalents                                  $   4,975,778    $   3,573,139
     Trading securities                                               784,598        1,014,808
     Investment securities
        Available for sale                                         37,128,840       37,298,664
        Held to maturity                                           25,520,977       21,997,870
                                                                -------------    -------------
             Total investment securities                           62,649,817       59,296,534
     Loans                                                        126,589,145      121,953,392
        Allowance for loan losses                                    (625,477)      (1,211,594)
                                                                -------------    -------------
             Net loans                                            125,963,668      120,741,798
     Premises and equipment                                         3,419,801        2,432,475
     Real estate owned                                                188,518               --
     Federal Home Loan Bank stock                                   1,395,500        1,346,800
     Interest receivable                                            1,962,469        1,821,970
     Goodwill                                                         396,495               --
     Other assets                                                     160,861          188,876
                                                                -------------    -------------
             Total assets                                       $ 201,897,505    $ 190,416,400
                                                                =============    =============
LIABILITIES
     Deposits
        Interest bearing                                        $ 167,259,334    $ 152,971,687
        Non-interest bearing                                        1,736,648        1,016,069
                                                                -------------    -------------
         Totals                                                   168,995,982      153,987,756
     Short term borrowings                                                 --        6,500,000
     Long term debt                                                12,545,938       10,597,501
     Interest payable                                               1,347,988          733,041
     Other liabilities                                                698,745          847,055
                                                                -------------    -------------
             Total liabilities                                    183,588,653      172,665,353
                                                                -------------    -------------
STOCKHOLDERS' EQUITY
     Issued and outstanding - 1,312,003 and
        1,303,031 shares                                            1,312,003        1,303,031
     Additional paid-in capital                                     6,348,279        6,303,419
     Less: Common stock acquired by Rabbi trusts
        for deferred compensation plans                              (504,737)        (639,767)
     Treasury stock, at cost, 202,046 shares                       (2,030,955)      (2,030,955)
     Retained earnings                                             14,300,276       13,501,715
     Accumulated other comprehensive income                        (1,116,014)        (686,396)
                                                                -------------    -------------
          Total stockholders' equity                               18,308,852       17,751,047
                                                                -------------    -------------
          Total liabilities and stockholders' equity            $ 201,897,505    $ 190,416,400
                                                                =============    =============
</TABLE>
See notes to consolidated financial statements.

                                       3
<PAGE>
                    HFB FINANCIAL CORPORATION AND SUBSIDIARY
                        CONSOLIDATED STATEMENT OF INCOME
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                        THREE-MONTHS ENDED                NINE-MONTHS ENDED
                                                            MARCH 31,                         MARCH 31,
                                                     2000             1999              2000             1999
INTEREST INCOME
<S>                                                 <C>               <C>              <C>               <C>
   Loans receivable                                 $2,594,545        $2,418,541       $7,652,846        $7,513,849
   Investment securities                             1,007,135           825,890        2,942,367         2,326,618
   Other dividend income                                30,928            29,523           97,913            85,570
   Deposits with financial institutions                 24,982            80,811           66,478           151,393
                                                ---------------  ----------------  ---------------  ----------------
            Total interest income                    3,657,590         3,354,765       10,759,604        10,077,430
                                                ---------------  ----------------  ---------------  ----------------
INTEREST EXPENSE
   Deposits                                          1,898,386         1,794,189        5,544,290         5,434,428
   Short term borrowings                                 5,462            93,227          110,764           282,947
   Long term debt                                      146,494           126,489          431,071           295,123
                                                ---------------  ----------------  ---------------  ----------------
            Total interest expense                   2,050,342         2,013,905        6,086,125         6,012,498
                                                ---------------  ----------------  ---------------  ----------------

NET INTEREST INCOME                                  1,607,248         1,340,860        4,673,479         4,064,932
   Provision for loan losses                            15,000            95,384        (459,488)           229,843
                                                ---------------  ----------------  ---------------  ----------------
NET INTEREST INCOME AFTER
  PROVISION FOR LOAN LOSSES                          1,592,248         1,245,476        5,132,967         3,835,089
                                                ---------------  ----------------  ---------------  ----------------
OTHER INCOME
   Service charges for deposit accounts                 94,773            98,220          286,814           278,061
   Other customer fees                                  21,234            14,860           58,870            57,662
   Net loss on trading securities                     (112,660)          (25,554)        (186,699)         (222,835)
   Net realized gain on sales of
    available for sale securities                           --                --               --             2,827
   Other income                                          1,821             1,952           10,623             5,244
                                                ---------------  ----------------  ---------------  ----------------
            Total other income                           5,168            89,478          169,608           120,959
                                                ---------------  ----------------  ---------------  ----------------
OTHER EXPENSES
   Salaries and employee benefits                      546,490           460,158        1,568,149         1,295,484
   Net occupancy expenses                               81,961            46,053          210,475           143,972
   Equipment expenses                                   68,793            57,878          183,568           160,554
   Data processing fees                                 64,803            57,042          206,095           176,271
   Deposit insurance expense                             8,136            22,238           53,386            64,887
   Legal and professional fees                          74,158            43,946          178,422           143,604
   Advertising                                          49,951            19,232          173,692            80,565
   State franchise and deposit taxes                    19,818            37,683           94,108           108,758
   Other expenses                                      213,405           171,747          697,197           511,708
                                                ---------------  ----------------  ---------------  ----------------
            Total other expenses                     1,127,515           915,977        3,365,092         2,685,803
                                                ---------------  ----------------  ---------------  ----------------

INCOME BEFORE INCOME TAX                               469,901           418,977        1,937,483         1,270,245
   Income tax expense                                  134,984           171,803          663,419           466,295
                                                ---------------  ----------------  ---------------  ----------------

                                                ===============  ================  ===============  ================
NET INCOME                                            $334,917          $247,174       $1,274,064          $803,950
                                                ===============  ================  ===============  ================

BASIC EARNINGS PER SHARE                                 $0.30             $0.22            $1.15             $0.73
DILUTED EARNINGS PER SHARE                                0.30              0.22             1.14              0.72

</TABLE>

See notes to consolidated financial statements.

                                       4
<PAGE>
                    HFB FINANCIAL CORPORATION AND SUBSIDIARY
                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                        Nine-months ended March 31, 2000
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                                          ACCUMULATED
                                          ADDITIONAL                                                         OTHER         TOTAL
                               COMMON      PAID-IN      RABBI      TREASURY    COMPREHENSIVE RETAINED    COMPREHENSIVE STOCKHOLDERS'
                               STOCK       CAPITAL     TRUSTS        STOCK        INCOME     EARNINGS         LOSS        EQUITY
                               -----------------------------------------------------------------------------------------------------
<S>                            <C>         <C>        <C>         <C>           <C>           <C>           <C>         <C>
BALANCES, JUNE 30, 1999        $1,303,031  $6,303,419 $(639,767)  $(2,030,955)               $13,501,715   $(686,396)  $17,751,047

Net income                                                                      $1,274,064     1,274,064                 1,274,064

Other Comprehensive income -
  net change in unrealized
  loss on securities
  available for sale                                                 (429,618)                 (429,618)     (429,618)
                                                                   ----------

Comprehensive Income                                                              $844,446
                                                                                ==========
Stock issued upon exercise of       8,972      44,860                                                                       53,832
  stock options

Dividends declared                                                                              (475,503)                 (475,503)

Net change in fair value of
  rabbi trust shares                                    135,030                                                            135,030
                               ------------------------------------------------              ---------------------------------------

BALANCES, MARCH 31, 2000       $1,312,003  $6,348,279 $(504,737)  $(2,030,955)               $14,300,276 $(1,116,014)  $18,308,852
                               ================================================              =======================================
</TABLE>
                                       5
<PAGE>
                    HFB FINANCIAL CORPORATION AND SUBSIDIARY
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                  (Unaudited)
<TABLE>
<CAPTION>
                                                                   NINE-MONTHS ENDED
                                                                        MARCH 31,

                                                                  2000            1999
OPERATING ACTIVITIES
<S>                                                             <C>             <C>
    Net cash provided by operating activities                   $2,188,372      $1,953,354
                                                              ------------    ------------
INVESTING ACTIVITIES
  Purchases of securities available for sale                    (8,346,396)    (14,521,635)
  Proceeds from maturities of securities available for sale      7,871,376       7,528,873
  Purchases of securities held to maturity                      (7,874,038)     (6,497,692)
  Proceeds from sales of securities available for sale                  --         520,648
  Proceeds from maturities of securities held to maturity        4,370,423       4,956,266
  Net change in loans                                           (5,221,870)     (5,298,550)
  Purchases of premises and equipment                           (1,160,797)       (512,355)
  Proceeds from sale of fixed assets                                    --          13,000
  Acquisition of deposits (net of cash acquired)                  (459,423)             --
                                                              ------------    ------------
    Net cash used by investing activities                      (10,820,725)    (13,811,445)
                                                              ------------    ------------

FINANCING ACTIVITIES
  Net change in
    Non interest-bearing, interest-bearing
      and savings  deposits                                      3,574,604        (227,824)
    Certificates of deposit                                     11,433,622       9,005,739
    Short term borrowings                                       (6,500,000)      1,000,000
    Proceeds of long-term debt                                   2,000,000       5,000,000
    Repayment of long-term debt                                    (51,563)        (47,588)
  Cash dividends                                                  (475,503)       (492,757)
  Proceeds from exercise of options on common stock                 53,832          63,018
  Common stock acquired by Rabbi trusts                                 --         (31,278)
                                                              ------------    ------------
    Net cash used by financing activities                       10,034,992      14,269,310
                                                              ------------    ------------

NET CHANGE IN CASH AND CASH EQUIVALENTS                          1,402,639       2,411,219

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                   3,573,139       6,947,148
                                                              ------------    ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                      $  4,975,778    $  9,358,367
                                                              ============    ============
ADDITIONAL CASH FLOWS INFORMATION
  Interest paid                                               $  5,471,178    $  4,657,881
  Income tax paid                                                  624,105         320,864
</TABLE>
See notes to consolidated financial statements.

                                       6
<PAGE>
                            HFB FINANCIAL CORPORATION

             Notes to Consolidated Financial Statements (Unaudited)

1.   BASIS OF PRESENTATION

         The  unaudited  consolidated  financial  information  for the three and
         nine-month  periods  ended March 31, 2000 and 1999 includes the results
         of operations of HFB Financial  Corporation (the "Corporation") and its
         wholly owned subsidiary Home Federal Bank,  Federal Savings Bank ("Home
         Federal"  or  the  "Bank").   The  accompanying   unaudited   financial
         statements  have been prepared in accordance  with  generally  accepted
         accounting  principles  for interim  financial  statements and with the
         instructions  to Form 10-Q. It is suggested  that these  statements and
         notes be read in  conjunction  with the financial  statements and notes
         thereto  included in the Bank's  annual  report for the year ended June
         30,  1999  on  Form  10-K  filed  with  the   Securities  and  Exchange
         Commission.

         In the opinion of management,  the financial  information  reflects all
         adjustments  (consisting only of normal recurring  adjustments),  which
         are necessary for a fair  presentation of the results of operations for
         such periods but should not be  considered as indicative of results for
         a full year.

2.   HARLAN BRANCH ACQUISITION

         On October 15,  1999,  the Bank  acquired  the deposits of the National
         City  Bank  of  Kentucky's  Harlan,  Kentucky  branch  office.  In  the
         acquisition,  the Bank purchased  $17.1 million in deposits and $12,000
         in fixed assets.  The purchase  premium was $459,000 and was calculated
         on 3% of core  deposits.  This premium will be amortized over 84 months
         on a declining balance method.  The Bank is currently in the process of
         purchasing the office building and real estate of this branch bank from
         National City and expects to complete the transfer of title by June 30,
         2000. In the interim period, the bank has placed $438,000 in escrow for
         the purchase of this branch and rents the building  from  National City
         for $3,600 per month.  The Bank has opted to  continue  operating  this
         branch as a separate  office and has retained the 7 persons  previously
         employed by National City.

1.       NON-PERFORMING LOANS AND PROBLEM ASSETS

         The following sets forth the activity in the Bank's  allowance for loan
         losses for the nine-months ended March 31, 2000 and 1999:
<TABLE>
<CAPTION>
                                                                                    (Dollars in thousands)

                                                                                         2000            1999
                                                                                         ----            ----

           <S>                                                                         <C>             <C>
           Balance July 1                                                              $1,212            $973
           Charge offs                                                                   (130)            (16)
           Recoveries                                                                       2               -
           Provision for loan losses                                                     (459)            229
                                                                                       ------          ------
           Balance March 31                                                              $625          $1,186

           Ratio of net charge offs during the period to average
               loans outstanding during the period                                       .10%            .00%
                                                                                       ======          ======
</TABLE>
                                       7
<PAGE>
           Information on impaired loans is summarized below

           AT MARCH 31                                                    2000
                                                                          ----

           Impaired loans with an allowance                               $275

           Allowance for impaired loans (included in the Company's
               allowance for loan losses)                                  $99

           NINE-MONTHS ENDED MARCH 31                                     2000
                                                                          ----

           Average balance of impaired loans                              $591
           Interest income recognized on impaired loans                     86
           Cash-basis interest received                                     83


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

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain   matters   discussed  in  this  Quarterly   Report  on  Form  10-Q  are
"forward-looking  statements"  intended  to qualify  for the safe  harbors  from
liability  established by the Private Securities  Litigation Reform Act of 1995.
These forward-looking statements can generally be identified as such because the
context of the  statement  will  include  words such as the Company  "believes",
"anticipates",  "expects",  "estimates" or words of similar  import.  Similarly,
statements  that  describe the Company's  future plans,  objectives or goals are
also forward-looking  statements. Such forward-looking statements are subject to
certain risks and uncertainties, which are described in, close proximity to such
statements and which could cause actual results to differ  materially from those
anticipated as of the date of this report. Shareholders, potential investors and
other  readers  are  urged  to  consider   these   factors  in  evaluating   the
forward-looking statements and are cautioned not to place undue reliance on such
forward-looking  statements.  The forward-looking statements included herein are
only made as of the date of this report and the Company undertakes no obligation
to publicly update such forward-looking  statements to reflect subsequent events
or circumstances.

GENERAL:

HFB Financial Corporation, a Tennessee Corporation, was formed in September 1992
at the direction of Home Federal Bank,  Federal  Savings Bank for the purpose of
becoming a holding company for the Bank as part of its conversion from mutual to
stock form. The Corporation's  primary operation is its investment in the common
stock of the Bank.

The Bank is principally  engaged in the business of accepting  deposits from the
general public and originating permanent loans, which are secured by one-to-four
family  residential  properties  located  in its  market  area.  The  Bank  also
originates  consumer  loans and  commercial  real estate loans,  and maintains a
substantial   investment  portfolio  of  mortgage-backed  and  other  investment
securities.

The  operations  of  Home  Federal,  and  savings  institutions  generally,  are
significantly  influenced by general  economic  conditions  and the monetary and
fiscal policies of government  regulatory  agencies.  Deposit flows and costs of
funds are influenced by interest rates on competing  investments  and prevailing
market  rates of  interest.  Lending  activities  are affected by the demand for
financing real estate and other types of loans,  which in turn are influenced by
the  interest  rates at which such  financing  may be offered and other  factors
related  to loan  demand  and the  availability  of  funds.  Just as  regulatory
authorities  influence the Bank's  operations,  so are its liquidity  levels and
capital resources.  As of March 31, 2000, management is not aware of any current
recommendations by the regulatory authorities,  which if implemented, would have
a material effect on the Bank's  operations,  liquidity or resources.

                                       8
<PAGE>
FINANCIAL CONDITION

The Corporation's  assets increased by 6.03% to $201.9 million at March 31, 2000
compared to $190.4  million at June 30, 1999.  The majority of this  increase is
reflected  in  increases in cash and cash  equivalents,  investment  securities,
loans and fixed assets.  These increases are financed primarily by the net of an
increase  in  deposits,  an increase in  long-term  borrowing  and a decrease in
short-term borrowings.

Cash and cash equivalents increased by $1.4 million to $5.0 million at March 31,
2000 from $3.6 million at June 30, 1999.  This increase was primarily the result
of excess liquidity invested in overnight funds.

The Company  maintains  a  portfolio  of trading  account  securities,  which is
comprised of common stock of other  financial  institutions.  The  portfolio was
$785,000 at March 31, 2000 compared to $1.015 million at June 30, 1999.  Most of
this  decrease  was  attributable  to a decrease in the fair market value of the
portfolio.

The loan portfolio increased by $5.3 million to $126.0 million at March 31, 2000
from $120.7 million at June 30, 1999. A substantial  portion of loans originated
during the last nine-month period were adjustable-rate residential mortgages.

At March 31, 2000,  the  allowance for loan losses was $625,000 or .49% of loans
receivable  compared  to $1.2  million or .99% of loans  receivable  at June 30,
1999.  During the  nine-months  ended  March 31,  2000,  management  reduced the
allowance,   due  to  the  repayment  of  $904,000  on  impaired  loans.   Total
non-performing  assets were $730,000 or .58% of total loans at March 31, 2000 as
compared to $1.9 million or 1.56% of total loans at June 30, 1999.  The decrease
in  non-performing  loans was  primarily  due to the  repayment  of  $874,000 on
several  problem real estate loans to one  borrower  that totaled $1.4  million.
Over the past year,  management  has  aggressively  worked to help this borrower
find new financing with another lender.  This  refinancing was the source of the
$874,000  reduction and reduced the borrowers  outstanding debt to $455,000.  At
March  31,  2000,  $99,000  was  included  in the  allowance  for  loan  losses,
specifically as a reserve for the remaining loans to this borrower.

The Bank  augments  its lending  activities  and  increases  its asset yields by
investing in mortgage-backed  securities and U.S. Government securities.  During
the  nine-months  ended March 31, 2000,  management  purchased  $16.2 million in
investment and mortgage-backed securities. These purchases were primarily funded
by proceeds  from the  acquisition  of the  deposits in the Harlan  transaction,
called   and   maturing   investment   securities,    principal   collected   on
mortgage-backed  securities  and  investments,  and  an  increase  in  long-term
borrowing.  At March  31,  2000,  the Bank held  $37.1  million  in  securities,
available for sale with a net unrealized  loss of $1.1 million and $25.5 million
in securities held to maturity with a fair market value of $24.4 million.

Premises and  equipment  increased by $987,000 to $3.4 million at March 31, 2000
from $2.4 million at June 30, 1999, primarily as the result of progress payments
made on the Bank's new operations center which is presently under  construction.
The final cost is estimated at approximately $1.0 million,  including  furniture
and fixtures.

Other assets and goodwill  increased $368,000 to $557,000 at March 31, 2000 from
$189,000  at June  30,  1999,  primarily  due to the  unamortized  core  deposit
intangible  resulting from the Harlan  transaction,  which was $396,000 at March
31, 2000, with 78 months of amortization remaining.

Total  deposits  increased by $15.0 million to $169.0  million at March 31, 2000
from $154.0  million at June 30, 1999.  During the  nine-months  ended March 31,
2000,  certificates of deposit increased $11.4 million. NOW accounts and savings
deposits  increased  $3.6  million,  primarily  due  to the  acquisition  of the
deposits in Harlan on October 15, 1999.  Excluding the $17.1 million in deposits
acquired in the Harlan  transaction,  NOW accounts and savings decreased by $1.0
million and  certificates of deposit  decreased by $1.9 million.  The decline in
these deposits was primarily  attributable to aggressive competition in the form
of premium rates offered by other institutions in our market area.

                                        9
<PAGE>

Short-term borrowings decreased $6.5 Million from June 30, 1999 as the result of
funding from the acquisition of the deposits of the new Harlan office. Long-term
borrowings  increased  by $2.0  million to $12.5  million at March 31, 2000 from
$10.5  million at June 30, 1999 due to funding needs for  investment  securities
and loans.

Accrued  interest  payable  increased by $615,000 to $1.348 million at March 31,
2000 from  $733,000  at June 30,  1999 due to an  increase  in  interest-bearing
deposit accounts and the timing of interest payments.

At March 31, 2000, the Bank met all regulatory capital  requirements.  Tangible,
core and risk-based  capital ratios were 8.5%,  8.5% and 19.7%  respectively  at
March 31, 2000 as compared to 9.0%, 9.0% and 21.4% at June 30, 1999.

RESULTS OF OPERATIONS FOR THE THREE-MONTHS ENDED MARCH 31, 2000 AND 1999

Net income  increased  by $88,000 to $335,000 for the  three-month  period ended
March 31, 2000 from  $247,000 for the  three-month  period ended March 31, 1999.
The primary  reasons for the increase were a decrease of $84,000 in non-interest
income and an increase of $212,000  in  non-interest  expense.  These items were
offset by a $266,000  increase in net interest income a $80,000  decrease in the
provision for loan losses and a $37,000 decrease in income tax expense.

Net interest income increased by $266,000 for the three-month period ended March
31, 2000 as compared to the three-month  period ended March 31, 1999,  primarily
as the result of higher volume.

Interest on loans  increased by $176,000 to $2.595  million for the  three-month
period  ended March 31, 2000 as compared to $2.419  million for the  three-month
period ended March 31, 1999.  This increase is mainly  attributable  to a higher
weighted-average balance of loans receivable outstanding.

Interest on investment  securities  increased by $183,000 to $1.038  million for
the  three-month  period ended March 31, 2000 from $855,000 for the  three-month
period ended March 31,  1999.  This  increase is primarily  the result of higher
weighted-average balances during the period.

Interest on deposits increased by $104,000 to $1.898 million for the three-month
period ended March 31, 2000 from $1.794 million for the three-month period ended
March 31, 1999 as a result of higher volume.

Interest on short-term  borrowings  and long-term  debt  decreased by $68,000 to
$152,000 for the  three-month  period ended March 31, 2000 from $220,000 for the
three-month  period  ended  March 31,  1999 due to lower  levels  of  short-term
borrowing.

The provision for loan losses decreased $80,000 for the three-month period ended
March 31, 2000 as compared to the same  period in 1999.  The  provision  was the
result of  management's  evaluation  of the adequacy of the  allowance  for loan
losses including  consideration  of recoveries of loans previously  charged off,
the  perceived  risk  exposure  among  loan  types,   actual  loss   experience,
delinquency  rates,  and current economic  conditions.  The Bank's allowance for
loan losses as a percent of total loans at March 31, 2000 was .49%.

Non-interest  income  decreased by $84,000 to $5,000 for the three-month  period
ended March 31,  2000 as  compared  to $89,000 for the same period in 1999.  The
decrease was attributable to a net increase in realized and unrealized  (losses)
on trading  account  securities  of $87,000  offset by an  increase of $3,000 in
service charges on deposits.

Non-interest expense increased by $212,000 to $1.128 million for the three-month
period ended March 31, 2000 as compared to $916,000 for the same period in 1999.
Compensation  and benefits  increased by $86,000 to $546,000 for the three-month
period ended March 31, 2000 as compared to $460,000 for the same period in 1999.
This increase is primarily  attributable to an increase in salaries and wages of
$75,000,  $35,000 which was attributable to the addition of 7 employees from the
Harlan  transaction.  The remaining portion of the increase was due to increases
in employee education and employee benefits.

                                       10
<PAGE>

Occupancy  expense  increased by $36,000 to $82,000 for the  three-month  period
ended March 31, 2000 from $46,000 for the same period in 1999. This increase was
primarily  due to an  increase  of $11,000  for the lease of the newly  acquired
Harlan branch office. The remaining portion of this increase was attributable to
increases in repairs and maintenance expense, depreciation expense and insurance
expense.

Professional services increased by $30,000 to $74,000 for the three-months ended
March 31, 2000 compared to $44,000 for the same period in 1999, primarily as the
result of $25,000 paid for a Phase II Environmental  study performed on the site
of the new Harlan Branch.

Advertising  expense increased by $31,000 to $50,000 for the quarter ended March
31, 2000 compared to $19,000 for the quarter ended March 31, 1999  primarily due
to a higher level of agency advertising activity in the current period.

Other expenses increased by $41,000 to $213,000 for the three-month period ended
March 31, 2000 from  $172,000 for the  three-month  period ended March 31, 1999,
primarily due to the addition of $31,000 in core deposit intangible amortization
expense related to the Harlan transaction.

RESULTS OF OPERATIONS FOR THE NINE-MONTHS ENDED MARCH 31, 2000 AND 1999

Net income  increased by $470,000 to $1.274  million for the  nine-month  period
ended March 31, 2000 from  $804,000  for the  nine-month  period ended March 31,
1999.  The primary  reasons  for the  increase  were a $609,000  increase in net
interest  income,  a $689,000  decrease in provision for loan losses,  a $49,000
increase  non-interest  income  offset by a $680,000  increase  in  non-interest
expense and a $197,000 increase in income tax expense.

Net interest income increased by $609,000 for the nine-month  period ended March
31, 2000 as compared to the nine-month period ended March 31, 1999, primarily as
the result of a higher volumes and the recognition of interest income on several
non-accrual loans, which were paid off.

Interest on loans  increased  by $139,000 to $7.653  million for the  nine-month
period  ended March 31, 2000 as  compared to $7.514  million for the  nine-month
period ended March 31, 1999.  This increase is mainly  attributable  to a higher
weighted-average balance of loans receivable outstanding.

Interest on investment  securities  increased by $615,000 to $2.942  million for
the  nine-month  period  ended  March  31,  2000  from  $2.327  million  for the
nine-month period ended March 31, 1999. This increase is primarily the result of
higher weighted-average balances during the period.

Interest on deposits with other financial  institutions  decreased by $85,000 to
$66,000 for the  nine-month  period  ended March 31, 2000 from  $151,000 for the
nine-month  period  ended  March  31,  1999  primarily  due to a lower  level of
interest-bearing cash balances.

Interest on deposits  increased by $110,000 to $5.544 million for the nine-month
period ended March 31, 2000 compared to $5.434 million for the nine-month period
end March 31, 1999. This increase was primarily due to an increase in volume.

Interest on short term  borrowings  and long term debt  decreased  by $36,000 to
$542,000 for the  nine-month  period ended March 31, 2000 from  $578,000 for the
nine-month  period  ended  March  31,  1999  primarily  due to lower  levels  of
short-term borrowing.

The provision for loan losses decreased $689,000 for the nine-month period ended
March 31, 2000 as compared to the same period in 1999.  During the quarter ended
September  30,  1999,  a total of $904,000 of impaired  loans were paid off. The
amount  charged  off for  those  loans  was  significantly  less  than  what was
specifically  reserved for these loans and  resulted in a $474,000  reduction in
the overall allowance. The provision is the result of management's evaluation of
the  adequacy  of the  allowance  for loan  losses  including  consideration  of
recoveries of loans  previously  charged off,

                                       11
<PAGE>

the  perceived  risk  exposure  among  loan  types,   actual  loss   experience,
delinquency  rates,  and current economic  conditions.  The Bank's allowance for
loan losses as a percent of total loans, net at March 31, 2000 was .49%.

Non-interest  income increased by $49,000 to $170,000 for the nine-month  period
ended March 31, 2000 as  compared to $121,000  for the same period in 1999.  The
increase was attributable to a net decrease in realized and unrealized losses on
trading account securities of $36,000, a decrease in realized gains on available
for sale securities of $3,000,  a $10,000  increase in customer fees and service
charges and an increase of $6,000 in other income.  The decrease in realized and
unrealized  losses on trading account  securities was primarily the result of an
decrease  in the  market  value of equity  securities  included  in the  trading
account  portfolio.  The trading account portfolio is comprised of common stocks
of other financial institutions.

Non-interest  expense increased by $679,000 to $3.365 million for the nine-month
period ended March 31, 2000 as compared to $2.686 million for the same period in
1999.  Compensation and benefits increased by $273,000 to $1.568 million for the
nine-month  period  ended March 31,  2000 as compared to $1.295  million for the
same period in 1999.  This increase is primarily  attributable to an increase of
$159,000 in salaries and wages. The remaining portion of the increase was due to
a decrease  of $85,000 in  salaries  and wages that are being  deferred  as loan
origination costs and an increase of $28,000 in employee benefits.  The decrease
in salaries and wages  deferred as loan  origination  costs  decreased  due to a
decrease in loan  production.  The increases in wages and benefits were a result
of annual wage increases and a $70,000 increase  attributable to the addition of
seven employees from the Harlan transaction.

Occupancy  expense  increased by $67,000 to $210,000 for the  nine-month  period
ended March 31, 2000  compared  to  $144,000  for the same period in 1999.  This
increase was  primarily  due to $20,000 in rent  expense for the newly  acquired
branch in Harlan,  an increase of $9,000 in other rent  expense,  an increase of
$20,000  in  repairs  and  maintenance   expense,   an  increase  of  $6,000  in
depreciation  expense and an increase of $12,000 in tax,  insurance  and utility
expenses.

Equipment  expense  increased by $23,000 to $184,000 for the  nine-month  period
ended March 31, 2000  compared to $161,000 for the  nine-period  ended March 31,
1999. The increase was due to a $14,000  increase in repairs and maintenance and
a $9,000 increase in depreciation expense.

Data processing fees increased by $30,000 to $206,000 for the nine-month  period
ended March 31, 2000 from  $176,000  for the  nine-month  period ended March 31,
1999  primarily  due to one time  conversion  expenses  incurred  for the Harlan
branch acquisition.

Professional services increased by $35,000 to $178,000 for the nine-month period
ended March 31,  2000  compared  to the same  period in 1999.  This  increase is
primarily  due  primarily  as  the  result  of  $25,000  paid  for  a  Phase  II
Environmental  study  performed on the site of the new Harlan  Branch office and
$10,000 in fees paid for assistance in developing a new strategic plan.

Advertising  expense  increased by $93,000 to $174,000 for the nine-month period
ended March 31, 2000 compared to $81,000 for the  nine-month  period ended March
31, 1999 primarily due to a new advertising campaign launched during the current
fiscal year.

Other expenses increased by $185,000 to $697,000 for the nine-month period ended
March 31, 2000 from  $512,000  for the  nine-month  period  ended March 31, 1999
primarily as the result of $63,000 in core deposit  intangible  amortization for
the Harlan transaction, a $20,000 increase in printing and stationary expense, a
$41,000  increase in other real estate  expense,  a $21,000  increase in ATM and
other processing fees and a $14,000 increase in telephone expense.

Income tax expense  increased by $197,000 to $663,000 for the nine-month  period
ended March 31, 2000  compared to $466,000 for the  nine-months  ended March 31,
1999 due to a higher level of taxable income.

                                       12
<PAGE>

QUANTATIVE/QUALITIVE DISCLOSURES ABOUT MARKET RISK

Key components of a successful  asset/liability  strategy are the monitoring and
managing of interest rate  sensitivity  of both the  interest-earning  asset and
interest-bearing  liability  portfolios.   Home  Federal  has  employed  various
strategies  intended to minimize  the  adverse  affect of interest  rate risk on
future  operations  by  providing  a better  match  between  the  interest  rate
sensitivity of its assets and liabilities.  In particular, the Bank's strategies
are intended to stabilize  net interest  income for the  long-term by protecting
its interest rate spread against  increases in interest  rates.  Such strategies
include the origination of adjustable-rate mortgage loans secured by one-to-four
family  residential  real estate and the origination of consumer and other loans
with greater interest rate sensitivities than long-term,  fixed-rate residential
mortgage loans. Although customers typically prefer fixed-rate mortgage loans in
a low interest rate environment, Home Federal has been successful in originating
adjustable-rate  loans in recent  years.  In addition,  the Bank has used excess
funds to invest in  various  short-term  investments  including  mortgage-backed
securities  with terms of seven  years or less,  U.S.  Government  Treasury  and
Agency  securities  with  terms  of ten  years  or  less  and  other  short-term
investments.

Asset/liability  management in the form of structuring cash instruments provides
greater flexibility to adjust exposure to interest rates. During periods of high
interest rates,  management believes it is prudent to offer competitive rates on
short-term deposits and less competitive rates for long-term  liabilities.  This
posture  allows the Bank to benefit  quickly  from  declines in interest  rates.
Likewise,  offering more competitive rates on long-term  deposits during the low
interest rate periods allows the Bank to extend the repricing and/or maturity of
its liabilities thus reducing its exposure to rising interest rates.

The Corporation uses interest rate sensitivity  analysis to measure its interest
rate risk by  computing  changes in net  portfolio  value of its cash flows from
assets,  liabilities  and  off-balance  sheet  items in the  event of a range of
assumed  changes in market interest  rates.  Net portfolio value  represents the
market  value of  portfolio  equity and is equal to the  market  value of assets
minus the market value of  liabilities,  with  adjustments  made for off-balance
sheet items.  This analysis  assesses the risk of loss in market risk  sensitive
instruments  in the  event of a sudden  and  sustained  100 to 400  basis  point
increase or decrease in market  interest rates with no effect given to any steps
that management might take to counter the effect of that interest rate movement.
The  Corporation  measures  interest  rate risk by  modeling  the  change in net
portfolio value over a variety of interest rate scenarios.

The Corporation has not yet completed its interest rate sensitivity analysis for
March 31, 2000,  but  anticipates  an increase in interest rate  sensitivity  as
disclosed in the annual  report to  shareholders'  at June 30, 1999. At December
31, 1999,  the  Corporations  net  portfolio  value was  estimated to decline by
$7,179,000 or change 30% with an immediate rate shock  reflecting an increase of
200 basis points compared to a decline of $5,761,000 and a change of 25% at June
30, 1999.

                                       13
<PAGE>

                            HFB FINANCIAL CORPORATION

                                     PART II

                                OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

             None

ITEM 2.   CHANGES IN SECURITIES AND USE OF PROCEEDS

             None

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

             None

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

             No  matters  were  submitted to a vote of Security  Holders  during
             the quarter ended March 31, 2000.

ITEM 5.   OTHER INFORMATION

             None

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

              a.  Exhibits

                The following  exhibit  is filed  as part of  this  Form  10-QSB
                   Exhibit 27 - Financial Data Schedule

b.       Reports on Form 8-K

                 None

                                       14
<PAGE>
                       HFB FINANCIAL CORPORATION

                                   Signatures

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

                                                   HFB FINANCIAL CORPORATION


                                                   By: /s/ David B. Cook
                                                      --------------------------
                                                      David B. Cook
                                                      President and
                                                      Chief Executive Officer


                                                  By: /s/ Stanley Alexander, Jr.
                                                      --------------------------
                                                      Stanley Alexander, Jr.
                                                      Chief Financial Officer

Dated: May 12, 2000

                                       15