SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ----------------------


                                   FORM 10-QSB
(Mark One)

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

   For the quarterly period ended September 30, 2002.
                                  -------------------


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

   For the transition period from                  to
                                 -----------------   ------------------

   Commission File Number: 0-26577
                           -------


                          Webster City Federal Bancorp
             (Exact name of registrant as specified in its charter)

           United States                                    42-1491186
           -------------                                    ----------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                      Identification Number)

820 Des Moines Street, Webster City, Iowa                  50595-0638
-----------------------------------------                  ----------
(Address of principal executive offices)                   (Zip Code)

Registrant's  telephone number,  including area code  515-832-3071
                                                      ------------
--------------------------------------------------------------------------------
(Former  name,  former  address and former  fiscal year,  if changed  since last
 report)

     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required to be filed by section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]  No [ ]

   Transitional Small Business Disclosure Format: [_] Yes  [X] No

     Indicate the number of shares outstanding for each of the issuer's classes
of common stock, as of the latest practicable date.

1,888,376 shares of common stock were outstanding at October 31, 2002.
                                                     -----------------

<PAGE>


                  Webster City Federal Bancorp and Subsidiaries

                                      Index


                                                                           Page
                                                                           ----
Part I. Financial Information

       Item 1. Financial Statements

                 Consolidated Balance Sheets
                 at September 30, 2002 and December 31, 2001                 1

                 Consolidated Statements of Operations
                 for the three and nine months ended September 30, 2002
                 and 2001                                                    2

                 Consolidated Statements of Cash Flows
                 for the nine months ended September 30, 2002
                 and 2001                                                    3

                 Notes to Consolidated Financial Statements                  4

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

       Item 3. Controls and Procedures                                       6



Part II. Other Information

                Other Information                                            9


<PAGE>

<TABLE>
<CAPTION>

                       Webster City Federal Bancorp and Subsidiaries

                                Consolidated Balance Sheets


                                                                                          September 30,          December 31,
                                                                                             2002                  2001
                                                                                        --------------        --------------
                                                                                          (Unaudited)
<S>                                                                                       <C>                   <C>
Assets
------
Cash and cash equivalents                                                                 $ 1,972,090           $ 9,183,215
Time deposits in other financial institutions                                               7,734,000             1,399,000
Securities available-for-sale                                                               8,514,921            10,188,900
Investment securities held-to-maturity (market value                                        3,126,932             4,574,354
    of $3,215,454 and $4,654,121, respectively)
Loans receivable, net                                                                      76,197,325            74,492,269
Real estate owned                                                                              44,379                     -
Office property and equipment, net                                                            766,366               882,238
Federal Home Loan Bank stock, at cost                                                         704,900               613,200
Deferred taxes on income                                                                      185,000               189,000
Accrued interest receivable                                                                   605,695               568,569
Prepaid expenses and other assets                                                             502,749               270,618
                                                                                        --------------        --------------

      Total assets                                                                      $ 100,354,357         $ 102,361,363
                                                                                        ==============        ==============


Liabilities and Stockholders' Equity
------------------------------------

Deposits                                                                                $  67,144,696         $  70,042,590
FHLB advance                                                                                9,700,000             9,700,000
Advance payments by borrowers for
    taxes and insurance                                                                       100,083               338,167
Accrued interest payable                                                                      315,589                53,454
Current income taxes payable                                                                  102,957                84,414
Accrued expenses and other liabilities                                                        839,097               794,438
                                                                                        --------------        --------------

      Total liabilities                                                                    78,202,422            81,013,063
                                                                                        --------------        --------------


Stockholders' Equity
--------------------

Common stock,  $.10 par value,  20,000,000 shares authorized;                                 215,061               213,339
     2,150,610  issued and 1,886,126 outstanding at September 30, 2002
     2,133,386  issued and 1,871,151 outstanding at December 31, 2001
Additional paid-in capital                                                                  9,440,991             9,242,996
Retained earnings, substantially restricted                                                16,313,902            15,749,736
Unrealized gain on securities available-for-sale                                               62,920                23,168
Treasury stock, 262,238 shares at September 30, 2002 and December 31, 2001                 (3,880,939)           (3,880,939)
                                                                                        --------------        --------------
      Total stockholders' equity                                                           22,151,935            21,348,300

      Total liabilities and stockholders' equity                                        $ 100,354,357         $ 102,361,363
                                                                                        ==============        ==============
</TABLE>

See notes to consolidated financial statements.

                                       1

<PAGE>

<TABLE>
<CAPTION>

                                             Webster City Federal Bancorp and Subsidiaries

                                                 Consolidated Statements of Operations


                                                      For the Three Months                            For the Nine Months
                                                       Ended September 30,                            Ended September 30,
                                                ----------------------------------             ----------------------------------
                                                     2002               2001                        2002               2001
                                                ---------------    ---------------             ---------------    ---------------
                                                                                    (Unaudited)
<S>                                                <C>                <C>                         <C>                <C>
Income
------
Interest Income:
   Loans receivable                                $ 1,450,943        $ 1,434,813                 $ 4,284,261        $ 4,198,229
   Mortgage-backed & related securities                 51,172             79,327                     174,315            272,841
   Investment securities                               129,681             49,563                     428,448            275,300
   Other interest-earning assets                        39,581             95,571                     133,336            310,781
                                                ---------------    ---------------             ---------------    ---------------
      Total interest income                          1,671,377          1,659,274                   5,020,360          5,057,151

Interest Expense:
   Deposits                                            518,784            772,507                   1,722,165          2,325,953
   FHLB advance                                        127,765             96,382                     379,129            340,933
                                                ---------------    ---------------             ---------------    ---------------
      Total interest expense                           646,549            868,889                   2,101,294          2,666,886
                                                ---------------    ---------------             ---------------    ---------------
   Net interest income                               1,024,828            790,385                   2,919,066          2,390,265
Provision for losses on loans                           20,000                  -                      20,000                  -
                                                ---------------    ---------------             ---------------    ---------------
   Net interest income after
      provision for losses on loans                  1,004,828            790,385                   2,899,066          2,390,265
                                                ---------------    ---------------             ---------------    ---------------

Non-Interest Income:
   Fees and service charges                             85,900             90,976                     216,799            196,673
   Other                                                41,157             42,907                     145,696            132,542
                                                ---------------    ---------------             ---------------    ---------------
      Total Non-interest Income                        127,057            133,883                     362,495            329,215
                                                ---------------    ---------------             ---------------    ---------------

Expense

Noninterest Expense:
   Compensation, payroll taxes,
     and employees benefits                            262,168            240,272                     802,098            711,522
   Office property and equipment                        53,216             46,560                     140,202             82,556
   Data processing services                             50,121             28,221                     131,555             91,000
   Federal insurance premiums                            2,967              3,459                       9,225             10,298
   Other real estate expenses, net                       4,701              4,097                      23,969              5,246
   Advertising                                           7,406              8,393                      21,263             21,990
   Other                                                99,870            162,957                     342,860            456,325
                                                ---------------    ---------------             ---------------    ---------------
      Total noninterest expense                        480,449            493,959                   1,471,172          1,378,937
                                                ---------------    ---------------             ---------------    ---------------

Earnings before taxes on income                        651,436            430,309                   1,790,389          1,340,543

Taxes on income                                        233,200            133,772                     647,642            489,904
                                                ---------------    ---------------             ---------------    ---------------

Net earnings                                         $ 418,236          $ 296,537                 $ 1,142,747          $ 850,639
                                                ===============    ===============             ---------------    ---------------

Earnings per share - basic                              $ 0.22             $ 0.16                      $ 0.61             $ 0.45
                                                ===============    ===============             ===============    ===============

Earnings per share - diluted                            $ 0.22             $ 0.16                      $ 0.61             $ 0.45
                                                ===============    ===============             ===============    ===============
</TABLE>

       See notes to consolidated financial statements.


                                       2

<PAGE>

<TABLE>
<CAPTION>

                                   Webster City Federal Bancorp and Subsidiaries

                                       Consolidated Statements of Cash Flows

                                                                                         For the Nine Months
                                                                                         Ended September 30,
                                                                         --------------------------------------------------
                                                                               2002                            2001
                                                                         ------------------              ------------------
                                                                                              (Unaudited)
<S>                                                                            <C>                               <C>
Cash flows from operating activities
   Net earnings                                                                $ 1,142,746                       $ 850,639
                                                                         ------------------              ------------------

   Adjustments to reconcile net earnings to net cash
     provided by operating activities:
        Depreciation                                                               119,064                          47,665
        Amortization of premiums and discounts, net                                  4,718                           6,104
        Gain on sale of investments available-for-sale                                   -                             535
        Transfer of loans to Real Estate Owned                                     125,170                               -
        Change in:
             Accrued interest receivable                                           (37,126)                        114,982
             Prepaid expenses and other assets                                    (156,725)                        104,748
             Accrued interest payable                                              262,135                         421,672
             Accrued expenses and other liabilities                                155,631                         181,446
             Accrued current taxes on income                                       (80,414)                        (90,119)
                                                                         ------------------              ------------------

                  Total adjustments                                                392,453                         787,033
                                                                         ------------------              ------------------

                  Net cash provided by operating activities                      1,535,199                       1,637,672
                                                                         ------------------              ------------------

Cash flows from investing activities
   Proceeds from the maturity of interest bearing deposits                       1,796,000                       9,574,123
   Purchase of interest earning deposits                                        (8,131,000)                     (8,000,000)
   Proceeds from sales of securities available-for-sale                          4,998,450                               -
   Purchase of securities available-for-sale                                    (3,000,000)                     (1,104,000)
   Principal collected on mortgage-backed and related securities                 1,071,148                       1,422,836
   Net change in loans receivable                                               (1,872,909)                     (5,292,581)
   Purchase of office property and equipment                                        (3,192)                       (574,804)
   Purchase of FHLB Stock                                                          (91,700)                              -
                                                                         ------------------              ------------------

            Net cash used in investing activities                               (5,233,203)                     (3,974,426)
                                                                         ------------------              ------------------

Cash flows from financing activities
   Net change in deposits                                                       (2,897,894)                      2,749,041
   Net decrease in advance payments by borrowers
     for taxes and insurance                                                      (238,084)                       (192,274)
   Proceeds from stock options                                                     199,717                         100,981
   Repurchase of common stock                                                            -                        (333,300)
   Net change in borrowings                                                                                     (2,000,000)
   Dividends paid                                                                 (576,860)                       (443,387)
                                                                         ------------------              ------------------
            Net cash used in financing activities                               (3,513,121)                       (118,939)
                                                                         ------------------              ------------------

            Net decrease in cash and cash equivalents                           (7,211,125)                     (2,455,693)

Cash and cash equivalents at beginning of period                                 9,183,215                       6,250,706
                                                                         ------------------              ------------------

Cash and cash equivalents at end of period                                     $ 1,972,090                     $ 3,795,013
                                                                         ==================              ==================

Supplemental disclosures of cash flow information:
   Cash paid during the year for:
     Interest                                                                  $ 1,460,030                     $ 1,904,281
     Taxes on income                                                               557,726                         524,690
                                                                         ==================              ==================

     Transfers from loans to real estate acquired
     through foreclosure                                                         $ 247,160                     $         -
                                                                         ==================              ==================
</TABLE>

See notes to consolidated financial statements.

                                       3

<PAGE>


                  Webster City Federal Bancorp and Subsidiaries

                   Notes to Consolidated Financial Statements
                                   (Unaudited)

1. DESCRIPTION OF BUSINESS
   -----------------------

Webster City Federal  Bancorp ( the  "Company" ) and its  subsidiaries,  Webster
City  Federal  Savings  Bank,  a federal  stock  savings  bank (the  "Bank") and
Security Title and Abstract,  Inc.,  conduct operations in Webster City, Iowa, a
community of approximately  8,000 people.  The Bank is primarily  engaged in the
business of attracting  deposits from the general  public in its market area and
investing  such  deposits  in  mortgage  loans  secured  by  one-to-four  family
residential real estate.  The Bank's primary area of lending and other financial
services  consists of Hamilton  County,  Iowa,  and the  surrounding  contiguous
counties.  Security  Title and  Abstract,  Inc.  is engaged in the  business  of
providing  abstracting  and title  services for  properties  located in Hamilton
County, Iowa.

Webster City Federal  Bancorp was formed as the holding  company for the Bank on
July 1, 1999  pursuant to a plan of  reorganization  adopted by the Bank and its
stockholders. Pursuant to the reorganization, each share of Webster City Federal
Savings  Bank  common  stock  held by  existing  stockholders  of the  Bank  was
exchanged  for a share of common  stock of Webster  City  Federal  Bancorp.  The
reorganization had no financial  statement impact and is reflected for all prior
periods presented.  Approximately 60% of the Company's  outstanding common stock
is  owned by WCF  Financial  M.H.C.,  a mutual  holding  company  (the  "Holding
Company").  The remaining 40% of the Company's outstanding common stock is owned
by the general public including the Bank's Employee Stock Ownership Plan.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
   ------------------------------------------

The consolidated financial statements for the three and nine-month periods ended
September 30, 2002 and 2001 are  unaudited.  In the opinion of management of the
Company, these financial statements reflect all adjustments,  consisting only of
normal  recurring  accruals  necessary  to  present  fairly  these  consolidated
financial statements.  The results of operations for the interim periods are not
necessarily  indicative  of results  that may be  expected  for an entire  year.
Certain  information  and footnote  disclosures  normally  included in financial
statements prepared in accordance with generally accepted accounting  principles
have been omitted.

Principles of Consolidation
---------------------------

The  consolidated  financial  statements  include the  accounts of Webster  City
Federal Bancorp, Security Title and Abstract, Inc., Webster City Federal Savings
Bank and its wholly owned subsidiary, WCF Service Corporation,  which is engaged
in the sales of  mortgage  life and credit  life  insurance  to the Bank's  loan
customers.  All  material  inter-company  accounts  and  transactions  have been
eliminated in the consolidation.

The  consolidated  financial  statements  have been prepared in accordance  with
accounting  principles  generally  accepted in the Unites States of America.  In
preparing  such financial  statements,  management is required to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of contingent  assets and  liabilities  as of the date of the balance
sheet and  revenues and expenses  for the period.  Actual  results  could differ
significantly  from those  estimates.  Material  estimates that are particularly
susceptible to significant  change relate to management's  determination  of the
allowance for loan losses, which is a critical accounting policy of the Company.
We believe our policies  with respect to the  methodology  for  determining  the
allowance for loan losses  involve a higher  degree of  complexity  and requires
management  to make  subjective  judgments  that often  require  assumptions  or
estimates  about highly  uncertain  matters.  These critical  policies and their
application are periodically  reviewed with the Audit Committee and the Board of
Directors.

                                       4


<PAGE>





3. EARNINGS PER SHARE COMPUTATIONS
   --------------------------------

2002
----

Earnings  per share - basic is computed  using the  weighted  average  number of
common  shares  outstanding  of 1,888,376  and  1,879,562 for the three and nine
months ended September 30, 2002, respectively, and divided into the net earnings
of $418,236 and  $1,142,747,  for the three and nine months ended  September 30,
2002,  respectively,  resulting in basic earnings per share of $.22 and $.61 for
the three and nine months ended September 30, 2002, respectively.

Earnings per share - diluted is computed  using the weighted  average  number of
common shares outstanding after giving effect to additional shares assumed to be
issued  pursuant to the Bank's  stock  option  plan using the average  price per
share for the period. Such additional shares were 3,445 and 3,283 shares for the
three and nine months ended September 30, 2002, respectively, due to the average
price  per share  being  more than the  stock  option  exercise  price for these
periods.  Net earnings for the three and nine months  ended  September  30, 2002
were $418,236 and $1,142,747,  respectively,  resulting in diluted  earnings per
share of $.22 and $.61 for the three and nine months ended  September  30, 2002,
respectively.

2001
----

Earnings  per share - basic is computed  using the  weighted  average  number of
common  shares  outstanding  of 1,867,901  and  1,880,101 for the three and nine
months ended September 30, 2001, respectively, and divided into the net earnings
of $296,537  and  $850,639,  for the three and nine months ended  September  30,
2001, respectively, resulting in net earnings per share of $.16 and $.45 for the
three and nine months ended September 30, 2001, respectively.

Earnings per share - diluted is computed  using the weighted  average  number of
common shares outstanding after giving effect to additional shares assumed to be
issued  pursuant to the Bank's  stock  option  plan using the average  price per
share for the period.  There were no additional  shares assumed to be issued for
the three and nine months ended September 30, 2001, due to the average price per
share being less than the stock option  exercise  price for these  periods.  Net
earnings for the three and nine months ended  September  30, 2001 were  $296,537
and $850,639, respectively, resulting in net earnings per share of $.16 and $.45
for the three and nine months ended September 30, 2001, respectively.

4. DIVIDENDS
   ---------

On July 17,  2002 the  Company  declared a cash  dividend  on its  common  stock
payable on August 22, 2002 to stockholders of record as of August 6, 2002, equal
to $.25 per share or  approximately  $537,654.  Of this  amount,  the payment of
approximately  $287,500  (representing  the dividend payable on 1,150,000 shares
owned by WCF Financial, M.H.C., the Company's mutual holding company) was waived
by the mutual holding company,  resulting in an actual dividend  distribution of
$250,154.

5. INTANGIBLE ASSET
   ----------------

A Company subsidiary  maintains an intangible asset relating to a customer list.
It has an  estimated  useful life of 15 years and is being  amortized  using the
straight-line  method.  At September  30, 2002,  the gross  carrying  amount was
$145,000 with accumulated amortization of $19,337.  Amortization expense for the
nine  months  ended  September  30,  2002  and  2001  was  $7,254  and  $10,476,
respectively.

The  estimated  amortization  expense for the  following  five year period is as
follows:

           December 31, 2003              $  9,667.
           December 31, 2004                 9,667.
           December 31, 2005                 9,667.
           December 31, 2006                 9,667.
           December 31, 2007                 9,667.


                                       5

<PAGE>

                                     Item 2

                  Webster City Federal Bancorp and Subsidiaries

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


FINANCIAL CONDITION
-------------------

Total  assets  decreased by $2.0  million,  or 1.9%,  from  December 31, 2001 to
September 30, 2002.  Cash and cash  equivalents  decreased $7.2 million or 78.4%
and time deposits in other financial  institutions  increased by $6.3 million or
450%. Loans receivable  increased $1.7 million or 2.3% from December 31, 2001 to
September  30,  2002.  At September  30,  2002,  the Company had $44,000 in real
estate  owned.  Investment  securities  decreased  $1.4  million or 30.6%,  from
December  31, 2001 to  September  30,  2002.  Prepaid  expenses and other assets
increased by $232,100 or 85.7% from  December  31, 2001 to  September  30, 2002,
which includes an investment of $280,000 in a local real estate property. During
the nine-month period deposits decreased $2.9 million, or 4.1%.

Total  stockholders'  equity increased by $803,600 to $22.2 million at September
30,  2002 from $21.3 at  December  31,  2001 as  earnings  of $1.1  million  and
additional paid in capital received from officers exercising their stock options
were offset by three quarterly dividends totaling $576,900.

CAPITAL
-------

The Bank's total  equity,  increased by $695,200,  to $21.3 million at September
30,  2002  from  $20.6  million  at  December  31,  2001.  The  Office of Thrift
Supervision   (OTS)  requires  that  the  Bank  meet  certain   minimum  capital
requirements.  As of  September  30,  2002 the Bank was in  compliance  with all
regulatory capital requirements.  The Bank's required, actual and excess capital
levels as of September 30, 2002 were as follows:

                       Required       % of      Actual      % of      Excess
                        Amount       Assets     Amount      Assets    Capital
                        ------       ------     ------      ------    -------
                                        (Dollars in thousands)

Tier 1 (Core) Capital   $3,994       4.0%      $21,322      21.36%     $17,328
Risk-based Capital      $4,015       8.0%      $21,581      43.00%     $17,566

LIQUIDITY
---------

OTS  regulations  require  the Bank to  maintain  an  average  daily  balance of
qualified liquid assets (cash, certain time deposits and specified United States
government,  state or federal agency  obligations) equal to a monthly average of
not less than 4% of its net withdrawable deposits plus short-term borrowings.

RESULTS OF OPERATIONS
---------------------

Interest  Income.  Interest  income  remained  unchanged at $1.7 million for the
three months ended  September 30, 2002 and for the three months ended  September
30,  2001.  This  was  the  result  of  a  decrease  in  the  average  yield  on
interest-earning  assets to 6.83% for the three months ended  September 30, 2002
from 7.03% for the three months ended  September 30, 2001 and an increase in the
average  balance of  interest  earning  assets of $3.5  million or 3.7% to $97.9
million for the three months ended September 30, 2002 from $94.4 million for the
three months ended September 30, 2001.  Interest income remained at $5.0 million
for the nine months  ended  September  30,  2002 and for the nine  months  ended
September  30, 2001.  This was the result of a decrease in the average  yield on
interest-earning  assets to 6.84% for the nine months ended  September  30, 2002
from 7.22% for the nine months ended  September  30, 2001 and an increase in the
average  balance of  interest  earning  assets of $4.5  million or 4.8% to $97.8
million for the nine months ended  September 30, 2002 from $93.4 million for the
nine months ended September 30, 2001.

Interest  on loans for the three  months  ended  September  30,  2002  increased
$16,100 or 1.1%  compared to the three months  ended  September  30,  2001.  The
increase resulted  primarily from an increase in total loans outstanding  during

                                       6

<PAGE>

the period,  offset by a decrease in the yields on loans  receivable  from 7.74%
for the nine months ended  September 30, 2001 to 7.63% for the nine months ended
September  30, 2002.  Interest on loans for the nine months ended  September 30,
2002 increased  $86,000 or 2.0% compared to the nine months ended  September 30,
2001.  The  increase  resulted   primarily  from  an  increase  in  total  loans
outstanding  for the nine months ended  September  30, 2002,  partly offset by a
decrease in the yields on loans  receivable from 7.74% for the nine months ended
September 30, 2001 to 7.63% for the nine months ended  September  30, 2002.  The
decrease in the yield on loans  receivable  was  primarily  due to lower  market
rates and adjustable  rate loans  repricing at a lower rate based on the lagging
index used by the Bank.

Interest on  mortgage-backed  securities  decreased  by $28,200 or 35.5% for the
three-month period ended September 30, 2002 as compared to the same period ended
September  30,  2001.  The decline  resulted  from a decrease of $2.0 million or
42.3% in the average balance of  mortgage-backed  securities to $3.2 million for
the three months ended  September 30, 2002 from to $4.7 million for three months
ended  September 30, 2001 and a decrease of 38 basis points in the average yield
on mortgage-backed  securities to 6.36% for the three months ended September 30,
2002 from 6.74% for the three  months  ended  September  30,  2001.  Interest on
mortgage-backed  securities decreased $98,500 or 36.1% for the nine months ended
September 30, 2002 compared to same period ended September 30, 2001. The decline
resulted  from a decrease  of $1.7  million or 32.3% in the  average  balance of
mortgage-backed  securities to $3.6 million for the nine months ended  September
30,  2002 from $5.3  million  for nine  months  ended  September  30, 2001 and a
decrease of 42 basis points in the average yield on  mortgage-backed  securities
to 6.48% for the nine months  ended  September  30, 2002 from 6.90% for the nine
months ended September 30, 2001.

Interest on investment  securities  increased by $80,100 or 161.6% for the three
months ended  September 30, 2002 compared to the same period ended September 30,
2001.  This  was  due  to an  increase  in the  average  balance  of  investment
securities  from $3.9 million for the three months ended  September  30, 2001 to
$9.5 million for the three months  ended  September  30, 2002 and an increase in
the average  yield of 30 basis  points from 5.15%,  for the three  months  ended
September  30, 2001 to 5.45%,  for the three  months ended  September  30, 2002.
Interest on  investment  securities  increased by $153,100 or 55.6% for the nine
months ended  September 30, 2002 as compared to the same period ended  September
30,  2001.  This was due to an  increase in the  average  balance of  investment
securities  from $5.9  million for the nine months ended  September  30, 2001 to
$10.9 million for the nine months ended  September 30, 2002 offset by a decrease
in the average  yield of 101 basis points from 6.21%,  for the nine months ended
September 30, 2001 to 5.20%, for the nine months ended September 30, 2002.

Interest  Expense.  Interest  expense  decreased  by  $222,300,  or 25.6%,  from
$868,900 for the three months ended September 30, 2001 to $646,500 for the three
months ended  September  30,  2002.  Interest  expense  decreased by $565,600 or
21.2%,  from $2.7 million for the nine months ended  September  30, 2001 to $2.1
million for the nine months ended  September 30, 2002.  The interest  expense on
the FHLB  advances  increased  by $31,400 or 32.6%  from  $96,400  for the three
months ended September 30, 2001 to $127,800 for the three months ended September
30, 2002.  The  increase in interest on FHLB  advances was more than offset by a
decrease in interest  on  deposits  of $253,700 or 32.8% from  $772,500  for the
three  months  ended  September  30, 2001 to $518,800 for the three months ended
September 30, 2002. The interest expense on the advances increased by $38,200 or
11.2% from $340,900 for the nine months ended September 30, 2001 to $379,100 for
the nine months  ended  September  30,  2002.  The  increase in interest on FHLB
advances  was more than offset by a decrease in interest on deposits of $603,800
or 26.0% from $2.3 million for the nine months ended  September 30, 2001 to $1.7
million for the nine months ended September 30, 2002. Net Interest  Income.  Net
interest  income before  provision for losses on loans  increased by $234,400 or
29.7% from  $790,400  for the three  months  ended  September  30,  2001 to $1.0
million for the three  months ended  September  30,  2002.  Net interest  income
increased  by  $528,800 or 22.1% for the nine months  ended  September  30, 2002
compared to the same period ended  September 30, 2001.  The  Company's  interest
rate spread for the nine months ended  September 30, 2002  increased by 87 basis
points to 3.23% from 2.36% for the nine months ended September 30, 2001.

Provision  for  Losses on Loans.  There were  provisions  for losses on loans of
$20,000 for the three and nine months ended  September 30, 2002. The Company had
$379,300 in  non-performing  loans as of September 30, 2002 compared to $687,100
as of  September  30,  2001.  The  allowance  for  losses  on  loans is based on
management's  periodic  evaluation of the loan  portfolio and reflects an amount
that, in  management's  opinion,  reflects all known and inherent  losses in the
portfolio  that are both probable and  reasonably  estimable.  In evaluating the
portfolio,  management  takes into  consideration  numerous  factors,  including
current economic conditions,  prior loan loss experience, the composition of the
loan portfolio, and management's estimate of anticipated credit losses.

                                       7

<PAGE>


Non-interest  Income.  Total non-interest income decreased by $6,800 or 5.1% for
the  three-month  period ended September 30, 2002 as compared to the same period
ended September 30, 2001. Non-interest income increased $33,300 or 10.1% for the
nine months  ended  September  30,  2002 as  compared  to the same period  ended
September  30,  2001.  The  increases  were  related to an  increase in fees and
service charges.

Non-interest  Expense.  Non-interest  expense  decreased $13,500 or 2.7% for the
three-month  period ended  September  30, 2002 compared to the same period ended
September  30,  2001.  Non-interest  expense  increased  $92,200 or 6.7% for the
nine-month  period ended  September  30, 2002  compared to the same period ended
September 30, 2001.  Compensation  and benefit costs  increased  $21,900 or 9.1%
from $240,300 for the three months ended  September 30, 2001 to $262,200 for the
three-month  period ended September 30, 2002. The increase in  compensation  was
due to the addition of one full-time staff member and the Company's contribution
to the employees  defined benefit  retirement  plan.  Data  processing  services
expense  increased  $21,900 or 77.6% for the three-month  period ended September
30, 2002 compared to the same period ended September 30,  2001.The  increase was
due to the  Bank  changing  data  processing  centers  to be able to  offer  its
customer's new services.  Compensation and benefit costs increased by $90,600 to
$802,100 for the nine months ended September 30, 2002 from $711,500 for the nine
months ended  September 30, 2001.  The increase in  compensation  was due to the
addition of one  full-time  staff member and the Company's  contribution  to the
employees defined benefit  retirement plan. The increase in compensation was due
to the addition of one full-time staff member and the Company's  contribution to
the employees defined benefit retirement plan. Data processing  services expense
increased  $40,600 or 44.6% for the nine-month  period ended  September 30, 2002
compared to the same period ended  September  30, 2001.  The increase was due to
the Bank changing data processing centers to be able to offer its customer's new
services.

Taxes on Income.  Income taxes for the three months  ended  September  30, 2002,
increased to $233,200  compared to $133,800 for the same period ended  September
30 2001.  Income taxes for the nine months ended  September 30, 2002,  increased
$157,800 or 32.2% to $647,700  from  $489,900  for the  nine-month  period ended
September 30 2001.  The  effective  income tax rate for the first nine months of
2002 was 37.8% compared to 36.6% for the first nine months of 2001.

Net Earnings. Net earnings totaled $418,200 for the three months ended September
30, 2002 compared to $296,500 for the three months ended September 30, 2001. Net
earnings  increased  $292,100 or 34.3% to $1.1 million for the nine-month period
ended  September  30,  2002  compared  to  $850,600  for the same  period  ended
September 30, 2001.

IMPACT OF NEW ACCOUNTING STANDARDS
----------------------------------

SFAS No. 141 & 142
------------------

In July 2001,  the FASB issued  Statement No. 141,  Business  Combinations,  and
Statement No. 142, Goodwill and Other Intangible Assets.  Statement 141 requires
that the purchase  method of  accounting  be used for all business  combinations
initiated  after  June  30,  2001  as  well  as  all  purchase  method  business
combinations completed after June 30, 2001. Statement 142 requires that goodwill
and intangible assets with indefinite  useful lives no longer be amortized,  but
instead  tested  for  impairment  at  least  annually  in  accordance  with  the
provisions of Statement 142.  Statement 142 also requires that intangible assets
with  estimatable  useful lives be  amortized  over their  respective  estimated
useful lives to their estimated  residual values, and reviewed for impairment in
accordance  with  FAS  Statement  No.  121,  Accounting  for the  Impairment  of
Long-Lived  Assets and for  Long-Lived  Assets to Be  Disposed  Of. The  Company
adopted  the  provisions  of SFAS No. 141 as of July 1, 2001 and SFAS No. 142 on
January 1, 2002.  The effects of  implementation  had no impact on the Company's
financial condition or results of operations.

SFAS No. 143 & 144
------------------

In June 2001,  the FASB  issued SFAS No. 143,  Accounting  for Asset  Retirement
Obligations (SFAS No. 143). SFAS No. 143 requires the Company to record the fair
value of an asset retirement obligation as a liability in the period in which it
incurs a legal obligation  associated with the retirement of tangible long-lived
assets that  result  from the  acquisition,  construction,  development,  and/or
normal use of the assets.  The Company also records a corresponding  asset which
is depreciated over the life of the asset. The Company is required to adopt SFAS
No. 143 on January 1, 2003.

                                       8

<PAGE>


In August 2001,  the FASB issued SFAS No. 144,  Accounting for the Impairment or
Disposal of Long-Lived  Assets (SFAS No. 144). SFAS No. 144 addresses  financial
accounting  and reporting for the  impairment or disposal of long-lived  assets.
The  Company   adopted  SFAS  No.  144  on  January  1,  2002.  The  effects  of
implementation  were immaterial on the Company's  financial condition or results
of operations.


SFAS No. 145 & 146
------------------

SFAS No. 145 "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB
Statement  No. 13,  and  Technical  Corrections"  was issued  April  2002.  This
Statement  rescinds  FASB  Statement  No. 4,  Reporting  Gains and  Losses  from
Extinguishment  of Debt, and an amendment of that Statement,  FASB Statement No.
64,  Extinguishments  of Debt Made to Satisfy  Sinking-Fund  Requirements.  This
Statement also rescinds FASB Statement No. 44,  Accounting for Intangible Assets
of Motor Carriers.  This Statement amends FASB Statement No. 13,  Accounting for
Leases,  to  eliminate an  inconsistency  between the  required  accounting  for
sale-leaseback  transactions  and the  required  accounting  for  certain  lease
modifications  that have  economic  effects  that are similar to  sale-leaseback
transactions.   This  Statement   also  amends  other   existing   authoritative
pronouncements  to make various  technical  corrections,  clarify  meanings,  or
describe their applicability under changed conditions.

The provisions of this Statement  related to the rescission of Statement 4 shall
be applied in fiscal years  beginning  after May 15,  2002.  The  provisions  in
paragraphs  8 and  9(c) of this  Statement  related  to  Statement  13  shall be
effective for transactions occurring after May 15, 2002. All other provisions of
this Statement  shall be effective for financial  statements  issued on or after
May 15, 2002. The effects of implementation are not material.

SFAS No. 146 "Accounting for Costs Associated with Exit or Disposal  Activities"
was  issued  June  2002.  This  Statement  addresses  financial  accounting  and
reporting for costs  associated  with exit or disposal  activities and nullifies
Emerging  Issues Task Force (EITF) Issue No. 94-3,  "Liability  Recognition  for
Certain  Employee  Termination  Benefits  and  Other  Costs to Exit an  Activity
(including Certain Costs Incurred in a Restructuring)."

The provisions of this Statement are effective for exit and disposal  activities
that are initiated after December 31, 2002.

SFAS No. 147
------------

In September 2002, the FASB issued SFAS 147  Acquisitions  of Certain  Financial
Institutions  (SFAS No. 147).  SFAS No. 147 changed the special  accounting  for
unidentifiable  intangible  assets  recognized  under  SFAS No.  72.  Transition
provisions  for  previously  recognized  unidentifiable  intangible  assets were
effective on October 1, 2002. The effects of implementation had no impact on the
Company's financial condition or results of operations.

Safe Harbor Statement
---------------------

This report contains certain  forward-looking  statements  within the meaning of
Section 27A of the  Securities  Act of 1933, as amended,  and Section 21E of the
Securities  Exchange  Act  of  1934,  as  amended.   The  Company  intends  such
forward-looking  statements  to be covered  by the safe  harbor  provisions  for
forward-looking  statements  contained in the Private  Securities  Reform Act of
1995,  and is  including  this  statement  for the purposes of these safe harbor
provisions.  Forward-looking statements,  which are based on certain assumptions
and describe  future plans,  strategies  and  expectations  of the Company,  are
generally  identifiable  by use  of the  words  "believe,"  "expect,"  "intend,"
"anticipate,"  "estimate,"  "project,"  or similar  expressions.  The  Company's
ability to predict results or the actual effect of future plans or strategies is
inherently  uncertain.  Factors that could have a material adverse effect on the
operations and future prospects of the Company and its subsidiaries include, but
are not limited to, changes in: interest  rates,  general  economic  conditions,
legislative/regulatory   changes,  monetary  and  fiscal  polices  of  the  U.S.
Government,  including  polices of the U.S.  Treasury  and the  Federal  Reserve
Board, the quality or composition of the loan or investment  portfolios,  demand
for loan products, deposit flows, competition,  demand for financial services in
the Company's  market area and accounting  principles,  polices and  guidelines.
These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.


                                       9

<PAGE>

                                     Item 3

                             Controls and Procedures


      (a) Evaluation of disclosure controls and procedures.

Under the supervision and with  participation  of our management,  including the
Company's  Chief  Executive  Officer and Chief  Financial  Officer,  the Company
evaluated  the  effectiveness  of  the  design  and  operation  of  the  Company
disclosure  controls  and  procedures  (as defined in Rule  13a-14(c)  under the
Exchange Act) as of a date (the  "Evaluation  Date") within 90 days prior to the
filing date of this  report.  Based upon that  evaluation,  the Chief  Executive
Officer and Chief Financial  Officer concluded that, as of the Evaluation Date ,
The Company disclosure controls and procedures were effective in timely alerting
them  to  the  material   information   relating  to  us  (or  our  consolidated
subsidiaries) required to be included in our periodic SEC filings.

      (b) Changes in internal controls.

There were no  significant  changes  made in out  internal  controls  during the
period covered by this report or, to our knowledge,  in other factors that could
significantly affect these controls subsequent to the date of their evaluation.

                                       10

<PAGE>

                  Webster City Federal Bancorp and Subsidiaries

                           PART II. Other Information



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

     There  are  various   claims  and  lawsuits  in  which  the  Registrant  is
periodically involved incidental to the Registrant's business. In the opinion of
management,  no material  loss is expected  from any of such  pending  claims or
lawsuits.


Item 2. Changes in Securities
        ---------------------
           None


Item 3. Defaults Upon Senior Securities
        -------------------------------
           None


Item 4. Submission of Matters to a Vote of Security Holders.
        ----------------------------------------------------
           None


Item 5. Other Information
        -----------------
           None


Item 6. Exhibits and Reports on Form 8-K.
        ---------------------------------

           (a) Exhibits

          99.1 Written Statement of Chief Executive  Officer furnished  pursuant
               to  Section  906 of the  Sarbanes-Oxley  Act of 2002,  18  U.S.C.
               Section 1350.

          99.2 Written Statement of Chief Financial  Officer furnished  pursuant
               to  Section  906 of the  Sarbanes-Oxley  Act of 2002,  18  U.S.C.
               Section 1350.

            (b) No form 8-K reports were filed during the quarter ended
                September 30, 2002.



                                       11

<PAGE>


                  Webster City Federal Bancorp and Subsidiaries


                                   Signatures

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


                                    WEBSTER CITY FEDERAL BANCORP
                                            Registrant




Date: November 8, 2002
                               By:  /s/ Phyllis A. Murphy
                                    --------------------------------------------
                                    Phyllis A. Murphy
                                    President and Chief Executive Officer




Date: November 8, 2002         By:  /s/ Stephen L. Mourlam
                                    --------------------------------------------
                                    Stephen L. Mourlam
                                    Exec. Vice President/Chief Financial Officer



                                       12

<PAGE>


                    Certification of Chief Executive Officer
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


I, Phyllis A. Murphy, President and Chief Executive Officer, certify that:

1.   I have  reviewed  this  quarterly  report on Form  10-QSB of  Webster  City
     Federal Bancorp;

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

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

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

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c)   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

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

     a)   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report  whether  there  were  significant  changes  in  internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.



                                        /s/ Phyllis A. Murphy
---------------------                  -------------------------------------
Date                                   Phyllis A. Murphy
                                       President and Chief Executive Officer


<PAGE>


                    Certification of Chief Financial Officer
            Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002


I, Stephen L. Mourlam,  Executive  Vice President and Chief  Financial  Officer,
certify that:

1.   I have  reviewed  this  quarterly  report on Form  10-QSB of  Webster  City
     Federal Bancorp;

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

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

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

     a.   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     b.   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     c.   presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

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

     a.   all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     b.   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly  report  whether  there  were  significant  changes  in  internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.



---------------------                  -------------------------------------
Date                                    Stephen L. Mourlam
                                        Executive Vice President and Chief
                                        Financial Officer

<PAGE>