Bear State Financial 8-K/A Report of Independent Auditors

Exhibit 99.3

UNAUDITEDPROFORMA CONDENSEDCOMBINEDCONSOLIDATEDFINANCIALINFORMATION

The following unaudited pro forma condensed combined consolidated financial statements as of and for the three months ended March 31, 2014 and for the year ended December 31, 2013 combine the historical consolidated financial statements of Bear State Financial, Inc. (the “Company”)(formerly First Federal Bancshares of Arkansas, Inc.) and First National Security Company (“FNSC”). The unaudited pro forma condensed combined consolidated financial statements give effect to the merger and the Company’s related private placement (the “Private Placement”) as if such transactions occurred on March 31, 2014 with respect to the pro forma combined consolidated balance sheet, and on January 1, 2013, with respect to the pro forma combined consolidated income statements.

The notes to the unaudited pro forma combined consolidated financial statements describe the pro forma amounts and adjustments presented below.

This pro forma data is not necessarily indicative of the operating results that the Company would have achieved had it completed the merger and the Private Placement as of January 1, 2013 and should not be considered as representative of future operations. In addition, as explained in more detail in the accompanying notes, the fair values of the FNSC assets acquired and liabilities assumed reflected in the unaudited pro forma condensed combined consolidated financial information are subject to adjustment and may vary from the actual fair values assigned that will be recorded upon completion of the merger.

The unaudited pro forma combined consolidated financial information presented below is based on, and should be read together with, the historical financial information of the Company and FNSC.

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Unaudited Pro Forma Condensed Combined Consolidated Balance Sheet

As ofMarch 31, 2014

(in thousands)

	Bear State Financial, Inc.			First National Security Company			Pro Forma Adjustments				Pro Forma Combined
Assets
Cash and cash equivalents	$	29,503		$	160,690		$	(50,410	)	(a)	$	139,783
Interest bearing time deposits in banks		23,869			--							23,869
Investment securities held to maturity		--			981			9		(b)		990
Investment securities available for sale		71,951			122,724							194,675
Loans receivable		403,464			611,757			(16,877	)	(c)		998,344
Allowance for loan losses		(12,478	)		(12,888	)		12,888		(d)		(12,478	)
Loans receivable, net		390,986			598,869			(3,989	)			985,866
Other real estate owned, net		7,031			99							7,130
Office properties and equipment, net		18,439			33,246			(2,232	)	(e)		49,453
Cash surrender value of life insurance		24,011			1,927							25,938
Goodwill		--			56,219			(31,029	)	(f)		25,190
Core deposit and other intangibles		--			607			7,109		(g)		7,716
Prepaid expenses and other assets		3,523			11,226			(366	)	(h)		14,383
TOTAL ASSETS	$	569,313		$	986,588		$	(80,908	)		$	1,474,993
Liabilities
Deposits – noninterest bearing	$	22,025		$	149,853		$				$	171,878
Deposits – interest bearing		466,692			627,178			366		(i)		1,094,236
Total deposits		488,717			777,031			366				1,266,114
Repurchase agreements and federal funds purchased		--			10,639							10,639
Other borrowings		5,912			41,268			64		(j)		47,244
Other liabilities		3,110			2,640			165		(h)(k)		5,915
Total liabilities		497,739			831,578			595				1,329,912
Stockholders’ equity
Common stock		200			1			(1	)	(l)		300
								100		(m)
Additional paid-in capital		92,815			10,866			(10,866	)	(l)		166,222
								73,407		(m)
Accumulated other comprehensive income		122			116			(116	)	(l)		122
Retained earnings (accumulated deficit)		(21,563	)		144,027			(144,027	)	(l)		(21,563	)
Total stockholders’ equity		71,574			155,010			(81,503	)			145,081
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	569,313		$	986,588		$	(80,908	)		$	1,474,993

See accompanying notes to Unaudited Pro Forma Condensed Combined Consolidated Financial Information

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Unaudited Pro FormaCondensedCombined Consolidated Income Statement

For theThree Months EndedMarch 31, 2014

(in thousands, except earnings per share data)

	Bear State Financial, Inc.			First National Security Company			Pro Forma Adjustments				Pro Forma Combined
Interest Income:
Loans receivable	$	4,135		$	7,788		$	2,107		(n)	$	14,030
Investment securities – taxable		225			129							354
Investment securities - nontaxable		286			37							323
Other		105			142							247
Total interest income		4,751			8,096			2,107				14,954
Interest Expense:
Deposits		869			462			(94	)	(o)		1,237
Other borrowings		22			427			(11	)	(p)		438
Total interest expense		891			889			(105	)			1,675
Net interest income before provision for loan losses		3,860			7,207			2,212				13,279
Provision for loan losses		--			300							300
Net interest income after provision for loan losses		3,860			6,907			2,212				12,979
Noninterest Income:
Net gain on sale of investment securities		-			(1	)						(1	)
Deposit fee income		625			1,180							1,805
Earnings on life insurance policies		201			13							214
Gain on sale of loans		304			--							304
Other		72			292							364
Total noninterest income		1,202			1,484			-				2,686
Noninterest Expense:
Salaries and employee benefits		3,110			3,242							6,352
Net occupancy expense		585			1,028							1,613
Real estate owned, net		217			9							226
Amortization of intangible assets		-			39			156		(q)		195
Other		1,427			1,704							3,131
Total noninterest expense		5,339			6,022			156				11,517
Income (loss) before provision for income taxes		(277	)		2,369			2,056				4,148
Provision for income taxes		-			944			787		(r)(s)		1,731
Net income (loss) available to common stockholders	$	(277	)	$	1,425		$	1,269			$	2,417
Basic earnings (loss) per share:
Earnings (loss) per share	$	(0.01	)	$	13.22						$	0.08
Weighted average shares outstanding		20,042			108							28,826
Diluted earnings (loss) per share:
Earnings (loss) per share	$	(0.01	)	$	13.22						$	0.08
Weighted average shares outstanding		20,042			108							29,637

See accompanying notes to Unaudited Pro Forma Condensed Combined Consolidated Financial Information

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Unaudited Pro FormaCondensedCombined Consolidated Income Statement

For the Year Ended December 31,2013

(in thousands, except earnings per share data)

	Bear State Financial, Inc.		First National Security Company		Pro Forma Adjustments				Pro Forma Combined
Interest Income:
Loans receivable	$	16,202	$	32,021	$	4,911		(n)	$	53,134
Investment securities – taxable		482		576						1,058
Investment securities - nontaxable		1,189		181						1,370
Other		492		527						1,019
Total interest income		18,365		33,305		4,911				56,581
Interest Expense:
Deposits		3,339		1,932		(201	)	(o)		5,070
Other borrowings		53		1,983		(27	)	(p)		2,009
Total interest expense		3,392		3,915		(228	)			7,079
Net interest income before provision for loan losses		14,973		29,390		5,139				49,502
Provision for loan losses		--		360						360
Net interest income after provision for loan losses		14,973		29,030		5,139				49,142
Noninterest Income:
Net gain on sale of investment securities		25		103						128
Deposit fee income		3,059		4,995						8,054
Earnings on life insurance policies		808		66						874
Gain on sale of loans		1,103		29						1,132
Other		431		2,318						2,749
Total noninterest income		5,426		7,511		-				12,937
Noninterest Expense:
Salaries and employee benefits		11,349		12,213						23,562
Net occupancy expense		2,373		4,347						6,720
Real estate owned, net		229		89						318
Amortization of intangible assets		-		243		625		(q)		868
Other		5,708		6,204						11,912
Total noninterest expense		19,659		23,096		625				43,380
Income before provision for income taxes		740		13,445		4,514				18,699
Provision for income taxes		11		5,117		1,728		(r)(s)		6,856
Net income available to common stockholders	$	729	$	8,328	$	2,786			$	11,843
Basic earnings per share:
Earnings per share	$	0.04	$	77.26					$	0.41
Weighted average shares outstanding		19,846		108						28,630
Diluted earnings per share:
Earnings per share	$	0.03	$	77.26					$	0.40
Weighted average shares outstanding		20,858		108						29,642

See accompanying notes to Unaudited Pro Forma Condensed Combined Consolidated Financial Information

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Notes to Unaudited Pro FormaCondensedCombined Consolidated Financial Statements

As of and for theThree Months EndedMarch 31, 2014

And for the Year Ended December 31, 2013

Note 1 – Pro Forma Adjustments

(in thousands, except share data)

(a) This represents the cash merger consideration of $74.0 million, net of estimated proceeds of $23.6 million generated from the Private Placement and exercise of warrants. The remaining cash merger consideration of $50.4 million was funded by dividends declared and paid by First Federal Bank (approximately $26.5 million), and FNSC's subsidiary bank First National Bank (approximately $24 million) at closing of the merger.

(b) This represents the recording of the mark-to-market adjustment on FNSC’s held-to-maturity investment portfolio.

(c) This adjustment represents the Company’s estimate of the necessary write down of FNSC’s loan portfolio to estimated fair value as part of the purchase accounting adjustments. The estimated purchase accounting adjustment for FNSC’s loan portfolio is comprised of approximately $5.3 million of non-accretable credit adjustments and approximately $11.6 million of accretable yield adjustments. As provided for under GAAP, management has up to 12 months following the date of acquisition to finalize the fair values of the acquired assets and assumed liabilities. Therefore it is possible that the amount and/or the composition of these estimated purchase accounting adjustments could change significantly in future periods. The weighted average remaining maturity of this acquired loan portfolio is approximately 3.7 years.

(d) This adjustment represents the elimination of FNSC’s allowance for loan losses as part of the purchase accounting adjustments.

(e) This adjustment represents the Company’s estimate of the necessary write down of FNSC’s office properties to estimated fair value.

(f) The consideration paid for FNSC exceeded the fair value of the net assets received; therefore the Company recorded a $31.0 million adjustment to goodwill.

(g) This intangible asset represents the value of the relationships FNSC had with its deposit customers. The fair value of this intangible asset was estimated based on a discounted cash flow methodology that gave appropriate consideration to expected customer attrition rates, cost of the deposit base, and the net maintenance cost attributable to customer deposits.

(h) The adjustment consists of $312,000 to reflect the application of stock issuance costs incurred through March 31, 2014 to stockholders’ equity as described in note (m) and a $54,000 adjustment to deferred taxes. The adjustment of $54,000 is for the deferred income tax assets and liabilities recorded to reflect the differences in the carrying values of the acquired assets and assumed liabilities for financial reporting purposes and the cost basis for federal income tax purposes, at the Company’s statutory federal and state income tax rate of 38.29%. See note (s) below for discussion of the Company’s net deferred tax asset and related valuation allowance.

(i) The fair values used for fixed term deposits was estimated using a discounted cash flow methodology based on current market rates for similar remaining maturities.

(j) The fair value of FHLB borrowed funds is estimated based on borrowing rates currently available to the Company for borrowings with similar terms and remaining maturities.

(k) This adjustment includes the Company’s estimate of remaining stock issuance costs to be paid of $165,000, including legal, accounting, and other transaction costs.

(l) This adjustment represents the elimination of the historical equity of FNSC as part of the purchase price adjustment.

(m) This adjustment represents the issuance of 6,252,400 shares of merger consideration at $8.06 per share, the closing price of the Company’s common stock on June 13, 2014, 2,531,646 shares from the Private Placement at the contractual sales price of $7.90 per share, and the exercise of 1,196,667 warrants at the contractual sales price of $3.00 per share, less estimated stock issuance costs of $477,000.

(n) The accretable portion of the fair value adjustment will be accreted into earnings using the level yield method over the remaining maturity of the underlying loans. For the purposes of the pro forma impact on the three months ended March 31, 2014 and the year ended December 31, 2013, the net discount accretion was calculated by summing monthly estimates of accretion/amortization on each loan pool, which was calculated based on the remaining maturity of each loan pool. The overall weighted average maturity of the loan portfolio is 3.7 years. This adjustment represents the Company’s best estimate of the expected accretion that would have been recorded in 2013 and in the first three months of 2014 assuming the merger closed on January 1, 2013. The estimated nonaccretable portion of the net discount of approximately $5.3 million will not be accreted into earnings.

(o) The fair value adjustment will be accreted into earnings as a reduction of the cost of such time deposits over the remaining maturity of the related deposits using the level yield method. The weighted average remaining maturity of such deposits is 9 months. This adjustment represents the Company’s best estimate of the expected accretion that would have been recorded in 2013 and in the first three months of 2014 assuming the merger closed on January 1, 2013.

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(p) The fair value adjustment will be accreted into earnings as a reduction of the cost of such borrowings using the level yield method. The weighted average remaining maturity of such borrowings is 6.0 years. This adjustment represents the estimated amount of accretion on FHLB advances that would have been recorded as a reduction of interest expense in 2013 and the first three months of 2014 assuming the transaction closed on January 1, 2013.

(q) This represents the expected amortization during 2013 and the first three months of 2014 of the core deposit intangible asset expected to be acquired in the merger, assuming the transaction closed on January 1, 2013. The useful life of this intangible asset is estimated to be 12.3 years.

(r) This represents income tax expense on the pro forma adjustments at the Company’s statutory federal and state income tax rate of 38.29%.

(s) The following is a discussion of the Company’s net deferred tax asset and related valuation allowance and its potential effect on the pro forma income statement. The credits to income tax expense noted in this discussion are not presented in the pro forma condensed income statement:

A full valuation allowance was provided against the Company’s net deferred tax asset as of December 31, 2009 due to operating losses caused by deterioration in credit quality. At March 31, 2014 a full valuation allowance continued to be provided against the Company’s net deferred tax asset based on the Company’s assessment of available positive and negative evidence. Although the Company returned to profitability in 2012, positive taxable income has not been attained. As a result of the effect of the valuation allowance, the Company’s deferred tax expense was eliminated for the year ended December 31, 2013 and the three months ended March 31, 2014. See Note 12 to the Company’s Audited Consolidated Financial Statements for the Years Ended December 31, 2013 and 2012 included in the Company’s Form 10-K filed March 28, 2014 for further information regarding the Company’s net deferred tax asset valuation allowance.

The Company plans to file a consolidated tax return for the Combined Company. If the proposed merger occurred on January 1, 2013, a portion of the Company’s net operating loss (“NOL”) carry forward for federal income tax purposes of approximately $24.7 million at December 31, 2013 as well as a portion of the NOL carry forward for state income tax purposes of approximately $47.0 million would have been used by the taxable income generated by the Combined Company resulting in a credit to income tax expense of approximately $5.1 million. The credit to income tax expense is a result of the valuation allowance reversal attributable to the use of the NOL carry forward.

For the three months ended March 31, 2014, credits to income tax expense for the Combined Company would also result from the use of the NOL carry forward and resulting reversal of the valuation allowance on the portion of the NOL carry forward used. It is estimated the credit to income tax expense for the three months ended March 31, 2014 would have been approximately $944,000.

Following completion of the merger and when there is positive evidence indicating that it is more likely than not that the net deferred tax asset will be realized, the Company expects to reverse the entire amount of its valuation allowance with the exception of amounts related to net unrealized built in losses and any state NOL carry forwards that are expected to expire unused.

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Note 2 – Pro Forma Allocation of Purchase Price

(in thousands, except share data)

The following table shows the pro forma allocation of purchase price to net assets acquired and the pro forma goodwill generated for the transaction:

Purchase Price
Cash			$	74,000
FNSC shares to be paid in stock		107,800
Exchange ratio		58
Company shares to be issued for FNSC shares		6,252,400
Price per share, based on closing price of Company common stock as of June 13, 2014	$	8.06
Pro forma value of Company shares to be issued				50,394
Total pro forma purchase price			$	124,394
Net Assets Acquired at Fair Value
Cash and cash equivalents	$	160,690
Investment securities		123,714
Loans receivable		594,880
Other real estate owned		99
Office properties		31,014
Core deposit intangible		7,716
Prepaid and other assets		13,099
Total assets		931,212
Deposits – noninterest bearing		149,853
Deposits – interest bearing		627,544
Borrowings		51,971
Other liabilities		2,640
Total liabilities		832,008
Net assets acquired at fair value				99,204
Pro forma goodwill			$	25,190

Note3 – Pro FormaWeighted Average Shares

Weighted average shares outstanding for the three months ended March 31, 2014 and for the year ended December 31, 2013 were calculated as follows:

	ThreeMonths Ended March 31, 2014		YearEnded December 31, 2013
Basic weighted average shares outstanding, as reported		20,041,547		19,845,675
Shares to be issued as merger consideration		6,252,400		6,252,400
Shares to be issued in the Private Placement		2,531,646		2,531,646
Pro forma basic weighted average shares outstanding		28,825,593		28,629,721
Diluted weighted average shares outstanding, as reported		20,041,547		20,858,430
Effective of antidilutive securities now dilutive		811,455		--
Shares to be issued as merger consideration		6,252,400		6,252,400
Shares to be issued in the Private Placement		2,531,646		2,531,646
Pro forma diluted weighted average shares outstanding		29,637,048		29,642,476

Note4 – Reclassifications

Certain historical amounts for the Company and FNSC have been reclassified to ensure consistency and comparability of pro forma amounts. The reclassifications had no effect on net income.

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