SecProbe.io

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<TYPE>CORRESP
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April 18, 2005

FILED VIA EDGAR

Mr. John P. Nolan
Accounting Branch Chief
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C.  20549

            Re:      Pocahontas Bancorp, Inc.
                     Form 10-K for the fiscal year ended September 30, 2004
                     Filed December 29, 2004

                     Form 10-Q for the period ended December 31, 2004
                     File Number: 000-23969

Dear Mr. Nolan:

     We are in receipt of your letter dated March 18, 2005 providing comments on
the referenced filings for Pocahontas Bancorp, Inc. (the "Company").

     For your convenience we have reproduced each of the staff's comments,  with
the Company's responses following each comment as follows:

Form 10-K filed on December 29, 2004
------------------------------------

Notes to the Consolidated Financial Statements
----------------------------------------------

Note 1. Summary of Significant Accounting Policies
--------------------------------------------------

1.   We note that you  amortize  core  deposit  premiums  over ten years,  which
     approximates the estimated life of the purchased  deposits.  We acknowledge
     that you periodically evaluate the carrying value to estimate the remaining
     periods of benefit.  Further we note that your deposit  balances  decreased
     from $586 million as of September  30, 2003 to $491 million as of September
     30, 2004 and the accompanying discussions on page 10 of your Annual Report.
     Please supplementally provide the following:

     o    An analysis of your most recent  periodic  review  performed which has
          enabled you to conclude no core  deposit  premium  impairment  exists.
          Specifically  state in your  response when this analysis was performed
          and provide all relevant details and schedules, as appropriate;

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          Deposit balances acquired through acquisitions that comprise the basis
          for our core  deposit  premium are  analyzed  annually  and  monitored
          quarterly.  The last such annual  analysis  was  completed  during the
          quarter  ended  December 31, 2004.  The Company's  annual  analysis is
          conducted  under  the  principles  of SFAS  142,  Goodwill  and  Other
          Intangible Assets,  paragraph 15. This guidance requires consideration
          of SFAS 121, which has been superseded by SFAS 144, Accounting for the
          Impairment of Disposal of Long-Lived  Assets.  No events or changes in
          circumstances  occurred that would require the core deposit premium to
          be tested for  recoverability  as required in SFAS 144,  paragraph  8.
          Included  in our annual  analysis  is a  comparison  of the  projected
          deposit   balances  on  which  the  core  deposit  premium  asset  was
          determined  at the time of each  acquisition  with the actual  deposit
          balances at the annual  reporting  period.  At September 30, 2004, the
          deposit balances at all acquired  operating branches were in excess of
          the balances at the date of the related acquisition. Deposits acquired
          totaled $244.3 million at acquisition  and $306.5 million at September
          30, 2004. You observed and asked about the decline in deposits  during
          the year ended September 30, 2004. The Company's management decided to
          permit a decrease in deposits by not matching  competitor rates during
          the year  ended  September  30,  2004,  due to the high  cost of those
          deposits  and the  alternative  sources  the  Company  had for  funds.
          However, as noted above, the results of this decision did not decrease
          the  balances  of  deposits  at  acquired  locations  to less than the
          balances  of those  deposits at the dates of  acquisition.  During the
          year ended  September 30, 2004, the Company did sell a branch location
          that had been a part of an  acquisition in a prior year. In accounting
          for this sale,  the  Company  analyzed  the amount of  remaining  core
          deposit  premium  at the date of the sale of the branch  location  and
          appropriately adjusted the carrying value of the core deposit premium.
          This  analysis  was a result of our  quarterly  monitoring  of deposit
          balances for unusual or unexpected declines.

     o    Include  within your  analysis  the portion of the decrease in deposit
          balances  specifically  attributable to your current  acquisitions for
          which core deposit  intangibles  were recorded and are currently being
          amortized;

          The balance of deposits at the acquired  branches  associated with the
          core deposit  premiums  decreased from $367.0 million at September 30,
          2003,  to $306.5  million at September  30, 2004.  The $306.5  million
          balance of deposits  at  acquired  branches  on  September  30,  2004,
          although down for the year,  is still over $62.0  million  higher than
          the balance of deposits acquired.  As noted above, during fiscal 2004,
          the Company sold a branch resulting in a decrease in deposits of $13.0
          million.  The  Company  recorded  an  appropriate  adjustment  to core
          deposit premiums associated with the transaction.

     o    Explain  how you  determined  that a useful  life of ten years for all
          core deposit premiums is appropriate based on your analysis;

          Following the guidance contained within SFAS 142, - Goodwill and Other
          Intangible  Assets,  paragraph  11, for each  acquisition  the Company
          analyzed the core deposit  premium asset and  calculated the number of
          years  that the asset was  expected  to  contribute  to the  Company's
          future cash flows. The Company  estimated the number of years it would
          take  the  acquired  deposits  to reach  5% of the  original  accounts
          acquired.   The   Company   applied  a  retention   rate   (determined
          individually  for  each  acquisition)

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          based  on  historical  retention  rates.  This  analysis  resulted  in
          estimated  useful  lives  ranging  between 15 to 29 years for the core
          deposit premiums associated with the acquisitions.

          In addition to the  analysis  performed  by the  Company,  the Company
          retained an unaffiliated and widely respected  business valuation firm
          to assist  with the  valuation  and  analysis  of the  Company's  core
          deposit  premiums and their related  useful lives.  The firm concurred
          with the  Company's  analysis.  Based on the  Company's  analysis  and
          subject  to the  ten-year  limitations  included  in Staff  Accounting
          Bulletin   42A   (the   applicable   guidance   at  the  time  of  the
          acquisitions),  the Company determined that 10 years would be used for
          the estimated useful lives and subsequent amortization period for core
          deposit premiums. No events or circumstances have occurred that caused
          the  Company to change the useful  lives of the  intangible  assets or
          revise the remaining period of amortization as prescribed by SFAS 142,
          paragraph 14, other than the branch sale noted above.

     o    Please provide to us a rollforward of your core deposit  premium,  net
          balance as  presented  in your  Consolidated  Statements  of Financial
          Condition.  Specifically,  we note that  your  balance  has  decreased
          approximately  $1.58  million,  but your  expense as  reported in your
          Consolidated Statements of Cash Flows relating to your amortization of
          core deposit premiums was $944,696;

<TABLE>
<CAPTION>

<S>                                                              <C>
          Beginning Balance October 1, 2003                      7,880,406
            Amortization                                          (944,696)
            Adjustment for sale of Strawberry Branch              (639,187)
                                                              -------------
          Ending Balance September 30, 2004                      6,296,523
                                                              =============
</TABLE>

     o    Please  tell  us  what  line  item in the  financial  statements  your
          amortization  of core  deposit  premiums is  recorded  and revise your
          accounting policy footnote in future filings accordingly.

          The amortization of core deposit premiums is reported in the "interest
          expense on deposits" line item of the Company's Consolidated Statement
          of Income.  The Company  considers  the  amortization  of core deposit
          premiums a cost  associated  with the deposits  acquired and therefore
          presents  the expense  associated  with the  amortization  as interest
          expense,  a line item within  continuing  operations  as prescribed by
          SFAS 142,  paragraph  42. The Company  will revise  future  filings to
          disclose that amortization of core deposit premiums is included in the
          "interest expense" line item of the Company's  Consolidated  Statement
          of Income.

     Please refer to the authoritative  guidance in paragraphs 11-15 of SFAS No.
     142.  Please  specifically  key  your  individual  responses  to the  above
     guidance when you explain how you determined  your relevant  accounting for
     this issue.

          As requested in the comment,  we have referred to the guidance of SFAS
          No. 142 in the above responses.

2.   We note from your  Critical  Accounting  Policy  disclosure  on page 6 that
     goodwill is  reviewed  at least  annually to ensure that there have been no
     events of  circumstances  resulting in an impairment of the recorded amount
     of excess  purchase  price.  You also

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     state that  adverse  changes in the  economic  environment,  operations  of
     acquired  business  units,  or other  factors  could result in a decline in
     projected  fair  values.  We also  note  that  you have  acquired  numerous
     institutions as evidenced on page 2 of your most recent 10-K filing. Please
     supplementally provide to us the following:

     o    Explain how you have identified  reporting  unit(s) on which to review
          your goodwill for potential impairment;

          The  Company  has  identified  a single  reporting  unit to exist.  In
          determining  the  reporting  unit,  the Company  referred to SFAS 142,
          paragraph 30, EITF D-101,  Clarification of Reporting Unit Guidance in
          Paragraph  30 of FASB  Statement  No. 142,  and SFAS 131,  Disclosures
          about Segments of an Enterprise and Related Information, which defines
          a  reporting  unit as the  same  level  as,  or one  level  below,  an
          operating segment. The companies acquired by the Company have all been
          banking or  savings  and loan  holding  companies  exhibiting  similar
          economic characteristics and subject to similar economic conditions as
          the  Company.  Neither  the assets nor  liabilities  obtained  in such
          acquisitions  were unique,  and all of the acquired  companies offered
          similar  products and services to customers.  In these  circumstances,
          paragraph 17 of SFAS 131  indicates  the existence and use of a single
          reporting unit.

          In  addition,  as noted  above,  the Company  engaged an  unaffiliated
          appraisal firm to assist in the fair value  computation  that was used
          in the analysis to determine whether  impairment  existed.  As part of
          that process, that firm independently reached the conclusion that only
          one reporting unit exists.

     o    Explain how you have assigned acquired assets (including goodwill) and
          liabilities for your reporting unit(s);

          As required by SFAS 141, Business Combinations, the purchase method of
          accounting was used in recording all assets and liabilities associated
          with each acquisition. No assignment of acquired assets or liabilities
          was necessary  because only one reporting  unit exists,  as defined in
          SFAS 131.

     o    Explain the  method(s)  by which you have  measured  the fair value of
          your reporting unit(s) during your most recent analysis;

          As noted above, the Company engaged an unaffiliated  appraisal firm to
          assist in the valuation computation that was used to determine that no
          impairment  existed.  Fair value is defined in SFAS 142 as "the amount
          at which that asset (or  liability)  could be bought (or  incurred) or
          sold (or settled) in a current  transaction  between willing  parties,
          that is, other than in a forced or liquidation sale." The following is
          noted in respect to this definition of value:

          o    An active  market  was  simulated,  assuming  that it exists  and
               functions properly.

          o    Fair value is expressed in cash-equivalent terms.

          o    While the  definition  above is silent with regard to the "level"
               of value (i.e.,  marketable or nonmarketable  minority  control),
               paragraph 23 of SFAS 142 clarifies  that fair value is applicable
               to the unit "as a whole," or at the controlling interest level of
               value.  Further comments regarding the consideration of

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<PAGE>

               synergies in the valuation of the reporting unit lead the Company
               to conclude  that fair value is consistent  with the  traditional
               notation  of  investment  value to the  current  owner  (in other
               words,  considering all synergies and other benefits  expected to
               accrue to the reporting unit).

          The fair  value  is a  correlated  indication  of  value  computed  by
          weighting various valuations as prescribed by SFAS 142,  paragraphs 23
          - 25. The  discounted  future  benefits  approach  and  single  period
          capitalization of earnings were each accorded a one-third weight. This
          reflects the primary importance that the market places on the earnings
          capacity and expected  growth therein as the primary  determinants  of
          financial  institution value. The stated and tangible capitalized book
          value were combined and accorded a one-third weight.

     o    Include in your response how the significant  decrease  experienced in
          your  deposit  balances in the  current  year has  impacted  your most
          recent fair value determination;

          The decreases in the Company's  deposit balances during the year ended
          September 30, 2004,  caused management to analyze whether the decrease
          in total  deposits was also  reflected in those  deposits  used in the
          initial  determination  of the core deposit  premiums and whether such
          decrease, if it existed,  indicated a decrease beyond that anticipated
          at the date of initial  determination of the core deposit premiums for
          each   acquisition.   Management   included   in  its   analysis   the
          reasonableness of the decreases actually  experienced compared to what
          management  believed,  based on the markets the Company serve,