----

----

| x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------------|

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|----------------------------------------------------------------------------------------------------|

|                                                          |                                   |
|---------------------------------------------------------------|----------------------------------------|
| Federal                                                       | 42-1597948                             |
| (State or Other Jurisdiction ofIncorporation or Organization) | (I.R.S. EmployerIdentification Number) |
| 40 Main Street, Putnam, Connecticut                           | 06260                                  |
| (Address of Principal Executive Office)                       | (Zip Code)                             |

|   | Large accelerated filer o     | Accelerated filer  o               |   |
|--------|------------------------------------|----------------------------------------------|--------|
|   | Non-accelerated filer  o | Smaller reporting company   x |   |

|   | 1. | Proxy Statement for the 2012 Annual Meeting of Stockholders (Parts II and III) |
|--------|----|--------------------------------------------------------------------------------|

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----

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|                |                                                                                                               | Page                                                |
|---------------------|--------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------|
| PART I         |         1                                                                  |
|                |                                                                                                               |                                                |
| ITEM 1.        | Business                                                                                                           |         1   |
|                |                                                                                                               |                                                |
| ITEM 1A.       | Risk Factors                                                                                                       |        32        |
|                |                                                                                                               |                                                |
| ITEM 1B.       | Unresolved Staff Comments                                                                                          |        38        |
|                |                                                                                                               |                                                |
| ITEM 2.        | Properties                                                                                                         |         39  |
|                |                                                                                                               |                                                |
| ITEM 3.        | Legal Proceedings                                                                                                  |         40  |
|                |                                                                                                               |                                                |
| ITEM 4.        | Mine Safety Disclosures                                                                                            |         40  |
|                |                                                                                                               |
| PART II        |         41                                                                 |
|                |                                                                                                               |                                                |
| ITEM 5.        | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |         41  |
|                |                                                                                                               |                                                |
| ITEM 6.        | Selected Financial Data                                                                                            |        42        |
|                |                                                                                                               |                                                |
| ITEM 7.        | Management’s Discussion and Analysis of Financial Condition and Results of Operations                        |         43  |
|                |                                                                                                               |                                                |
| ITEM 7A.       | Quantitative and Qualitative Disclosures About Market Risk                                                         |         51  |
|                |                                                                                                               |                                                |
| ITEM 8.        | Consolidated Financial Statements and Supplementary Data                                                           |         52  |
|                |                                                                                                               |                                                |
| ITEM 9.        | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure                               |         114 |
|                |                                                                                                               |                                                |
| ITEM 9A.       | Controls and Procedures                                                                                            |         114 |
|                |                                                                                                               |                                                |
| ITEM 9B.       | Other Information                                                                                                  |         115 |
|                |                                                                                                               |
| PART III  |         115                                                                |
|                |                                                                                                               |                                                |
| ITEM 10.       | Directors, Executive Officers and Corporate Governance                                                             |         115 |
|                |                                                                                                               |                                                |
| ITEM 11.       | Executive Compensation                                                                                             |         115 |
|                |                                                                                                               |                                                |
| ITEM 12.       | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                     |         115 |
|                |                                                                                                               |                                                |
| ITEM 13.       | Certain Relationships and Related Transactions, and Director Independence                                          |         115 |
|                |                                                                                                               |                                                |
| ITEM 14.       | Principal Accountant Fees and Services                                                                             |         115 |
|                |                                                                                                               |
| PART IV   |         116                                                                |
|                |                                                                                                               |
| ITEM 15.       | Exhibits and Financial Statement Schedules                                                                         |         116 |
|                |                                                                                                               |
| Signatures          |         118                                                                |

----

| ITEM 1. | Business |
|--------------|----------|

----

----

|                                       |   | At June 30,            |    |
|--------------------------------------------|--------|------------------------|---------|
|                                       |   | 2012                   |    |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                       |   | Amount                 |    |   | Percent |   |   | Amount |   |   | Percent |   |   | Amount |   |   | Percent |   |   | Amount |   |   | Percent |   |   | Amount |   |   | Percent |   |
|                                       |   | (Dollars in thousands) |    |
| Mortgage Loans:                            |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Residential (1)          |   | $                      | 200,148 |   |   |   | 79.24 | % |   | $ | 193,084 |   |   |   | 74.96 | % |   | $ | 194,960 |   |   |   | 75.37 | % |   | $ | 200,680 |   |   |   | 74.57 | % |   | $ | 181,978 |   |   |   | 72.59 | % |
|    Commercial real estate   |   |                   | 45,032  |   |   |   | 17.83 |   |   |   | 53,248 |   |   |   | 20.67 |   |   |   | 54,398 |   |   |   | 21.03 |   |   |   | 56,500 |   |   |   | 20.99 |   |   |   | 55,406 |   |   |   | 22.10 |   |
|    Residential construction |   |                   | 3,044   |   |   |   | 1.20 |   |   |   | 2,824 |   |   |   | 1.10 |   |   |   | 1,338 |   |   |   | 0.52 |   |   |   | 1,887 |   |   |   | 0.70 |   |   |   | 3,223 |   |   |   | 1.29 |   |
| Commercial                                 |   |                   | 3,459   |   |   |   | 1.37 |   |   |   | 7,356 |   |   |   | 2.86 |   |   |   | 6,786 |   |   |   | 2.62 |   |   |   | 8,958 |   |   |   | 3.33 |   |   |   | 8,687 |   |   |   | 3.46 |   |
| Consumer and other                         |   |                   | 898     |   |   |   | 0.36 |   |   |   | 1,070 |   |   |   | 0.41 |   |   |   | 1,177 |   |   |   | 0.46 |   |   |   | 1,097 |   |   |   | 0.41 |   |   |   | 1,394 |   |   |   | 0.56 |   |
|                                       |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total loans                                |   |                   | 252,581 |   |   |   | 100.00 | % |   |   | 257,582 |   |   |   | 100.00 | % |   |   | 258,659 |   |   |   | 100.00 | % |   |   | 269,122 |   |   |   | 100.00 | % |   |   | 250,688 |   |   |   | 100.00 | % |
|                                       |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unadvanced construction loans              |   |                   | (1,559  | ) |   |   |   |   |   |   | (1,476 | ) |   |   |   |   |   |   | (1,521 | ) |   |   |   |   |   |   | (2,929 | ) |   |   |   |   |   |   | (6,522 | ) |   |   |   |   |
|                                       |   |                   | 251,022 |   |   |   |   |   |   |   | 256,106 |   |   |   |   |   |   |   | 257,138 |   |   |   |   |   |   |   | 266,193 |   |   |   |   |   |   |   | 244,166 |   |   |   |   |   |
| Net deferred loan costs                    |   |                   | 463     |   |   |   |   |   |   |   | 191 |   |   |   |   |   |   |   | 285 |   |   |   |   |   |   |   | 324 |   |   |   |   |   |   |   | 320 |   |   |   |   |   |
| Allowance for loan losses                  |   |                   | (2,913  | ) |   |   |   |   |   |   | (3,072 | ) |   |   |   |   |   |   | (2,651 | ) |   |   |   |   |   |   | (2,200 | ) |   |   |   |   |   |   | (1,758 | ) |   |   |   |   |
|                                       |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans, net                                 |   | $                      | 248,572 |   |   |   |   |   |   | $ | 253,225 |   |   |   |   |   |   | $ | 254,772 |   |   |   |   |   |   | $ | 264,317 |   |   |   |   |   |   | $ | 242,728 |   |   |   |   |   |
|                                       |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1)          Residential mortgage loans include one- to four-family mortgage loans, home equity loans, and home equity lines of credit. |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                      |   | Residential (1)        |    |                | Commercial Real Estate |   |   | Residential Construction |                |   | Commercial |   |   | Consumer and OtherLoans |   |   | Total Loans |   |
|-------------------------------------------|--------|------------------------|---------|---------------------|------------------------|--------|--------|--------------------------|---------------------|--------|------------|--------|--------|-------------------------|--------|--------|-------------|--------|
|                                      |   | Amount                 |    | WeightedAverageRate |                   |   | Amount |                     | WeightedAverageRate |   |       | Amount |   | WeightedAverageRate     |   |   | Amount      |   | WeightedAverageRate |   |   | Amount |   | WeightedAverageRate |   |   | Amount |   | WeightedAverageRate |   |
|                                      |   | (Dollars in thousands) |    |
| Due During the Years                      |   |                   |    |                |                   |   |   |                     |                |   |       |   |   |                    |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ending After June 30, 2012                |   |                   |    |                |                   |   |   |                     |                |   |       |   |   |                    |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |
| One year or less                          |   | $                      | 1,660   |                | 5.41                   | %      |   | $                        | 9,062               |   | 6.11       | %      |   | $                       | 1,930  |   | 4.36        | %      |   | $ | 1,081 |   | 5.30 | % |   | $ | 286 |   | 5.17 | % |   | $ | 14,019 |   | 5.70 | % |
| More than one to five years               |   |                   | 5,672   |                | 5.85                   | %      |   |                     | 10,844              |   | 6.25       | %      |   |                    | 369    |   | 6.31        | %      |   |   | 2,125 |   | 6.12 | % |   |   | 594 |   | 6.91 | % |   |   | 19,604 |   | 6.14 | % |
| More than five years                      |   |                   | 192,816 |                | 4.60                   | %      |   |                     | 24,312              |   | 6.32       | %      |   |                    | -      |   | 0.00        | %      |   |   | 253 |   | 5.65 | % |   |   | 18 |   | 6.00 | % |   |   | 217,399 |   | 4.79 | % |
|                                      |   |                   |    |                |                   |   |   |                     |                |   |       |   |   |                    |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|       Total |   | $                      | 200,148 |                | 4.64                   | %      |   | $                        | 44,218              |   | 6.26       | %      |   | $                       | 2,299  |   | 4.67        | %      |   | $ | 3,459 |   | 5.83 | % |   | $ | 898 |   | 6.34 | % |   | $ | 251,022 |   | 4.95 | % |

----

| (1) | Residential mortgage loans include one- to four-family mortgage loans, home equity loans, and home equity lines of credit. |
|-----|----------------------------------------------------------------------------------------------------------------------------|

----

|                                                   |   |           |    |   |       |   |   |   |   |
|--------------------------------------------------------|--------|----------------|---------|--------|------------|--------|--------|--------|--------|
|                                                   |   | Fixed          |    |   | Adjustable |   |   | Total  |   |
|                                                   |   | (In thousands) |    |
| Mortgage loans:                                        |   |           |    |   |       |   |   |   |   |
|      Residential (1)          |   | $              | 127,613 |   |       | $      | 70,875 |   |   | $ | 198,488 |   |
|      Commercial real estate   |   |           | 11,444  |   |       |   | 23,712 |   |   |   | 35,156 |   |
|      Residential construction |   |           | 300     |   |       |   | 69     |   |   |   | 369 |   |
| Commercial                                             |   |           | 1,390   |   |       |   | 988    |   |   |   | 2,378 |   |
| Consumer and other                                     |   |           | 612     |   |       |   | -      |   |   |   | 612 |   |
|                                                   |   |           |    |   |       |   |   |   |   |   |   |   |
|       Total              |   | $              | 141,359 |   |       | $      | 95,644 |   |   | $ | 237,003 |   |

----

| (1) | Residential mortgage loans include one- to four-family mortgage loans, home equity loans, and home equity lines of credit. |
|-----|----------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

|                                                                              |   | At June 30,            |   |
|-----------------------------------------------------------------------------------|--------|------------------------|--------|
|                                                                              |   | 2012                   |   |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                                                              |   | (Dollars in thousands) |   |
|                                                                              |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-accrual loans:                                                                |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential mortgage loans (1)                                                    |   | $                      | 3,985  |   |   | $ | 1,752 |   |   | $ | 1,425 |   |   | $ | 1,277 |   |   | $ | - |   |
|     Commercial real estate                                    |   |                   | 3,975  |   |   |   | 4,635 |   |   |   | 4,164 |   |   |   | 5,073 |   |   |   | 982 |   |
|     Residential construction                                  |   |                   | 424    |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |
| Commercial                                                                        |   |                   | -      |   |   |   | - |   |   |   | 213 |   |   |   | 99 |   |   |   | - |   |
| Total                                                                             |   |                   | 8,384  | (2) |   |   | 6,387 | (2) |   |   | 5,802 |   |   |   | 6,449 |   |   |   | 982 |   |
| Accruing loans past due 90 days or more:                                          |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential mortgage loans (1)                                                    |   |                   | -      |   |   |   | 32 |   |   |   | 491 |   |   |   | - |   |   |   | - |   |
|     Commercial real estate                                    |   |                   | -      |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 470 |   |
| Total                                                                             |   |                   | -      |   |   |   | 32 |   |   |   | 491 |   |   |   | - |   |   |   | 470 |   |
| Total non-performing loans                                                        |   |                   | 8,384  |   |   |   | 6,419 |   |   |   | 6,293 |   |   |   | 6,449 |   |   |   | 1,452 |   |
| Other real estate owned                                                           |   |                   | 1,683  |   |   |   | 1,074 |   |   |   | 1,561 |   |   |   | 1,211 |   |   |   | - |   |
| Other non-performing assets                                                       |   |                   | -      |   |   |   | 46 |   |   |   | 46 |   |   |   | 46 |   |   |   | - |   |
| Total non-performing assets                                                       |   |                   | 10,067 |   |   |   | 7,539 |   |   |   | 7,900 |   |   |   | 7,706 |   |   |   | 1,452 |   |
| Troubled debt restructurings in compliance with restructured terms                |   |                   | 3,443  |   |   |   | 4,644 |   |   |   | 930 |   |   |   | 259 |   |   |   | - |   |
| Troubled debt restructurings and total non-performing assets                      |   | $                      | 13,510 |   |   | $ | 12,183 |   |   | $ | 8,830 |   |   | $ | 7,965 |   |   | $ | 1,452 |   |
| Total non-performing loans to total loans                                         |   |                   | 3.34   | % |   |   | 2.51 | % |   |   | 2.45 | % |   |   | 2.42 | % |   |   | 0.59 |   |
| Total non-performing assets to total assets                                       |   |                   | 2.23   | % |   |   | 1.60 | % |   |   | 1.61 | % |   |   | 1.61 | % |   |   | 0.29 | % |
| Total non-performing assets and troubled debt restructurings to total assets |   |                   | 2.99   | % |   |   | 2.58 | % |   |   | 1.80 | % |   |   | 1.67 | % |   |   | 0.29 | % |

----

| (1) | Residential mortgage loans include one- to four-family mortgage loans, home equity loans, and home equity lines of credit. |
|-----|----------------------------------------------------------------------------------------------------------------------------|

| (2) | The gross interest income that would have been reported if the loans had performed in accordance with their original terms was $456,000 and $592,000 for the years ended June 30, 2012 and 2011, respectively. Actual income recognized in income was $201,000 and $202,000 for the years ended June 30, 2012 and 2011, respectively. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                             |   | Loans Delinquent For   |   |   |             |   |   |   |   |
|--------------------------------------------------|--------|------------------------|--------|--------|------------------|--------|--------|--------|--------|
|                                             |   | 60-89 Days Past Due    |   |   | 90 Days and Over |   |   | Total  |   |
|                                             |   | Number                 |   |   | Amount           |   |   | Number |   |   | Amount |   |   | Number |   |   | Amount |   |
|                                             |   | (Dollars in thousands) |   |
| At June 30, 2012                                 |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)          |   |                   | 2      |   |             | $      | 162    |   |   |   | 5 |   |   | $ | 940 |   |   |   | 7 |   |   | $ | 1,102 |   |
|     Commercial real estate   |   |                   | -      |   |             |   | -      |   |   |   | 5 |   |   |   | 1,573 |   |   |   | 5 |   |   |   | 1,573 |   |
|     Residential construction |   |                   | -      |   |             |   | -      |   |   |   | 1 |   |   |   | 424 |   |   |   | 1 |   |   |   | 424 |   |
| Total                                            |   |                   | 2      |   |             | $      | 162    |   |   |   | 11 |   |   | $ | 2,937 |   |   |   | 13 |   |   | $ | 3,099 |   |
|                                             |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| At June 30, 2011                                 |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)          |   |                   | 2      |   |             | $      | 247    |   |   |   | 5 |   |   | $ | 1,126 |   |   |   | 7 |   |   | $ | 1,373 |   |
|     Commercial real estate   |   |                   | 4      |   |             |   | 488    |   |   |   | 8 |   |   |   | 3,324 |   |   |   | 12 |   |   |   | 3,812 |   |
| Total                                            |   |                   | 6      |   |             | $      | 735    |   |   |   | 13 |   |   | $ | 4,450 |   |   |   | 19 |   |   | $ | 5,185 |   |
|                                             |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| At June 30, 2010                                 |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)          |   |                   | 6      |   |             | $      | 696    |   |   |   | 4 |   |   | $ | 491 |   |   |   | 10 |   |   | $ | 1,187 |   |
| Total                                            |   |                   | 6      |   |             | $      | 696    |   |   |   | 4 |   |   | $ | 491 |   |   |   | 10 |   |   | $ | 1,187 |   |
|                                             |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| At June 30, 2009                                 |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)          |   |                   | 3      |   |             | $      | 581    |   |   |   | - |   |   | $ | - |   |   |   | 3 |   |   | $ | 581 |   |
|     Commercial real estate   |   |                   | 4      |   |             |   | 2,024  |   |   |   | - |   |   |   | - |   |   |   | 4 |   |   |   | 2,024 |   |
| Total                                            |   |                   | 7      |   |             | $      | 2,605  |   |   |   | - |   |   | $ | - |   |   |   | 7 |   |   | $ | 2,605 |   |
|                                             |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| At June 30, 2008                                 |   |                   |   |   |             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Commercial real estate   |   |                   | 6      |   |             | $      | 1,289  |   |   |   | 11 |   |   | $ | 2,859 |   |   |   | 17 |   |   | $ | 4,148 |   |
|     Commercial               |   |                   | 1      |   |             |   | 45     |   |   |   | 1 |   |   |   | 195 |   |   |   | 2 |   |   |   | 240 |   |
| Total                                            |   |                   | 7      |   |             | $      | 1,334  |   |   |   | 12 |   |   | $ | 3,054 | (2) |   |   | 19 |   |   | $ | 4,388 |   |

----

| (1) | Residential mortgage loans include one- to four-family mortgage loans, home equity loans, and home equity lines of credit. |
|-----|----------------------------------------------------------------------------------------------------------------------------|

| (2) | The difference in loans delinquent 90 days and over and non-performing loans as of June 30, 2008 is primarily related to completion of underwriting for renewals and obtaining current financial information from borrowers, with these loans otherwise performing as agreed. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                                       |   | Year Ended June 30,    |   |
|----------------------------------------------------------------------------|--------|------------------------|--------|
|                                                                       |   | 2012                   |   |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                                                       |   | (Dollars in thousands) |   |
|                                                                       |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance at beginning of year                                               |   | $                      | 3,072  |   |   | $ | 2,651 |   |   | $ | 2,200 |   |   | $ | 1,758 |   |   | $ | 1,780 |   |
| Provision for loan losses                                                  |   |                   | 1,152  |   |   |   | 915 |   |   |   | 1,049 |   |   |   | 967 |   |   |   | 51 |   |
| Charge offs:                                                               |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)                                    |   |                   | (364   | ) |   |   | (208 | ) |   |   | (50 | ) |   |   | (53 | ) |   |   | - |   |
|     Commercial real estate                             |   |                   | (928   | ) |   |   | (62 | ) |   |   | (410 | ) |   |   | (400 | ) |   |   | - |   |
|     Commercial                                         |   |                   | -      |   |   |   | (212 | ) |   |   | (49 | ) |   |   | - |   |   |   | (27 | ) |
|     Consumer and other                                 |   |                   | (60    | ) |   |   | (72 | ) |   |   | (156 | ) |   |   | (118 | ) |   |   | (97 | ) |
| Total charge-offs                                                          |   |                   | (1,352 | ) |   |   | (554 | ) |   |   | (665 | ) |   |   | (571 | ) |   |   | (124 | ) |
| Recoveries:                                                                |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|     Residential (1)                                    |   |                   | 7      |   |   |   | 6 |   |   |   | 4 |   |   |   | 1 |   |   |   | - |   |
|     Commercial real estate                             |   |                   | -      |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 10 |   |
|     Commercial                                         |   |                   | 11     |   |   |   | 18 |   |   |   | 25 |   |   |   | 5 |   |   |   | 4 |   |
|     Consumer and other                                 |   |                   | 23     |   |   |   | 36 |   |   |   | 38 |   |   |   | 40 |   |   |   | 37 |   |
| Total recoveries                                                           |   |                   | 41     |   |   |   | 60 |   |   |   | 67 |   |   |   | 46 |   |   |   | 51 |   |
| Net charge-offs                                                            |   |                   | (1,311 | ) |   |   | (494 | ) |   |   | (598 | ) |   |   | (525 | ) |   |   | (73 | ) |
| Balance at end of year                                                     |   | $                      | 2,913  |   |   | $ | 3,072 |   |   | $ | 2,651 |   |   | $ | 2,200 |   |   | $ | 1,758 |   |
|                                                                       |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Ratios:                                                                    |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses to non-performing loansat end of year            |   |                   | 34.74  | % |   |   | 47.86 | % |   |   | 42.13 | % |   |   | 34.11 | % |   |   | 121.07 | % |
| Allowance for loan losses to total loansoutstanding at the end of the year |   |                   | 1.16   | % |   |   | 1.20 | % |   |   | 1.03 | % |   |   | 0.83 | % |   |   | 0.72 | % |
| Net charge-offs to average loans outstanding                               |   |                   | 0.51   | % |   |   | 0.19 | % |   |   | 0.22 | % |   |   | 0.20 | % |   |   | 0.03 | % |

----

----

|                            |   | Amount                 |   |   | % ofAllowance toTotalAllowance |   |   | % of Loansin Categoryto TotalLoans |   |
|---------------------------------|--------|------------------------|--------|--------|--------------------------------|--------|--------|------------------------------------|--------|
|                            |   | (Dollars in thousands) |   |
|                            |   |                   |   |   |                           |   |   |                               |   |
| At June 30, 2012                |   |                   |   |   |                           |   |   |                               |   |
| Residential mortgages (1)       |   | $                      | 1,505  |   |                           |   | 51.67  | %                                  |   |   | 80.43 | % |
| Commercial loans (2)            |   |                   | 1,364  |   |                           |   | 46.82  |                               |   |   | 19.21 |   |
| Consumer and other              |   |                   | 37     |   |                           |   | 1.27   |                               |   |   | 0.36 |   |
| Unallocated                     |   |                   | 7      |   |                           |   | 0.24   |                               |   |   | - |   |
| Total allowance for loan losses |   | $                      | 2,913  |   |                           |   | 100.00 | %                                  |   |   | 100.00 | % |
|                            |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| At June 30, 2011                |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| Residential mortgages (1)       |   | $                      | 1,548  |   |                           |   | 50.39  | %                                  |   |   | 76.05 | % |
| Commercial loans (2)            |   |                   | 1,426  |   |                           |   | 46.42  |                               |   |   | 23.53 |   |
| Consumer and other              |   |                   | 11     |   |                           |   | 0.36   |                               |   |   | 0.42 |   |
| Unallocated                     |   |                   | 87     |   |                           |   | 2.83   |                               |   |   | - |   |
| Total allowance for loan losses |   | $                      | 3,072  |   |                           |   | 100.00 | %                                  |   |   | 100.00 | % |
|                            |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| At June 30, 2010                |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| Residential mortgages (1)       |   | $                      | 1,342  |   |                           |   | 50.62  | %                                  |   |   | 75.89 | % |
| Commercial loans (2)            |   |                   | 1,198  |   |                           |   | 45.19  |                               |   |   | 23.65 |   |
| Consumer and other              |   |                   | 43     |   |                           |   | 1.62   |                               |   |   | 0.46 |   |
| Unallocated                     |   |                   | 68     |   |                           |   | 2.57   |                               |   |   | - |   |
| Total allowance for loan losses |   | $                      | 2,651  |   |                           |   | 100.00 | %                                  |   |   | 100.00 | % |
|                            |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| At June 30, 2009                |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| Residential mortgages (1)       |   | $                      | 1,085  |   |                           |   | 49.32  | %                                  |   |   | 75.27 | % |
| Commercial loans (2)            |   |                   | 1,016  |   |                           |   | 46.18  |                               |   |   | 24.32 |   |
| Consumer and other              |   |                   | 11     |   |                           |   | 0.50   |                               |   |   | 0.41 |   |
| Unallocated                     |   |                   | 88     |   |                           |   | 4.00   |                               |   |   | - |   |
| Total allowance for loan losses |   | $                      | 2,200  |   |                           |   | 100.00 | %                                  |   |   | 100.00 | % |
|                            |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| At June 30, 2008                |   |                   |   |   |                           |   |   |                               |   |   |   |   |
| Residential mortgages (1)       |   | $                      | 842    |   |                           |   | 47.89  | %                                  |   |   | 73.88 | % |
| Commercial loans (2)            |   |                   | 845    |   |                           |   | 48.07  |                               |   |   | 25.56 |   |
| Consumer and other              |   |                   | 15     |   |                           |   | 0.85   |                               |   |   | 0.56 |   |
| Unallocated                     |   |                   | 56     |   |                           |   | 3.19   |                               |   |   | - |   |
| Total allowance for loan losses |   | $                      | 1,758  |   |                           |   | 100.01 | %                                  |   |   | 100.00 | % |

----

| (1) | Residential mortgage loans include one- to four-family mortgage loans, residential construction loans, home equity loans, and home equity lines of credit. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Commercial loans include commercial real estate loans and commercial loans. |
|-----|-----------------------------------------------------------------------------|

----

----

----

----

| Issuer                  | Goldman Sachs    |   | Merrill Lynch    |   | Bank of America  |
|-------------------------|------------------|--------|------------------|--------|------------------|
| Par amount              |  $3,000,000 |   |  $5,000,000 |   |  $2,000,000 |
| Book Value              |  $3,000,000 |   |  $5,000,000 |   |  $2,000,000 |
| Purchase Date           | 12-12-07         |   | 09-04-07         |   | 11-20-07         |
| Maturity Date           | 08-23-26         |   | 05-28-27         |   | 08-17-47         |
| Next Reset Date         | 08-21-12         |   | 08-27-12         |   | 08-16-12         |
| Reset Frequency         | Quarterly        |   | Quarterly        |   | Quarterly        |
| Failed Auction          | Yes              |   | Yes              |   | Yes              |
| Receiving Default Rates | Yes              |   | Yes              |   | Yes              |
| Current Rate            | 4.592%           |   | 4.714%           |   | 4.677%           |
| Dividends Current:      | Yes              |   | Yes              |   | Yes              |

|                                                                      |   | At June 30,            |    |
|---------------------------------------------------------------------------|--------|------------------------|---------|
|                                                                      |   | 2012                   |    |   | 2011 |   |   | 2010 |   |
|                                                                      |   | Carrying               |    |   | Percent |   |   | Carrying |   |   | Percent |   |   | Carrying |   |   | Percent |   |
|                                                                      |   | Value                  |    |   | of total |   |   | Value |   |   | of total |   |   | Value |   |   | of total |   |
|                                                                      |   | (Dollars in thousands) |    |
|                                                                      |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Securities, available for sale:                                           |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government and government-sponsored securities                       |   | $                      | 459     |   |   |   | 0.3 | % |   | $ | 666 |   |   |   | 0.4 | % |   | $ | 6,101 |   |   |   | 3.6 | % |
| Corporate bonds and other securities                                      |   |                   | 4,654   |   |   |   | 3.1 | % |   |   | 4,905 |   |   |   | 2.9 | % |   |   | 4,368 |   |   |   | 2.6 | % |
| U.S. Government sponsored and guaranteed mortgage-backed securities  |   |                   | 24,113  |   |   |   | 15.8 | % |   |   | 30,316 |   |   |   | 17.5 | % |   |   | 50,734 |   |   |   | 30.0 | % |
| Non-agency mortgage-backed securities                                     |   |                   | 8,351   |   |   |   | 5.5 | % |   |   | 11,722 |   |   |   | 6.8 | % |   |   | 16,233 |   |   |   | 9.6 | % |
| Equity securities                                                         |   |                   | 9,636   |   |   |   | 6.3 | % |   |   | 10,400 |   |   |   | 6.0 | % |   |   | 8,457 |   |   |   | 5.0 | % |
| Total securities, available for sale                                      |   |                   | 47,213  |   |   |   | 31.0 | % |   |   | 58,009 |   |   |   | 33.6 | % |   |   | 85,893 |   |   |   | 50.8 | % |
|                                                                      |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Securities, held-to-maturity:                                             |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government and government-sponsored securities                       |   |                   | 9,192   |   |   |   | 6.0 | % |   |   | 16,085 |   |   |   | 9.3 | % |   |   | 45,275 |   |   |   | 26.8 | % |
| U.S. Government sponsored and guaranteed mortgage-backed securities       |   |                   | 96,003  |   |   |   | 63.0 | % |   |   | 98,656 |   |   |   | 57.1 | % |   |   | 37,974 |   |   |   | 22.4 | % |
| Total securities, held-to-maturity                                        |   |                   | 105,195 |   |   |   | 69.0 | % |   |   | 114,741 |   |   |   | 66.4 | % |   |   | 83,249 |   |   |   | 49.2 | % |
|                                                                      |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total securities                                                          |   | $                      | 152,408 |   |   |   | 100.0 | % |   | $ | 172,750 |   |   |   | 100.0 | % |   | $ | 169,142 |   |   |   | 100.0 | % |

----

|                                                                |   | In OneYear orLess      |   |   | After OneYearThroughFive Years |   |   | After FiveYearsThroughTen Years |   |   | After TenYears |   |   | Total  |    |
|---------------------------------------------------------------------|--------|------------------------|--------|--------|--------------------------------|--------|--------|---------------------------------|--------|--------|----------------|--------|--------|--------|---------|
|                                                                |   | (Dollars in thousands) |   |
| Securities available for sale:                                      |   |                   |   |   |                           |   |   |                            |   |   |           |   |   |   |    |
| U.S. Government and government-sponsored securities                 |   | $                      | 459    |   |                           | $      | -      |                            |   | $      | -              |   |   | $      | -       |   |   | $ | 459 |   |
| Corporate debt securities                                           |   |                   | -      |   |                           |   | -      |                            |   |   | -              |   |   |   | 4,654   |   |   |   | 4,654 |   |
| U.S. Government sponsored and guaranteed mortgage-backed securities |   |                   | 1      |   |                           |   | 440    |                            |   |   | 2,704          |   |   |   | 20,968  |   |   |   | 24,113 |   |
| Non-agency mortgage-backed securities                               |   |                   | -      |   |                           |   | -      |                            |   |   | -              |   |   |   | 8,351   |   |   |   | 8,351 |   |
| Total debt securities                                               |   |                   | 460    |   |                           |   | 440    |                            |   |   | 2,704          |   |   |   | 33,973  |   |   |   | 37,577 |   |
| Equity securities                                                   |   |                   | -      |   |                           |   | -      |                            |   |   | -              |   |   |   | 9,636   |   |   |   | 9,636 |   |
|                                                                |   |                   |   |   |                           |   |   |                            |   |   |           |   |   |   |    |   |   |   |   |   |
| Total securities available for sale                                 |   |                   | 460    |   |                           |   | 440    |                            |   |   | 2,704          |   |   |   | 43,609  |   |   |   | 47,213 |   |
|                                                                |   |                   |   |   |                           |   |   |                            |   |   |           |   |   |   |    |   |   |   |   |   |
| Securities held to maturity:                                        |   |                   |   |   |                           |   |   |                            |   |   |           |   |   |   |    |   |   |   |   |   |
| U.S. Government and government-sponsored securities                 |   |                   | -      |   |                           |   | 5,996  |                            |   |   | 3,196          |   |   |   | -       |   |   |   | 9,192 |   |
| U.S. Government sponsored and guaranteed mortgage-backed securities |   |                   | -      |   |                           |   | -      |                            |   |   | 6,767          |   |   |   | 89,236  |   |   |   | 96,003 |   |
| Total securities held to maturity                                   |   |                   | -      |   |                           |   | 5,996  |                            |   |   | 9,963          |   |   |   | 89,236  |   |   |   | 105,195 |   |
|                                                                |   |                   |   |   |                           |   |   |                            |   |   |           |   |   |   |    |   |   |   |   |   |
| Total securities                                                    |   | $                      | 460    |   |                           | $      | 6,436  |                            |   | $      | 12,667         |   |   | $      | 132,845 |   |   | $ | 152,408 |   |
| Weighted average yield                                              |   |                   | 5.27   | %      |                           |   | 1.90   | %                               |   |   | 2.64           | %      |   |   | 3.04    | % |   |   | 2.96 | % |

----

|                                            |   | At June 30,            |    |
|-------------------------------------------------|--------|------------------------|---------|
|                                            |   | 2012                   |    |   | 2011 |   |   | 2010 |   |
|                                            |   |                   |    |   |   |   |   | Weighted |   |   |   |   |   |   |   |   | Weighted |   |   |   |   |   |   |   |   | Weighted |   |
|                                            |   | Average                |    |   |   |   |   | Average |   |   | Average |   |   |   |   |   | Average |   |   | Average |   |   |   |   |   | Average |   |
|                                            |   | Balance                |    |   | Percent |   |   | Rate |   |   | Balance |   |   | Percent |   |   | Rate |   |   | Balance |   |   | Percent |   |   | Rate |   |
|                                            |   | (Dollars in thousands) |    |
|                                            |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                 |   | $                      | 38,948  |   |   |   | 11.66 | % |   |   | - | % |   | $ | 35,914 |   |   |   | 10.85 | % |   |   | - | % |   | $ | 35,279 |   |   |   | 10.99 | % |   |   | - | % |
| NOW accounts                                    |   |                   | 91,767  |   |   |   | 27.46 |   |   |   | 0.67 |   |   |   | 90,186 |   |   |   | 27.25 |   |   |   | 0.81 |   |   |   | 80,526 |   |   |   | 25.08 |   |   |   | 1.11 |   |
| Regular savings                                 |   |                   | 51,063  |   |   |   | 15.28 |   |   |   | 0.21 |   |   |   | 48,004 |   |   |   | 14.50 |   |   |   | 0.34 |   |   |   | 46,447 |   |   |   | 14.46 |   |   |   | 0.35 |   |
| Money market accounts                           |   |                   | 15,117  |   |   |   | 4.52 |   |   |   | 0.48 |   |   |   | 13,517 |   |   |   | 4.09 |   |   |   | 0.68 |   |   |   | 11,036 |   |   |   | 3.44 |   |   |   | 0.88 |   |
| Club accounts                                   |   |                   | 196     |   |   |   | 0.06 |   |   |   | 0.15 |   |   |   | 199 |   |   |   | 0.06 |   |   |   | 0.30 |   |   |   | 237 |   |   |   | 0.07 |   |   |   | 0.30 |   |
|                                            |   |                   | 197,091 |   |   |   | 58.98 |   |   |   | 0.40 |   |   |   | 187,820 |   |   |   | 56.75 |   |   |   | 0.52 |   |   |   | 173,525 |   |   |   | 54.04 |   |   |   | 0.67 |   |
| Certificates of deposit                         |   |                   | 137,054 |   |   |   | 41.02 |   |   |   | 1.96 |   |   |   | 143,158 |   |   |   | 43.25 |   |   |   | 2.34 |   |   |   | 147,599 |   |   |   | 45.96 |   |   |   | 2.58 |   |
|        Total |   | $                      | 334,145 |   |   |   | 100.00 | % |   |   | 1.04 | % |   | $ | 330,978 |   |   |   | 100.00 | % |   |   | 1.31 | % |   | $ | 321,124 |   |   |   | 100.00 | % |   |   | 1.55 | % |

| Three months or less                |   | $      | 15,363 |   |
|-------------------------------------|--------|--------|--------|--------|
| Over three through six months       |   |   | 4,702  |   |
| Over six months through one year    |   |   | 7,926  |   |
| Over one year through three years   |   |   | 23,127 |   |
| Over three years                    |   |   | 11,272 |   |
|      Total |   | $      | 62,390 |   |

----

|                                                          |   | At and For The Year Ended |   |
|---------------------------------------------------------------|--------|---------------------------|--------|
|                                                          |   | June 30,                  |   |
|                                                          |   | 2012                      |   |   | 2011 |   |   | 2010 |   |
|                                                          |   | (Dollars in thousands)    |   |
|                                                          |   |                      |   |   |   |   |   |   |   |
| Maximum amount of advances outstanding                        |   |                      |   |   |   |   |   |   |   |
| at any month end during the year:                             |   |                      |   |   |   |   |   |   |   |
| FHLB advances                                                 |   | $                         | 83,500 |   |   | $ | 98,500 |   |   | $ | 120,500 |   |
| Securities sold under agreements to repurchase with customers |   |                      | 12,236 |   |   |   | 11,651 |   |   |   | 15,179 |   |
| Average advances outstanding during the year:                 |   |                      |   |   |   |   |   |   |   |   |   |   |
| FHLB advances                                                 |   |                      | 72,692 |   |   |   | 93,799 |   |   |   | 106,473 |   |
| Securities sold under agreements to repurchase with customers |   |                      | 6,303  |   |   |   | 7,671 |   |   |   | 9,154 |   |
| Balance outstanding at end of year:                           |   |                      |   |   |   |   |   |   |   |   |   |   |
| FHLB advances                                                 |   |                      | 53,500 |   |   |   | 83,500 |   |   |   | 100,500 |   |
| Securities sold under agreements to repurchase with customers |   |                      | 3,653  |   |   |   | 4,244 |   |   |   | 5,896 |   |
| Weighted average interest rate during the year:               |   |                      |   |   |   |   |   |   |   |   |   |   |
| FHLB advances                                                 |   |                      | 3.79   | % |   |   | 3.84 | % |   |   | 3.95 | % |
| Securities sold under agreements to repurchase with customers |   |                      | 0.21   |   |   |   | 0.28 |   |   |   | 1.03 |   |
| Weighted average interest rate at end of year:                |   |                      |   |   |   |   |   |   |   |   |   |   |
| FHLB advances                                                 |   |                      | 3.47   | % |   |   | 3.88 | % |   |   | 3.89 | % |
| Securities sold under agreements to repurchase with customers |   |                      | 0.16   |   |   |   | 0.27 |   |   |   | 0.33 |   |

----

----

|   | ● | Appoint a Compliance Committee of the Board to monitor compliance with the Agreement. |
|--------|---------|---------------------------------------------------------------------------------------|

|   | ● | The Compliance Committee must prepare and submit to the full Board within 90 days from June 20, 2012, a report detailing the actions taken to comply with the requirements of the Agreement, and thereafter to provide quarterly progress reports. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | The full Board must forward a copy of the progress report with any comments they may have to the Assistant Deputy Comptroller. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Develop a detailed three year business plan for Putnam Bank which must be forwarded to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Putnam Bank may not deviate from the business plan without receiving the prior written determination of no supervisory objection from the Assistant Deputy Comptroller. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Prepare and forward to the Assistant Deputy Comptroller a revised capital plan for Putnam Bank that is consistent with Putnam Bank’s business plan. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Following receipt of the Assistant Deputy Comptroller’s written determination of no supervisory objection, the Board shall adopt and Putnam Bank shall implement the capital plan. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Adopt and implement a written program to review Putnam Bank’s classified investment securities and reduce the levels of classified investments. |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | ● | Develop and implement policies and procedures to identify and monitor investment securities with other than temporary impairment. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Develop and implement a program to improve loan portfolio management. |
|--------|---------|-----------------------------------------------------------------------|

|   | ● | Establish a written loan review system to review on at least a quarterly basis Putnam Bank’s loan portfolio to assure the timely identification and categorization of problem loans. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Prior to adoption the written loan system and any future changes must be provided to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection. |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Adopt, implement and adhere to written policies and procedures for maintaining an adequate allowance for loan and lease losses. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------|

|   | ● | Establish a written program eliminating the basis of criticism of assets criticized by the Office of the Comptroller of the Currency or by any internal or external loan review. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | • | the total capital distributions for the applicable calendar year exceed the sum of the association’s net income for that year to date plus the association’s retained net income for the preceding two years still available for dividend; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | the association would not be at least adequately capitalized following the distribution; |
|--------|---------|------------------------------------------------------------------------------------------|

|   | • | the distribution would violate any applicable statute, regulation, agreement or Office of the Comptroller of the Currency-imposed condition; or |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | the association is not eligible for expedited treatment of its filings. |
|--------|---------|-------------------------------------------------------------------------|

|   | • | the association would be undercapitalized following the distribution; |
|--------|---------|-----------------------------------------------------------------------|

|   | • | the proposed capital distribution raises safety and soundness concerns; or |
|--------|---------|----------------------------------------------------------------------------|

|   | • | the capital distribution would violate a prohibition contained in any statute, regulation or agreement. |
|--------|---------|---------------------------------------------------------------------------------------------------------|

----

----

|   | • | well-capitalized (at least 5% leverage capital, 6% Tier 1 risk-based capital and 10% total risk-based capital); |
|--------|---------|----------------------------------------------------------------------------------------------------------------------|

|   | • | adequately capitalized (at least 4% leverage capital (3% for savings banks with a composite examination rating of 1), 4% Tier 1 risk-based capital and 8% total risk-based capital); |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | undercapitalized (less than 8% total risk-based capital, 4% Tier 1 risk-based capital or 4% leverage capital (3% for savings banks with a composite examination rating of 1); |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | significantly undercapitalized (less than 6% total risk-based capital, 3% Tier 1 risk-based capital or 3% leverage capital); and |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | critically undercapitalized (less than 2% tangible capital). |
|--------|---------|--------------------------------------------------------------|

----

----

----

|  ITEM 1A. | Risk Factors |
|----------------|--------------|

----

----

|   | ● | the interest income we earn on our interest-earning assets, such as loans and securities; and |
|--------|---------|-----------------------------------------------------------------------------------------------|

|   | ● | the interest expense we pay on our interest-bearing liabilities, such as deposits and borrowings. |
|--------|---------|---------------------------------------------------------------------------------------------------|

----

----

----

----

| ITEM 1B. | Unresolved Staff Comments |
|----------|---------------------------|

|   | Not applicable. |
|--------|-----------------|

----

| ITEM 2. | Properties |
|--------------|------------|

|                                                        |   | Leased or |   | Year Acquired |   | Square  |   |   | Net Book Value   |   |
|-------------------------------------------------------------|--------|-----------|--------|---------------|--------|---------|--------|--------|------------------|--------|
| Location                                                    |   | Owned     |   | or Leased     |   | Footage |   |   | of Real Property |   |
|                                                        |   |      |   |          |   |    |   |   | (In thousands)   |   |
| Main Office:                                                |   |      |   |          |   |    |   |   |             |   |
| 40 Main Street                                              |   | Owned     |   | 1974          |   |    | 14,938 |   |             | $      | 1,057 |   |
| Putnam, Connecticut 06260                                   |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| Full Service Branches:                                      |   |      |   |          |   |    |   |   |             |   |   |   |
| 251 Kennedy Drive                                           |   | Leased    |   | 2006          |   |    | 473    |   |             |   | 74 |   |
| Putnam, Connecticut 06260                                   |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 100 Averill Road                                            |   | Owned     |   | 1981          |   |    | 2,487  |   |             |   | 432 |   |
| Pomfret Center, Connecticut 06259                           |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 125 Wauregan Road                                           |   | Owned     |   | 1993          |   |    | 2,452  |   |             |   | 319 |   |
| Danielson, Connecticut 06239                                |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 11 Pratt Road                                               |   | Owned     |   | 2000          |   |    | 2,162  |   |             |   | 318 |   |
| Plainfield, Connecticut 06374                               |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 461 Voluntown Road, Rte. 138                                |   | Leased    |   | 2005          |   |    | 2,600  |   |             |   | 35 |   |
| Griswold, Connecticut 06351                                 |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 2 Chapman Lane                                              |   | Owned     |   | 2009          |   |    | 2,400  |   |             |   | 623 |   |
| Gales Ferry, Connecticut 06335                              |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| 40 High Street                                              |   | Owned     |   | 2009          |   |    | 2,800  |   |             |   | 1,129 |   |
| Norwich, Connecticut 06360                                  |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| Loan Center:                                                |   |      |   |          |   |    |   |   |             |   |   |   |
| 50 Canal Street                                             |   | Owned     |   | 2000          |   |    | 2,940  |   |             |   | 136 |   |
| Putnam, Connecticut 06260                                   |   |      |   |          |   |    |   |   |             |   |   |   |
|                                                        |   |      |   |          |   |    |   |   |             |   |   |   |
| Special Needs Limited Branch (1):                           |   |      |   |          |   |    |   |   |             |   |   |   |
| Creamery Brook Retirement Village                           |   | -         |   |          |   |    | -      |   |             |   | - |   |
| 36 Vina Lane                                                |   |      |   |          |   |    |   |   |             |   |   |   |
| Brooklyn, Connecticut 06234                                 |   |      |   |          |   |    |   |   |             |   |   |   |
|          Total |   |      |   |          |   |    |   |   |             | $      | 4,123 |   |

|   |                                                                                                                                                                                                                                                                                                                      |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (1)    | Our personnel are at this location for approximately three hours once a week. The facility provides a furnished room for us at no cost. Our personnel conduct limited banking activities, such as deposit-taking, check cashing, notary and certificate of deposit renewals. We began operating at this location in 2002. |

----

| ITEM 3.   | Legal Proceedings |
|--------------------------|-------------------|

| ITEM 4. | Mine Safety Disclosures |
|--------------|-------------------------|

----

| ITEM 5.    | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
|--------------------------------|--------------------------------------------------------------------------------------------------------------------|

|                             |   | High   |   |   | Low    |   |   | Dividends |   |
|----------------------------------|--------|--------|--------|--------|--------|--------|--------|-----------|--------|
| Fiscal 2011                      |   |   |   |   |   |   |   |      |   |
| Quarter ended September 30, 2010 |   | $      | 4.89   |   |   | $      | 2.96   |      |   | $ | - |   |
| Quarter ended December 31, 2010  |   |   | 4.15   |   |   |   | 3.27   |      |   |   | - |   |
| Quarter ended March 31, 2011     |   |   | 5.75   |   |   |   | 4.15   |      |   |   | - |   |
| Quarter ended June 30, 2011      |   |   | 5.85   |   |   |   | 4.83   |      |   |   | - |   |
|                             |   |   |   |   |   |   |   |      |   |   |   |   |
| Fiscal 2012                      |   |   |   |   |   |   |   |      |   |   |   |   |
| Quarter ended September 30, 2011 |   | $      | 5.49   |   |   | $      | 4.40   |      |   | $ | - |   |
| Quarter ended December 31, 2011  |   |   | 4.97   |   |   |   | 4.12   |      |   |   | - |   |
| Quarter ended March 31, 2012     |   |   | 4.98   |   |   |   | 4.50   |      |   |   | - |   |
| Quarter ended June 30, 2012      |   |   | 4.80   |   |   |   | 4.18   |      |   |   | - |   |

----

| ITEM 6. | Selected Financial Data |
|---------|-------------------------|

|                                                      |   | At June 30,                 |    |
|-----------------------------------------------------------|--------|-----------------------------|---------|
|                                                      |   | 2012                        |    |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                                      |   | (in thousands)              |    |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected Financial Condition Data:                        |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                                              |   | $                           | 452,343 |   |   | $ | 472,499 |   |   | $ | 489,359 |   |   | $ | 477,349 |   |   | $ | 494,499 |   |
| Cash and cash equivalents                                 |   |                        | 11,413  |   |   |   | 8,273 |   |   |   | 23,291 |   |   |   | 6,059 |   |   |   | 8,146 |   |
| Securities available-for-sale, at fair value              |   |                        | 47,213  |   |   |   | 58,009 |   |   |   | 85,893 |   |   |   | 164,888 |   |   |   | 212,083 |   |
| Securities held-to-maturity, at cost                      |   |                        | 105,195 |   |   |   | 114,741 |   |   |   | 83,249 |   |   |   | 2,000 |   |   |   | - |   |
| Loans receivable, net                                     |   |                        | 248,572 |   |   |   | 253,225 |   |   |   | 254,772 |   |   |   | 264,317 |   |   |   | 242,728 |   |
| Loans held-for-sale                                       |   |                        | 776     |   |   |   | 1,567 |   |   |   | 1,470 |   |   |   | 1,200 |   |   |   | 675 |   |
| Deposits                                                  |   |                        | 342,338 |   |   |   | 333,773 |   |   |   | 335,146 |   |   |   | 308,099 |   |   |   | 283,724 |   |
| Borrowings                                                |   |                        | 57,153  |   |   |   | 87,744 |   |   |   | 106,396 |   |   |   | 124,971 |   |   |   | 156,621 |   |
| Total stockholders’ equity                          |   |                        | 48,135  |   |   |   | 46,747 |   |   |   | 43,855 |   |   |   | 39,896 |   |   |   | 49,437 |   |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   | For the Year Ended June 30, |    |
|                                                      |   | 2012                        |    |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                                      |   | (in thousands)              |    |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected Operating Data:                                  |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                      |   |                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest and dividend income                              |   | $                           | 17,738  |   |   | $ | 19,730 |   |   | $ | 22,462 |   |   | $ | 25,318 |   |   | $ | 27,205 |   |
| Interest expense                                          |   |                        | 6,655   |   |   |   | 8,370 |   |   |   | 10,125 |   |   |   | 12,726 |   |   |   | 15,229 |   |
|      Net interest income         |   |                        | 11,083  |   |   |   | 11,360 |   |   |   | 12,337 |   |   |   | 12,592 |   |   |   | 11,976 |   |
| Provision for loan losses                                 |   |                        | 1,152   |   |   |   | 915 |   |   |   | 1,049 |   |   |   | 967 |   |   |   | 51 |   |
|  Net interest income after provision for loan losses |   |                        | 9,931   |   |   |   | 10,445 |   |   |   | 11,288 |   |   |   | 11,625 |   |   |   | 11,925 |   |
| Non-interest income (charge)                              |   |                        | 2,279   |   |   |   | 2,503 |   |   |   | 1,983 |   |   |   | (12,559 | ) |   |   | 3,193 |   |
| Non-interest expense                                      |   |                        | 10,945  |   |   |   | 11,313 |   |   |   | 11,700 |   |   |   | 10,807 |   |   |   | 10,945 |   |
| Income (loss) before income taxes                         |   |                        | 1,265   |   |   |   | 1,635 |   |   |   | 1,571 |   |   |   | (11,741 | ) |   |   | 4,173 |   |
| Income tax expense (benefit)                              |   |                        | 215     |   |   |   | 537 |   |   |   | 309 |   |   |   | (4,610 | ) |   |   | 1,105 |   |
|      Net income (loss)           |   | $                           | 1,050   |   |   | $ | 1,098 |   |   | $ | 1,262 |   |   | $ | (7,131 | ) |   | $ | 3,068 |   |

----

|                                                                    |   | June 30, |   |
|-------------------------------------------------------------------------|--------|----------|--------|
| Selected Financial Ratios and Other Data:                               |   | 2012     |   |   | 2011 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                                                    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Performance Ratios:                                                     |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Return on average assets                                                |   |     | 0.23   | % |   |   | 0.23 | % |   |   | 0.26 | % |   |   | (1.47 | ) % |   |   | 0.63 | % |
| Return on average equity                                                |   |     | 2.25   |   |   |   | 2.38 |   |   |   | 2.93 |   |   |   | (17.76 | ) |   |   | 5.95 |   |
| Interest rate spread (1)                                                |   |     | 2.34   |   |   |   | 2.29 |   |   |   | 2.47 |   |   |   | 2.46 |   |   |   | 2.04 |   |
| Net interest margin (2)                                                 |   |     | 2.57   |   |   |   | 2.53 |   |   |   | 2.74 |   |   |   | 2.79 |   |   |   | 2.59 |   |
| Non-interest expense to average assets                                  |   |     | 2.37   |   |   |   | 2.35 |   |   |   | 2.42 |   |   |   | 2.23 |   |   |   | 2.23 |   |
| Efficiency ratio (3)                                                    |   |     | 81.91  |   |   |   | 81.61 |   |   |   | 81.70 |   |   | NA |   |   |   | 72.15 |   |
| Basic earnings (loss) per share                                         |   | $        | 0.16   |   |   | $ | 0.17 |   |   | $ | 0.20 |   |   | $ | (1.14 | ) |   | $ | 0.49 |   |
| Diluted earnings (loss) per share                                       |   | $        | 0.16   |   |   | $ | 0.17 |   |   | $ | 0.20 |   |   | $ | (1.14 | ) |   | $ | 0.48 |   |
| Average interest-earning assets to average interest-bearing liabilities |   |     | 115.10 | % |   |   | 113.11 | % |   |   | 112.03 | % |   |   | 112.01 | % |   |   | 116.77 | % |
|                                                                    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Capital Ratios:                                                         |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equity to total assets at end of period                                 |   |     | 10.64  | % |   |   | 9.89 | % |   |   | 8.96 | % |   |   | 8.36 | % |   |   | 10.00 | % |
| Average equity to average assets                                        |   |     | 10.11  |   |   |   | 9.59 |   |   |   | 8.92 |   |   |   | 8.30 |   |   |   | 10.51 |   |
| Total capital to risk-weighted assets                                   |   |     | 16.36  |   |   |   | 16.04 |   |   |   | 13.42 |   |   |   | 10.92 |   |   |   | 16.24 |   |
| Tier 1 capital to risk-weighted assets                                  |   |     | 15.15  |   |   |   | 14.79 |   |   |   | 12.38 |   |   |   | 10.20 |   |   |   | 15.58 |   |
| Tier 1 capital to adjusted tangible assets                              |   |     | 8.24   |   |   |   | 7.68 |   |   |   | 6.91 |   |   |   | 6.62 |   |   |   | 8.34 |   |
| Dividend payout ratio                                                   |   |     | 0.00   |   |   |   | 0.00 |   |   |   | 0.20 |   |   |   | (0.25 | ) |   |   | 0.63 |   |
|                                                                    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Asset Quality Ratios:                                                   |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses as a percent of total loans                   |   |     | 1.16   | % |   |   | 1.20 | % |   |   | 1.03 | % |   |   | 0.83 | % |   |   | 0.72 | % |
| Allowance for loan losses as a percent of non-performing loans          |   |     | 34.74  |   |   |   | 47.86 |   |   |   | 42.13 |   |   |   | 34.11 |   |   |   | 121.07 |   |
| Net charge-offs to average outstanding loans during the period          |   |     | 0.51   |   |   |   | 0.19 |   |   |   | 0.22 |   |   |   | 0.20 |   |   |   | 0.03 |   |
| Non-performing loans as a percent of total loans                        |   |     | 3.34   |   |   |   | 2.51 |   |   |   | 2.45 |   |   |   | 2.42 |   |   |   | 0.59 |   |
| Non-performing assets as a percent of total assets                      |   |     | 2.99   |   |   |   | 2.58 |   |   |   | 1.80 |   |   |   | 1.67 |   |   |   | 0.29 |   |
|                                                                    |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Data:                                                             |   |     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Number of full-service offices                                          |   |     | 7      |   |   |   | 7 |   |   |   | 7 |   |   |   | 6 |   |   |   | 6 |   |

|   | (1)  | Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of interest-bearing liabilities. |
|--------|-----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | (2)       | Represents net interest income as a percent of average interest-earning assets.                                                                                |
|   | (3)  | Represents non-interest expense divided by the sum of net interest income and non-interest income.                                                             |

| ITEM 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
|--------------|---------------------------------------------------------------------------------------------|

----

----

----

----

|                                   |   | June 30,               |    |
|----------------------------------------|--------|------------------------|---------|
|                                   |   | 2012                   |    |   | 2011 |   |   | 2010 |   |
|                                   |   | Average                |    |   | Income/ |   |   | Yield/ |   |   | Average |   |   | Income/ |   |   | Yield/ |   |   | Average |   |   | Income/ |   |   | Yield/ |   |
|                                   |   | Balance                |    |   | Expense |   |   | Cost |   |   | Balance |   |   | Expense |   |   | Cost |   |   | Balance |   |   | Expense |   |   | Cost |   |
|                                   |   | (Dollars in thousands) |    |
| Interest earning assets:               |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment securities                  |   | $                      | 168,419 |   |   | $ | 4,765 |   |   |   | 2.83 | % |   | $ | 186,412 |   |   | $ | 6,032 |   |   |   | 3.24 | % |   | $ | 169,043 |   |   | $ | 7,811 |   |   |   | 4.62 | % |
| Loans                                  |   |                   | 255,645 |   |   |   | 12,964 |   |   |   | 5.07 | % |   |   | 256,737 |   |   |   | 13,694 |   |   |   | 5.33 | % |   |   | 265,142 |   |   |   | 14,641 |   |   |   | 5.52 | % |
| Other interest earning assets          |   |                   | 6,647   |   |   |   | 9 |   |   |   | 0.14 | % |   |   | 5,353 |   |   |   | 4 |   |   |   | 0.07 | % |   |   | 15,606 |   |   |   | 10 |   |   |   | 0.06 | % |
| Total interest-earnings assets         |   |                   | 430,711 |   |   |   | 17,738 |   |   |   | 4.12 | % |   |   | 448,502 |   |   |   | 19,730 |   |   |   | 4.40 | % |   |   | 449,791 |   |   |   | 22,462 |   |   |   | 4.99 | % |
| Non-interest-earning assets            |   |                   | 31,520  |   |   |   |   |   |   |   |   |   |   |   | 32,209 |   |   |   |   |   |   |   |   |   |   |   | 32,813 |   |   |   |   |   |   |   |   |   |
| Total assets                           |   | $                      | 462,231 |   |   |   |   |   |   |   |   |   |   | $ | 480,711 |   |   |   |   |   |   |   |   |   |   | $ | 482,604 |   |   |   |   |   |   |   |   |   |
|                                   |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:          |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW accounts                           |   | $                      | 91,767  |   |   |   | 700 |   |   |   | 0.76 | % |   | $ | 90,186 |   |   |   | 934 |   |   |   | 1.04 | % |   | $ | 80,526 |   |   |   | 1,317 |   |   |   | 1.64 | % |
| Savings accounts                       |   |                   | 51,063  |   |   |   | 169 |   |   |   | 0.33 | % |   |   | 48,004 |   |   |   | 168 |   |   |   | 0.35 | % |   |   | 46,447 |   |   |   | 195 |   |   |   | 0.42 | % |
| Money market accounts                  |   |                   | 15,117  |   |   |   | 93 |   |   |   | 0.62 | % |   |   | 13,517 |   |   |   | 111 |   |   |   | 0.82 | % |   |   | 11,036 |   |   |   | 111 |   |   |   | 1.01 | % |
| Time deposits                          |   |                   | 137,250 |   |   |   | 2,927 |   |   |   | 2.13 | % |   |   | 143,357 |   |   |   | 3,536 |   |   |   | 2.47 | % |   |   | 147,836 |   |   |   | 4,200 |   |   |   | 2.84 | % |
| Borrowings                             |   |                   | 78,996  |   |   |   | 2,766 |   |   |   | 3.50 | % |   |   | 101,469 |   |   |   | 3,621 |   |   |   | 3.57 | % |   |   | 115,630 |   |   |   | 4,302 |   |   |   | 3.72 | % |
| Total interest-bearing liabilities     |   |                   | 374,193 |   |   |   | 6,655 |   |   |   | 1.78 | % |   |   | 396,533 |   |   |   | 8,370 |   |   |   | 2.11 | % |   |   | 401,475 |   |   |   | 10,125 |   |   |   | 2.52 | % |
| Non-interest-bearing demand deposits   |   |                   | 38,948  |   |   |   |   |   |   |   |   |   |   |   | 35,914 |   |   |   |   |   |   |   |   |   |   |   | 35,280 |   |   |   |   |   |   |   |   |   |
| Other non-interest-bearing liabilities |   |                   | 2,364   |   |   |   |   |   |   |   |   |   |   |   | 2,162 |   |   |   |   |   |   |   |   |   |   |   | 2,782 |   |   |   |   |   |   |   |   |   |
| Capital accounts                       |   |                   | 46,726  |   |   |   |   |   |   |   |   |   |   |   | 46,102 |   |   |   |   |   |   |   |   |   |   |   | 43,067 |   |   |   |   |   |   |   |   |   |
| Total liabilities and capital accounts |   | $                      | 462,231 |   |   |   |   |   |   |   |   |   |   | $ | 480,711 |   |   |   |   |   |   |   |   |   |   | $ | 482,604 |   |   |   |   |   |   |   |   |   |
|                                   |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                    |   |                   |    |   |   | $ | 11,083 |   |   |   |   |   |   |   |   |   |   | $ | 11,360 |   |   |   |   |   |   |   |   |   |   | $ | 12,337 |   |   |   |   |   |
| Interest rate spread                   |   |                   |    |   |   |   |   |   |   |   | 2.34 | % |   |   |   |   |   |   |   |   |   |   | 2.29 | % |   |   |   |   |   |   |   |   |   |   | 2.47 | % |
| Net interest-earning assets            |   | $                      | 56,518  |   |   |   |   |   |   |   |   |   |   | $ | 51,969 |   |   |   |   |   |   |   |   |   |   | $ | 48,316 |   |   |   |   |   |   |   |   |   |
| Net interest margin                    |   |                   |    |   |   |   |   |   |   |   | 2.57 | % |   |   |   |   |   |   |   |   |   |   | 2.53 | % |   |   |   |   |   |   |   |   |   |   | 2.74 | % |
| Average earning assets to              |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| average interest-bearing liabilities   |   |                   |    |   |   |   |   |   |   |   | 115.10 | % |   |   |   |   |   |   |   |   |   |   | 113.11 | % |   |   |   |   |   |   |   |   |   |   | 112.03 | % |

----

|                               |   | Years ended June 30,       |   |   | Years ended June 30,       |   |
|------------------------------------|--------|----------------------------|--------|--------|----------------------------|--------|
|                               |   | 2012 Compared to 2011      |   |   | 2011 Compared to 2010      |   |
|                               |   | Increase (Decrease) Due to |   |   | Increase (Decrease) Due to |   |
| Interest-earning assets:           |   | Rate                       |   |   | Volume                     |   |   | Net |   |   | Rate |   |   | Volume |   |   | Net |   |
| Interest and Dividend Income:      |   | (in thousands)             |   |
| Investment securities              |   | $                          | (717   | )      |                       | $      | (550 | ) |   | $ | (1,267 | ) |   | $ | (2,520 | ) |   | $ | 741 |   |   | $ | (1,779 | ) |
| Loans                              |   |                       | (672   | )      |                       |   | (58 | ) |   |   | (730 | ) |   |   | (491 | ) |   |   | (456 | ) |   |   | (947 | ) |
| Other interest-earning assets      |   |                       | 4      |   |                       |   | 1 |   |   |   | 5 |   |   |   | 1 |   |   |   | (7 | ) |   |   | (6 | ) |
| Total interest-earning assets:     |   |                       | (1,385 | )      |                       |   | (607 | ) |   |   | (1,992 | ) |   |   | (3,010 | ) |   |   | 278 |   |   |   | (2,732 | ) |
|                               |   |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities       |   |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Expense:                  |   |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW accounts                       |   |                       | (250   | )      |                       |   | 16 |   |   |   | (234 | ) |   |   | (527 | ) |   |   | 144 |   |   |   | (383 | ) |
| Savings accounts                   |   |                       | (9     | )      |                       |   | 10 |   |   |   | 1 |   |   |   | (33 | ) |   |   | 6 |   |   |   | (27 | ) |
| Money Market accounts              |   |                       | (30    | )      |                       |   | 12 |   |   |   | (18 | ) |   |   | (22 | ) |   |   | 22 |   |   |   | - |   |
| Time deposits                      |   |                       | (463   | )      |                       |   | (146 | ) |   |   | (609 | ) |   |   | (540 | ) |   |   | (124 | ) |   |   | (664 | ) |
| Borrowings                         |   |                       | (67    | )      |                       |   | (788 | ) |   |   | (855 | ) |   |   | (170 | ) |   |   | (511 | ) |   |   | (681 | ) |
| Total interest-bearing liabilities |   |                       | (819   | )      |                       |   | (896 | ) |   |   | (1,715 | ) |   |   | (1,292 | ) |   |   | (463 | ) |   |   | (1,755 | ) |
|                               |   |                       |   |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Change in net interest income      |   | $                          | (566   | )      |                       | $      | 289 |   |   | $ | (277 | ) |   | $ | (1,718 | ) |   | $ | 741 |   |   | $ | (977 | ) |

----

| Net Interest Income At-Risk |
|-----------------------------|
|                        |   |   |   |   |
|                        |   | Estimated Increase (Decrease) |   | Estimated Increase (Decrease) |
| Change in Interest Rates    |   | in NII |   | in NII |
| (Basis Points)              |   | June 30, 2012 |   | June 30, 2011 |
|                        |   |   |   |   |
| Stable                      |   |   |   |   |
| + 100                       |   | -0.56% |   | -1.25% |
| + 200                       |   | -4.81% |   | -3.99% |

----

|               |   |      |   |   |                             |   |    |    |   |   | NPV as a Percentage of Present |   |
|--------------------|--------|-----------|--------|--------|----------------------------------|--------|---------|---------|--------|--------|--------------------------------|--------|
|               |   |      |   |   |                             |   |    |    |   |   | Value of Assets (3)            |   |
|               |   |      |   |   | Estimated Increase (Decrease) in |   |    |    |   |   |                           |   |
| Change in          |   |      |   |   | NPV                              |   |    |    |   |   | Increase                       |   |
| Interest Rates     |   | Estimated |   |   |                             |   |    |    |   |   |                           |   |   | (Decrease) |   |
| (basis points) (1) |   | NPV (2)   |   |   | Amount                           |   |    | Percent |   |   | NPV Ratio (4)                  |   |   | (basis points) |   |
|               |   |      |   |   |                             |   |    |    |   |   |                           |   |   |   |   |
| +300               |   | $         | 35,301 |   |                             | $      | (12,609 | )       |   |   | -26.32                         | %      |   |   | 8.41 | % |   |   | -220 |   |
| +200               |   | $         | 42,474 |   |                             | $      | (5,436  | )       |   |   | -11.35                         | %      |   |   | 9.84 | % |   |   | -77 |   |
| +100               |   | $         | 46,887 |   |                             | $      | (1,022  | )       |   |   | -2.13                          | %      |   |   | 10.60 | % |   |   | -1 |   |
| 0                  |   | $         | 47,910 |   |                             | $      | -       |    |   |   | 0.00                           | %      |   |   | 10.61 | % |   |   | 0 |   |
| -100               |   | $         | 48,585 |   |                             | $      | 675     |    |   |   | 1.41                           | %      |   |   | 10.60 | % |   |   | -1 |   |

|   | (1) | Assumes an instantaneous uniform change in interest rates at all maturities. |
|--------|-----|------------------------------------------------------------------------------|

|   | (2) | NPV is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------|

|   | (3) | Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------|

|   | (4) | NPV ratio represents NPV divided by the present value of assets. |
|--------|-----|------------------------------------------------------------------|

----

| ITEM 7A. | Quantitative and Qualitative Disclosures About Market Risk |
|----------|------------------------------------------------------------|

----

| ITEM 8. | Consolidated Financial Statements and Supplementary Data |
|--------------|----------------------------------------------------------|

| Report of Independent Registered Public Accounting Firm  |
|---------------------------------------------------------------|

----

|   |                                        |
|--------|----------------------------------------|
|   | SHATSWELL, MacLEOD & COMPANY, P.C. |

----

|                                                                                                                                         |   | 2012   |    |   | 2011   |   |
|----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|
|                                                                                                                                         |   |   |    |   |   |   |
| ASSETS                                                                                                                                       |   |   |    |   |   |   |
| Cash and due from depository institutions                                                                                                    |   | $      | 5,228   |   |   | $      | 7,915 |   |
| Interest-bearing deposits with other banks                                                                                                   |   |   | 6,185   |   |   |   | 358 |   |
| Cash and cash equivalents                                                                                                                    |   |   | 11,413  |   |   |   | 8,273 |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| Investments in available-for-sale securities (at fair value)                                                                                 |   |   | 47,213  |   |   |   | 58,009 |   |
| Investments in held-to-maturity securities (fair value of $108,336 as of June 30, 2012 and $115,962 as of June 30, 2011)                |   |   | 105,195 |   |   |   | 114,741 |   |
| Federal Home Loan Bank stock, at cost                                                                                                        |   |   | 7,536   |   |   |   | 8,056 |   |
| Loans held-for-sale                                                                                                                          |   |   | 776     |   |   |   | 1,567 |   |
| Loans                                                                                                                                        |   |   | 251,485 |   |   |   | 256,297 |   |
| Allowance for loan losses                                                                                                                    |   |   | (2,913  | )      |   |   | (3,072 | ) |
| Net loans                                                                                                                                    |   |   | 248,572 |   |   |   | 253,225 |   |
| Premises and equipment                                                                                                                       |   |   | 4,526   |   |   |   | 4,849 |   |
| Accrued interest receivable                                                                                                                  |   |   | 1,158   |   |   |   | 1,528 |   |
| Other real estate owned                                                                                                                      |   |   | 1,683   |   |   |   | 1,074 |   |
| Goodwill                                                                                                                                     |   |   | 6,912   |   |   |   | 6,912 |   |
| Intangible assets                                                                                                                            |   |   | 202     |   |   |   | 324 |   |
| Bank-owned life insurance                                                                                                                    |   |   | 8,759   |   |   |   | 6,431 |   |
| Due from broker                                                                                                                              |   |   | 2,000   |   |   |   | - |   |
| Deferred tax asset                                                                                                                           |   |   | 3,890   |   |   |   | 4,216 |   |
| Other assets                                                                                                                                 |   |   | 2,508   |   |   |   | 3,294 |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| Total assets                                                                                                                                 |   | $      | 452,343 |   |   | $      | 472,499 |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                   |   |   |    |   |   |   |   |   |
| Deposits:                                                                                                                                    |   |   |    |   |   |   |   |   |
| Noninterest-bearing                                                                                                                          |   | $      | 43,785  |   |   | $      | 36,814 |   |
| Interest-bearing                                                                                                                             |   |   | 298,553 |   |   |   | 296,959 |   |
|            Total deposits                                                             |   |   | 342,338 |   |   |   | 333,773 |   |
| Mortgagors’ escrow accounts                                                                                                            |   |   | 2,034   |   |   |   | 1,766 |   |
| Federal Home Loan Bank advances                                                                                                              |   |   | 53,500  |   |   |   | 83,500 |   |
| Securities sold under agreements to repurchase                                                                                               |   |   | 3,653   |   |   |   | 4,244 |   |
| Other liabilities                                                                                                                            |   |   | 2,683   |   |   |   | 2,469 |   |
|            Total liabilities                                                          |   |   | 404,208 |   |   |   | 425,752 |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| Commitments and Contingencies (Notes 10 and 12)                                                                                              |   |   |    |   |   |   |   |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| Stockholders’ equity:                                                                                                                  |   |   |    |   |   |   |   |   |
| Preferred stock, $0.10 par value, 1,000,000 shares authorized, no shares issued and outstanding                                              |   |   | -       |   |   |   | - |   |
| Common stock, $0.10 par value, 12,000,000 shares authorized, 6,943,125 shares issued, 6,528,863 shares outstanding at June 30, 2012 and 2011 |   |   | 694     |   |   |   | 694 |   |
| Additional paid-in capital                                                                                                                   |   |   | 30,602  |   |   |   | 30,594 |   |
| Retained earnings                                                                                                                            |   |   | 23,630  |   |   |   | 22,648 |   |
| Accumulated other comprehensive loss                                                                                                         |   |   | (1,013  | )      |   |   | (1,267 | ) |
| Unearned ESOP shares                                                                                                                         |   |   | (1,565  | )      |   |   | (1,693 | ) |
| Unearned stock awards                                                                                                                        |   |   | -       |   |   |   | (16 | ) |
| Treasury stock, at cost (414,262 shares at June 30, 2012 and 2011)                                                                      |   |   | (4,213  | )      |   |   | (4,213 | ) |
| Total stockholders’ equity                                                                                                             |   |   | 48,135  |   |   |   | 46,747 |   |
|                                                                                                                                         |   |   |    |   |   |   |   |   |
| Total liabilities and stockholders’ equity                                                                                             |   | $      | 452,343 |   |   | $      | 472,499 |   |

----

|                                                             |   | 2012   |      |   | 2011   |   |
|------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|
|                                                             |   |   |      |   |   |   |
| Interest and dividend income:                                    |   |   |      |   |   |   |
| Interest and fees on loans                                       |   | $      | 12,964    |   |   | $      | 13,694 |   |
| Interest on debt securities                                      |   |   | 4,260     |   |   |   | 5,547 |   |
| Dividends on marketable equity securities                        |   |   | 473       |   |   |   | 473 |   |
| Dividends on Federal Home Loan Bank stock                        |   |   | 32        |   |   |   | 12 |   |
| Other interest                                                   |   |   | 9         |   |   |   | 4 |   |
| Total interest and dividend income                               |   |   | 17,738    |   |   |   | 19,730 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Interest expense:                                                |   |   |      |   |   |   |   |   |
| Interest on deposits                                             |   |   | 3,889     |   |   |   | 4,749 |   |
| Interest on Federal Home Loan Bank advances                      |   |   | 2,753     |   |   |   | 3,600 |   |
| Interest on securities sold under agreements to repurchase       |   |   | 13        |   |   |   | 21 |   |
| Total interest expense                                           |   |   | 6,655     |   |   |   | 8,370 |   |
| Net interest and dividend income                                 |   |   | 11,083    |   |   |   | 11,360 |   |
| Provision for loan losses                                        |   |   | 1,152     |   |   |   | 915 |   |
| Net interest and dividend income after provision for loan losses |   |   | 9,931     |   |   |   | 10,445 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Non-interest income:                                             |   |   |      |   |   |   |   |   |
| Total other-than-temporary impairment losses on debt securities  |   |   | (3,522    | )      |   |   | (3,037 | ) |
| Portion of losses recognized in other comprehensive loss/income  |   |   | 1,558     |   |   |   | 1,972 |   |
| Net impairment losses recognized in earnings                     |   |   | (1,964    | )      |   |   | (1,065 | ) |
| Fees for services                                                |   |   | 1,836     |   |   |   | 2,052 |   |
| Mortgage banking activities                                      |   |   | 149       |   |   |   | 138 |   |
| Net commissions from brokerage services                          |   |   | 116       |   |   |   | 134 |   |
| Bank-owned life insurance income                                 |   |   | 328       |   |   |   | 407 |   |
| Gain on sales and calls of available-for-sale securities, net    |   |   | 235       |   |   |   | 257 |   |
| Income from legal settlement                                     |   |   | 1,452     |   |   |   | 420 |   |
| Other income                                                     |   |   | 127       |   |   |   | 160 |   |
| Total non-interest income                                        |   |   | 2,279     |   |   |   | 2,503 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Non-interest expense:                                            |   |   |      |   |   |   |   |   |
| Compensation and benefits                                        |   |   | 5,766     |   |   |   | 5,849 |   |
| Occupancy and equipment                                          |   |   | 1,291     |   |   |   | 1,333 |   |
| Data processing                                                  |   |   | 661       |   |   |   | 884 |   |
| LAN/ WAN network expense                                         |   |   | 144       |   |   |   | 104 |   |
| Advertising and marketing                                        |   |   | 278       |   |   |   | 221 |   |
| OCC/ OTS assessments                                             |   |   | 184       |   |   |   | 187 |   |
| Professional fees                                                |   |   | 396       |   |   |   | 327 |   |
| Amortization of intangible asset                                 |   |   | 122       |   |   |   | 149 |   |
| FDIC deposit insurance                                           |   |   | 605       |   |   |   | 773 |   |
| Prepayment penalties on Federal Home Loan Bank advances          |   |   | 5         |   |   |   | 31 |   |
| Other real estate owned                                          |   |   | 105       |   |   |   | 140 |   |
| Write-down of other real estate owned                            |   |   | 71        |   |   |   | 95 |   |
| Other non-interest expense                                       |   |   | 1,317     |   |   |   | 1,220 |   |
| Total non-interest expense                                       |   |   | 10,945    |   |   |   | 11,313 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Income before income tax expense                                 |   |   | 1,265     |   |   |   | 1,635 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Income tax expense                                               |   |   | 215       |   |   |   | 537 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Net income                                                       |   | $      | 1,050     |   |   | $      | 1,098 |   |
|                                                             |   |   |      |   |   |   |   |   |
| Earnings per common share:                                       |   |   |      |   |   |   |   |   |
| Basic                                                            |   | $      | 0.16      |   |   | $      | 0.17 |   |
| Diluted                                                          |   | $      | 0.16      |   |   | $      | 0.17 |   |
| Weighted average common shares outstanding:                      |   |   |      |   |   |   |   |   |
| Basic                                                            |   |   | 6,364,345 |   |   |   | 6,342,473 |   |
| Diluted                                                          |   |   | 6,364,345 |   |   |   | 6,342,473 |   |

----

|                                                                                                                               |   | Common Stock   |   |   | Additional Paid-in Capital |   |   | Retained Earnings |   |   | Accumulated Other Comprehensive (Loss) (1) |   |   | Unearned ESOP Shares |   |   | Unearned Stock Awards |   |   | Treasury Stock |   |   | Total  |   |
|------------------------------------------------------------------------------------------------------------------------------------|--------|----------------|--------|--------|----------------------------|--------|--------|-------------------|--------|--------|-------------------------------------------------|--------|--------|----------------------|--------|--------|-----------------------|--------|--------|----------------|--------|--------|--------|--------|
|                                                                                                                               |   | (In thousands) |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |
| Balance at June 30, 2010                                                                                                           |   | $              | 694    |   |                       | $      | 30,633 |              |   | $      | 21,550                                          |   |   | $                    | (2,776 | )      |                  | $      | (1,821 | )              |   | $      | (212   | )      |   | $ | (4,213 | ) |   | $ | 43,855 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive income:                                                                                                              |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                                                         |   |           | -      |   |                       |   | -      |              |   |   | 1,098                                           |   |   |                 | -      |   |                  |   | -      |           |   |   | -      |   |   |   | - |   |   |   | 1,098 |   |
| Net change in unrealized holding losses on available-for-sale securities, net of reclassification adjustments and tax effects |   |           | -      |   |                       |   | -      |              |   |   | -                                               |   |   |                 | 1,509  |   |                  |   | -      |           |   |   | -      |   |   |   | - |   |   |   | 1,509 |   |
| Comprehensive income                                                                                                               |   |           | -      |   |                       |   | -      |              |   |   | -                                               |   |   |                 | -      |   |                  |   | -      |           |   |   | -      |   |   |   | - |   |   |   | 2,607 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| ESOP shares released                                                                                                               |   |           | -      |   |                       |   | (71    | )                 |   |   | -                                               |   |   |                 | -      |   |                  |   | 128    |           |   |   | -      |   |   |   | - |   |   |   | 57 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Stock-based compensation expense                                                                                                   |   |           | -      |   |                       |   | 32     |              |   |   | -                                               |   |   |                 | -      |   |                  |   | -      |           |   |   | 196    |   |   |   | - |   |   |   | 228 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance at June 30, 2011                                                                                                           |   |           | 694    |   |                       |   | 30,594 |              |   |   | 22,648                                          |   |   |                 | (1,267 | )      |                  |   | (1,693 | )              |   |   | (16    | )      |   |   | (4,213 | ) |   |   | 46,747 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive income:                                                                                                              |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                                                         |   |           | -      |   |                       |   | -      |              |   |   | 1,050                                           |   |   |                 | -      |   |                  |   | -      |           |   |   | -      |   |   |   | - |   |   |   | 1,050 |   |
| Net change in unrealized holding losses on available-for-sale securities, net of reclassification adjustments and tax effects |   |           | -      |   |                       |   | -      |              |   |   | -                                               |   |   |                 | 254    |   |                  |   | -      |           |   |   | -      |   |   |   | - |   |   |   | 254 |   |
| Comprehensive income                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   | 1,304 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| ESOP shares released                                                                                                               |   |           | -      |   |                       |   | -      |              |   |   | (68                                             | )      |   |                 | -      |   |                  |   | 128    |           |   |   | -      |   |   |   | - |   |   |   | 60 |   |
| Stock-based compensation expense                                                                                                   |   |           | -      |   |                       |   | 8      |              |   |   | -                                               |   |   |                 | -      |   |                  |   | -      |           |   |   | 16     |   |   |   | - |   |   |   | 24 |   |
|                                                                                                                               |   |           |   |   |                       |   |   |              |   |   |                                            |   |   |                 |   |   |                  |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance at June 30, 2012                                                                                                           |   | $              | 694    |   |                       | $      | 30,602 |              |   | $      | 23,630                                          |   |   | $                    | (1,013 | )      |                  | $      | (1,565 | )              |   | $      | -      |   |   | $ | (4,213 | ) |   | $ | 48,135 |   |

----

| Reclassification disclosure for the years ended June 30:                              |   | 2012           |   |   | 2011   |   |
|--------------------------------------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                                                                       |   | (In thousands) |   |
|                                                                                       |   |           |   |   |   |   |   |   |
| Net unrealized holding (losses) gains on available-for-sale securities                     |   |           | (1,344 | )      |   |   | 1,475 |   |
| Reclassification adjustment for losses realized in income on available-for-sale securities |   |           | 1,729  |   |   |   | 811 |   |
| Other comprehensive income before tax                                                      |   |           | 385    |   |   |   | 2,286 |   |
| Income tax expense related to other comprehensive income                              |   |           | (131   | )      |   |   | (777 | ) |
| Other comprehensive income, net of tax                                                     |   | $              | 254    |   |   | $      | 1,509 |   |

----

|                                                                                     |   | 2012           |    |   | 2011   |   |
|------------------------------------------------------------------------------------------|--------|----------------|---------|--------|--------|--------|
|                                                                                     |   | (In thousands) |    |
|                                                                                     |   |           |    |   |   |   |
| Cash flows from operating activities:                                                    |   |           |    |   |   |   |
| Net income                                                                               |   | $              | 1,050   |   |   | $      | 1,098 |   |
| Adjustments to reconcile net income to cash provided by operating activities:            |   |           |    |   |   |   |   |   |
| Amortization of securities, net                                                          |   |           | 1,309   |   |   |   | 1,197 |   |
| Gain on sales and calls of securities, net                                               |   |           | (235    | )      |   |   | (257 | ) |
| Impairment losses on securities                                                          |   |           | 1,964   |   |   |   | 1,065 |   |
| Net decrease (increase) in loans held for sale                                           |   |           | 791     |   |   |   | (97 | ) |
| (Accretion) amortization of deferred loan (fees) costs, net                              |   |           | (75     | )      |   |   | 94 |   |
| Provision for loan losses                                                                |   |           | 1,152   |   |   |   | 915 |   |
| Gain on sale of other real estate owned                                                  |   |           | (1      | )      |   |   | (59 | ) |
| Write-down of other real estate owned                                                    |   |           | 71      |   |   |   | 95 |   |
| Loss on disposal of equipment                                                            |   |           | 5       |   |   |   | 7 |   |
| Depreciation and amortization                                                            |   |           | 464     |   |   |   | 512 |   |
| Amortization of core deposit intangible                                                  |   |           | 122     |   |   |   | 149 |   |
| Decrease in accrued interest receivable and other assets                                 |   |           | 1,538   |   |   |   | 2,554 |   |
| Increase in cash surrender value of bank owned life insurance                            |   |           | (328    | )      |   |   | (407 | ) |
| Increase in other liabilities                                                            |   |           | 214     |   |   |   | 288 |   |
| Deferred tax expense (benefit)                                                           |   |           | 195     |   |   |   | (187 | ) |
| Amortization of ESOP expense                                                             |   |           | 60      |   |   |   | 57 |   |
| Stock-based compensation                                                                 |   |           | 24      |   |   |   | 120 |   |
| Net cash provided by operating activities                                                |   |           | 8,320   |   |   |   | 7,144 |   |
|                                                                                     |   |           |    |   |   |   |   |   |
| Cash flows from investing activities:                                                    |   |           |    |   |   |   |   |   |
| Purchase of available-for-sale securities                                                |   |           | (5,503  | )      |   |   | - |   |
| Proceeds from sales, call, paydowns and maturities of available-for-sale securities |   |           | 14,922  |   |   |   | 29,299 |   |
| Purchase of held-to maturity securities                                                  |   |           | (32,483 | )      |   |   | (93,692 | ) |
| Proceeds from calls, paydowns and maturities of held-to-maturity securities              |   |           | 38,753  |   |   |   | 61,066 |   |
| Redemption of Federal Home Loan Bank stock                                               |   |           | 520     |   |   |   | - |   |
| Loan repayments net of originations                                                      |   |           | 1,825   |   |   |   | 282 |   |
| Purchase of bank-owned life insurance                                                    |   |           | (2,000  | )      |   |   | - |   |
| Recoveries of loans previously charged off                                               |   |           | 41      |   |   |   | 60 |   |
| Proceeds from sale of other real estate owned                                            |   |           | 1,031   |   |   |   | 607 |   |
| Proceeds from the surrender of bank-owned life insurance policy                          |   |           | -       |   |   |   | 167 |   |
| Capital expenditures - premises and equipment                                            |   |           | (528    | )      |   |   | (65 | ) |
| Net cash provided by (used in) investing activities                                      |   |           | 16,578  |   |   |   | (2,276 | ) |
|                                                                                     |   |           |    |   |   |   |   |   |

----

|                                                                  |   | 2012           |    |   | 2011   |   |
|-----------------------------------------------------------------------|--------|----------------|---------|--------|--------|--------|
|                                                                  |   | (In thousands) |    |
|                                                                  |   |           |    |   |   |   |
| Cash flows from financing activities:                                 |   |           |    |   |   |   |
| Net increase (decrease) in  deposit accounts                |   |           | 8,565   |   |   |   | (1,373 | ) |
| Net increase in mortgagors’ escrow accounts                     |   |           | 268     |   |   |   | 139 |   |
| Proceeds from Federal Home Loan Bank advances                         |   |           | 3,830   |   |   |   | 10,000 |   |
| Repayments of Federal Home Loan Bank advances                         |   |           | (33,830 | )      |   |   | (27,000 | ) |
| Net decrease in securities sold under agreements to repurchase        |   |           | (591    | )      |   |   | (1,652 | ) |
| Net cash used in financing activities                                 |   |           | (21,758 | )      |   |   | (19,886 | ) |
|                                                                  |   |           |    |   |   |   |   |   |
| Net increase (decrease) in cash and cash equivalents                  |   |           | 3,140   |   |   |   | (15,018 | ) |
| Cash and cash equivalents at beginning of year                        |   |           | 8,273   |   |   |   | 23,291 |   |
|                                                                  |   |           |    |   |   |   |   |   |
| Cash and cash equivalents at end of year                              |   | $              | 11,413  |   |   | $      | 8,273 |   |
| Supplemental disclosures:                                             |   |           |    |   |   |   |   |   |
| Interest paid                                                         |   | $              | 6,768   |   |   | $      | 8,429 |   |
| Income taxes refunded                                                 |   |           | (432    | )      |   |   | (864 | ) |
| Loans transferred to other real estate owned                          |   |           | 1,710   |   |   |   | 709 |   |
| Increase in due from broker                                           |   |           | (2,000  | )      |   |   | - |   |
| Deferred gain on sale of other real estate owned in other liabilities |   |           | -       |   |   |   | (40 | ) |
| Loans originated to finance sales of other real estate owned          |   |           | 233     |   |   |   | 513 |   |

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|                                                               |   | Income      |      |   | Shares        |   |      | Per-Share |   |
|--------------------------------------------------------------------|--------|-------------|-----------|--------|---------------|--------|-----------|-----------|--------|
|                                                               |   | (Numerator) |      |   | (Denominator) |   |      | Amount    |   |
| Year ended June 30, 2012:                                          |   |        |      |   |          |   |      |      |   |
| Basic EPS:                                                         |   |        |      |   |          |   |      |      |   |
| Net income                                                         |   | $           | 1,050,000 |   |          |   |      |      |   |   |
| Net income and income allocated to common stockholders             |   |        | 1,050,000 |   |          |   | 6,364,345 |      |   |   |   |
| Basic EPS                                                          |   |        |      |   |          |   |      |      |   | $ | 0.16 |   |
| Diluted EPS:                                                       |   |        |      |   |          |   |      |      |   |   |   |   |
| Effect of dilutive securities options                              |   |        |      |   |          |   | -         |      |   |   |   |   |
|                                                               |   |        |      |   |          |   |      |      |   |   |   |   |
| Diluted EPS                                                        |   | $           | 1,050,000 |   |          |   | 6,364,345 |      |   | $ | 0.16 |   |
|                                                               |   |        |      |   |          |   |      |      |   |   |   |   |
| Year ended June 30, 2011:                                          |   |        |      |   |          |   |      |      |   |   |   |   |
| Basic EPS:                                                         |   |        |      |   |          |   |      |      |   |   |   |   |
| Net income                                                         |   | $           | 1,098,000 |   |          |   |      |      |   |   |   |   |
| Dividends and undistributed earnings allocated to unvested shares  |   |        | (2,000    | )      |          |   |      |      |   |   |   |   |
| Net income and income allocated to common stockholders             |   |        | 1,096,000 |   |          |   | 6,342,473 |      |   | $ | 0.17 |   |
| Effect of dilutive securities options and warrants                 |   |        |      |   |          |   | N/A       |      |   |   |   |   |
| Diluted EPS:                                                       |   |        |      |   |          |   |      |      |   |   |   |   |
| Income attributable to common stockholders and assumed conversions |   | $           | 1,096,000 |   |          |   | 6,342,473 |      |   | $ | 0.17 |   |

----

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|                                                                 |   | Amortized      |   |   | Gross Unrealized |   |   | Fair   |   |
|----------------------------------------------------------------------|--------|----------------|--------|--------|------------------|--------|--------|--------|--------|
|                                                                 |   | Cost Basis     |   |   | Gain             |   |   | (Loss) |   |   | Value |   |
|                                                                 |   | (In thousands) |   |
| June 30, 2012:                                                       |   |           |   |   |             |   |   |   |   |   |   |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |
| Available-for-sale:                                                  |   |           |   |   |             |   |   |   |   |   |   |   |
| Debt securities:                                                     |   |           |   |   |             |   |   |   |   |   |   |   |
| U.S. government and government-sponsored securities:                 |   |           |   |   |             |   |   |   |   |   |   |   |
| Due within one year                                                  |   | $              | 450    |   |             | $      | 9      |   |   | $ | - |   |   | $ | 459 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Corporate bonds and other securities:                                |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| After ten years                                                      |   |           | 5,998  |   |             |   | -      |   |   |   | (1,344 | ) |   |   | 4,654 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government-sponsored and guaranteed mortgage-backed securities: |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Due in one year or less                                              |   |           | 1      |   |             |   | -      |   |   |   | - |   |   |   | 1 |   |
| From one through five years                                          |   |           | 416    |   |             |   | 24     |   |   |   | - |   |   |   | 440 |   |
| From five through ten years                                          |   |           | 2,564  |   |             |   | 140    |   |   |   | - |   |   |   | 2,704 |   |
| After ten years                                                      |   |           | 19,717 |   |             |   | 1,265  |   |   |   | (14 | ) |   |   | 20,968 |   |
|                                                                 |   |           | 22,698 |   |             |   | 1,429  |   |   |   | (14 | ) |   |   | 24,113 |   |
| Non-agency mortgage-backed securities:                               |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| After ten years                                                      |   |           | 9,601  |   |             |   | -      |   |   |   | (1,250 | ) |   |   | 8,351 |   |
| Total debt securities                                                |   |           | 38,747 |   |             |   | 1,438  |   |   |   | (2,608 | ) |   |   | 37,577 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities:                                                   |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Auction rate preferred                                               |   |           | 10,000 |   |             |   | 11     |   |   |   | (375 | ) |   |   | 9,636 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total available-for-sale securities                                  |   | $              | 48,747 |   |             | $      | 1,449  |   |   | $ | (2,983 | ) |   | $ | 47,213 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| June 30, 2011:                                                       |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Available-for-sale:                                                  |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Debt securities:                                                     |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government and agency obligations:                              |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| From one through five years                                          |   | $              | 630    |   |             | $      | 36     |   |   | $ | - |   |   | $ | 666 |   |
| Corporate bonds and other obligations:                               |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| After ten years                                                      |   |           | 5,998  |   |             |   | -      |   |   |   | (1,093 | ) |   |   | 4,905 |   |
| Mortgage-backed securities                                           |   |           | 43,253 |   |             |   | 1,673  |   |   |   | (2,888 | ) |   |   | 42,038 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Equity securities:                                                   |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Auction rate preferred                                               |   |           | 10,047 |   |             |   | 682    |   |   |   | (329 | ) |   |   | 10,400 |   |
|                                                                 |   |           |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total available-for-sale securities                                  |   | $              | 59,928 |   |             | $      | 2,391  |   |   | $ | (4,310 | ) |   | $ | 58,009 |   |

----

|                                                                 |   | Amortized      |    |   | Gross Unrealized |   |   | Fair   |   |
|----------------------------------------------------------------------|--------|----------------|---------|--------|------------------|--------|--------|--------|--------|
|                                                                 |   | Cost Basis     |    |   | Gain             |   |   | (Loss) |   |   | Value |   |
|                                                                 |   | (In thousands) |    |
| June 30, 2012:                                                       |   |           |    |   |             |   |   |   |   |   |   |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |
| Held-to-maturity:                                                    |   |           |    |   |             |   |   |   |   |   |   |   |
| U.S. Government and government-sponsored securities:                 |   |           |    |   |             |   |   |   |   |   |   |   |
| From one through five years                                          |   | $              | 5,996   |   |             | $      | 34     |   |   | $ | - |   |   | $ | 6,030 |   |
| From five through ten years                                          |   |           | 3,196   |   |             |   | 149    |   |   |   | (7 | ) |   |   | 3,338 |   |
|                                                                 |   |           | 9,192   |   |             |   | 183    |   |   |   | (7 | ) |   |   | 9,368 |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government-sponsored and guaranteed mortgage-backed securities: |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| From five through ten years                                          |   |           | 6,767   |   |             |   | 192    |   |   |   | - |   |   |   | 6,959 |   |
| After ten years                                                      |   |           | 89,236  |   |             |   | 2,783  |   |   |   | (10 | ) |   |   | 92,009 |   |
|                                                                 |   |           | 96,003  |   |             |   | 2,975  |   |   |   | (10 | ) |   |   | 98,968 |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total held to maturity securities                                    |   | $              | 105,195 |   |             | $      | 3,158  |   |   | $ | (17 | ) |   | $ | 108,336 |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| June 30, 2011:                                                       |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity:                                                    |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government and government-sponsored securities:                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| From one through five years                                          |   | $              | 2,000   |   |             | $      | 34     |   |   | $ | - |   |   | $ | 2,034 |   |
| From five through ten years                                          |   |           | 11,234  |   |             |   | 51     |   |   |   | (26 | ) |   |   | 11,259 |   |
| After ten years                                                      |   |           | 2,851   |   |             |   | -      |   |   |   | (15 | ) |   |   | 2,836 |   |
|                                                                 |   |           | 16,085  |   |             |   | 85     |   |   |   | (41 | ) |   |   | 16,129 |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed securities                                           |   |           | 98,656  |   |             |   | 1,221  |   |   |   | (44 | ) |   |   | 99,833 |   |
|                                                                 |   |           |    |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total held to maturity securities                                    |   | $              | 114,741 |   |             | $      | 1,306  |   |   | $ | (85 | ) |   | $ | 115,962 |   |

|   |                                 |   | Amortized      |   |   | Fair   |   |
|--------|--------------------------------------|--------|----------------|--------|--------|--------|--------|
|   | Issuer                               |   | Cost           |   |   | Value  |   |
|   |                                 |   | (In thousands) |   |
|   |                                 |   |           |   |   |   |   |
|   | Merrill Lynch Auction Rate Pass Thru |   | $              | 5,000  |   |   | $      | 4,868 |   |

----

|                                                                      |   | Less than 12 Months |   |   | 12 Months or More |   |   | Total          |   |
|---------------------------------------------------------------------------|--------|---------------------|--------|--------|-------------------|--------|--------|----------------|--------|
|                                                                      |   | Fair                |   |   | Unrealized        |   |   | Fair           |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
|                                                                      |   | Value               |   |   | Loss              |   |   | Value          |   |   | Loss |   |   | Value |   |   | Loss |   |
|                                                                      |   |                |   |   |              |   |   | (In thousands) |   |   |   |   |   |   |   |
| June 30, 2012:                                                            |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |
| Available-for-sale:                                                       |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |
| Debt securities:                                                          |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |
| Corporate bonds and other securities                                      |   | $                   | -      |   |              | $      | -      |           |   | $ | 4,654 |   |   | $ | 1,344 |   |   | $ | 4,654 |   |   | $ | 1,344 |   |
| U.S. Government sponsored and guaranteed mortgage-backed securities       |   |                | 1,826  |   |              |   | 14     |           |   |   | - |   |   |   | - |   |   |   | 1,826 |   |   |   | 14 |   |
| Equity securities                                                         |   |                | 7,625  |   |              |   | 375    |           |   |   | - |   |   |   | - |   |   |   | 7,625 |   |   |   | 375 |   |
| Total temporarily impaired securities                                     |   |                | 9,451  |   |              |   | 389    |           |   |   | 4,654 |   |   |   | 1,344 |   |   |   | 14,105 |   |   |   | 1,733 |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Held-to-maturity:                                                         |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government and government-sponsored securities                       |   |                | 2,257  |   |              |   | 7      |           |   |   | - |   |   |   | - |   |   |   | 2,257 |   |   |   | 7 |   |
| U.S. Government-sponsored and guaranteed mortgage-backed securities       |   |                | 10,141 |   |              |   | 10     |           |   |   | - |   |   |   | - |   |   |   | 10,141 |   |   |   | 10 |   |
| Total temporarily impaired held-to-maturity                               |   |                | 12,398 |   |              |   | 17     |           |   |   | - |   |   |   | - |   |   |   | 12,398 |   |   |   | 17 |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other-than-temporarily impaired debt securities: (1)                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-agency mortgage-backed securities                                     |   |                | 1,767  |   |              |   | 21     |           |   |   | 6,512 |   |   |   | 1,229 |   |   |   | 8,279 |   |   |   | 1,250 |   |
| Total temporarily impaired and other-than-temporarily impaired securities |   | $                   | 23,616 |   |              | $      | 427    |           |   | $ | 11,166 |   |   | $ | 2,573 |   |   | $ | 34,782 |   |   | $ | 3,000 |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                      |   | Less than 12 Months |   |   | 12 Months or More |   |   | Total          |   |
|                                                                      |   | Fair                |   |   | Unrealized        |   |   | Fair           |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
|                                                                      |   | Value               |   |   | Loss              |   |   | Value          |   |   | Loss |   |   | Value |   |   | Loss |   |
|                                                                      |   |                |   |   |              |   |   |           |   | (In thousands) |   |   |   |   |   |   |   |   |   |
| June 30, 2011:                                                            |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U.S. Government and agency securities                                     |   | $                   | 3,810  |   |              | $      | 41     |           |   | $ | - |   |   | $ | - |   |   | $ | 3,810 |   |   | $ | 41 |   |
| Corporate bonds and other obligations                                     |   |                | -      |   |              |   | -      |           |   |   | 4,905 |   |   |   | 1,093 |   |   |   | 4,905 |   |   |   | 1,093 |   |
| Mortgage-backed securities                                                |   |                | 10,323 |   |              |   | 45     |           |   |   | - |   |   |   | - |   |   |   | 10,323 |   |   |   | 45 |   |
| Equity securities                                                         |   |                | -      |   |              |   | -      |           |   |   | 6,671 |   |   |   | 329 |   |   |   | 6,671 |   |   |   | 329 |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total temporarily impaired securities                                     |   |                | 14,133 |   |              |   | 86     |           |   |   | 11,576 |   |   |   | 1,422 |   |   |   | 25,709 |   |   |   | 1,508 |   |
|                                                                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other-than-temporarily impaired debt securities: (1)                      |   |                |   |   |              |   |   |           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed securities                                                |   |                | 4,567  |   |              |   | 537    |           |   |   | 7,155 |   |   |   | 2,350 |   |   |   | 11,722 |   |   |   | 2,887 |   |
| Total temporarily impaired and other-than-temporarily impaired securities |   | $                   | 18,700 |   |              | $      | 623    |           |   | $ | 18,731 |   |   | $ | 3,772 |   |   | $ | 37,431 |   |   | $ | 4,395 |   |

----

----

|                                                                                                       |   | EquitySecurities |   |   | CorporateSecurities |   |   | Non-AgencyMortgage-BackedSecurities |   |   | Total  |   |
|------------------------------------------------------------------------------------------------------------|--------|------------------|--------|--------|---------------------|--------|--------|-------------------------------------|--------|--------|--------|--------|
|                                                                                                       |   | (In Thousands)   |   |
| June 30, 2012:                                                                                             |   |             |   |   |                |   |   |                                |   |   |   |   |
| Total other-than-temporary impairment losses                                                               |   | $                | -      |   |                | $      | -      |                                |   | $      | 3,522  |   |   | $ | 3,522 |   |
| Less: unrealized other-than-temporary losses recognized in accumulated other comprehensive income/loss (1) |   |             | -      |   |                |   | -      |                                |   |   | 1,558  |   |   |   | 1,558 |   |
|                                                                                                       |   |             |   |   |                |   |   |                                |   |   |   |   |   |   |   |   |
| Net impairment losses recognized in earnings (2)                                                           |   | $                | -      |   |                | $      | -      |                                |   | $      | 1,964  |   |   | $ | 1,964 |   |
|                                                                                                       |   |             |   |   |                |   |   |                                |   |   |   |   |   |   |   |   |
| June 30, 2011                                                                                              |   |             |   |   |                |   |   |                                |   |   |   |   |   |   |   |   |
| Total other-than-temporary impairment losses                                                               |   | $                | -      |   |                | $      | -      |                                |   | $      | 3,037  |   |   | $ | 3,037 |   |
| Less: unrealized other-than-temporary losses recognized in other comprehensive loss (1)                    |   |             | -      |   |                |   | -      |                                |   |   | 1,972  |   |   |   | 1,972 |   |
|                                                                                                       |   |             |   |   |                |   |   |                                |   |   |   |   |   |   |   |   |
| Net impairment losses recognized in earnings (2)                                                           |   | $                | -      |   |                | $      | -      |                                |   | $      | 1,065  |   |   | $ | 1,065 |   |

|   | (1) Represents the non-credit component of the other-than-temporary impairment. |
|--------|---------------------------------------------------------------------------------|

----

| Balance as of June 30, 2010                                                                                        |   | $      | 12,242 |   |
|--------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
|                                                                                                               |   |   |   |   |
| Credit losses on securities for which other-than-temporary impairment was not previously recorded                  |   |   | 3      |   |
| Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded |   |   | 1,062  |   |
| Reductions for securities sold during the period                                                                   |   |   | -      |   |
|                                                                                                               |   |   |   |   |
| Balance as of June 30, 2011                                                                                        |   |   | 13,307 |   |
|                                                                                                               |   |   |   |   |
| Credit losses on securities for which other-than-temporary impairment was not previously recorded                  |   |   | -      |   |
| Additional credit losses on securities for which an other-than-temporary impairment charge was previously recorded |   |   | 1,964  |   |
| Reductions for securities sold during the period                                                                   |   |   | -      |   |
|                                                                                                               |   |   |   |   |
| Balance as of June 30, 2012                                                                                        |   | $      | 15,271 |   |

|   |             |   | Weighted |   |   | Range   |   |
|--------|------------------|--------|----------|--------|--------|---------|--------|
|   |             |   | Average  |   |   | Minimum |   |   | Maximum |   |
|   |             |   |     |   |   |    |   |   |   |   |
|   | Prepayment rates |   |     | 18.2   | %      |    |   | 0.0% |   |   |   | 31.1% |   |
|   | Default rates    |   |     | 21.5   | %      |    |   | 5.6% |   |   |   | 32.8% |   |
|   | Loss severity    |   |     | 33.0   | %      |    |   | 10.0% |   |   |   | 37.9% |   |

----

----

|                          |   | 2012                   |    |   | 2011   |   |
|-------------------------------|--------|------------------------|---------|--------|--------|--------|
|                          |   | (Dollars in thousands) |    |
| Mortgage loans:               |   |                   |    |   |   |   |
| Residential                   |   | $                      | 200,148 |   |   | $      | 193,084 |   |
| Commercial real estate        |   |                   | 45,032  |   |   |   | 53,248 |   |
| Residential construction      |   |                   | 3,044   |   |   |   | 2,824 |   |
| Commercial                    |   |                   | 3,459   |   |   |   | 7,356 |   |
| Consumer and other            |   |                   | 898     |   |   |   | 1,070 |   |
|                          |   |                   |    |   |   |   |   |   |
| Total loans                   |   |                   | 252,581 |   |   |   | 257,582 |   |
|                          |   |                   |    |   |   |   |   |   |
| Unadvanced construction loans |   |                   | (1,559  | )      |   |   | (1,476 | ) |
|                          |   |                   | 251,022 |   |   |   | 256,106 |   |
|                          |   |                   |    |   |   |   |   |   |
| Net deferred loan costs       |   |                   | 463     |   |   |   | 191 |   |
| Allowance for loan losses     |   |                   | (2,913  | )      |   |   | (3,072 | ) |
|                          |   |                   |    |   |   |   |   |   |
| Loans, net                    |   | $                      | 248,572 |   |   | $      | 253,225 |   |
|                          |   |                   |    |   |   |   |   |   |
| Weighted average yield        |   |                   | 4.95    | %      |   |   | 5.33 | % |

|                           |   | 2012           |    |   | 2011   |   |
|--------------------------------|--------|----------------|---------|--------|--------|--------|
|                           |   | (In thousands) |    |
| Fixed rate:                    |   |           |    |   |   |   |
| Term to maturity               |   |           |    |   |   |   |
| One month through one year     |   | $              | 9,275   |   |   | $      | 8,701 |   |
| One year through three years   |   |           | 6,344   |   |   |   | 12,800 |   |
| Three years through five years |   |           | 7,785   |   |   |   | 8,905 |   |
| Five years through ten years   |   |           | 22,504  |   |   |   | 24,098 |   |
| Over ten years                 |   |           | 104,486 |   |   |   | 97,888 |   |
|                           |   |           | 150,394 |   |   |   | 152,392 |   |
| Adjustable rate:               |   |           |    |   |   |   |   |   |
| Rate adjustment                |   |           |    |   |   |   |   |   |
| One month through one year     |   |           | 57,995  |   |   |   | 54,727 |   |
| One year through three years   |   |           | 26,313  |   |   |   | 24,702 |   |
| Three years through five years |   |           | 10,814  |   |   |   | 17,865 |   |
| Over five years                |   |           | 5,506   |   |   |   | 6,420 |   |
|                           |   |           | 100,628 |   |   |   | 103,714 |   |
|                           |   |           |    |   |   |   |   |   |
| Total loans                    |   | $              | 251,022 |   |   | $      | 256,106 |   |

----

|                                                                       |   | Residential    |    |   | Commercial  |   |   | Residential  |   |   |       |   |   | Consumer    |   |   |        |   |   |   |   |
|----------------------------------------------------------------------------|--------|----------------|---------|--------|-------------|--------|--------|--------------|--------|--------|------------|--------|--------|-------------|--------|--------|-------------|--------|--------|--------|--------|
|                                                                       |   | Real Estate    |    |   | Real Estate |   |   | Construction |   |   | Commercial |   |   | & Other |   |   | Unallocated |   |   | Total  |   |
|                                                                       |   | (In thousands) |    |
| Year Ended June 30, 2012                                                   |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |
| Allowance for loan losses:                                                 |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |
| Beginning balance                                                          |   | $              | 1,520   |   |        | $      | 1,286  |         |   | $      | 28         |   |   | $           | 140    |   |        | $      | 11     |   |   | $ | 87 |   |   | $ | 3,072 |   |
|      Charge-offs                                  |   |           | (364    | )      |        |   | (928   | )            |   |   | -          |   |   |        | -      |   |        |   | (60    | )      |   |   | - |   |   |   | (1,352 | ) |
|      Recoveries                                   |   |           | 7       |   |        |   | -      |         |   |   | -          |   |   |        | 11     |   |        |   | 23     |   |   |   | - |   |   |   | 41 |   |
|      Provision                                    |   |           | 322     |   |        |   | 989    |         |   |   | (8         | )      |   |        | (134   | )      |        |   | 63     |   |   |   | (80 | ) |   |   | 1,152 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance                                                             |   | $              | 1,485   |   |        | $      | 1,347  |         |   | $      | 20         |   |   | $           | 17     |   |        | $      | 37     |   |   | $ | 7 |   |   | $ | 2,913 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| At June 30, 2012                                                           |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Amount of allowance for impaired loans                |   | $              | 185     |   |        | $      | 190    |         |   | $      | -          |   |   | $           | -      |   |        | $      | -      |   |   | $ | - |   |   | $ | 375 |   |
| Ending balance: Amount of allowance for loan losses for non-impaired loans |   | $              | 1,300   |   |        | $      | 1,157  |         |   | $      | 20         |   |   | $           | 17     |   |        | $      | 37     |   |   | $ | 7 |   |   | $ | 2,538 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Loans:  Ending balance                                           |   | $              | 200,148 |   |        | $      | 44,218 |         |   | $      | 2,299      |   |   | $           | 3,459  |   |        | $      | 898    |   |   | $ | - |   |   | $ | 251,022 | (1) |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Impaired loans                                             |   | $              | 4,846   |   |        | $      | 10,070 |         |   | $      | 424        |   |   | $           | -      |   |        | $      | 27     |   |   | $ | - |   |   | $ | 15,367 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Non-impaired loans                                         |   | $              | 195,302 |   |        | $      | 34,148 |         |   | $      | 1,875      |   |   | $           | 3,459  |   |        | $      | 871    |   |   | $ | - |   |   | $ | 235,655 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| (1) Does not include deferred fees or costs.                               |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   | Residential    |    |   | Commercial  |   |   | Residential  |   |   |       |   |   | Consumer    |   |   |        |   |   |   |   |   |   |
|                                                                       |   | Real Estate    |    |   | Real Estate |   |   | Construction |   |   | Commercial |   |   | & Other |   |   | Unallocated |   |   | Total  |   |
|                                                                       |   | (In thousands) |    |
| June 30, 2011                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for credit losses:                                               |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Beginning balance                                                          |   | $              | 1,332   |   |        | $      | 901    |         |   | $      | 10         |   |   | $           | 297    |   |        | $      | 43     |   |   | $ | 68 |   |   | $ | 2,651 |   |
|      Charge-offs                                  |   |           | 208     |   |        |   | 62     |         |   |   | -          |   |   |        | 212    |   |        |   | 72     |   |   |   | - |   |   |   | 554 |   |
|      Recoveries                                   |   |           | 6       |   |        |   | -      |         |   |   | -          |   |   |        | 18     |   |        |   | 36     |   |   |   | - |   |   |   | 60 |   |
|      Provision                                    |   |           | 390     |   |        |   | 447    |         |   |   | 18         |   |   |        | 37     |   |        |   | 4      |   |   |   | 19 |   |   |   | 915 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending Balance                                                             |   | $              | 1,520   |   |        | $      | 1,286  |         |   | $      | 28         |   |   | $           | 140    |   |        | $      | 11     |   |   | $ | 87 |   |   | $ | 3,072 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment                      |   | $              | 236     |   |        | $      | 686    |         |   | $      | -          |   |   | $           | -      |   |        | $      | 6      |   |   | $ | - |   |   | $ | 928 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment                      |   | $              | 1,284   |   |        | $      | 600    |         |   | $      | 28         |   |   | $           | 140    |   |        | $      | 5      |   |   | $ | 87 |   |   | $ | 2,144 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Loans:                                                                     |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending Balance                                                             |   | $              | 193,084 |   |        | $      | 52,686 |         |   | $      | 1,910      |   |   | $           | 7,356  |   |        | $      | 1,070  |   |   | $ | - |   |   | $ | 256,106 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Individually evaluated for impairment                      |   | $              | 2,415   |   |        | $      | 8,093  |         |   | $      | -          |   |   | $           | -      |   |        | $      | 57     |   |   | $ | - |   |   | $ | 10,565 |   |
|                                                                       |   |           |    |   |        |   |   |         |   |   |       |   |   |        |   |   |        |   |   |   |   |   |   |   |   |   |   |   |
| Ending balance: Collectively evaluated for impairment                      |   | $              | 190,669 |   |        | $      | 44,593 |         |   | $      | 1,910      |   |   | $           | 7,356  |   |        | $      | 1,013  |   |   | $ | - |   |   | $ | 245,541 |   |

----

----

|                                                              |   | Residential    |    |   | Commercial  |   |   | Residential  |   |   |       |   |   | Consumer    |     |   |   |   |
|-------------------------------------------------------------------|--------|----------------|---------|--------|-------------|--------|--------|--------------|--------|--------|------------|--------|--------|-------------|----------|--------|--------|--------|
|                                                              |   | Real Estate    |    |   | Real Estate |   |   | Construction |   |   | Commercial |   |   | & Other |     |   | Total  |   |
|                                                              |   | (In thousands) |    |
| June 30, 2012                                                     |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |
| Grade:                                                            |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |
|      Pass                                |   | $              | 195,825 |   |        | $      | 32,032 |         |   | $      | 1,875      |   |   | $           | 2,834    |   |   | $      | 898 |   |   | $ | 233,464 |   |
|      Special Mention                     |   |           | 338     |   |        |   | 1,719  |         |   |   | -          |   |   |        | 625      |   |   |   | - |   |   |   | 2,682 |   |
|      Substandard                         |   |           | 3,605   |   |        |   | 9,998  |         |   |   | 424        |   |   |        | -        |   |   |   | - |   |   |   | 14,027 |   |
|      Doubtful                            |   |           | 380     |   |        |   | 469    |         |   |   | -          |   |   |        | -        |   |   |   | - |   |   |   | 849 |   |
|      Loss                                |   |           | -       |   |        |   | -      |         |   |   | -          |   |   |        | -        |   |   |   | - |   |   |   | - |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
|           Total |   | $              | 200,148 |   |        | $      | 44,218 |         |   | $      | 2,299      |   |   | $           | 3,459    |   |   | $      | 898 |   |   | $ | 251,022 |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |
|                                                              |   | Residential    |    |   | Commercial  |   |   | Residential  |   |   |       |   |   |        | Consumer |   |   |   |   |   |
|                                                              |   | Real Estate    |    |   | Real Estate |   |   | Construction |   |   | Commercial |   |   | & Other |     |   | Total  |   |
|                                                              |   | (In thousands) |    |
| June 30, 2011                                                     |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
| Grade:                                                            |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
|      Pass                                |   | $              | 191,309 |   |        | $      | 37,787 |         |   | $      | 1,910      |   |   | $           | 6,509    |   |   | $      | 1,070 |   |   | $ | 238,585 |   |
|      Special Mention                     |   |           | 23      |   |        |   | 3,783  |         |   |   | -          |   |   |        | 847      |   |   |   | - |   |   |   | 4,653 |   |
|      Substandard                         |   |           | 1,752   |   |        |   | 11,116 |         |   |   | -          |   |   |        | -        |   |   |   | - |   |   |   | 12,868 |   |
|      Doubtful                            |   |           | -       |   |        |   | -      |         |   |   | -          |   |   |        | -        |   |   |   | - |   |   |   | - |   |
|      Loss                                |   |           | -       |   |        |   | -      |         |   |   | -          |   |   |        | -        |   |   |   | - |   |   |   | - |   |
|                                                              |   |           |    |   |        |   |   |         |   |   |       |   |   |        |     |   |   |   |   |   |   |   |   |   |
|           Total |   | $              | 193,084 |   |        | $      | 52,686 |         |   | $      | 1,910      |   |   | $           | 7,356    |   |   | $      | 1,070 |   |   | $ | 256,106 |   |

|                                                   |   |             |   |   |             |   |   | 90 days    |   |   |     |   |   |        |   |
|--------------------------------------------------------|--------|------------------|--------|--------|------------------|--------|--------|------------|--------|--------|----------|--------|--------|-------------|--------|
|                                                   |   | 30–59 Days |   |   | 60–89 Days |   |   | or Greater |   |   | Total    |   |   | Total       |   |
|                                                   |   | Past Due         |   |   | Past Due         |   |   | Past Due   |   |   | Past Due |   |   | Non-accrual |   |
|                                                   |   | (In thousands)   |   |
| 2012                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
|                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
| Real estate:                                           |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
|      Residential              |   | $                | 363    |   |             | $      | 162    |       |   | $      | 940      |   |   | $           | 1,465  |   |   | $ | 3,985 |   |
|      Commercial               |   |             | 159    |   |             |   | -      |       |   |   | 1,573    |   |   |        | 1,732  |   |   |   | 3,975 |   |
|      Residential construction |   |             | -      |   |             |   | -      |       |   |   | 424      |   |   |        | 424    |   |   |   | 424 |   |
|                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |   |   |   |   |   |
|      Total                    |   | $                | 522    |   |             | $      | 162    |       |   | $      | 2,937    |   |   | $           | 3,621  |   |   | $ | 8,384 |   |

----

|                                                   |   |             |   |   |             |   |   | 90 days    |   |   |     |   |   |        |   |
|--------------------------------------------------------|--------|------------------|--------|--------|------------------|--------|--------|------------|--------|--------|----------|--------|--------|-------------|--------|
|                                                   |   | 30–59 Days |   |   | 60–89 Days |   |   | or Greater |   |   | Total    |   |   | Total       |   |
|                                                   |   | Past Due         |   |   | Past Due         |   |   | Past Due   |   |   | Past Due |   |   | Non-accrual |   |
|                                                   |   | (In thousands)   |   |
| 2011                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
|                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
| Real estate:                                           |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |
|      Residential              |   | $                | 92     |   |             | $      | 247    |       |   | $      | 1,126    |   |   | $           | 1,465  |   |   | $ | 1,752 |   |
|      Commercial               |   |             | 629    |   |             |   | 488    |       |   |   | 3,324    |   |   |        | 4,441  |   |   |   | 4,635 |   |
|      Residential construction |   |             | -      |   |             |   | -      |       |   |   | -        |   |   |        | -      |   |   |   | - |   |
| Commercial                                             |   |             | 150    |   |             |   | -      |       |   |   | -        |   |   |        | 150    |   |   |   | - |   |
| Consumer & other                                   |   |             | -      |   |             |   | -      |       |   |   | -        |   |   |        | -      |   |   |   | - |   |
|                                                   |   |             |   |   |             |   |   |       |   |   |     |   |   |        |   |   |   |   |   |   |
|      Total                    |   | $                | 871    |   |             | $      | 735    |       |   | $      | 4,450    |   |   | $           | 6,056  |   |   | $ | 6,387 |   |

|                                                                             |   | At June 30, 2012 |   |   | Year Ended June 30, 2012 |   |
|----------------------------------------------------------------------------------|--------|------------------|--------|--------|--------------------------|--------|
|                                                                             |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   | Interest |   |
|                                                                             |   |             |   |   | Unpaid                   |   |   |   |   |   | Average |   |   | Interest |   |   | Income |   |
|                                                                             |   | Recorded         |   |   | Principal                |   |   | Related |   |   | Recorded |   |   | Income |   |   | Recognized |   |
|                                                                             |   | Investment       |   |   | Balance                  |   |   | Allowance |   |   | Investment |   |   | Recognized |   |   | on Cash Basis |   |
|                                                                             |   | (In thousands)   |   |
| Impaired loans without a valuation allowance:                                    |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Real estate:                                                                     |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential                                                                      |   | $                | 1,415  |   |                     | $      | 1,415 |   |   | $ | - |   |   | $ | 1,235 |   |   | $ | 29 |   |   | $ | 9 |   |
| Commercial                                                                       |   |             | 6,668  |   |                     |   | 6,754 |   |   |   | - |   |   |   | 3,370 |   |   |   | 97 |   |   |   | 87 |   |
| Residential construction                                                         |   |             | 424    |   |                     |   | 424 |   |   |   | - |   |   |   | 426 |   |   |   | 9 |   |   |   | 9 |   |
| Commercial                                                                       |   |             | -      |   |                     |   | - |   |   |   | - |   |   |   | 26 |   |   |   | 11 |   |   |   | 7 |   |
| Consumer & other                                                             |   |             | 27     |   |                     |   | 27 |   |   |   | - |   |   |   | 43 |   |   |   | 4 |   |   |   | - |   |
| Total impaired with no related allowance                                         |   |             | 8,534  |   |                     |   | 8,620 |   |   |   | - |   |   |   | 5,100 |   |   |   | 150 |   |   |   | 112 |   |
|                                                                             |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Impaired loans with a valuation allowance:                                       |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Real estate:                                                                     |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential                                                                      |   | $                | 3,431  |   |                     | $      | 3,527 |   |   | $ | 185 |   |   | $ | 2,957 |   |   | $ | 66 |   |   | $ | 33 |   |
| Commercial                                                                       |   |             | 3,402  |   |                     |   | 3,768 |   |   |   | 190 |   |   |   | 3,319 |   |   |   | 127 |   |   |   | 22 |   |
| Total impaired with an allowance recorded                                        |   |             | 6,833  |   |                     |   | 7,295 |   |   |   | 375 |   |   |   | 6,276 |   |   |   | 193 |   |   |   | 55 |   |
|                                                                             |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total impaired loans:                                                            |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Real Estate:                                                                     |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Residential                                                                      |   | $                | 4,846  |   |                     | $      | 4,942 |   |   | $ | 185 |   |   | $ | 4,192 |   |   | $ | 95 |   |   | $ | 42 |   |
| Commercial                                                                       |   |             | 10,070 |   |                     |   | 10,522 |   |   |   | 190 |   |   |   | 6,689 |   |   |   | 224 |   |   |   | 109 |   |
| Residential construction                                                         |   |             | 424    |   |                     |   | 424 |   |   |   | - |   |   |   | 426 |   |   |   | 9 |   |   |   | 9 |   |
| Commercial                                                                       |   |             | -      |   |                     |   | - |   |   |   | - |   |   |   | 26 |   |   |   | 11 |   |   |   | 7 |   |
| Consumer & other                                                             |   |             | 27     |   |                     |   | 27 |   |   |   | - |   |   |   | 43 |   |   |   | 4 |   |   |   | - |   |
|                                                                             |   |             |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|           Total impaired loans |   | $                | 15,367 |   |                     | $      | 15,915 |   |   | $ | 375 |   |   | $ | 11,376 |   |   | $ | 343 |   |   | $ | 167 |   |

----

|                                                                             |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   | Interest      |   |
|----------------------------------------------------------------------------------|--------|----------------|--------|--------|-----------|--------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|---------------|--------|
|                                                                             |   |           |   |   | Unpaid    |   |   |      |   |   | Average    |   |   | Interest   |   |   | Income        |   |
|                                                                             |   | Recorded       |   |   | Principal |   |   | Related   |   |   | Recorded   |   |   | Income     |   |   | Recognized    |   |
|                                                                             |   | Investment     |   |   | Balance   |   |   | Allowance |   |   | Investment |   |   | Recognized |   |   | on Cash Basis |   |
|                                                                             |   | (In thousands) |   |
| June 30, 2011                                                                    |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |
|                                                                             |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |
| Impaired loans without a valuation allowance:                                    |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |
| Real Estate:                                                                     |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |
| Residential                                                                      |   | $              | 395    |   |      | $      | 393    |      |   | $      | -          |   |   | $          | 1,071  |   |          | $      | 4 |   |   | $ | 4 |   |
| Commercial                                                                       |   |           | 2,625  |   |      |   | 2,623  |      |   |   | -          |   |   |       | 2,719  |   |          |   | 22 |   |   |   | 9 |   |
| Residential construction                                                         |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | -      |   |          |   | - |   |   |   | - |   |
| Commercial                                                                       |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | -      |   |          |   | - |   |   |   | - |   |
| Consumer and other                                                               |   |           | 51     |   |      |   | 51     |      |   |   | -          |   |   |       | 17     |   |          |   | 3 |   |   |   | - |   |
| Total impaired with no related allowance                                         |   |           | 3,071  |   |      |   | 3,067  |      |   |   | -          |   |   |       | 3,807  |   |          |   | 29 |   |   |   | 13 |   |
|                                                                             |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Impaired loans with a valuation allowance:                                       |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Real estate:                                                                     |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Residential                                                                      |   | $              | 2,025  |   |      | $      | 2,022  |      |   | $      | 236        |   |   | $          | 1,381  |   |          | $      | 58 |   |   | $ | 5 |   |
| Commercial                                                                       |   |           | 5,472  |   |      |   | 5,470  |      |   |   | 686        |   |   |       | 3,787  |   |          |   | 137 |   |   |   | 49 |   |
| Residential construction                                                         |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | -      |   |          |   | - |   |   |   | - |   |
| Commercial                                                                       |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | 43     |   |          |   | - |   |   |   | - |   |
| Consumer and other                                                               |   |           | 6      |   |      |   | 6      |      |   |   | 6          |   |   |       | 21     |   |          |   | - |   |   |   | - |   |
| Total impaired with an allowance recorded                                        |   |           | 7,503  |   |      |   | 7,498  |      |   |   | 928        |   |   |       | 5,232  |   |          |   | 195 |   |   |   | 54 |   |
|                                                                             |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Total impaired loans:                                                            |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Real estate:                                                                     |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
| Residential                                                                      |   | $              | 2,420  |   |      | $      | 2,415  |      |   | $      | 236        |   |   | $          | 2,452  |   |          | $      | 62 |   |   | $ | 9 |   |
| Commercial                                                                       |   |           | 8,097  |   |      |   | 8,093  |      |   |   | 686        |   |   |       | 6,506  |   |          |   | 159 |   |   |   | 58 |   |
| Residential construction                                                         |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | -      |   |          |   | - |   |   |   | - |   |
| Commercial                                                                       |   |           | -      |   |      |   | -      |      |   |   | -          |   |   |       | 43     |   |          |   | - |   |   |   | - |   |
| Consumer and other                                                               |   |           | 57     |   |      |   | 57     |      |   |   | 6          |   |   |       | 38     |   |          |   | 3 |   |   |   | - |   |
|                                                                             |   |           |   |   |      |   |   |      |   |   |       |   |   |       |   |   |          |   |   |   |   |   |   |   |
|           Total impaired loans |   | $              | 10,574 |   |      | $      | 10,565 |      |   | $      | 928        |   |   | $          | 9,039  |   |          | $      | 224 |   |   | $ | 67 |   |

----

|         |   |                   |   |   | Pre-Modification |   |   | Post-Modification |   |
|--------------|--------|------------------------|--------|--------|------------------|--------|--------|-------------------|--------|
|         |   |                   |   |   | Outstanding      |   |   | Outstanding       |   |
|         |   | Number of              |   |   | Recorded         |   |   | Recorded          |   |
|         |   | Contracts              |   |   | Investment       |   |   | Investment        |   |
|         |   | (Dollars in thousands) |   |
|         |   |                   |   |   |             |   |   |              |   |
| Real estate: |   |                   |   |   |             |   |   |              |   |
| Residential  |   |                   | 11     |   |             | $      | 1,882  |              |   | $ | 1,883 |   |
| Commercial   |   |                   | 16     |   |             |   | 2,224  |              |   |   | 2,227 |   |
|         |   |                   |   |   |             |   |   |              |   |   |   |   |
|         |   |                   | 27     |   |             | $      | 4,106  |              |   | $ | 4,110 |   |

|                                      |   | Number of              |   |   | Recorded   |   |
|-------------------------------------------|--------|------------------------|--------|--------|------------|--------|
|                                      |   | Contracts              |   |   | Investment |   |
|                                      |   | (Dollars in thousands) |   |
| Real estate:                              |   |                   |   |   |       |   |
|      Residential |   |                   | 2      |   |       | $      | 229 |   |
|      Commercial  |   |                   | 1      |   |       |   | 224 |   |
|                                      |   |                   |   |   |       |   |   |   |
|                                      |   |                   | 3      |   |       | $      | 453 |   |

----

----

|                                                                              |   | 2012           |   |   | 2011   |   |
|-----------------------------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                                                              |   | (In thousands) |   |
|                                                                              |   |           |   |   |   |   |
| Land                                                                              |   | $              | 470    |   |   | $      | 470 |   |
| Buildings                                                                         |   |           | 6,270  |   |   |   | 6,266 |   |
| Equipment                                                                         |   |           | 2,770  |   |   |   | 2,769 |   |
|                                                                              |   |           | 9,510  |   |   |   | 9,505 |   |
| Accumulated depreciation and amortization                                         |   |           | (4,984 | )      |   |   | (4,656 | ) |
|                                                                              |   |           |   |   |   |   |   |   |
|          Premises and equipment, net |   | $              | 4,526  |   |   | $      | 4,849 |   |

|                                                  |   | June 30,       |   |
|-------------------------------------------------------|--------|----------------|--------|
|                                                  |   | 2012           |   |   | 2011 |   |
|                                                  |   | (In thousands) |   |
| Balances not subject to amortization:                 |   |           |   |   |   |   |
|      Goodwill                |   | $              | 6,912  |   |   | $ | 6,912 |   |
| Balances subject to amortization:                     |   |           |   |   |   |   |   |   |
|      Core deposit intangible |   |           | 202    |   |   |   | 324 |   |
| Total intangible assets                               |   | $              | 7,114  |   |   | $ | 7,236 |   |

----

|        |   | Years          |   |
|-------------|--------|----------------|--------|
|        |   | Ending         |   |
|        |   | June 30,       |   |
|        |   | (In thousands) |   |
|        |   |           |   |
|  2013  |   | $              | 93     |   |
|  2014  |   |           | 65     |   |
|  2015  |   |           | 36     |   |
|  2016  |   |           | 8      |   |
|        |   |           |   |   |
|  Total |   | $              | 202    |   |

|                    |   | 2012                |   |
|-------------------------|--------|---------------------|--------|
|                    |   | GrossCarryingAmount |   |   | AccumulatedAmortization |   |   | Net CarryingAmount |   |
|                    |   | (In thousands)      |   |
|                    |   |                |   |   |   |   |   |   |   |
| Core deposit intangible |   | $                   | 1,553  |   |   | $ | 1,351 |   |   | $ | 202 |   |
|                    |   |                |   |   |   |   |   |   |   |   |   |   |
|                    |   | 2011                |   |
|                    |   | GrossCarryingAmount |   |   | AccumulatedAmortization |   |   | Net CarryingAmount |   |
|                    |   | (In thousands)      |   |
|                    |   |                |   |   |   |   |   |   |   |   |   |   |
| Core deposit intangible |   | $                   | 1,553  |   |   | $ | 1,229 |   |   | $ | 324 |   |

----

|                              |   | 2012                   |    |   | 2011                |   |
|-----------------------------------|--------|------------------------|---------|--------|---------------------|--------|
|                              |   | Amount                 |    |   | WeightedAverageRate |   |   | Amount |   |   | WeightedAverageRate |   |
|                              |   | (Dollars in thousands) |    |
|                              |   |                   |    |   |                |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                   |   | $                      | 43,785  |   |                |   | - | % |   | $ | 36,814 |   |   |   | - | % |
| NOW accounts                      |   |                   | 92,662  |   |                |   | 0.67 |   |   |   | 92,273 |   |   |   | 0.81 |   |
| Regular savings                   |   |                   | 54,495  |   |                |   | 0.21 |   |   |   | 50,283 |   |   |   | 0.34 |   |
| Money market accounts             |   |                   | 16,668  |   |                |   | 0.48 |   |   |   | 13,474 |   |   |   | 0.68 |   |
| Club accounts                     |   |                   | 256     |   |                |   | 0.15 |   |   |   | 245 |   |   |   | 0.30 |   |
|                              |   |                   | 207,866 |   |                |   | 0.39 |   |   |   | 193,089 |   |   |   | 0.52 |   |
|                              |   |                   |    |   |                |   |   |   |   |   |   |   |   |   |   |   |
| Certificate accounts maturing in: |   |                   |    |   |                |   |   |   |   |   |   |   |   |   |   |   |
| Less than one year                |   |                   | 60,699  |   |                |   | 1.28 |   |   |   | 71,200 |   |   |   | 1.84 |   |
| One to two years                  |   |                   | 30,251  |   |                |   | 2.64 |   |   |   | 24,112 |   |   |   | 2.43 |   |
| Two to three years                |   |                   | 18,439  |   |                |   | 2.59 |   |   |   | 22,182 |   |   |   | 3.25 |   |
| Three to five years               |   |                   | 25,083  |   |                |   | 2.29 |   |   |   | 23,190 |   |   |   | 2.91 |   |
|                              |   |                   | 134,472 |   |                |   | 1.96 |   |   |   | 140,684 |   |   |   | 2.34 |   |
|                              |   |                   |    |   |                |   |   |   |   |   |   |   |   |   |   |   |
|    Total deposits  |   | $                      | 342,338 |   |                |   | 1.01 | % |   | $ | 333,773 |   |   |   | 1.29 | % |

----

|                                           |   | 2012                   |   |   | 2011     |   |
|------------------------------------------------|--------|------------------------|--------|--------|----------|--------|
|                                           |   | AmountDue              |   |   | Weighted |   |   | AmountDue |   |   | Weighted |   |
|                                           |   | Average                |   |   | Average  |   |
|                                           |   | Rate                   |   |   | Rate     |   |
|                                           |   | (Dollars in thousands) |   |
| Short-term borrowing                           |   |                   |   |   |     |   |   |   |   |   |   |   |
| Securities sold under agreements to repurchase |   | $                      | 3,653  |   |     |   | 0.17 | % |   |   | 4,244 |   |   |   | 0.27 | % |
| Total short-term borrowings                    |   |                   | 3,653  |   |     |   | 0.17 |   |   |   | 4,244 |   |   |   | 0.27 |   |
|                                           |   |                   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Long-term FHLB of Boston (FHLB) advances       |   |                   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Year of maturity:                              |   |                   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |
| 2012                                           |   |                   | -      |   |     |   | - |   |   |   | 32,000 |   |   |   | 4.56 |   |
| 2013                                           |   |                   | 5,000  |   |     |   | 3.23 |   |   |   | 5,000 |   |   |   | 3.23 |   |
| 2014                                           |   |                   | 17,500 |   |     |   | 3.19 |   |   |   | 17,500 |   |   |   | 3.19 |   |
| 2015                                           |   |                   | 1,000  |   |     |   | 3.35 |   |   |   | 1,000 |   |   |   | 3.35 |   |
| 2016                                           |   |                   | 10,000 |   |     |   | 3.17 |   |   |   | 10,000 |   |   |   | 3.17 |   |
| 2017                                           |   |                   | 12,000 |   |     |   | 3.89 |   |   |   | 10,000 |   |   |   | 4.15 |   |
| 2018                                           |   |                   | 8,000  |   |     |   | 3.91 |   |   |   | 8,000 |   |   |   | 3.91 |   |
| Total long-term borrowings                     |   |                   | 53,500 |   |     |   | 3.46 |   |   |   | 83,500 |   |   |   | 3.90 |   |
|                                           |   |                   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Total borrowed funds                           |   | $                      | 57,153 |   |     |   | 3.25 | % |   | $ | 87,744 |   |   |   | 3.72 | % |

----

|               |   | 2012           |   |   | 2011   |   |
|--------------------|--------|----------------|--------|--------|--------|--------|
|               |   | (In thousands) |   |
| Current:           |   |           |   |   |   |   |
| Federal            |   | $              | 18     |   |   | $      | 723 |   |
| State              |   |           | 2      |   |   |   | 1 |   |
| Total current      |   |           | 20     |   |   |   | 724 |   |
| Deferred:          |   |           |   |   |   |   |   |   |
| Federal            |   |           | 195    |   |   |   | (187 | ) |
| State              |   |           | -      |   |   |   | - |   |
| Total deferred     |   |           | 195    |   |   |   | (187 | ) |
|               |   |           |   |   |   |   |   |   |
| Income tax expense |   | $              | 215    |   |   | $      | 537 |   |

----

|                                       |   | 2012           |   |   | 2011   |   |
|--------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                       |   | (In thousands) |   |
|                                       |   |           |   |   |   |   |
| Federal income tax at statutory rates      |   | $              | 430    |   |   | $      | 556 |   |
| Increase (decrease) in tax resulting from: |   |           |   |   |   |   |   |   |
| State taxes, net of federal benefit        |   |           | 1      |   |   |   | 1 |   |
| Qualifying option (benefit) expense        |   |           | (3     | )      |   |   | 9 |   |
| Dividends received deduction               |   |           | (112   | )      |   |   | (113 | ) |
| Bank-owned life insurance                  |   |           | (111   | )      |   |   | (138 | ) |
| Tax-exempt municipal income, net           |   |           | (14    | )      |   |   | (14 | ) |
| Expiration unused contributions            |   |           | -      |   |   |   | 92 |   |
| Other, net                                 |   |           | 24     |   |   |   | 144 |   |
|                                       |   |           |   |   |   |   |   |   |
| Income tax expense                         |   | $              | 215    |   |   | $      | 537 |   |
|                                       |   |           |   |   |   |   |   |   |
| Effective tax rates                        |   |           | 17.0   | %      |   |   | 32.8 | % |

|                                                         |   | 2012           |   |   | 2011   |   |
|--------------------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                                         |   | (In thousands) |   |
| Deferred tax assets:                                         |   |           |   |   |   |   |
| Allowance for loan losses                                    |   | $              | 918    |   |   | $      | 985 |   |
| Net unrealized holding loss on available-for-sale securities |   |           | 521    |   |   |   | 652 |   |
| Deferred compensation                                        |   |           | 188    |   |   |   | 190 |   |
| Stock-based compensation                                     |   |           | 64     |   |   |   | 59 |   |
| Impairment losses on securities available-for-sale           |   |           | 1,093  |   |   |   | 1,769 |   |
| Accrued expenses                                             |   |           | 159    |   |   |   | - |   |
| Post retirement benefits                                     |   |           | 55     |   |   |   | 37 |   |
| Interest receivable on non-accrual loans                     |   |           | 168    |   |   |   | 134 |   |
| Federal carryovers                                           |   |           | 1,516  |   |   |   | 1,043 |   |
| Other                                                        |   |           | 68     |   |   |   | 42 |   |
| Gross deferred tax asset                                     |   |           | 4,750  |   |   |   | 4,911 |   |
|                                                         |   |           |   |   |   |   |   |   |
| Deferred tax liabilities:                                    |   |           |   |   |   |   |   |   |
| Depreciation and amortization                                |   |           | (703   | )      |   |   | (630 | ) |
| Deferred loan costs                                          |   |           | (157   | )      |   |   | (65 | ) |
| Gross deferred tax liability                                 |   |           | (860   | )      |   |   | (695 | ) |
|                                                         |   |           |   |   |   |   |   |   |
| Net deferred tax asset                                       |   | $              | 3,890  |   |   | $      | 4,216 |   |

----

----

|       |   | Rental         |   |
|------------|--------|----------------|--------|
|       |   | Expense Due    |   |
|       |   | (In thousands) |   |
|       |   |           |   |
| 2013       |   | $              | 154    |   |
| 2014       |   |           | 150    |   |
| 2015       |   |           | 98     |   |
| 2016       |   |           | 51     |   |
| 2017       |   |           | 8      |   |
| Thereafter |   |           | -      |   |
|       |   |           |   |   |
| Total      |   | $              | 461    |   |

----

----

|                                                                            |   | Fair Value Measurements at Reporting Date Using: |   |
|---------------------------------------------------------------------------------|--------|--------------------------------------------------|--------|
|                                                                            |   |                                             |   |   | Quoted Prices in |   |   | Significant |   |   | Significant |   |
|                                                                            |   |                                             |   |   | Active Markets for |   |   | Other Observable |   |   | Unobservable |   |
|                                                                            |   |                                             |   |   | Identical Assets |   |   | Inputs |   |   | Inputs |   |
|                                                                            |   | Total                                            |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                                                                            |   | (In thousands)                                   |   |
| June 30, 2012                                                                   |   |                                             |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |
| Securities available-for-sale:                                                  |   |                                             |   |   |   |   |   |   |   |   |   |   |
| U. S. Government and government-sponsored securities                            |   | $                                                | 459    |   |   | $ | - |   |   | $ | 459 |   |   | $ | - |   |
| Corporate bonds and other securities                                            |   |                                             | 4,654  |   |   |   | - |   |   |   | 4,654 |   |   |   | - |   |
| U.S. Government-sponsored and guaranteed mortgage-backed securities             |   |                                             | 24,113 |   |   |   | - |   |   |   | 24,113 |   |   |   | - |   |
| Non-agency mortgage-backed securities                                           |   |                                             | 8,351  |   |   |   | - |   |   |   | 8,351 |   |   |   | - |   |
| Equity securities                                                               |   |                                             | 9,636  |   |   |   | - |   |   |   | - |   |   |   | 9,636 |   |
|                                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                           |   | $                                                | 47,213 |   |   | $ | - |   |   | $ | 37,577 |   |   | $ | 9,636 |   |
|                                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   | Fair Value Measurements at Reporting Date Using: |   |
|                                                                            |   |                                             |   |   |   | Quoted Prices in |   |   | Significant |   |   | Significant |   |
|                                                                            |   |                                             |   |   |   | Active Markets for |   |   | Other Observable |   |   | Unobservable |   |
|                                                                            |   |                                             |   |   |   | Identical Assets |   |   | Inputs |   |   | Inputs |   |
|                                                                            |   | Total                                            |   |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |
|                                                                            |   | (In thousands)                                   |   |
| June 30, 2011                                                                   |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Securities available-for-sale:                                                  |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| U. S. Government agency securities                                              |   | $                                                | 666    |   |   | $ | - |   |   | $ | 666 |   |   | $ | - |   |
| Corporate securities                                                            |   |                                             | 4,905  |   |   |   | - |   |   |   | 4,905 |   |   |   | - |   |
| Mortgage-backed securities insured or guaranteed by U.S. Government enterprises |   |                                             | 30,316 |   |   |   | - |   |   |   | 30,316 |   |   |   | - |   |
| Non-agency mortgage-backed securities                                           |   |                                             | 11,722 |   |   |   | - |   |   |   | 11,722 |   |   |   | - |   |
| Equity securities                                                               |   |                                             | 10,400 |   |   |   | - |   |   |   | - |   |   |   | 10,400 |   |
|                                                                            |   |                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                           |   | $                                                | 58,009 |   |   | $ | - |   |   | $ | 47,609 |   |   | $ | 10,400 |   |

----

|                                                                               |   | Fair Value Measurements        |   |
|------------------------------------------------------------------------------------|--------|--------------------------------|--------|
|                                                                               |   | Using Significant Unobservable |   |
|                                                                               |   | Inputs (Level 3)               |   |
|                                                                               |   | Available-for-sale             |   |   |   |   |
|                                                                               |   | Securities                     |   |   | Total |   |
|                                                                               |   | (In thousands)                 |   |
|                                                                               |   |                           |   |   |   |   |
| Beginning balance, July 1, 2010                                                    |   | $                              | 8,457  |   |   | $ | 8,457 |   |
|                                                                               |   |                           |   |   |   |   |   |   |
| Total gains or losses (realized/unrealized) included in other comprehensive income |   |                           | 1,943  |   |   |   | 1,943 |   |
| Principal payments on securities                                                   |   |                           | -      |   |   |   | - |   |
| Accretion of securities, net                                                       |   |                           | -      |   |   |   | - |   |
| Transfers out of Level 3                                                           |   |                           | -      |   |   |   | - |   |
|                                                                               |   |                           |   |   |   |   |   |   |
| Ending balance, June 30, 2011                                                      |   |                           | 10,400 |   |   |   | 10,400 |   |
|                                                                               |   |                           |   |   |   |   |   |   |
| Total gains or losses (realized/unrealized) included in earnings                   |   |                           | -      |   |   |   | - |   |
| Included in other comprehensive income                                             |   |                           | (764   | ) |   |   | (764 | ) |
| Principal payments on securities                                                   |   |                           | -      |   |   |   | - |   |
| Accretion of securities, net                                                       |   |                           | -      |   |   |   | - |   |
| Transfers out of Level 3                                                           |   |                           | -      |   |   |   | - |   |
|                                                                               |   |                           |   |   |   |   |   |   |
| Ending balance, June 30, 2012                                                      |   | $                              | 9,636  |   |   | $ | 9,636 |   |

----

|                    |   | Fair Value Measurements at Reporting Date Using: |   |   |               |               |
|-------------------------|--------|--------------------------------------------------|--------|--------|--------------------|--------------------|
|                    |   |                                             |   |   | Quoted Prices in   |               |   | Significant |   |   | Significant |   |   | Total Losses |   |
|                    |   |                                             |   |   | Active Markets for |               |   | Other Observable |   |   | Unobservable |   |   | for the |   |
|                    |   |                                             |   |   | Identical Assets   |               |   | Inputs |   |   | Inputs |   |   | Year Ended |   |
|                    |   | Total                                            |   |   | Level 1            |               |   | Level 2 |   |   | Level 3 |   |   | June 30, 2012 |   |
|                    |   | (In thousands)                                   |   |
| June 30, 2012           |   |                                             |   |   |               |               |   |   |   |   |   |   |   |   |   |
| Other real estate owned |   | $                                                | 247    |   |               | $                  | - |   |   | $ | - |   |   | $ | 247 |   |   | $ | 56 |   |
|                    |   |                                             |   |   |               |               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                    |   | Fair Value Measurements at Reporting Date Using: |   |   |               |               |   |
|                    |   |                                             |   |   |               | Quoted Prices in   |   |   | Significant |   |   | Significant |   |   | Total Losses |   |
|                    |   |                                             |   |   |               | Active Markets for |   |   | Other Observable |   |   | Unobservable |   |   | for the |   |
|                    |   |                                             |   |   |               | Identical Assets   |   |   | Inputs |   |   | Inputs |   |   | Year Ended |   |
|                    |   | Total                                            |   |   | Level 1            |               |   | Level 2 |   |   | Level 3 |   |   | June 30, 2011 |   |
|                    |   | (In thousands)                                   |   |
| June 30, 2011           |   |                                             |   |   |               |               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                    |   |                                             |   |   |               |               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Impaired loans          |   | $                                                | 6,575  |   |               | $                  | - |   |   | $ | - |   |   | $ | 6,575 |   |   | $ | - |   |
| Other real estate owned |   |                                             | 1,074  |   |               |               | - |   |   |   | 343 |   |   |   | 731 |   |   |   | 95 |   |
|                    |   |                                             |   |   |               |               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Totals                  |   | $                                                | 7,649  |   |               | $                  | - |   |   | $ | 343 |   |   | $ | 7,306 |   |   | $ | 95 |   |

----

|                                           |   | 2012           |    |
|------------------------------------------------|--------|----------------|---------|
|                                           |   | CarryingAmount |    |   | Level 1 |   |   | Level 2 |   |   | Level 3 |   |   | FairValue |   |
|                                           |
|                                           |   | (In thousands) |    |
| Financial assets:                              |   |           |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                      |   | $              | 11,413  |   |   | $ | 11,413 |   |   |   | - |   |   |   | - |   |   | $ | 11,413 |   |
| Available-for-sale securities                  |   |           | 47,213  |   |   |   | - |   |   |   | 47,213 |   |   |   | - |   |   |   | 47,213 |   |
| Held-to-maturity securities                    |   |           | 105,195 |   |   |   | - |   |   |   | 108,336 |   |   |   | - |   |   |   | 108,336 |   |
| Federal Home Loan Bank Stock                   |   |           | 7,536   |   |   |   | - |   |   |   | - |   |   |   | 7,536 |   |   |   | 7,536 |   |
| Loans held-for-sale                            |   |           | 776     |   |   |   | - |   |   |   | - |   |   |   | 794 |   |   |   | 782 |   |
| Loans, net                                     |   |           | 248,572 |   |   |   | - |   |   |   | - |   |   |   | 255,075 |   |   |   | 255,074 |   |
| Accrued interest receivable                    |   |           | 1,158   |   |   |   | - |   |   |   | - |   |   |   | 1,158 |   |   |   | 1,158 |   |
|                                           |   |           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities:                         |   |           |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                       |   |           | 342,338 |   |   |   | - |   |   |   | - |   |   |   | 344,675 |   |   |   | 344,675 |   |
| Mortgagors’ escrow accounts              |   |           | 2,034   |   |   |   | - |   |   |   | - |   |   |   | 2,034 |   |   |   | 2,034 |   |
| Federal Home Loan Bank advances                |   |           | 53,500  |   |   |   | - |   |   |   | 55,340 |   |   |   | - |   |   |   | 55,340 |   |
| Securities sold under agreements to repurchase |   |           | 3,653   |   |   |   | - |   |   |   | 3,653 |   |   |   | - |   |   |   | 3,653 |   |

|                                           |   | 2011           |    |
|------------------------------------------------|--------|----------------|---------|
|                                           |   | CarryingAmount |    |   | Fair Value |   |
|                                           |
|                                           |   | (In thousands) |    |
| Financial assets:                              |   |           |    |   |   |   |
| Cash and cash equivalents                      |   | $              | 8,273   |   |   | $ | 8,273 |   |
| Available-for-sale securities                  |   |           | 58,009  |   |   |   | 58,009 |   |
| Held-to-maturity securities                    |   |           | 114,741 |   |   |   | 115,962 |   |
| Federal Home Loan Bank Stock                   |   |           | 8,056   |   |   |   | 8,056 |   |
| Loans held-for-sale                            |   |           | 1,567   |   |   |   | 1,583 |   |
| Loans, net                                     |   |           | 253,225 |   |   |   | 257,835 |   |
| Accrued interest receivable                    |   |           | 1,528   |   |   |   | 1,528 |   |
|                                           |   |           |    |   |   |   |   |   |
| Financial liabilities:                         |   |           |    |   |   |   |   |   |
| Deposits                                       |   |           | 333,773 |   |   |   | 331,132 |   |
| Mortgagors’ escrow accounts              |   |           | 1,766   |   |   |   | 1,766 |   |
| Federal Home Loan Bank advances                |   |           | 83,500  |   |   |   | 87,339 |   |
| Securities sold under agreements to repurchase |   |           | 4,244   |   |   |   | 4,244 |   |

----

----

|                                             |   | 2012           |   |   | 2011   |   |
|--------------------------------------------------|--------|----------------|--------|--------|--------|--------|
|                                             |   | (In thousands) |   |
|                                             |   |           |   |   |   |   |
| Commitments to originate loans                   |   | $              | 3,646  |   |   | $      | 2,966 |   |
| Unadvanced portions of loans:                    |   |           |   |   |   |   |   |   |
|      Construction loans |   |           | 1,559  |   |   |   | 1,476 |   |
|      Lines of credit    |   |           | 12,690 |   |   |   | 12,737 |   |
| Letters of credit                                |   |           | 842    |   |   |   | 782 |   |
|                                             |   |           |   |   |   |   |   |   |
| Outstanding commitments                          |   | $              | 18,737 |   |   | $      | 17,961 |   |

----

|   |                                         |   | Actual         |   |   | For Capital Adequacy Purposes |   |   | To Be Well Capitalized Under Prompt Corrective Action Provisions |   |
|--------|----------------------------------------------|--------|----------------|--------|--------|-------------------------------|--------|--------|------------------------------------------------------------------|--------|
|   |                                         |   | Amount         |   |   | Ratio                         |   |   | Amount                                                           |   |   | Ratio |   |   | Amount |   |   | Ratio |   |
|   |                                         |   | (In thousands) |   |
|   | As of June 30, 2012:                         |   |           |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |
|   | Tangible Equity Capital (to Tangible Assets) |   | $              | 36,587 |   |                          |   | 8.24   | %                                                                |   | $ | 6,661 |   |   |   | 1.50 | % |   |   | N/A |   |   |   | N/A |   |
|   | Tier 1 Capital (to Adjusted Total Assets)    |   |           | 36,587 |   |                          |   | 8.24   | %                                                                |   |   | 17,763 |   |   |   | 4.00 | % |   | $ | 22,204 |   |   |   | 5.00 | % |
|   | Tier 1 Capital (to Risk-Weighted Assets)     |   |           | 36,587 |   |                          |   | 15.15  | %                                                                |   |   | 9,661 |   |   |   | 4.00 | % |   |   | 14,491 |   |   |   | 6.00 | % |
|   | Total Capital (to Risk-Weighted Assets)      |   |           | 39,523 |   |                          |   | 16.36  | %                                                                |   |   | 19,322 |   |   |   | 8.00 | % |   |   | 24,152 |   |   |   | 10.00 | % |
|   |                                         |   |           |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | As of June 30, 2011:                         |   |           |   |   |                          |   |   |                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   | Tangible Equity Capital (to Tangible Assets) |   | $              | 35,673 |   |                          |   | 7.68   | %                                                                |   | $ | 6,967 |   |   |   | 1.50 | % |   |   | N/A |   |   |   | N/A |   |
|   | Tier 1 Capital (to Adjusted Total Assets)    |   |           | 35,673 |   |                          |   | 7.68   | %                                                                |   |   | 18,578 |   |   |   | 4.00 | % |   | $ | 23,222 |   |   |   | 5.00 | % |
|   | Tier 1 Capital (to Risk-Weighted Assets)     |   |           | 35,673 |   |                          |   | 14.79  | %                                                                |   |   | 9,095 |   |   |   | 4.00 | % |   |   | 13,643 |   |   |   | 6.00 | % |
|   | Total Capital (to Risk-Weighted Assets)      |   |           | 36,465 |   |                          |   | 16.04  | %                                                                |   |   | 18,190 |   |   |   | 8.00 | % |   |   | 22,738 |   |   |   | 10.00 | % |

|   |                                               |   | June 30,       |   |
|--------|----------------------------------------------------|--------|----------------|--------|
|   |                                               |   | 2012           |   |
|   |                                               |   | (In thousands) |   |
|   |                                               |   |           |   |   |
|   | Total consolidated equity                          |   | $              | 48,135 |   |
|   | Adjustments:                                       |   |           |   |   |
|   | Equity capital of PSB Holdings, Inc.               |   |           | (3,985 | ) |
|   | Intangible assets                                  |   |           | (6,279 | ) |
|   | Disallowed deferred tax assets                     |   |           | (1,938 | ) |
|   | Unrealized losses on available-for-sale securities |   |           | 654    |   |
|   | Tier 1 Capital                                     |   |           | 36,587 |   |
|   | Allowance for loan losses                          |   |           | 2,936  |   |
|   |                                               |   |           |   |   |
|   | Total Risk-Based capital                           |   | $              | 39,523 |   |

----

|   |                                                    |   | 2011           |   |
|--------|---------------------------------------------------------|--------|----------------|--------|
|   |                                                    |   | (In thousands) |   |
|   |                                                    |   |           |   |
|   | Capital under generally accepted accounting principles  |   | $              | 42,765 |   |
|   | Intangible Assets                                       |   |           | (6,551 | ) |
|   | Disallowed deferred tax assets                          |   |           | (1,813 | ) |
|   | Unrealized losses on available-for-sale securities      |   |           | 1,272  |   |
|   | Tier 1 Capital                                          |   |           | 35,673 |   |
|   | Allowance for loan losses                               |   |           | 2,845  |   |
|   | Deduction for low-level recourse and residual interests |   |           | (2,053 | ) |
|   |                                                    |   |           |   |   |
|   | Total Risk-Based capital                                |   | $              | 36,465 |   |

----

----

----

|   |                   |   | November 7, 2005 Grant |   |   | June 7, 2006 Grant |   |   | May 25, 2007 Grant |   |
|--------|------------------------|--------|------------------------|--------|--------|--------------------|--------|--------|--------------------|--------|
|   |                   |   |                   |   |   |               |   |   |               |   |
|   | Dividend yield         |   |                   | 1.89   | %      |               |   | 2.23   | %                  |   |   | 2.24 | % |
|   | Expected volatility    |   |                   | 12.65  | %      |               |   | 12.17  | %                  |   |   | 11.04 | % |
|   | Risk-free rate         |   |                   | 4.56   | %      |               |   | 4.95   | %                  |   |   | 4.86 | % |
|   | Expected life in years |   |                   | 6.5    |   |               |   | 6.5    |               |   |   | 6.5 |   |
|   | Fair value             |   | $                      | 2.00   |   |               | $      | 1.97   |               |   | $ | 1.84 |   |

----

|   |                                                                                   |   | 2012      |    |   | 2011     |   |   |
|--------|----------------------------------------------------------------------------------------|--------|-----------|---------|--------|----------|--------|--------|
|   |                                                                                   |   |      |    |   | Weighted |   |   |   |   |   | Weighted |   |
|   |                                                                                   |   |      |    |   | Average  |   |   |   |   |   | Average |   |
|   |                                                                                   |   | Number of |    |   | Exercise |   |   | Number of |   |   | Exercise |   |
|   |                                                                                   |   | Shares    |    |   | Price    |   |   | Shares |   |   | Price |   |
|   |                                                                                   |   |      |    |   |     |   |   |   |   |   |   |   |
|   | Outstanding at beginning of year                                                       |   |      | 222,921 |   |     | $      | 10.62  |   |   |   | 222,921 |   |   | $ | 10.62 |   |
|   |      Granted                                                  |   |      | -       |   |     |   | -      |   |   |   | - |   |   |   | - |   |
|   |      Exercised                                                |   |      | -       |   |     |   | -      |   |   |   | - |   |   |   | - |   |
|   |      Forfeited                                                |   |      | -       |   |     |   | -      |   |   |   | - |   |   |   | - |   |
|   |                                                                                   |   |      |    |   |     |   |   |   |   |   |   |   |   |   |   |   |
|   |           Outstanding at end of year |   |      | 222,921 |   |     | $      | 10.62  |   |   |   | 222,921 |   |   | $ | 10.62 |   |
|   |                                                                                   |   |      |    |   |     |   |   |   |   |   |   |   |   |   |   |   |
|   | Options exercisable at end of year                                                     |   |      | 222,921 |   |     | $      | 10.62  |   |   |   | 218,321 |   |   | $ | 10.61 |   |

|   | Options Outstanding                                         |   |          | Options Exercisable |   |
|--------|-------------------------------------------------------------|--------|---------------|---------------------|--------|
|   |                                                        |   | Number        |                |   | Weighted-Average |   |   |   |   |   | Number |   |   |   |   |
|   | Exercise                                                    |   | Outstanding   |                |   | Remaining |   |   | Weighted-Average |   |   | Exercisable |   |   | Weighted-Average |   |
|   | Price                                                       |   | as of 6/30/12 |                |   | Contractual Life |   |   | Exercise Price |   |   | as of 6/30/12 |   |   | Exercise Price |   |
|   |                                                        |   |          |                |   |   |   |   |   |   |   |   |   |   |   |   |
|   | $       10.60            |   |          | 193,921             |   |   |   | 3.36 |   |   | $ | 10.60 |   |   |   | 193,921 |   |   | $ | 10.60 |   |
|   |          10.70      |   |          | 23,000              |   |   |   | 4.90 |   |   |   | 10.70 |   |   |   | 23,000 |   |   |   | 10.70 |   |
|   |          10.78 |   |          | 6,000               |   |   |   | 3.94 |   |   |   | 10.78 |   |   |   | 6,000 |   |   |   | 10.78 |   |

----

|                                                             |   | June 30, |   |
|------------------------------------------------------------------|--------|----------|--------|
|                                                             |   | 2012     |   |   | 2011 |   |
|                                                             |   |     |   |   |   |   |
|                                                             |   |     |   |   |   |   |
| ASSETS                                                           |   |     |   |   |   |   |
|                                                             |   |     |   |   |   |   |
| Cash and due from depository institutions                        |   | $        | 556    |   |   | $ | 434 |   |
| Investment in Putnam Bank                                        |   |     | 44,150 |   |   |   | 42,765 |   |
| Investment in available-for-sale securities (at fair value)      |   |     | 169    |   |   |   | 225 |   |
| Investment in held-to-maturity securities (fair value of $1,003) |   |     | 1,000  |   |   |   | 1,000 |   |
| Loan to ESOP                                                     |   |     | 1,863  |   |   |   | 1,985 |   |
| Other assets                                                     |   |     | 421    |   |   |   | 379 |   |
|                                                             |   |     |   |   |   |   |   |   |
| Total assets                                                     |   | $        | 48,159 |   |   | $ | 46,788 |   |
|                                                             |   |     |   |   |   |   |   |   |
|                                                             |   |     |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                       |   |     |   |   |   |   |   |   |
|                                                             |   |     |   |   |   |   |   |   |
| Other liabilities                                                |   | $        | 24     |   |   | $ | 41 |   |
| Stockholders’ equity                                       |   |     | 48,135 |   |   |   | 46,747 |   |
|                                                             |   |     |   |   |   |   |   |   |
| Total liabilities and stockholders’ equity                 |   | $        | 48,159 |   |   | $ | 46,788 |   |

----

|                                                                                          |   |   |   |   |   |   |
|-----------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
|                                                                                          |   | 2012   |   |   | 2011   |   |
|                                                                                          |   |   |   |   |   |   |
| Interest and dividends on investments                                                         |   | $      | 20     |   |   | $      | 26 |   |
| Interest on loan                                                                              |   |   | 63     |   |   |   | 67 |   |
|    Total interest and dividend income                                          |   |   | 83     |   |   |   | 93 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
| Interest expense                                                                              |   |   | -      |   |   |   | - |   |
|    Net interest and dividend income                                            |   |   | 83     |   |   |   | 93 |   |
| Other expense                                                                                 |   |   | 220    |   |   |   | 183 |   |
| Loss before income tax (benefit) expense and equity in undistributed net income of subsidiary |   |   | (137   | )      |   |   | (90 | ) |
| Income tax (benefit) expense                                                                  |   |   | (56    | )      |   |   | 71 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
| Loss before equity in undistributed net income of subsidiary                                  |   |   | (81    | )      |   |   | (161 | ) |
| Equity in undistributed net income of subsidiary                                              |   |   | 1,131  |   |   |   | 1,259 |   |
|                                                                                          |   |   |   |   |   |   |   |   |
|           Net income                        |   | $      | 1,050  |   |   | $      | 1,098 |   |

----

|                                                                              |   | 2012   |   |   | 2011   |   |
|-----------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|
|                                                                              |   |   |   |   |   |   |
| Cash flows from operating activities                                              |   |   |   |   |   |   |
| Net income                                                                        |   |   |   |   |   |   |
| Adjustments to reconcile net income to net cash provided by operating activities: |   | $      | 1,050  |   |   | $      | 1,098 |   |
| Amortization of securities, net                                                   |   |   | 1      |   |   |   | - |   |
| Amortization of ESOP expense                                                      |   |   | 60     |   |   |   | 57 |   |
| (Increase) decrease in other assets                                               |   |   | (42    | )      |   |   | 60 |   |
| (Increase) decrease in due from subsidiary                                        |   |   | (4     | )      |   |   | 176 |   |
| Increase in due to subsidiary                                                     |   |   | (6     | )      |   |   | - |   |
| Decrease in other liabilities                                                     |   |   | (10    | )      |   |   | (118 | ) |
| Stock-based compensation expense                                                  |   |   | 27     |   |   |   | 234 |   |
| Undistributed net income of subsidiary                                            |   |   | (1,131 | )      |   |   | (1,259 | ) |
| Net cash (used in) provided by operating activities                               |   |   | (55    | )      |   |   | 248 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| Cash flows from investing activities:                                             |   |   |   |   |   |   |   |   |
| Proceeds from maturities of available-for-sale securities                         |   |   | 55     |   |   |   | 1,030 |   |
| Purchase of held-to-maturity securities                                           |   |   | -      |   |   |   | (1,000 | ) |
| Principal payments received on loan to ESOP                                       |   |   | 122    |   |   |   | 118 |   |
| Net cash provided by investing activities                                         |   |   | 177    |   |   |   | 148 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| Net cash provided by financing activities                                         |   |   | -      |   |   |   | - |   |
|                                                                              |   |   |   |   |   |   |   |   |
| Net increase in cash and cash equivalents                                         |   |   | 122    |   |   |   | 396 |   |
| Cash and cash equivalents at beginning of year                                    |   |   | 434    |   |   |   | 38 |   |
|                                                                              |   |   |   |   |   |   |   |   |
| Cash and cash equivalents at end of year                                          |   | $      | 556    |   |   | $      | 434 |   |

----

| ITEM 9. | Changes In and Disagreements With Accountants on Accounting and Financial Disclosure |
|--------------|--------------------------------------------------------------------------------------|

| ITEM 9A. | Controls and Procedures |
|---------------|-------------------------|

----

| ITEM 9B. | Other Information |
|---------------|-------------------|

| ITEM 10. | Directors, Executive Officers and Corporate Governance |
|---------------|--------------------------------------------------------|

| ITEM 11. | Executive Compensation |
|---------------|------------------------|

| ITEM 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
|---------------|------------------------------------------------------------------------------------------------|

|                                                   |   | Number of Securities to be |    |   |             |   |    |                     |   |
|--------------------------------------------------------|--------|----------------------------|---------|--------|------------------|--------|---------|--------------------------|--------|
|                                                   |   | Issued upon Exercise of    |    |   |             |   |    | Number of Securities     |   |
|                                                   |   | Outstanding Options and    |    |   | Weighted Average |   |    | Remaining Available for  |   |
| Plan                                                   |   | Rights                     |    |   | Exercise Price   |   |    | Issuance under the Plans |   |
| Equity compensation plans approved by stockholders     |   |                       | 222,921 | (1)    |             | $      | 10.62   | (2)                      |   |   | 133,009 | (3) |
|                                                   |   |                       |    |   |             |   |    |                     |   |   |   |   |
| Equity compensation plans not approved by stockholders |   |                       | ------- |   |             |   | ------- |                     |   |   | ------- |   |
| Total                                                  |   |                       | 222,921 | (1)    |             | $      | 10.62   | (2)                      |   |   | 133,009 | (3) |

| (1) | Reflects options to purchase shares of common stock awarded under the Incentive Plan. |
|-----|---------------------------------------------------------------------------------------|

| (2) | Relates to 222,921 outstanding stock options. |
|-----|-----------------------------------------------|

| (3) | Includes 15,717 shares of restricted stock and 117,292 options available for issuance under the Incentive Plan. |
|-----|-----------------------------------------------------------------------------------------------------------------|

| ITEM 13. | Certain Relationships and Related Transactions, and Director Independence |
|---------------|---------------------------------------------------------------------------|

| ITEM 14. | Principal Accountant Fees and Services |
|---------------|----------------------------------------|

----

| ITEM 15. | Exhibits and Financial Statement Schedules |
|---------------|--------------------------------------------|

|   | (A)    | Management Responsibility Statement                              |
|--------|--------|------------------------------------------------------------------|
|   |   |                                                             |
|   | (B)    | Report of Independent Registered Public Accounting Firm          |
|   |   |                                                             |
|   | (C)    | Consolidated Balance Sheets                                      |
|   |   |                                                             |
|   | (D)    | Consolidated Statements of Income                                |
|   |   |                                                             |
|   | (E)    | Consolidated Statements of Changes In Stockholders’ Equity |
|   |   |                                                             |
|   | (F)    | Consolidated Statements of Cash Flows                            |
|   |   |                                                             |
|   | (G)    | Notes to Consolidated Financial Statements                       |

|   |  3.1 | Charter of PSB Holdings, Inc.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|--------|-----------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |  3.2 | Bylaws of PSB Holdings, Inc.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |  4.  | Form of Common Stock Certificate of PSB Holdings, Inc.*                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 10.1      | Employee Stock Ownership Plan*                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 10.2      | Deferred Compensation Plan*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 10.3      | PSB Holdings, Inc. 2005 Stock-Based Incentive Plan**                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 10.4      | Agreement By and Between Putnam Bank, Putnam, Connecticut and The Comptroller of the Currency                                                                                                                                                                                                                                                                                                                                                                                                                |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 14.       | Code of Ethics***                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 21.       | Subsidiaries of Registrant*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 23.       | Consent of Shatswell, MacLeod & Company, P.C.                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 23.1      | Consent of Wolf & Company, P.C.                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 31.1      | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                 |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 31.2      | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                 |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 32.       | Certification of Chief Financial Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                                                                                                                                |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|   | 101       | The following materials from the Company’s Annual Report on Form 10-K for the twelve months ended June 30, 2012, formatted in XBRL: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income, (iii) the Condensed Consolidated Statements of Changes in Stockholders’ Equity, (iv) the Condensed Consolidated Statements of Cash Flows and (v) the Notes to Condensed Consolidated Financial Statements. **** |
|   |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| *      |      | Incorporated by reference to the Registration Statement on Form SB-2 of PSB Holdings, Inc. (file no. 333-116364), originally filed with the Securities and Exchange Commission on June 10, 2004, as amended.                                                                                                                                                                                                                                                                                  |

----

| **   |   | Incorporated by reference to Appendix B of the Company’s Definitive Proxy Statement dated September 20, 2005 as filed with the Securities and Exchange Commission on September 19, 2005. |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ***  |   | Incorporated by reference to Exhibit 14 of the Company’s Annual Report on Form 10-K for year ended June 30, 2007, filed with the Securities and Exchange Commission on September 21, 2007.    |
| **** |   | To be filed by amendment.                                                                                                                                                                                |

----

|                     |   | PSB HOLDINGS, INC. |
|--------------------------|--------|--------------------|
|                     |   |               |   |
| Date: September 26, 2012 |   | By:                | /s/    Thomas A. Borner        |
|                     |   |               |   | Thomas A. Borner |
|                     |   |               |   | President and Chief Executive Officer and Director(Duly Authorized Representative) |

| Signatures                                         |   | Title                                                                                           |   | Date               |
|----------------------------------------------------|--------|-------------------------------------------------------------------------------------------------|--------|--------------------|
|                                               |   |                                                                                            |   |               |
| /s/    Thomas A. Borner        |   | President, Chief Executive Officer and Vice-Chairman of the Board (Principal Executive Officer) |   | September 26, 2012 |
| Thomas A. Borner                                   |   |                                                                                            |   |
|                                               |   |                                                                                            |   |               |
| /s/    Robert J. Halloran, Jr. |   | Executive Vice-President and Treasurer (Principal Financial and Accounting Officer)             |   | September 26, 2012 |
| Robert J. Halloran, Jr.                            |   |                                                                                            |   |
|                                               |   |                                                                                            |   |               |
| /s/   Charles W. Bentley, Jr.       |   | Director                                                                                        |   | September 26, 2012 |
| Charles W. Bentley, Jr.                            |   |                                                                                            |   |               |
|                                               |   |                                                                                            |   |               |
| /s/   jitendra k. sinha             |   | Director                                                                                        |   | September 26, 2012 |
| Jitendra K. Sinha                                  |   |                                                                                            |   |               |
|                                               |   |                                                                                            |   |               |
| /s/    Paul M. Kelly           |   | Director                                                                                        |   | September 26, 2012 |
| Paul M. Kelly                                      |   |                                                                                            |   |               |
|                                               |   |                                                                                            |   |               |
| /s/    Richard A. Loomis       |   | Director                                                                                        |   | September 26, 2012 |
| Richard A. Loomis                                  |   |                                                                                            |   |               |
|                                               |   |                                                                                            |   |               |
| /s/    John P. Miller          |   | Director                                                                                        |   | September 26, 2012 |
| John P. Miller                                     |   |                                                                                            |   |               |
|                                               |   |                                                                                            |   |               |
| /s/    Charles H. Puffer       |   | Chairman of the Board                                                                           |   | September 26, 2012 |
| Charles H. Puffer                                  |   |                                                                                            |   |               |