UNITED STATES SECURITIES AND EXCHANGE COMMISSION

                        Washington, D.C.   20552

                              FORM 10 - QSB

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

For the quarterly period ended March 31, 2000

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


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

                     Commission File Number 0-23765
                     ------------------------------

                     Carnegie Financial Corporation
          (Exact name of registrant as specified in its charter)

Pennsylvania                                           23 -1806857
(State or other jurisdiction of incorporation  (IRS Employer Identification No.)
or organization)


             17 West Mall Plaza, Carnegie, Pennsylvania,  15106
                   (Address of principal executive offices)

                             (412) 276 - 1266
            (Registrant's telephone number, including area code)


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

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date:

              Class:  Common Stock, par value $.10 per share
                Outstanding at May 3, 2000: 224,776





<PAGE>
                      CARNEGIE FINANCIAL CORP

                               INDEX



                                                           Page
                                                          Number
                                                        ---------

PART I  - FINANCIAL INFORMATION

   Item 1. Financial Statements

           Consolidated Balance Sheet
            (Unaudited) as of March 31,
             2000 and December 31, 1999                     3

           Consolidated Statement of Income
            (Unaudited) for the Three Months
             ended March 31, 2000 and 1999                  4

           Consolidated Statement of
             Changes in Stockholders' Equity
             (Unaudited) as of March 31, 2000               5

            Consolidated Statement of Cash
              Flows (Unaudited) for the Three
              Months ended March 31, 2000 and 1999          6

            Notes to Unaudited Consolidated
              Financial Statements                          7

   Item 2.  Management's Discussion and Analysis of
              Financial Condition and Results
              of Operations                              8 - 14

PART II  -  OTHER INFORMATION

   Item 1.  Legal Proceedings                              15

   Item 2.  Changes in Securities                          15

   Item 3.  Default Upon Senior Securities                 15

   Item 4.  Submissions of Matters to a
              Vote of Security Holders                     15

   Item 5.  Other Information                              15

   Item 6.  Exhibits and Reports on Form 8 - K             15

SIGNATURES                                                 16




<PAGE>

                         CARNEGIE FINANCIAL CORPORATION
                     CONSOLIDATED BALANCE SHEET (UNAUDITED)
<TABLE>
<CAPTION>
                                          March 31,            December 31,
                                            2000                   1999
                                        ------------           ------------
<S>                                    <C>                   <C>
             ASSETS
Cash and due from banks                 $    200,568          $    504,005
Interest - bearing overnight
   deposits with other institutions          389,853               286,780
                                        ------------          ------------
Cash and cash equivalents                    590,421               790,785

Certificates of deposit                      100,000               100,000
Investment securities available
   for sale                                3,499,721             3,323,894
Investment securities held to
   maturity (fair value of
   $144,122 and $144,870)                    145,000               145,000
Mortgage - backed securities
   available for sale                        667,260               690,164
Mortgage - backed securities
   held to maturity (fair value
   of $725,716 and $750,369)                 717,987               743,385
Loans receivable, (net of
   allowance for loan losses
   of $181,320 and $203,648)              22,770,237            22,518,456
Premises and equipment                       235,093               225,827
Federal Home Loan Bank Stock                 564,900               564,900
Accrued interest receivable                  151,882               180,797
Other assets                                 259,625               205,393
                                        ------------          ------------
          TOTAL ASSETS                  $ 29,702,126          $ 29,488,601
                                        ============          ============

     LIABILITIES AND STOCKHOLDERS EQUITY
Deposits                                $ 17,244,345          $ 16,551,544
Borrowed funds                             9,000,000             9,537,500
Advances from borrowers for taxes
   and insurance                             297,766               275,758
Accrued interest payable and
   other liabilities                         422,787               431,191
                                        ------------          ------------
          TOTAL LIABILITIES               26,964,898            26,795,993

STOCKHOLDERS' EQUITY
Preferred Stock, no par value;
    2,000,000 shares authorized;
    none issued                                    -                     -
Common Stock, $.10 par value;
    4,000,000 shares authorized
and 238,050 outstanding                       23,805                23,805
Additional paid - in capital               2,061,611             2,062,493
Retained Earnings - substantially
    restricted                             1,232,438             1,203,806
Unearned Employee Stock Ownership
    Plan shares (ESOP)                      (157,113)            (161,874)
Unearned Restricted Stock Plan shares (RSP)  (60,703)             (64,750)
Accumulated other comprehensive loss        (233,304)            (241,366)
Treasury Stock (13,274 shares, at cost)     (129,506)            (129,506)
                                        ------------          ------------
          Total stockholders' equity       2,737,228             2,692,608
                                        ------------          ------------
          Total liabilities and
             stockholder's equity       $ 29,702,126          $ 29,488,601
                                        ============          ============
</TABLE>

See accompanying notes to the unaudited consolidated financial statements.

3
<PAGE>
                     CARNEGIE FINANCIAL CORPORATION
              CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
                                               Three Months Ended
                                                    March 31,
                                         -----------       -----------
                                             2000             1999
                                         -----------       -----------
<S>                                     <C>               <C>
INTEREST AND DIVIDEND INCOME
   Loans receivable                      $   430,854       $   301,791
   Investment securities
       Taxable                                63,978            35,743
       Exempt from federal
         income tax                            1,658             5,899
   Interest - bearing deposits
     in other banks                            4,491            23,559
   Mortgage - backed securities               22,713            33,273
   Dividends on Federal Home
     Loan Bank Stock                           9,481             3,466
                                         -----------       -----------
        Total interest and
          dividend income                    533,175           403,731
                                         -----------       -----------
INTEREST EXPENSE
   Deposits                                  177,371           167,870
   Borrowings                                132,646            48,750
                                         -----------       -----------
           Total interest expense            310,017           216,620
                                         -----------       -----------
NET INTEREST INCOME                          223,158           187,111

Provision for loan losses                     19,964            24,021
                                         -----------       -----------
NET INTEREST INCOME AFTER
   PROVISION FOR LOAN LOSSES                 203,194           163,090
                                         -----------       -----------
NONINTEREST INCOME
   Service fees                               20,981            19,379
   Gain on sale of investment
     securities                                5,635             1,167
   Other income                                  355            14,101
                                         -----------       -----------
           Total noninterest income           26,971            34,647
                                         -----------       -----------
NONINTEREST EXPENSE
   Compensation and employee benefits         85,271            85,797
   Occupancy and equipment                    11,200            10,706
   Data processing charges                    16,644            18,286
   Other expense                              71,419            69,991
                                         -----------       -----------
           Total noninterest expense         184,534           184,780

                                         -----------       -----------
Income before income taxes                    45,631            12,957

Income taxes                                  16,999               666
                                         -----------       -----------
NET INCOME                               $    28,632       $    12,291
                                         ===========       ===========
Basic earnings per share earnings        $      0.14       $      0.06
                                         ===========       ===========
Dilutive earnings per share              $      0.14       $      0.06
                                         ===========       ===========
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.

4
<PAGE>
                         CARNEGIE FINANCIAL CORPORATION
            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
                                                                     Accumulated
                       Additional                Unearned  Unearned    Other                    Total
               Common   Paid-in      Retained      ESOP      RSP    Comprehensive  Treasury Stockholders' Comprehensive
               Stock    Capital      Earnings     Shares    Shares  Income (loss)   Stock       Equity        Income
               -----    -------      --------     ------    ------  -------------   -----       ------        ------
<S>          <C>      <C>         <C>         <C>        <C>        <C>          <C>         <C>              <C>
Balance,
  December
  31, 1999    $23,805  $2,062,493  $1,203,806  $(161,874) $(64,750)  $(241,366)  $(129,506)  $2,692,608

Net income                             28,632                                                    28,632         $28,632
 Other
   comprehensive
   income:
   Unrealized
   gain on
   available
   for sale
   securities,
   net of
   taxes
   of $4,153                                                             8,062                    8,062           8,062
                                                                                                                 ------
Comprehensive
income                                                                                                          $36,694
                                                                                                                =======
RSP Shares
  earned                                                     4,047                                4,047
ESOP Shares
  earned                     (882)                 4,761                                          3,879
              -------  ----------  ----------  ---------  --------   ---------   ---------   ----------
Balance,
  March
  31, 2000    $23,805  $2,061,611  $1,232,438  $(157,113) $(60,703)  $(233,304)  $(129,506)  $2,737,228
              =======  ==========  ==========  =========  ========   =========   =========   ==========

Components of comprehensive
  income:  Change in net
  unrealized loss on investment
  securities held for sale                                                       $  11,781
Realized gains included in
  net income, net of taxes of $1,916                                                (3,719)
                                                                                 ---------
Total                                                                            $   8,062
                                                                                 =========
</TABLE>

See accompanying notes to the unaudited consolidated financial statements.

5


<PAGE>

                      CARNEGIE FINANCIAL CORP.
            CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
                                                      Three Months Ended
                                                           March 31,
                                                      2000           1999
                                                  -----------    ---------
OPERATING ACTIVITIES
Net income                                             28,632      12,291
Adjustments to reconcile net income to net
   cash provided by (used for)operating activities:
    Depreciation, amortization and
       accretion, net                                  (7,624)     (2,002)
    Provision for loan losses                          19,964      24,021
    Amortization of unearned ESOP and RSP               8,808       8,808
    Gain on sale of securities                         (5,635)     (1,167)
    Decrease (increase) in accrued
       interest receivable                             28,915     (25,336)
    Increase (decrease) in accrued interest payable   (11,382)    102,771
    Other, net                                        (56,289)   (120,441)
                                                     --------    --------
    Net cash provided by (used for)
       operating activities                             5,389      (1,055)
                                                     --------    --------
INVESTING ACTIVITIES

Investment securities available for sale:
    Purchases                                        (203,813)  (2,501,119)
    Proceeds from sales                                63,823      209,940
Mortgage-backed securities available for sale:
    Purchases                                               -     (111,463)
    Maturities and repayments                          19,251      162,045
Mortgage-backed securities held to maturity:
    Maturities and repayments                          25,422       99,503
Net increase in loans                                (271,745)  (2,488,792)
Purchases of Federal Home Loan Bank stock                   -     (197,100)
Purchases of office properties and equipment          (16,000)      (2,583)
                                                   ----------   ----------
Net cash used for investing activities               (383,062)  (4,829,569)
                                                   ----------   ----------
FINANCING ACTIVITIES
Net increase in deposits                              692,801      356,367
Proceeds from borrowed funds                                -    4,800,000
Payments of borrowed funds                           (537,500)           -
Purchase of treasury stock                                  -      (38,730)
Purchase stock for RSP                                      -      (88,078)
Net change in advances for taxes and insurance         22,008       34,969
                                                   ----------   ----------
Net cash provided by
    financing activities                              177,309    5,064,528
                                                   ----------   ----------
Increase (decrease) in cash and cash equivalents     (200,364)     233,904

CASH AND CASH EQUIVALENTS
   AT BEGINNING OF PERIOD                             790,785      965,488
                                                   ----------   ----------
CASH AND CASH EQUIVALENTS
   AT END OF PERIOD                                   590,421    1,199,392
                                                   ----------   ----------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Cash paid during the period for:
  Interest on deposits and borrowings             $   321,399  $   113,849
  Income taxes                                         40,500        1,200

See accompanying notes to the unaudited consolidated financial statements.

6



<PAGE>


CARNEGIE FINANCIAL CORPORATION
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - BASIS OF PRESENTATION

The consolidated  financial  statements of Carnegie  Financial  Corporation (the
"Company")  includes its wholly-  owned  subsidiary  Carnegie  Savings Bank (the
"Bank"). All significant intercompany items have been eliminated.

The accompanying  unaudited consolidated financial statements have been prepared
in  accordance  with the  instructions  to Form  10-QSB and,  therefore,  do not
necessarily  include all information that would be included in audited financial
statements. The information furnished reflects all adjustments which are, in the
opinion  of  management,  necessary  for a  fair  statement  of the  results  of
operations.

All such adjustments are of a normal recurring nature. The results of operations
for the interim  periods  are not  necessarily  indicative  of the results to be
expected for the full year or any other interim period.

Note 2 - EARNINGS PER SHARE

Earnings per share  computations  are based upon the  weighted  number of shares
outstanding  for the three months ended March 31, 2000.  The weighted  number of
shares  outstanding for the period was 200,861.  Net income used in the earnings
per share calculation was $28,632.

The Company provides dual  presentation of Basic and Diluted earnings per share.
Basic  earnings per share  utilizes net income as reported as the  numerator and
the actual average shares  outstanding as the denominator.  Diluted earnings per
share  includes  any  dilutive  effects of options,  warrants,  and  convertible
securities.  At March 31,  2000 and 1999 there were no  dilutive  effects on the
computation.




7
<PAGE>
           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

The Private  Securities  Litigation Act of 1995 contains safe harbor  provisions
regarding forward-looking  statements.  When used in this discussion,  the words
"believes,"  "anticipates,"  "contemplates,"  "expects," and similar expressions
are intended to identify forward-looking statements. Such statements are subject
to certain  risks and  uncertainties  that could cause actual  results to differ
materially from those projected.  Those risks and uncertainties  include changes
in interest rates, the ability to control costs and expenses,  year 2000 issues,
general  economic  conditions,  government  policies  and actions of  regulatory
authorities.  The Company  undertakes  no  obligation  to  publicly  release the
results of any revisions to those forward looking  statements  which may be made
to reflect  events or  circumstances  after the date  hereof or to  reflect  the
occurrence of unanticipated events.

Carnegie   Financial   Corporation  is  a  savings  and  loan  holding   company
headquartered  in  Carnegie,  Pennsylvania,  which  provides  a broad  range  of
deposits and loan products through its wholly owned subsidiary, Carnegie Savings
Bank (collectively, the "Company").

Subsequent Events

         In conjunction  with a routine  regulatory  examination of the "Bank by
the Office of Thrift  Supervision  (the "OTS"),  the OTS  requested  the Bank to
enter into a Supervisory  Agreement (the "Agreement").  The Agreement was signed
on April 14, 2000, (the "Effective  Date") and will,  among other things,  place
restrictions  on the  Bank's  growth.  Under  the  Agreement,  the  Bank may not
increase  its assets in an amount  exceeding  net  interest  credited on deposit
liabilities  (or  earnings  credited  on share  accounts)  during  any  calendar
quarter, without prior written approval of the regional director of the OTS (the
"Regional Director"). Additionally, the Agreement requires the Bank or its Board
of  Directors  to  revise  various  policies  including  1)  interest  rate risk
management, 2) strategic planning to improve earnings, 3) loan documentation and
underwriting policies, and 4) internal loan and asset classifications  policies.
The  restrictions  on the Bank's  operations are  immediately  effective and the
revision of certain of the Bank's  policies must be completed  within 90 days of
the Effective  Date,  unless  extended by the OTS. The Agreement  will remain in
place  until  terminated  by the OTS and could  adversely  affect the  financial
conditions, liquidity, and operations of the Company.

Asset/Liability Management

         The Company's  net interest  income is sensitive to changes in interest
rates, as the rates paid on interest-bearing liabilities generally change faster
than the rates  earned on  interest-earning  assets.  As a result,  net interest
income will frequently  decline in periods of rising interest rates and increase
in periods of decreasing interest rates.

         The board of directors attempts to manage the interest rate sensitivity
of the Company  through its asset and liability  committee which is comprised of
the  board  of of  directors.  The  board  of  directors  meets  quarterly  with
management to monitor the impact of interest  rate risk and develops  strategies
to manage its liquidity,  shorten the effective  maturities of certain  interest
earning assets and increase the effective maturities of certain liabilities,  to
reduce the exposure to interest rate  fluctuations.  The Agreement  with the OTS
identifies the Bank's interest rate levels as unacceptably high and requires the
Bank to develop and pursue strategies to reduce  interest-rate risk. The Bank is
currently  working on a revised  interest-rate  policy.  The board of  directors
expects to consider methods to extend the terms of the Company's  borrowings and
shorten the terms of the Company's  assets.  Although this is expected to reduce
the

8
<PAGE>
Bank's  interest  rate  risk in the  short  term,  it may also  affect  the
Company's current income. However, in implementing these strategies the board of
directors  will  attempt to balance the need to improve its  interest  rate risk
against the impact such restructurings will have on profitability.

Net Portfolio Value

         The OTS  computes  amounts by which the net present  value of cash flow
from assets,  liabilities and off balance sheet items ("net portfolio  value" or
"NPV")  would  change  in the  event of a range of  assumed  changes  in  market
interest  rates.  The Interest Rate  Sensitivity  of Net Portfolio  Value Report
shows the degree to which balance  sheet line items and net portfolio  value are
potentially affected by a 100 to 300 basis point (1/100th of a percentage point)
upward and downward parallel shift (shock) in the Treasury yield curve.

         The following  table  presents the Company's NPV at March 31, 2000. The
NPV was calculated by the OTS based upon information provided by the Company.


                              Percentage Change in Net Portfolio Value
                              ----------------------------------------
              Changes
             in Market                               Change in NPV
           Interest Rates        NPV Ratio(1)              Ratio(2)
           --------------        ------------         -------------
           (basis points)

              + 300                 .68%                 (857) bp
              + 200                3.60                  (565) bp
              + 100                6.55                  (269) bp
                0                  9.24                    --
             -   100              12.01                   277 bp
             -   200              13.69                   445 bp
             -   300              14.88                   563 bp

------------------
(1)    Calculated as the estimated NPV divided by present value of total assets.
(2)    Calculated  as the excess  (deficiency)  of the NPV ratio  assuming the
       indicated  change  in  interest  rates  over the  estimated  NPV  ratio
       assuming no change in interest rates.

         The  calculations  in the above table  indicate  that the Company's NPV
would be  significantly  adversely  affected by increases in interest  rates and
favorably  affected by decreases in interest rates.  Computations of prospective
effects of hypothetical interest rate changes are based on numerous assumptions,
including  relative  levels of market  interest  rates,  prepayments and deposit
run-offs and should not be relied upon as indicative of actual results.  Certain
shortcomings  are inherent in such  computations.  Although  certain  assets and
liabilities may have similar  maturity or periods of repricing they may react at
different  times and in  different  degrees to  changes  in the market  interest
rates.  The  interest  rates on  certain  types of assets  and  liabilities  may
fluctuate in advance of changes in market interest  rates,  while rates on other
types of assets and liabilities may lag behind changes in market interest rates.
Certain assets, such as adjustable rate mortgages, generally have features which
restrict  changes in  interest  rates on a short term basis and over the life of
the asset.  In the event of a change in interest  rates,  prepayments  and early
withdrawal  levels  could  deviate  significantly  from those  assumed in making

9
<PAGE>


calculations set forth above. Additionally,  an increased credit risk may result
as the ability of many borrowers to service their debt may decrease in the event
of an interest rate increase.

Results of Operations

         Net income  increased  $16,300 to $29,000  for the three  months  ended
March 31, 2000 from  $12,000 for the same period ended 1999.  This  increase was
primarily due to an increase in net interest income of $36,000  partially offset
by a decline in noninterest income and increased income taxes.

         Net interest  income  before the  provision  for loan losses  increased
$36,000 to $223,000 for the current three month period ended March 31, 2000 from
$187,000 for the same period in 1999.  The  increase in net interest  income was
primarily  related to increases in total average loans of $7,300,000 and average
investment securities of $646,000,  which was offset by a 23 basis point decline
in average  interest  rate earned on average  loans  receivable  and a 100 basis
point  increase in average cost of other  liabilities.  The increases in average
total loans  receivable and investment  securities were primarily  funded by the
average increase in other liabilities of $5,106,000. For the current three month
period, average cost of funds for total  interest-bearing  liabilities increased
39 basis points to 4.93 % from 4.53 % for the same period in 1999.


10
<PAGE>

Average Balance Sheet

         The  following  table sets forth  certain  information  relating to the
Company's  average  balance  sheet and reflects the average  yield on assets and
average cost of  liabilities  for the periods  indicated and the average  yields
earned and rates paid.  Such yields and costs are derived by dividing  income or
expense by the average balance of assets or liabilities,  respectively,  for the
periods presented.  Average balances are derived from daily balances.  The table
illustrates  that the increase in the amount and cost of funds of average  other
liabilities,  which  consists  of FHLB  advances,  has  adversely  affected  the
interest rate spread for the current three month period.

<TABLE>
<CAPTION>

                                                                           Three Months ended March 31,
                                                  ------------------------------------------------------------------------
                                                                2000                                   1999
                                                  ----------------------------------    ----------------------------------
                                                                           (Dollars in thousands)
                                                  Average                 Average       Average                 Average
                                                  Balance     Interest    Yield/Cost    Balance     Interest    Yield/Cost
                                                  -------     --------    ----------    -------     --------    ----------
<S>                                              <C>           <C>         <C>         <C>           <C>        <C>
Interest-earning assets:
 Loans receivable(1).........................     $22,810       $ 431         2.56%     $15,510       $ 302        7.79%
 Mortgage-backed securities..................       1,450          23         6.34%       2,005          33        6.58%
 Investment securities.......................       3,335          66         7.92%       2,689          42        6.25%
 Other interest-earning assets(2)............       1,014          14         5.52%       2,174          27        4.97%
                                                  -------       -----                   -------        ----
  Total interest-earning assets..............      28,609         534         7.47%      22,378         404        7.22%
Non-interest-earning assets..................         986                                   271
                                                  -------                               -------
  Total assets...............................     $29,595                               $22,649
                                                  =======                               =======
Interest-bearing liabilities:
 NOW accounts................................     $ 1,452           7         1.93%      $1,463           6        1.64%
 Savings accounts............................       3,848          24         2.49%       3,705          23        2.48%
 Certificates of deposit.....................      10,700         146         5.46%       9,800         138        5.63%
 Other liabilities...........................       9,195         133         5.79%       4,089          49        4.79%
                                                  -------       -----                   -------        ----
  Total interest-bearing liabilities........       25,195         310         4.93%      19,057         216        4.53%
                                                  -------       -----         -----     -------        ----        -----
Non-interest bearing liabilities:............
 Other liabilities...........................       1,685                                   624
                                                   ------                               -------
 Total liabilities...........................      26,880                                19,681
                                                   ------                               -------
Stockholders' equity.........................       2,715                                 2,968
                                                   ------                               -------
 Total liabilities and stockholders' equity..     $29,595                               $22,649
                                                   ======                               =======
Net interest income..........................                   $ 224                                  $188
                                                                =====                                  ====
Interest rate spread(3)......................                                 2.54%                                2.69%
                                                                              ====                                 =====
Net yield on interest-earning assets(4)......                                 3.13%                                3.36%
                                                                              ====                                 =====
Ratio of average interest-earning assets to
  average interest-bearing liabilities.......                               113.55%                              117.43%
                                                                            ======                               =======
</TABLE>
---------------------------------
(1)  Average balances include non-accrual loans.
(2)  Includes investment-bearing deposits in other financial institutions.
(3)  Interest-rate  spread  represents  the  difference  between the average
     yield  on  interest-earning  assets  and the  average  cost of  interest-
     bearing liabilities.
(4)  Net  yield  on  interest-earning  assets  represents  net interest income
     as a percentage of average interest-earning assets.

11
<PAGE>
Rate/Volume Table

     The following table sets forth certain information regarding changes in our
interest  income  and  interest  expense  for the  periods  indicated.  For each
category   of   interest-earning   assets  and   interest-bearing   liabilities,
information  is  provided  on  changes  attributable  to (i)  changes  in volume
(changes  in  average  volume  multiplied  by old rate);  (ii)  changes in rates
(changes in rate multiplied by old average volume).  Increases and decreases due
to both rate and volume have been allocated  proportionally to the change due to
volume and the change due to rate.

<TABLE>
<CAPTION>
                                              Three Months ended March 31,
                                              ----------------------------
                                                      2000 vs. 1999
                                                   Increase (Decrease)
                                                         Due to
                                                         ------
                                              Volume      Rate        Total
                                              ------      ----        -----
                                                      (In Thousands)
Interest income:
<S>                                         <C>        <C>           <C>
Loans receivable.........................    $ 142      $   (13)      $ 129
Mortgage-backed securities...............      (9)           (1)        (10)
Investment securities....................       10           14          24
Other interest-earning assets............     (15)            2         (13)
                                              ----      -------       -----
  Total interest-earning assets..........     $128      $     2       $ 130
                                              ====      =======       =====
Interest expense:
 NOW accounts............................     $  -      $     1       $   1
 Savings deposits........................        1            -           1
 Certificates of deposit.................       13           (5)          8
 Other interest-bearing liabilities......       61           23          84
                                              ----      -------       -----
  Total interest-bearing liabilities.....     $ 75      $    19       $  94
                                              ====      =======       =====

Change in net interest income.......... .     $ 53      $  (17)       $  36
                                              ====      =======       =====
</TABLE>

     The  provision  for loan losses for the three month  period ended March 31,
2000  totaled  $20,000  as  compared  to  $24,000  for the same  period in 1999.
Management  continually evaluates the adequacy of the allowance for loan losses,
which  encompasses  the overall risk  characteristics  of the various  portfolio
segments,  past  experience  with losses,  the impact of economic  conditions on
borrowers  and  other  relevant  factors  which  may  come to the  attention  of
management.  Although the Company  maintains  its allowance for loan losses at a
level that it considers to be adequate to provide for the inherent  risk of loss
in its loan  portfolio,  there can be no assurance  that future  losses will not
exceed estimated amounts or that additional  provisions for loan losses will not
be required in future periods. See "Risk Elements".

     Noninterest  income,  which is  comprised  of  service  charges  on deposit
accounts,  gains on sales of securities,  and other income  decreased  $8,000 to
$27,000 for the three  month  period  ended March 31, 2000 from  $35,000 for the
same period in 1999. Decreased loan originations at March 31, 2000 resulted in a
decline in fee income for the current three month period.

12
<PAGE>
     Income tax expense  increased $16,000 to $17,000 for the three month period
ended  March 31, 2000 from  $1,000 for the same  period  ended 1999.  Income tax
expense for the prior three month period was reduced due to the  availability of
the use of tax loss carryforwards  which was not available for the current three
month period.

Liquidity And Capital Resources

     Liquidity  may  be  adversely  affected  by  unexpected  deposit  outflows,
excessive interest rates paid by competitors,  adverse publicity relating to the
savings and loan industry and similar  matters.  Management  monitors  projected
liquidity  needs  and  determines  the  level  desirable  based  in  part on the
Company's commitments to make loans and management's assessment of the Company's
ability to generate funds.

     Management monitors both the Company's and the Bank's total risk-based Tier
I risk-based and Tier I leverage  capital  ratios in order to assess  compliance
with  regulatory  guidelines.  At March 31, 2000,  both the Company and the Bank
exceeded the minimum  risk-based and leverage  capital ratios  requirements.  At
March 31, 2000, the Company's and Bank's total risk-based, Tier I risk-based and
Tier I  leverage  ratios  were  20.4%,  19.5%,  19.2%,  18.4%,  9.9%,  and 9.4%,
respectively. The capital ratios for the Company and the Bank could be adversely
affected due to the Agreement.




13
<PAGE>

Risk Element

The table below presents information  concerning  nonperforming assets including
nonaccrual loans, renegotiated loans, loans 90 days or more past due, other real
estate loans,  and repossessed  assets. A loan is classified as nonaccrual when,
in the opinion of management,  there are serious doubts about  collectibility of
interest  and  principal.  At the time the accrual of interest is  discontinued,
future income is recognized only when cash is received.  Renegotiated  loans are
those  loans  which  terms  have been  renegotiated  to provide a  reduction  or
deferral  of  principal  or  interest  as a result of the  deterioration  of the
borrower.

<TABLE>
<CAPTION>
                                                     March 31,      December 31,
                                                       2000             1999
                                                   ------------     ------------
                                                       (Dollars in thousands)
<S>                                                 <C>             <C>
Loans on nonaccrual basis                            $   83          $    50

Loans past due 90 days or more and still accruing         -                -
                                                     ------           ------
Total nonperforming loans                                83               50
                                                     ------           ------
Real estate owned                                         -                -
                                                     ------           ------
Total nonperforming assets                               83               50
                                                     ------           ------
Nonperforming loans as a percent of total loans        0.36%            0.22%
                                                     ======           ======
Nonperforming assets as a percent of total assets      0.28%            0.17%
                                                     ======           ======
Allowance for loan losses to nonperforming loans     218.46%          407.30%
                                                     ======           ======
</TABLE>

Management  monitors  impaired loans on a continual basis. As of March 31, 2000,
impaired  loans had no material  effect on the Company's  financial  position or
results of operations.

Management believes the level of the allowance for loan losses at March 31, 2000
is sufficient; however, there can be no assurance that the current allowance for
loan losses will be adequate to absorb all future loan losses.  The relationship
between the allowance for loan losses and outstanding loans is a function of the
credit  quality and known risk  attributed to the loan  portfolio.  The on-going
loan  review  program  and  credit  approval  process is used to  determine  the
adequacy of the allowance for loan losses.


14
<PAGE>
CARNEGIE FINANCIAL CORPORATION
PART II   OTHER INFORMATION

ITEM 1.  Legal Proceedings

         None

ITEM 2.  Changes in Securities

         None

ITEM 3.  Defaults upon Senior Securities

         None

ITEM 4.  Submission of Matters to a Vote of Security Holders

         None

ITEM 5.  Other Information

         None

ITEM 6.  Exhibits and Reports on Form 8-K

         (a)  The following exhibits are incorporated as part of this report

                   3(i)    Articles of Incorporation of Carnegie Financial
                           Corporation *
                   3(ii)   Bylaws of Carnegie Financial Corporation *
                   4       Specimen Stock Certificate *
                  10.1     Employment Agreement between the Bank and Shirley
                           Chiesa *
                  10.2     Supplemental Executive Retirement Plan *
                  10.3     Form of Directors Consultation and Retirement Plan
                           between the Bank and each of the directors *
                  10.4     Carnegie Financial Corporation 1999 Stock Plan **
                  10.5     Carnegie Savings Bank Restricted Stock Plan **
                  27       Financial Data Schedule (electronic filing only)
                  99       Review Report of S.R. Snodgrass, A.C.

---------------------
*        Incorporated  by reference to the identically  numbered  exhibit to the
         registration  statement  on Form  SB-2  (File No.  333-24579)  declared
         effective by the SEC on May 14, 1998.
**       Incorporated  by  reference  to the Proxy  Statement  for the  Special
         Meeting on January  11, 1999 and filed with the SEC on
         December 10, 1999.

          (b) Reports on Form 8-K

                  On April 14, 2000,  the Company filed an Item 5 Form 8-K which
disclosed that the Bank entered into a Supervisory  Agreement with the Office of
Thrift Supervision.

15
<PAGE>









                                   SIGNATURES

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


                                          Carnegie Financial Corporation


Date:  May 15, 2000                    By:/s/Shirley C. Chiesa
                                          -----------------------------------
                                          Shirley C. Chiesa
                                          President and Chief Executive Officer


Date:  May 15, 2000                    By:/s/Joseph Pigoni
                                          --------------------------------------
                                          Joseph Pigoni
                                          Vice President and CFO