| For                the Quarter Ended June 30, 2005 | Commission                file number 000-51408 |
|----------------------------------------------------|-------------------------------------------------|

| Connecticut                             | 04-3806732                                             |
|-----------------------------------------|--------------------------------------------------------|
| (State                of incorporation) | (I.R.S.                Employer Identification Number) |

----

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| **Part                I**                                                                | **FINANCIAL                INFORMATION**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                     |
|                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
| Item                1.                                                                   | Financial                Statements:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
|                                                                                     | Statements                of Financial Condition (Unaudited) as of                    June 30, 2005 and December 31, 2004 Statements                of Income (Unaudited) for the three and six month                   periods ended June 30, 2005 and 2004 Statements                of Changes in Capital Accounts (Unaudited) for the     six                month periods ended June 30, 2005 and 2004 Statements                of Cash Flows (Unaudited) for the six month                    periods ended June 30, 2005 and 2004 Notes                to Financial Statements |  3                  4  5  6 7-10 |
| Item                2.                                                                   | Management’s                Discussion and Analysis of Financial                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                     |
|                                                                                     | Condition                and Results of Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | 11                - 21                                                   |
|                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
| Item                3.                                                                   | Controls                and Procedures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 21                                                                       |
|                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
| **Part                II**                                                               | **OTHER                INFORMATION**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
|  Item                1.                                                             |  Legal                Proceedings                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  22                                                                 |
| Item                2.                                                                   | Unregistered                Sales of Equity Securities and Use of Proceeds                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 22                                                                       |
| Item                3.Item                4.Item                5.Item                6. | Defaults                Upon Senior SecuritiesSubmission                of Matters to a Vote of Security HoldersOther                InformationExhibits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | 22222222                                                                 |
|                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                     |
| **SIGNATURES** **CERTIFICATIONS**                                                   | 23 24-                29                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

----

**Item      1 Financial Statements:**

| **STATEMENTS                OF FINANCIAL CONDITION (UNAUDITED)**        |   |
|-------------------------------------------------------------------------|--------|
| **(in                thousands except share data)**                     |   |
|                                                                    |   |   | June                30,  |   |   | December                31, |   |
|                                                                    |   |   | 2005 |   |   | 2004 |   |
|                                                                    |   |   |   |   |   |   |   |
|                                                                    |   |   |   |   |   |   |   |
| **ASSETS**                                                              |   |   |   |   |   |   |   |
| Cash                and due from depository institutions                |   | $ | 3,742 |   | $ | 5,764 |   |
| Federal                funds sold and money market accounts             |   |   | 6,675 |   |   | 4,269 |   |
| Investment                securities                                    |   |   | 37,030 |   |   | 39,548 |   |
| Loans                receivable, net                                    |   |   | 85,064 |   |   | 77,729 |   |
| Premises                and equipment, net                              |   |   | 1,504 |   |   | 1,524 |   |
| FHLB                Stock                                               |   |   | 727 |   |   | 727 |   |
| Accrued                income receivable                                |   |   | 563 |   |   | 560 |   |
| Deferred                income taxes                                    |   |   | 647 |   |   | 632 |   |
| Other                assets                                             |   |   | 665 |   |   | 187 |   |
| **TOTAL                ASSETS**                                         |   | **$** | **136,617** |   | **$** | **130,940** |   |
|                                                                    |   |   |   |   |   |   |   |
|                                                                    |   |   |   |   |   |   |   |
|                                                                    |   |   |   |   |   |   |   |
| **LIABILITIES                AND CAPITAL ACCOUNTS**                     |   |   |   |   |   |   |   |
| Deposits:                                                               |   |   |   |   |   |   |   |
| Non-interest                bearing                                     |   | $ | 15,642 |   | $ | 12,300 |   |
| Interest                bearing                                         |   |   | 98,350 |   |   | 95,446 |   |
| Total                deposits                                           |   |   | 113,992 |   |   | 107,746 |   |
| Borrowed                funds                                           |   |   | 11,575 |   |   | 12,679 |   |
| Mortgagors'                escrow accounts                              |   |   | 153 |   |   | 150 |   |
| Other                liabilities                                        |   |   | 1,337 |   |   | 1,206 |   |
| Total                Liabilities                                        |   |   | 127,057 |   |   | 121,781 |   |
|                                                                    |   |   |   |   |   |   |   |
| Capital                Accounts:                                        |   |   |   |   |   |   |   |
| Common                stock, no par value; authorized 2,000,000 shares; |   |   |   |   |   |   |   |
| issued                and outstanding 1,076,082 and 1,072,902 at        |   |   |   |   |   |   |   |
| June                30, 2005 and December 31, 2004, respectively        |   |   | 890 |   |   | 887 |   |
| Additional                paid-in capital                               |   |   | 8,164 |   |   | 8,126 |   |
| Retained                earnings                                        |   |   | 688 |   |   | 305 |   |
| Accumulated                other comprehensive loss                     |   |   | (182 | ) |   | (159 | ) |
| Total                Capital Accounts                                   |   |   | 9,560 |   |   | 9,159 |   |
| **TOTAL                LIABILITIES AND CAPITAL ACCOUNTS**               |   | **$** | **136,617** |   | **$** | **130,940** |   |
|                                                                    |   |   |   |   |   |   |   |

----

| **STATEMENTS                  OF INCOME (UNAUDITED)**          |      |
|----------------------------------------------------------------|-----------|
| **(in                  thousands except share data)**          |      |
|                                                           |      | Three                  Months Ended |   | Six                  Months Ended |   |
|                                                           |      | June                  30, |   | June                  30, |   |
|                                                           |      | 2005 |   | 2004 |   | 2005 |   | 2004 |   |
| Interest                  income:                              |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Interest                  on loans                             |      | $ | 1,412 |   | $ | 1,116 |   | $ | 2,718 |   | $ | 2,117 |   |
| Interest                  and dividends on investments         |      |   |  |   |   |  |   |   |  |   |   |  |   |
| and                  deposits                                  |      |   | 381 |   |   | 286 |   |   | 760 |   |   | 610 |   |
| Total                  interest income                         |      |   | 1,793 |   |   | 1,402 |   |   | 3,478 |   |   | 2,727 |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Interest                  expense:                             |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Deposits                  and escrow                           |      |   | 506 |   |   | 338 |   |   | 973 |   |   | 634 |   |
| Borrowed                  money                                |      |   | 77 |   |   | 62 |   |   | 152 |   |   | 130 |   |
| Total                  interest expense                        |      |   | 583 |   |   | 400 |   |   | 1,125 |   |   | 764 |   |
| Net                  interest income                           |      |   | 1,210 |   |   | 1,002 |   |   | 2,353 |   |   | 1,963 |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Provision                  for loan losses                     |      |   | 85 |   |   | 65 |   |   | 161 |   |   | 162 |   |
| Net                  interest income after provision           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| for                  loan losses                               |      |   | 1,125 |   |   | 937 |   |   | 2,192 |   |   | 1,801 |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Noninterest                  income:                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Service                  charges and other fees                |      |   | 102 |   |   | 77 |   |   | 191 |   |   | 138 |   |
| Realized                  gains on investments                 |      |   | - |   |   | - |   |   | - |   |   | 6 |   |
| Total                  noninterest income                      |      |   | 102 |   |   | 77 |   |   | 191 |   |   | 144 |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Noninterest                  expenses:                         |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Salaries                                                       |      |   | 404 |   |   | 364 |   |   | 809 |   |   | 717 |   |
| Employee                  benefits and taxes                   |      |   | 77 |   |   | 72 |   |   | 169 |   |   | 150 |   |
| Occupancy                  and equipment                       |      |   | 156 |   |   | 180 |   |   | 329 |   |   | 359 |   |
| Professional                  fees                             |      |   | 38 |   |   | 35 |   |   | 74 |   |   | 76 |   |
| Marketing                                                      |      |   | 32 |   |   | 25 |   |   | 52 |   |   | 46 |   |
| Office                  supplies                               |      |   | 20 |   |   | 18 |   |   | 37 |   |   | 35 |   |
| Outside                  service fees                          |      |   | 59 |   |   | 28 |   |   | 107 |   |   | 65 |   |
| Other                                                          |      |   | 88 |   |   | 55 |   |   | 172 |   |   | 103 |   |
| Total                  noninterest expenses                    |      |   | 874 |   |   | 777 |   |   | 1,749 |   |   | 1,551 |   |
| Income                  before income tax expense              |      |   | 353 |   |   | 237 |   |   | 634 |   |   | 394 |   |
| Income                  tax expense                            |      |   | 141 |   |   | 91 |   |   | 251 |   |   | 151 |   |
| **NET                  INCOME**                                |      | **$** | **212** |   | **$** | **146** |   | **$** | **383** |   | **$** | **243** |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Basic                  income per share                        |      | $ | 0.20 |   | $ | 0.14 |   | $ | 0.36 |   | $ | 0.23 |   |
| Diluted                  income per share                      |      | $ | 0.19 |   | $ | 0.13 |   | $ | 0.34 |   | $ | 0.22 |   |
|                                                           |      |   |  |   |   |  |   |   |  |   |   |  |   |
| Weighted-average                  shares outstanding - basic   | 1,076,082 |   |   | 1,070,744 |   |   | 1,076,029 |   |   | 1,070,473 |   |
| Weighted-average                  shares outstanding - diluted | 1,116,108 |   |   | 1,086,099 |   |   | 1,116,055 |   |   | 1,085,828 |   |

----

| **STATEMENTS                  OF CHANGES IN CAPITAL ACCOUNTS (UNAUDITED)** |   |
|----------------------------------------------------------------------------|--------|
| **(in                  thousands)**                                        |   |   |   |   |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |
|                                                                       |   |   |   |   |   |   |   | Accumulated |   |   |   |
|                                                                       |   |   |   |   |   |   |   | Other |   |   |   |
|                                                                       |   |   |   | Additional |   |   |   | Comprehensive |   | Total |   |
|                                                                       |   | Common |   | Paid-In |   | Retained |   | Income |   | Capital |   |
|                                                                       |   | Stock |   | Capital |   | Earnings |   | (Loss) |   | Accounts |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Balance                  at December 31, 2003                              |   | $ | 884 |   | $ | 8,090 |   | $ | (267 | ) | $ | (62 | ) | $ | 8,645 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares                  issued under stock                                 |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| compensation                  plan                                         |   |   | 1 |   |   | 15 |   |   |  |   |   |  |   |   | 16 |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Comprehensive                  income:                                     |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  income                                                |   |   |  |   |   |  |   |   | 243 |   |   |  |   |   |  |   |
| Net                  unrealized losses on                                  |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| available-for-sale                  securities                             |   |   |  |   |   |  |   |   |  |   |   | (258 | ) |   |  |   |
|  Comprehensive                  income                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |  (15) |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Balance                  at June 30, 2004                                  |   | $ | 885 |   | $ | 8,105 |   | $ | (24 | ) | $ | (320 | ) | $ | 8,646 |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Balance                  at December 31, 2004                              |   | $ | 887 |   | $ | 8,126 |   | $ | 305 |   | $ | (159 | ) | $ | 9,159 |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shares                  issued under stock                                 |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| compensation                  plan                                         |   |   | 3 |   |   | 38 |   |   |  |   |   |  |   |   | 41 |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Comprehensive                  income:                                     |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Net                  income                                                |   |   |  |   |   |  |   |   | 383 |   |   |  |   |   |  |   |
| Net                  unrealized losses on                                  |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| available-for-sale                  securities                             |   |   |  |   |   |  |   |   |  |   |   | (23 | ) |   |  |   |
| Comprehensive                  income                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |  360 |   |
|                                                                       |   |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| **Balance                  at June 30, 2005**                              |   | **$** | **890** |   | **$** | **8,164** |   | **$** | **688** |   | **$** | **(182** | **)** | **$** | **9,560** |   |
|                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| **STATEMENTS                  OF CASH FLOWS (UNAUDITED)**             |   |
|-----------------------------------------------------------------------|--------|
| **(in                  thousands)**                                   |   |
|                                                                  |   | Six                  Months Ended June 30, |   |
|                                                                  |   | 2005 |   | 2004 |   |
| **Cash                  flows from operating activities**             |   |   |   |   |   |   |   |
| Net                  income                                           |   | $ | 383 |   | $ | 243 |   |
| Adjustments                  to reconcile net income to               |   |   |   |   |   |   |   |
| cash                  provided by operating activities:               |   |   |   |   |   |   |   |
| Realized                  gains on investments                        |   |   | - |   |   | (6 | ) |
| Depreciation                                                          |   |   | 119 |   |   | 104 |   |
| Provision                  for loan losses                            |   |   | 161 |   |   | 162 |   |
| Amortization                  (accretion) of premiums (discounts) net |   |   | 88 |   |   | 114 |   |
| Net                  Change in:                                       |   |   |   |   |   |   |   |
| Accrued                  income receivable                            |   |   | (3 | ) |   | (22 | ) |
| Deferred                  loan fees                                   |   |   | 19 |   |   | 35 |   |
| Other                  assets                                         |   |   | (477 | ) |   | 116 |   |
| Other                  liabilities                                    |   |   | 131 |   |   | 1,228 |   |
| Net                  cash provided by operating activities            |   |   | 421 |   |   | 1,974 |   |
|                                                                  |   |   |   |   |   |   |   |
| **Cash                  flows from investing activities**             |   |   |   |   |   |   |   |
| Proceeds                  from maturities, calls and paydowns         |   |   |   |   |   |   |   |
| of                  available-for-sale securities                     |   |   | 10,891 |   |   | 6,268 |   |
| Proceeds                  from sales of available-for-sale securities |   |   | - |   |   | - |   |
| Purchase                  of available-for-sale securities            |   |   | (8,500 | ) |   | (4,138 | ) |
| Loan                  originations net of principal payments          |   |   | (7,515 | ) |   | (12,810 | ) |
| Purchases                  of premises and equipment                  |   |   | (99 | ) |   | (629 | ) |
| Net                  cash used by investing activities                |   |   | (5,223 | ) |   | (11,309 | ) |
|                                                                  |   |   |   |   |   |   |   |
| **Cash                  flows from financing activities**             |   |   |   |   |   |   |   |
| Change                  in DDA, NOW, money market and                 |   |   |   |   |   |   |   |
| savings                  accounts                                     |   |   | (989 | ) |   | 6,830 |   |
| Change                  in time deposit accounts                      |   |   | 7,235 |   |   | 7,580 |   |
| Change                  in borrowed funds                             |   |   | (1,104 | ) |   | (2,100 | ) |
| Change                  in mortgagors' escrow accounts                |   |   | 3 |   |   | 1 |   |
| Proceeds                  from issuance of common stock               |   |   | 41 |   |   | 16 |   |
| Net                  cash provided by financing activities            |   |   | 5,186 |   |   | 12,327 |   |
|                                                                  |   |   |   |   |   |   |   |
| Net                  change in cash and cash equivalents              |   |   | 384 |   |   | 2,992 |   |
| Cash                  and cash equivalents at beginning of period     |   |   | 10,033 |   |   | 7,074 |   |
|                                                                  |   |   |   |   |   |   |   |
| **Cash                  and cash equivalents at end of period**       |   | $ | 10,417 |   | $ | 10,066 |   |
|                                                                  |   |   |   |   |   |   |   |
| ***Supplemental                  Disclosures***                       |   |   |   |   |   |   |   |
| Cash                  paid during the period for:                     |   |   |   |   |   |   |   |
| Interest                                                              |   | $ | 1,028 |   | $ | 731 |   |
| Income                  taxes                                         |   | $ | 369 |   | $ | 143 |   |

----

**Notes      to Financial Statements**

**(Unaudited)**

**Note      1. **
**Business**

**Note      2. **
**Basis      of presentation**

----

**Note      3. **
**Comprehensive      Income**

|                                                                                                                                |   | Six                Months Ended |    |
|-------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------|---------|
|                                                                                                                                |   | June                30,         |    |
|                                                                                                                                |   | 2005                            |    | 2004 |   |
| Net                Income                                                                                                           |   | $                               | 383     |   | $ | 243 |   |
|                                                                                                                                |   |                            |    |   |   |   |   |
| Other                comprehensive income (loss):                                                                                   |   |                            |    |   |   |   |   |
| Net                unrealized holding gains (losses) on securities                    available-for-sale             |   |                            | (38     | ) |   | (416 | ) |
| Reclassification                adjustment for gain recognized in net income                                                        |   |                            | -       |   |   | (6 | ) |
| Other                comprehensive income (loss) before tax expense                                                                 |   |                            | (38     | ) |   | (422 | ) |
| Income                tax expense (benefit) related to items of other                    comprehensive income (loss) |   |                            | 15      |   |   | 162 |   |
| Other                comprehensive income net of tax                                                                                |   |                            | (23     | ) |   | (260 | ) |
|                                                                                                                                |   |                            |    |   |   |   |   |
| **Total                comprehensive income**                                                                                       |   | **$**                           | **360** |   | **$** | **(17** | **)** |

**Note      4. **
**Income      per Share**

**Note      5. **
**Commitment      to Extend Credit**

|                                         |                         |   |                             |
|----------------------------------------------|------------------------------|--------|----------------------------------|
|                                         | June                30, 2005 |   | December                31, 2004 |
| Commitments                to extend credit: |                         |   |                             |
| Loan                commitments              | $                7,093       |   | $                2,987           |
| Unadvanced                lines of credit    | 21,017                       |   | 16,572                           |
| Standby                letters of credit     | 504                          |   | 504                              |
| Outstanding                commitments       | $                28,614      |   | $                20,063          |

----

**Note      6. **
**Stock      Based Compensation**

|                                                   |   | Six                Months Ended |   |
|--------------------------------------------------------|--------|---------------------------------|--------|
|                                                   |   | June                30,         |   |
|                                                   |   | 2005                            |   | 2004 |   |
|                                                   |   |                            |   |   |   |
| Net                income, as reported                 |   | $                               | 383    |   | $ | 243 |   |
| Stock-based                employee compensation       |   |                            |   |   |   |   |   |
| included                in net income                  |   |                            | -      |   |   | - |   |
| Total                stock-based employee compensation |   |                            |   |   |   |   |   |
| expense                determined under the fair value |   |                            |   |   |   |   |   |
| based                method for all awards             |   |                            | -      |   |   | (20 | ) |
| Pro                forma net income                    |   | $                               | 383    |   | $ | 223 |   |
|                                                   |   |                            |   |   |   |   |   |
| Earnings                per share:                     |   |                            |   |   |   |   |   |
| Basic,                as reported                      |   | $                               | 0.36   |   | $ | 0.23 |   |
| Diluted,                as reported                    |   | $                               | 0.34   |   | $ | 0.22 |   |
| Basic,                pro forma                        |   | $                               | 0.36   |   | $ | 0.21 |   |
| Diluted,                pro forma                      |   | $                               | 0.34   |   | $ | 0.21 |   |

**Note      7. **
**Recent      Accounting Pronouncements**

----

----

**Part      I. - FINANCIAL INFORMATION**

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

**Cautionary      Statement**

**(a)**
**Plan      of Operation**

**(b)**
**Management's      Discussion and Analysis of Financial Condition and Results of      Operation**

**Overview**

----

**Subsequent      Events**

----

**FINANCIAL      CONDITION**

**General**

**Investment      Securities**

|                                                 |   | Amortized |   | Gross                  Unrealized |   | Estimated |   |
|------------------------------------------------------|--------|-----------|--------|-----------------------------------|--------|-----------|--------|
|                                                 |   | Cost      |   | Gain                              |   | (Loss)    |   | Market                  Value |   |
| **June                  30, 2005:**                  |   |      |   |                              |   |      |   |   |
| Available-for-sale                  securities:      |   |      |   |                              |   |      |   |   |
| U.S.                  agency obligations:            |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Due                  in less than one year           |   | $         | 500    |                              | $      | -         |   | $ | (6 | ) | $ | 494 |   |
| Due                  from one through five years     |   |      | 8,013  |                              |   | 1         |   |   | (92 | ) |   | 7,922 |   |
|                                                 |   |      | 8,513  |                              |   | 1         |   |   | (98 | ) |   | 8,416 |   |
| Corporate                  bonds:                    |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Due                  from one through five years     |   |      | 2,113  |                              |   | -         |   |   | (41 | ) |   | 2,072 |   |
| Due                  after ten years                 |   |      | 100    |                              |   | -         |   |   | - |   |   | 100 |   |
|                                                 |   |      | 2,213  |                              |   | -         |   |   | (41 | ) |   | 2,172 |   |
|                                                 |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Mortgage-backed                  securities          |   |      | 23,599 |                              |   | 34        |   |   | (191 | ) |   | 23,442 |   |
|                                                 |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Variable                  rate preferred securities  |   |      | 3,000  |                              |   | -         |   |   | - |   |   | 3,000 |   |
| Total                  available-for-sale securities |   | $         | 37,325 |                              | $      | 35        |   | $ | (330 | ) | $ | 37,030 |   |

|                                                 |   | Amortized |   | Gross                  Unrealized |   | Estimated |   |
|------------------------------------------------------|--------|-----------|--------|-----------------------------------|--------|-----------|--------|
|                                                 |   | Cost      |   | Gain                              |   | (Loss)    |   | Market                  Value |   |
| **December                  31, 2004:**              |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Available-for-sale                  securities:      |   |      |   |                              |   |      |   |   |
| U.S.                  agency obligations:            |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Due                  in less than one year           |   | $         | 500    |                              | $      | 3         |   | $ | - |   | $ | 503 |   |
| Due                  from one through five years     |   |      | 8,518  |                              |   | 2         |   |   | (86 | ) |   | 8,434 |   |
|                                                 |   |      | 9,018  |                              |   | 5         |   |   | (86 | ) |   | 8,937 |   |
| Corporate                  bonds:                    |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Due                  from one through five years     |   |      | 2,129  |                              |   | -         |   |   | (27 | ) |   | 2,102 |   |
| Due                  after ten years                 |   |      | 100    |                              |   | 3         |   |   | - |   |   | 103 |   |
|                                                 |   |      | 2,229  |                              |   | 3         |   |   | (27 | ) |   | 2,205 |   |
|                                                 |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Mortgage-backed                  securities          |   |      | 26,557 |                              |   | 23        |   |   | (174 | ) |   | 26,406 |   |
|                                                 |   |      |   |                              |   |      |   |   |   |   |   |   |   |
| Variable                  rate preferred securities  |   |      | 2,000  |                              |   | -         |   |   | - |   |   | 2,000 |   |
| Total                  available-for-sale securities |   | $         | 39,804 |                              | $      | 31        |   | $ | (287 | ) | $ | 39,548 |   |

----

**Loans**

|                                          |   | June                30, |   | December                31, |   |
|-----------------------------------------------|--------|-------------------------|--------|-----------------------------|--------|
|                                          |   | 2005                    |   | 2004                        |   |
| Commercial                mortgages           |   | $                       | 42,635 |                        | $      | 38,186 |   |
| Commercial                loans               |   |                    | 18,355 |                        |   | 19,227 |   |
| Residential                mortgages          |   |                    | 14,504 |                        |   | 12,407 |   |
| Consumer                and home equity loans |   |                    | 11,179 |                        |   | 9,409 |   |
|                                          |   |                    | 86,673 |                        |   | 79,229 |   |
| Less:                                         |   |                    |   |                        |   |   |   |
| Deferred                loan origination fees |   |                    | 224    |                        |   | 205 |   |
| Allowance                for loan losses      |   |                    | 1,385  |                        |   | 1,295 |   |
| Loans                receivable, net          |   | $                       | 85,064 |                        | $      | 77,729 |   |
| Weighted                average yield         |   |                    | 6.40   | %                           |   | 6.20 | % |

**Critical      Accounting Policies**

**Allowance      for Loan Losses**

----

|   | Balance,                    beginning of period |   | $      | 1,295     |   |   |
|--------|-------------------------------------------------|--------|--------|-----------|--------|--------|
|   | Provision                    for loan losses    |   |   | 161       |   |   |
|   | Chargeoffs                                      |   |   | (79       | )      |   |
|   | Recoveries                                      |   |   | 8         |   |   |
|   | Balance,                    end of period       |   | **$**  | **1,385** |   |   |

**Deposits**

|                                 |   | June                30, 2005 |        | December                31,2004 |   |
|--------------------------------------|--------|------------------------------|-------------|---------------------------------|--------|
|                                 |   |                         |        | Weighted                        |   |   |   | Weighted |   |
|                                 |   |                         |        | Average                         |   |   |   | Average |   |
|                                 |   | Amount                       |        | Rate                            |   | Amount |   | Rate |   |
| Non-interest                checking |   | $                            | 15,642      |                            |   | 0.00 | % | $ | 12,300 |   |   | 0.00 | % |
| Regular                savings       |   |                         | 23,161      |                            |   | 0.79 | % |   | 23,782 |   |   | 0.81 | % |
| Money                market savings  |   |                         | 17,899      |                            |   | 1.71 | % |   | 21,326 |   |   | 1.40 | % |
| NOW                accounts          |   |                         | 3,138       |                            |   | 0.39 | % |   | 3,431 |   |   | 0.34 | % |
|                                 |   |                         | 59,840      |                            |   | 0.84 | % |   | 60,839 |   |   | 0.83 | % |
|                                 |   |                         |        |                            |   |   |   |   |   |   |   |   |   |
| Time                deposits         |   |                         | 54,152      |                            |   | 3.11 | % |   | 46,907 |   |   | 2.73 | % |
| Total                Deposits        |   | **$**                        | **113,992** |                            |   | **1.92** | **%** | **$** | **107,746** |   |   | **1.65** | **%** |

**Borrowed      Funds**

----

**Liquidity      and Capital Resources**

----

**RESULTS      OF OPERATIONS**

**Comparison      of the three and six-month periods ended June 30, 2005 and      2004**

**Net      Income**

**Net      Interest Income**

**Interest      Income**

**Interest      Expense**

----

|                                                    |   | For                  Three Months Ended |          |
|---------------------------------------------------------|--------|-----------------------------------------|---------------|
|                                                    |   | June                  30, 2005          |          | June                  30, 2004 |   |
|                                                    |   | Average                                 |          | Income/ |   | Average |   | Average |   | Income/ |   | Average |   |
|                                                    |   | Balance                                 |          | Expense |   | Rate |   | Balance |   | Expense |   | Rate |   |
| **Interest                  Earning Assets:**           |   |                                    |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                  funds sold and money           |   |                                    |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| market                  accounts                        |   | $                                       | 4,605         |   | $ | 32 |   |   | 2.79 | % | $ | 2,976 |   | $ | 7 |   |   | 0.94 | % |
| Investment                  securities                  |   |                                    | 38,125        |   |   | 349 |   |   | 3.67 | % |   | 33,252 |   |   | 279 |   |   | 3.37 | % |
| Loans                                                   |   |                                    | 85,429        |   |   | 1,412 |   |   | 6.63 | % |   | 70,401 |   |   | 1,116 |   |   | 6.36 | % |
| Total                  interest earnings assets         |   |                                    | 128,159       |   |   | 1,793 |   |   | 5.61 | % |   | 106,629 |   |   | 1,402 |   |   | 5.27 | % |
| Non-interest-earning                  assets            |   |                                    | 5,704         |   |   |   |   |   |  |   |   | 6,250 |   |   |   |   |   |  |   |
| Total                  assets                           |   | $                                       | 133,863       |   |   |   |   |   |  |   | $ | 112,879 |   |   |   |   |   |  |   |
|                                                    |   |                                    |               |   |   |   |   |   |  |   |   |  |   |   |   |   |   |  |   |
| **Interest                  Bearing Liabilities:**      |   |                                    | 123,025       |   |   |   |   |   |  |   |   |  |   |   |   |   |   |  |   |
| NOW                  accounts                           |   |                                    | 3,120         |   |   | 6 |   |   | 0.77 | % |   | 2,843 |   |   | 3 |   |   | 0.42 | % |
| Savings                  and money market accounts      |   |                                    | 42,850        |   |   | 123 |  |   | 1.15 | %  |   |  39,841 |   |   | 104 |   |   | 1.05 | % |
| Time                  deposits                          |   |                                    | 51,716        |   |   | 377 |   |   | 2.92 | % |   | 37,485 |   |   | 231 |   |   | 2.47 | % |
| Borrowed                  money                         |   |                                    | 10,208        |   |   | 77 |   |   | 3.03 | % |   | 10,298 |   |   | 62 |   |   | 2.41 | % |
| Total                  interest bearing liabilities     |   |                                    | 107,894       |   |   | 583 |   |   | 2.17 | % |   | 90,467 |   |   | 400 |   |   | 1.77 | % |
| Non-interest                  bearing demand deposits   |   |                                    |  15,131  |   |   |  |   |   |   |   |   |  12,028 |   |   |  |   |   |   |   |
| Other                  non-interest-bearing liabilities |   |                                    |  1,465   |   |   |  |   |   |   |   |   |  1,620 |   |   |  |   |   |   |   |
| Capital                  accounts                       |   |                                    | 9,373         |   |   |   |   |   |  |   |   | 8,764 |   |   |   |   |   |  |   |
| Total                  liabilities and capital accounts |   |  $                                 |  113,863 |   |   |  |   |   |   |   | $  |  112,879 |   |   |  |   |   |   |   |
|                                                    |   |                                    |               |   |   |   |   |   |  |   |   |  |   |   |   |   |   |  |   |
| Net                  interest income                    |   |                                    |               |   |   | 1,210 |   |   |  |   |   |  |   |   | 1,002 |   |   |  |   |
|                                                    |   |                                    |               |   |   |   |   |   |  |   |   |  |   |   |   |   |   |  |   |
| Net                  interest margin                    |   |                                    |               |   |   | 3.79 | % |   |   |   |   |   |   |   | 3.77 | % |   |  |   |
| Interest                  rate spread         |   |                                    |          |   |   |  3.44 | %  |   |   |   |   |   |   |   |  3.50 | %  |   |   |   |

----

|                                                  |   | For                Six Months Ended |    |
|-------------------------------------------------------|--------|-------------------------------------|---------|
|                                                  |   | June                30, 2005        |    | June                30, 2004 |   |
|                                                  |   | Average                             |    | Income/ |   | Average |   | Average |   | Income/ |   | Average |   |
|                                                  |   | Balance                             |    | Expense |   | Rate |   | Balance |   | Expense |   | Rate |   |
| **Interest-Earning                Assets:**           |   |                                |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                funds sold and money           |   |                                |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| market                accounts                        |   | $                                   | 3,936   |   | $ | 51 |   |   | 2.61 | % | $ | 3,798 |   | $ | 17 |   |   | 0.90 | % |
| Investment                securities                  |   |                                | 38,935  |   |   | 709 |   |   | 3.67 | % |   | 33,888 |   |   | 593 |   |   | 3.51 | % |
| Loans                                                 |   |                                | 83,285  |   |   | 2,718 |   |   | 6.58 | % |   | 65,975 |   |   | 2,117 |   |   | 6.44 | % |
| Total                interest-earnings assets         |   |                                | 126,156 |   |   | 3,478 |   |   | 5.56 | % |   | 103,661 |   |   | 2,727 |   |   | 5.28 | % |
| Non-interest-earning                assets            |   |                                | 5,874   |   |   |   |   |   |   |   |   | 5,785 |   |   |   |   |   |   |   |
| Total                assets                           |   | $                                   | 132,030 |   |   |   |   |   |   |   | $ | 109,446 |   |   |   |   |   |   |   |
|                                                  |   |                                |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| **Interest-Bearing                Liabilities:**      |   |                                |         |   |   |   |   |   |   |   |   |  |   |   |   |   |   |   |   |
| NOW                accounts                           |   |                                | 3,081   |   |   | 11 |   |   | 0.72 | % |   | 2,734 |   |   | 7 |   |   | 0.51 | % |
| Savings                and money market accounts      |   |                                | 43,802  |   |   | 252 |   |   | 1.16 | % |   | 38,309 |   |   | 196 |   |   | 1.03 | % |
| Time                deposits                          |   |                                | 50,194  |   |   | 710 |   |   | 2.85 | % |   | 35,873 |   |   | 431 |   |   | 2.41 | % |
| Borrowed                money                         |   |                                | 10,246  |   |   | 152 |   |   | 2.99 | % |   | 11,035 |   |   | 130 |   |   | 2.36 | % |
| Total                interest-bearing liabilities     |   |                                | 107,323 |   |   | 1,125 |   |   | 2.11 | % |   | 87,951 |   |   | 764 |   |   | 1.74 | % |
| Non-interest-bearing                demanddeposits    |   |                                | 13,977  |   |   |   |   |   | 0.00 | % |   | 11,872 |   |   |   |   |   | 0.00 | % |
| Other                non-interest-bearing liabilities |   |                                | 1,429   |   |   |   |   |   |   |   |   | 2,276 |   |   |   |   |   |   |   |
| Capital                accounts                       |   |                                | 9,301   |   |   |   |   |   |   |   |   | 7,347 |   |   |   |   |   |   |   |
| Total                liabilities and capital accounts |   | $                                   | 132,030 |   |   |   |   |   |   |   | $ | 109,446 |   |   |   |   |   |   |   |
|                                                  |   |                                |         |   |   |   |   |   |   |   |   |  |   |   |   |   |   |   |   |
| Net                interest income                    |   |                                |         |   |   | 2,353 |   |   |   |   |   |  |   |   | 1,963 |   |   |   |   |
|                                                  |   |                                |         |   |   |   |   |   |  |   |   |  |   |   |   |   |   |   |   |
| Net                interest margin                    |   |                                |         |   |   | 3.76 | % |   |   |   |   |   |   |   | 3.80 | % |   |   |   |
| Interest              rate spread                |   |                                |    |   |   |  3.45 | %  |   |   |   |   |   |   |   |  3.54 | %  |   |   |   |

----

|                                                        |   | For                the 3 Months Ended     |   | For                the 6 Months Ended     |   |
|-------------------------------------------------------------|--------|-------------------------------------------|--------|-------------------------------------------|--------|
|                                                        |   | June                30, 2005 versus 2004  |   | June                30, 2005 versus 2004  |   |
|                                                        |   | Increase                (Decrease) Due to |   | Increase                (Decrease) Due to |   |
|                                                        |   | Rate                                      |   | Volume                                    |   | Total |   | Rate |   | Volume |   | Total |   |
| Interest                Income:                             |   |                                      |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                funds sold money                     |   |                                      |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| money                market accounts                        |   | $                                         | 20     |                                      | $      | 5 |   | $ | 25 |   | $ | 33 |   | $ | 1 |   | $ | 34 |   |
| Investment                securities                        |   |                                      | 27     |                                      |   | 43 |   |   | 70 |   |   | 27 |   |   | 89 |   |   | 116 |   |
| Loans                                                       |   |                                      | 49     |                                      |   | 247 |   |   | 296 |   |   | 46 |   |   | 555 |   |   | 601 |   |
| Total                interest income                        |   |                                      | 96     |                                      |   | 295 |   |   | 391 |   |   | 106 |   |   | 645 |   |   | 751 |   |
|                                                        |   |                                      |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                Expense:                            |   |                                      |   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| NOW                accounts                                 |   |                                      | 3      |                                      |   | - |   |   | 3 |   |   | 3 |   |   | 1 |   |   | 4 |   |
| Savings                and money marketaccounts             |   |                                      | 11     |                                      |   | 8 |   |   | 19 |   |   | 26 |   |   | 30 |   |   | 56 |   |
| Time                deposits                                |   |                                      | 48     |                                      |   | 99 |   |   | 147 |   |   | 87 |   |   | 192 |   |   | 279 |   |
| Borrowed                money                               |   |                                      | 16     |                                      |   | (1 | ) |   | 15 |   |   | 38 |   |   | (17 | ) |   | 21 |   |
| Total                interest expense                       |   |                                      | 78     |                                      |   | 106 |   |   | 184 |   |   | 154 |   |   | 206 |   |   | 360 |   |
| Change                in net interest                income |   | $                                         | 18     |                                      | $      | 189 |   | $ | 207 |   | $ | (48 | ) | $ | 439 |   | $ | 392 |   |

**Provision      for Loan Losses**

----

**Noninterest        Income**

**Noninterest      Expense**

**Income      Taxes**

**(c)**
**Off      Balance Sheet Arrangements**

**Item      3. Controls and Procedures**

----

**Part      II. - OTHER INFORMATION**

| Item                  1. | Legal                  Proceedings - Not applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|--------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Item                  2. | Unregistered                  Sales of Equity Securities and Use of Proceeds - Not                  applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Item                  3. | Defaults                  Upon Senior Securities - Not applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Item                  4. | Submission                  of Matters to a Vote of Security Holders - On May 23, 2005, the                  Bank held                  its annual meeting.  At the annual meeting, more than two-thirds                  of                  the Banks' Shareholders approved the reorganization of the Bank                  into a                  holding company structure; James G. Biondi, J. Yancey Brame, Edmund                  D.                  Donovan and Edward T. McFee, Jr. were elected as directors of the                  Bank;                  and the Bank's shareholders ratified the appointment of Snyder&                  Haller, P.C. as the Bank's independent auditors for the fiscal                  year ended                  December 31, 2005. |
| Item                  5. | Other                  Information - Not applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Item                  6. | Exhibits                  -                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

| (a)   | Exhibits |
|-----------------|----------|

| 3.1  | Certificate                  of Incorporation of First Valley Bancorp, Inc., incorporated herein                  by                  reference to Registrant's July 2005 Form 8-A                                                                                                                            |
|------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.2  | Bylaws                  of First Valley Bancorp, Inc., incorporated herein by reference                  to                  Registrant's July 2005 Form 8-A                                                                                                                                                  |
| 4.1  | Form                  of Common Stock Certificate of First Valley Bancorp, Inc., incorporated                  herein by reference to Registrant's July 2005 Form 8-A                                                                                                                                         |
| 10.1 | Lease                  between Valley Bank and The Carpenter Realty Co., Inc. and the                  S.                  Carpenter Construction                  Co. & Bristol Holding, LLC dated October 4, 1999, incorporated herein                  by reference to Registrant's July 2005 Form 8-A |
| 10.2 | Lease                  between 888 Farmington Avenue, LLC and Bristol Travel, Inc. dba                  Global                  Travel                  Service dated April 6, 2004, incorporated herein by reference to                  Registrant's July 2005 Form 8-A                                     |
| 10.3 | Lease                  between Valley Bank and Forpicus, LLC dated October 12, 2004, incorporated                  herein by reference to Registrant's July 2005 Form 8-A                                                                                                                                     |
| 10.4 | Employment                  Agreement between Valley Bank and Robert L. Messier, Jr. dated                  July 1,                  2004,                  as amended November 1, 2004, incorporated herein by reference to                  Registrant's July 2005 Form 8-A                                 |
| 10.5 | Valley                  Bank Amended and Restated 1999 Stock Option and Stock Compensation                  Plan,                  incorporated                  herein by reference to Registrant's July 2005 Form                  8-A                                                                      |
| 10.6 | Change                  of Control Agreement between Valley Bank and Mark J. Blum dated                  October 1,                  2004,                  incorporated herein by reference to Registrant's July 2005 Form                  8-A                                                              |
| 10.7 | Change                  of Control Agreement between Valley Bank and Anthony M. Mattioli                  dated                  October                  1, 2004, incorporated herein by reference to Registrant's July                  2005 Form                  8-A                                      |
| 10.8 | Change                  of Control Agreement between Valley Bank and Robert L. Messier,                  Jr. dated                  October                  1, 2004, incorporated herein by reference to Registrant's July                  2005 Form                  8-A                                   |
| 31.1 | Chief                  Executive Officer Certification pursuant to 17 CFR 240.13a-14 as                  adopted                  pursuant to Section 302 of the Sarbanes-Oxley Act of                  2002.                                                                                                 |
| 31.2 | Chief                  Financial Officer Certification pursuant to 17 CFR 240.13a-14 as                  adopted                  pursuant to Section 302 of the Sarbanes-Oxley Act of                  2002.                                                                                                 |
| 32.1 | Chief                  Executive Officer Certification pursuant to 18 U.S.C. Section 1350,                  as                  adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                  2002.                                                                                           |
| 32.2 | Chief                  Financial Officer Certification pursuant to 18 U.S.C. Section 1350,                  as                  adopted pursuant to Section 906 of the Sarbanes-Oxley Act of                  2002.                                                                                           |

----

**SIGNATURES**

|                                       | FIRST                VALLEY BANCORP, INC.          |
|--------------------------------------------|----------------------------------------------------|
|                                       | (Registrant)                                       |
|                                       |                                               |
|                                       |                                               |
| Date:                 August 11, 2005 | /s/                Robert L. Messier, Jr.          |
|                                       | Robert                L. Messier, Jr.              |
|                                       | President                and Chief Executive       |
|                                       | Officer                                            |
|                                       |                                               |
|                                       |                                               |
|                                       |                                               |
| Date:                 August 11, 2005 | /s/                Mark J. Blum                    |
|                                       | Mark                J. Blum                        |
|                                       | Executive                Vice President, Treasurer |
|                                       | and                Chief Financial Officer         |

----