<PAGE>
 
<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

For the quarterly period ended  January 31, 1999 
                                ----------------

                                       or

[ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

For the transition period from _________________ to ___________________

Commission file number:  0-13649
                         -------

                           COOPER LIFE SCIENCES, INC.
                           --------------------------
             (Exact name of registrant as specified in its charter)

<TABLE>
<S>                                              <C>
DELAWARE                                              94-2563513      
--------------------------------                 -------------------
(State or other jurisdiction of                  (I.R.S. Employer
incorporation or organization)                   Identification No.)

160 BROADWAY, NEW YORK, NEW YORK                  10038  
--------------------------------                  ------------------     
(Address of principal executive offices)          (Zip Code)

</TABLE>

Registrant's telephone number, including area code: (212) 791-5362  
                                                    ----------------

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for 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
                                             ---     ---

         As of March 22, 1999, there were 2,126,265 outstanding shares of the
issuers Common Stock, $.10 par value.




<PAGE>
 
<PAGE>




                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                          QUARTERLY REPORT ON FORM 10-Q

                                      INDEX
<TABLE>
<CAPTION>

                                                                       PAGE NO.
                                                                       --------
<S>      <C>                                                          <C>

         PART I.           FINANCIAL INFORMATION

Item 1.           Financial Statements

                  Consolidated Balance Sheets as of
                  January 31, 1999 and October 31, 1998                    3

                  Consolidated Statements of Income
                  For The Three Months Ended
                  January 31, 1999 and 1998                                4

                  Consolidated Statements of Cash Flows
                  For The Three Months Ended
                  January 31, 1999 and 1998                                5

                  Notes to Consolidated Financial Statements               6

Item 2.           Management's Discussion and Analysis
                  of Financial Condition and Results
                  of Operations                                           12

         PART II           OTHER INFORMATION

Item 6.           Exhibits and Reports on Form 8-K                        36

Signature                                                                 37

Index of Exhibits
</TABLE>

                                        2






<PAGE>
 
<PAGE>



                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             (Dollars in Thousands)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                                        JANUARY 31,        OCTOBER 31,
                                                                           1999                1998
                                                                        --------------------------------
<S>                                                                     <C>                 <C>

ASSETS
Cash and due from banks                                                  $   1,870           $      58
Interest bearing deposits                                                   41,043              65,200
Federal funds sold                                                          18,750                  --
                                                                         ---------           ---------
Total cash and cash equivalents                                             61,663              65,258
Investment Securities:
 Available-for-sale                                                         46,648                  --
 Held-to-maturity                                                            9,642                  --
                                                                         ---------           ---------
Total investment securities                                                 56,290                  --
Loans, net of unearned income                                               41,603                  --
Loans held for sale                                                            782                  --
 Less: allowance for loan losses                                              (797)                 --
                                                                         ---------           ---------
Net loans                                                                   41,588                  --
Accrued interest receivable                                                  1,062                  --
Premises and equipment, net                                                    331                  --
Deferred taxes                                                                 925                 925
Prepaid expenses and other                                                   1,198                 647
Goodwill, net of amortization of $61                                        14,502                  --
                                                                         ---------           ---------
Total assets                                                             $ 177,559           $  66,830
                                                                         =========           =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:

 Non-interest bearing                                                    $  21,422                  --
 Interest bearing                                                           86,305                  --
                                                                         ---------           ---------
Total deposits                                                             107,727                  --
Securities sold under agreements to repurchase                               1,500                  --
Accrued interest payable                                                       225                  --
Accrued expenses and accounts payable                                        1,696               1,185
Income taxes payable                                                           474                 179
                                                                         ---------           ---------
Total liabilities                                                          111,622               1,364
                                                                         ---------           ---------
Stockholders' equity
 Preferred stock - $.10 Par value:                                              --                  --
  6,000,000 shares authorized - none issued
 Common stock - $.10 par value
  Authorized  -- 6,000,000 shares
  Issued      -- 2,566,095 shares
  Outstanding --
   January 31, 1999, 2,126,265 shares
   October 31, 1998, 2,126,265 shares                                          256                 256
Additional paid-in capital                                                  78,546              78,546
Accumulated other comprehensive income, net                                     40                  --
Accumulated deficit                                                        (10,132)            (10,563)
Less: Common stock in treasury - at cost:
 January 31, 1999, 439,830 shares
 October 31, 1998, 439,830 shares
                                                                            (2,773)             (2,773)
                                                                         ---------           ---------
Total stockholders' equity                                                  65,937              65,466
                                                                         ---------           ---------
                                                                         $ 177,559           $  66,830
                                                                         =========           =========

</TABLE>


                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                        3






<PAGE>
 
<PAGE>




                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME
                    (IN THOUSANDS, EXCEPT PER SHARE FIGURES)
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                         THREE MONTHS ENDED
                                                              JANUARY 31,
                                                  ------------------------------
                                                     1999                   1998
                                                   --------               ------
<S>                                               <C>                  <C>

Interest income                                    $  1,296             $    610
Interest expense                                        262                   --
                                                   --------             --------
Net interest income                                   1,034                  610
Provision for loan losses                                 5                   --
                                                   --------             --------
Net interest income after
 provision for loan losses                            1,029                  610
                                                   --------             --------
Other income:
 Investment securities (losses) gains                   (12)              38,926
 Other income                                           235                   --
                                                   --------             --------
Total other income                                      223               38,926
                                                   --------             --------
Other expense:
 General and administrative                             277                  142
 Amortization of goodwill                                61                   --
 Other                                                  105                   --
                                                   --------             --------
Total non-interest expense                              443                  142
                                                   --------             --------
Income before provision for taxes                       809               39,394
Provision for income taxes                              378                3,319
                                                   --------             --------
Net income                                         $    431             $ 36,075
                                                   ========             ========
Net income per share:
 Basic                                             $    .20             $  16.97
                                                   ========             ========
 Diluted                                           $    .19             $  16.01
                                                   ========             ========
Weighted average number of
 shares outstanding
  Basic                                               2,126                2,126
                                                   ========             ========
  Diluted                                             2,259                2,253
                                                   ========             ========

</TABLE>



                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                        4






<PAGE>
 
<PAGE>



                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)
<TABLE>
<CAPTION>


                                                           FOR THE THREE MONTHS ENDED
                                                                   JANUARY 31,
                                                                1999           1998
                                                                ----           ----

<S>                                                        <C>             <C>
  Cash flows from operating activities:
Net income                                                  $    431       $ 36,075
Adjustments to reconcile net income to net
 cash provided by (used in) operating activities:

Loss (gain) on investment securities                              12        (38,926)
(Increase) in deferred taxes                                      --         (2,619)
Depreciation and amortization                                     80             --
Provision for loan losses                                          5             --

  Changes in assets and liabilities:

 (Increase) in accrued interest receivable                      (312)            --
 (Increase) decrease in prepaid expenses and other              (258)            27
 Increase in accounts payable, other accrued
  expenses, liabilities and income taxes payable               2,218          4,104
                                                            --------       --------
 Net cash provided by (used in) operating activities           2,176         (1,339)
                                                            --------       --------

  Cash flows from investing activities:

Investment in The Berkshire Bank                             (25,164)            --
Proceeds from sales of The Cooper Companies,
 Inc. and Executone Information Systems, Inc.
 common stock                                                     --         44,064
Net decrease in interest bearing deposits with banks              50             --
Net decrease in federal funds sold                             3,689             --
Investment securities available for sale
 Purchases                                                    (4,449)            --
 Proceeds from sales and redemptions                           2,334             --
Net increase in loans                                         (1,868)            --
Net increase in loans held for sale                             (654)            --
Acquisition of premises and equipment                            (34)            --
                                                            --------       --------
Net cash provided by (used in) investing activities          (26,096)        44,064
                                                            --------       --------

  Cash flows from financing activities:

Net increase in non interest bearing deposits                    335             --
Net increase in interest bearing deposits                      1,240             --
                                                             -------       --------
Net cash provided by financing activities                      1,575             --
                                                             -------       --------

  Net increase (decrease) in cash                            (22,345)        42,725
  Cash - beginning of period                                  65,258         25,887
                                                            --------       --------
  Cash - end of period                                      $ 42,913       $ 68,612
                                                            ========       ========
Supplemental cash flow information:

  Cash used to pay interest                                 $    262       $     --
  Cash used to pay taxes                                    $     73       $    133

</TABLE>



                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                        5






<PAGE>
 
<PAGE>

                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JANUARY 31, 1999 AND 1998

FORWARD-LOOKING STATEMENTS.

         Statements in this Quarterly Report on Form 10-Q that are not based on
historical fact may be "forward-looking statements" as defined by the Private
Securities Litigation Reform Act of 1995. They include words like "may", "will",
"expect", "estimate", "anticipate", "continue" or similar terms and reflect the
Company's current analysis of existing trends. Actual results could differ
materially from those expressed or implied due to: major changes in business
conditions and the economy, or the development of an adverse interest rate
environment that adversely affects the interest rate spread or other income
anticipated from the Company's operations and investments, loss of key senior
management, major disruptions in the operations of the Company's banking
facilities, new competitors or technologies, significant disruptions caused by
the failure of third parties to address the Year 2000 issue, acquisition
integration costs, dilution to earnings per share from stock issuance or
acquisitions, regulatory issues, litigation costs, and other items discussed
throughout this Quarterly Report on Form 10-Q.

         Certain information customarily disclosed by financial institutions,
such as estimates of interest rate sensitivity and the adequacy of the loan loss
allowance, are inherently forward-looking statements because, by their nature,
they represent attempts to estimate what will occur in the future.

         A wide variety of factors could cause the Company's actual results and
experiences to differ materially from the anticipated results or other
expectations expressed or implied in the Company's forward-looking statements.
Some of the risks and uncertainties that may affect operations, performance,
results of the Company's business, the interest rate sensitivity of its assets
and liabilities, and the adequacy of its loan loss allowance, include but are
not limited to: (i) deterioration in local, regional, national or global
economic conditions which could result, among other things, in an increase in
loan delinquencies, a decrease in property values, or a change in the housing
turnover rate; (ii) changes in market interest rates or changes in the speed at
which market interest rates change; (iii) changes in laws and regulations
affecting the financial services industry; (iv) changes in competition; and (v)
changes in consumer preferences.

         For these reasons, the Company cautions readers not to place undue
reliance upon any forward-looking statements. Forward-looking statements speak
only as of the date made and the Company assumes no obligation to update or
revise any such statements upon any change in applicable circumstances.

                                        6







<PAGE>
 
<PAGE>



                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JANUARY 31, 1999 AND 1998

NOTE 1. GENERAL

         Cooper Life Sciences, Inc., a Delaware corporation (the "Company"), was
not engaged in any business operations during the fiscal year ended October 31,
1998. On August 6, 1998, the Company, through its wholly-owned subsidiary,
Greater American Finance Group, Inc. ("GAFG"), made a cash tender offer for any
and all of the outstanding shares of common stock of The Berkshire Bank (the
"Berkshire Bank" or the "Bank"), a New York state-chartered commercial bank.
(See Note 2 of Notes to Consolidated Financial Statements).

         The Company's and GAFG's obligation to purchase shares pursuant to the
tender offer was subject to various conditions including, among others, the
receipt of required regulatory approvals from the New York State Banking Board
and the Board of Governors of the Federal Reserve System (the "Federal
Reserve"). The approvals were received in December 1998 and on January 4, 1999,
after the close of the Company's fiscal year ended October 31, 1998, the Company
acquired approximately 99% of the outstanding common stock of the Bank. As a
result of the acquisition, the Company and GAFG became bank holding companies
under the Bank Holding Company Act.

         As bank holding companies, the Company and GAFG are subject to
extensive regulation by the Federal Reserve and the Berkshire Bank remains
subject to extensive regulation by the Federal Deposit Insurance Corporation
(the "FDIC") and the Superintendent of Banks of the State of New York.

         During interim periods, the Company follows the accounting policies set
forth in its Annual Report on Form 10-K filed with the Securities and Exchange
Commission. Readers are encouraged to refer to the Company's Form 10-K for the
fiscal year ended October 31, 1998 when reviewing this Form 10-Q. Quarterly
results reported herein are not necessarily indicative of results to be expected
for other quarters.

         The Company utilizes a fiscal year which ends on October 31 for
reporting purposes, whereas the Bank utilizes a fiscal year which ends on
December 31 for such purposes. The financial information presented herein
combines the Company and the Bank with the Bank's results presented to coincide
with the reporting period of the Company.

         In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of normal recurring
adjustments) considered necessary to present fairly the Company's consolidated
financial position as of January 31, 1999 and October 31, 1998 and the
consolidated results of its operations for the three month periods ended January
31, 1999 and 1998, and its consolidated cash flows for the three month periods
ended January 31, 1999 and 1998.

NOTE 2. -  ACQUISITION OF THE BERKSHIRE BANK

         On January 4, 1999, the Company, through its wholly owned subsidiary,
Greater American Finance Group, Inc. ("GAFG"), purchased 2,396,600 shares, or
approximately 99%, of the outstanding shares of Common Stock (the "Shares") of
the Bank, a privately-owned New York State chartered commercial bank. The Shares
were acquired for a purchase price of $10.50 per share, net to the seller in
cash, upon the terms and conditions set forth in an Offer to Purchase dated
August 6, 1998, and in the related Letter of Transmittal (collectively, the
"Offer"). The total amount of funds required by GAFG to purchase the Shares was
approximately $25.2 million. Such funds were obtained by GAFG from the Company's
cash on hand. The purchase of the Shares pursuant to the Offer was subject to

                                        7




<PAGE>
 
<PAGE>




                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JANUARY 31, 1999 AND 1998

receipt of the approval of the New York State Banking Board and the approval of
the Federal Reserve Board. Said approvals have been received by CLS and GAFG.
The acquisition was accounted for as a purchase and, accordingly, the results of
operations of the Berkshire Bank have been included in the consolidated
statements of income from the date of acquisition. In connection with the
acquisition, the Company acquired assets with an aggregated fair value of
$119,429,000 and assumed deposits and other liabilities of $108,760,000.

         The Bank's principal business consists of gathering deposits from the
general public and investing those deposits primarily in loans, debt obligations
issued by the U.S. Government, its agencies, and business corporations, and
mortgage-backed securities. The Bank operates from two deposit-taking offices.
Its main office, in Manhattan, is located on the upper floors of a high rise
office building and does not offer a customary retail banking presence. Instead,
it provides personal, face to face banking services for professionals and other
normally high-balance depositors. In addition, in 1995, the Bank opened a branch
in Brooklyn which provides it with a customary retail banking office.

         The Bank's principal loan types are residential and commercial mortgage
loans and commercial non-mortgage loans, both unsecured and secured by personal
property. The Bank's revenues come principally from interest on loans and
investment securities. The Bank's primary sources of funds are deposits and
proceeds from principal and interest payments on loans and investment
securities.

NOTE 3. -  COMPREHENSIVE INCOME

         On January 1, 1998, the Company adopted SFAS No. 130 "Comprehensive
Income." SFAS No. 130 establishes new standards for reporting comprehensive
income, which includes net income as well as certain other items which result in
a change to equity during the period. Comprehensive income was $453,000 for the
three months ended January 31, 1999. There were no transactions for the three
months ended January 31, 1998 which would generate other comprehensive income.

NOTE 4. -  LOANS RECEIVABLE AND ALLOWANCE FOR LOAN LOSSES

         Loans receivable, which management has the intent and ability to hold
for the foreseeable future or until maturity or payoff are reported at their
outstanding principal, adjusted for any charge-offs, the allowance for loan
losses, and any deferred fees or costs on originated loans.

         The allowance for loan losses is established through a provision for
loan losses based on management's evaluation of the risks inherent in the Bank's
loan portfolio and the general economy. The allowance for loan losses is
maintained at an amount management considers adequate to cover loan losses which
are deemed probable and can be estimated. The allowance is based upon a number
of factors, including the size of the loan portfolio, asset classifications,
economic trends, industry experience and trends, industry and geographic
concentrations, estimated collateral values, management's assessment of the
credit risk inherent in the portfolio, historical loan loss experience and the
Bank's underwriting policies. In general, it is the Bank's policy to maintain a
minimum allowance equal to 1% of outstanding loans plus outstanding commitments
and letters of credit. In addition, the Bank evaluates all loans identified as
problem loans and augments the allowance based upon the perceived risks
associated with such problem loans.

         It is the Bank's policy to discontinue accruing interest on a loan when
it is 90 days past due or if management believes that continued interest
accruals are unjustified. The Bank may continue interest accruals if a loan is
more than 90 days past due if the Bank determines that the nature of the
delinquency and

                                        8




<PAGE>
 
<PAGE>




                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JANUARY 31, 1999 AND 1998

the collateral are such that collection of the principal and interest on the
loan in full is reasonably assured. When the accrual of interest is
discontinued, all accrued but unpaid interest is charged against current period
income. Once the accrual of interest is discontinued, the Bank records interest
as and when received until the loan is restored to accruing status. If the Bank
determines that collection of the loan in full is in reasonable doubt, then
amounts received are recorded as a reduction of principal until the loan is
returned to accruing status.

         The Company accounts for its impaired loans in accordance with SFAS No.
114, Accounting by Creditors for Impairment of a Loan, as amended by SFAS No.
118, Accounting by Creditors for Impairment of a Loan - Income Recognition and
Disclosures. This standard requires that a creditor measure impairment based on
the present value of expected future cash flows discounted at the loan's
effective interest rate, except that as a practical expedient, a creditor may
measure impairment based on a loan's observable market price, or the fair value
of the collateral if the loan is collateral dependent. Regardless of the
measurement method, a creditor must measure impairment based on the fair value
of the collateral when the creditor determines that foreclosure is probable. As
of January 31, 1999, the Company did not have any non accrual or impaired loans.

         The following table summarizes loan balances (including loans held for
sale) by category as of January 31, 1999 (in thousands):

<TABLE>
<CAPTION>

                                                        JANUARY 31, 1999
                                                        ----------------
                                                                     % OF
                                                      AMOUNT         TOTAL
                                                      ------         -----
<S>                                                <C>             <C>

Commercial and professional loans                   $  4,389         10.3%
Secured by real estate                                34,718         81.9
Personal                                               1,894          4.5
Other                                                  1,384          3.3
                                                    --------        -----
Total loans                                           42,385        100.0%
                                                                    =====
Less:
 Allowance for loan losses                              (797)
                                                    --------
Loans, net                                          $ 41,588
                                                    ========

</TABLE>


NOTE 5. - DEPOSITS

         The Bank offers several types of deposit programs to its customers,
including statement savings accounts, NOW accounts, money market deposit
accounts, checking accounts and certificates of deposit with terms from seven
days to five years. Deposit account terms vary according to the minimum balance
required, the time periods the funds must remain on deposit and the interest
rate, among other factors. The Bank relies primarily on customer service to
attract and retain deposits; however, market interest rates and rates offered by
competing financial institutions significantly affect the Bank's ability to
attract and retain deposits. The Bank does not use brokers to obtain deposits
and has no brokered deposits.

         The Bank prices its deposit offerings based upon market and competitive
conditions in its market area. The Bank seeks to price its deposit offerings to
be competitive with other institutions in its market area.

                                        9




<PAGE>
 
<PAGE>



                   COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            JANUARY 31, 1999 AND 1998

         The following table summarizes the maturity distribution of time
deposits of $100,000 or more as of January 31, 1999 (in thousands):

<TABLE>
<CAPTION>

                                                        JANUARY 31,
                                                            1999
                                                        -----------
<S>                                                     <C>

3 months or less                                          $  21,115
Over 3 months but within
6 months                                                      3,162
Over 6 months but within
12 months                                                     2,876
Over 12 months                                                1,744
                                                          ---------
Total                                                     $  28,897
                                                          =========
</TABLE>


                                       10




<PAGE>
 
<PAGE>




NOTE 6. - SECURITIES

         The following table summarizes the Company's available-for-sale and
held-to-maturity securities at January 31, 1999 (dollars in thousands):

<TABLE>
<CAPTION>

                                     Weighted                                    Gross           Gross
                                      Average                                 Unrealized       Unrealized       Fair
                                       Yield                    Cost             Gains           Losses         Value
                                   ------------               ---------       ----------      -----------      --------
<S>                                 <C>                       <C>              <C>             <C>             <C>   

AVAILABLE-FOR-SALE
 U.S. Government
 Agency Obligations
Due within one year                           --%             $      --        $     --        $      --       $     --

Due after one year
 through five years                         5.69                 16,003              13               (9)        16,007
Due after five years
 through ten years                          5.84                 14,243              18              (16)        14,245
Due after ten years                         5.84                 14,233              13              (27)        14,219
                                                              ---------        --------        ---------       --------
                                                                 44,479              44              (52)        44,471
   Corporate Notes
Due within one year                           --                     --              --               --             --
Due after one year
 through five years                        11.41                    984              21             (112)           893
Due after five years
 through ten years                         11.13                    587              19              (65)           541
Due after ten years                         7.20                    200               8               --            208
                                                              ---------        --------        ---------       --------
                                                                  1,771              48             (177)         1,642
                                                              ---------        --------        ---------       --------
Federal Home Loan Bank Stock                7.27                    535              --               --            535
                                                              ---------        --------        ---------       --------
                                                                 46,785              92             (229)        46,648
                                                              =========        ========        =========       ========
HELD-TO-MATURITY
 U.S. Government
 Agency Obligations
Due within one year                         3.83%             $   6,597        $     --        $     (13)      $  6,584

Due after one year
 through five years                         5.72                    246              --               --            246
Due after five years
 through ten years                          6.63                    155              --               --            155
Due after ten years                         6.08                    399               3               --            402
                                                              ---------        --------        ---------       --------
                                                                  7,397               3              (13)         7,387
                                                              ---------        --------        ---------       --------
 Corporate Notes
Due within one year                         4.42                  1,750              --               (2)          1,748
Due after one year
 through five years                         5.00                    495              --               --            495
Due after five years
 through ten years                            --                     --              --               --             --
Due after ten years                           --                     --              --               --             --
                                                              ---------        --------        ---------       --------
                                                                  2,245              --              (27)         2,243
                                                              ---------        --------        ---------       --------
                                                                  9,642               3              (15)         9,630
                                                              =========        ========        =========       ========

</TABLE>


                                       11




<PAGE>
 
<PAGE>



ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATIONS.

         The following discussion and analysis is intended to provide a better
understanding of the consolidated financial condition and results of operations
of Cooper Life Sciences, Inc. and subsidiaries (the "Company") for the quarter
ended January 31, 1999 and 1998. References to the Company herein shall be
deemed to refer to the Company and its consolidated subsidiaries unless the
context otherwise requires. References to Notes herein are references to the
"Notes to Consolidated Financial Statements" of the Company located in Item 1
herein. Historical discussion and analysis is not presented because it is not
meaningful.


         The unaudited proforma combined consolidated financial information set
forth in the following tables is presented for informational purposes only and
is not necessarily indicative of the combined financial position or results of
operations that would have occurred had the acquisition of The Berkshire Bank
been consummated on October 31, 1998 or at the beginning of the periods
indicated. The Company utilizes a fiscal year which ends on October 31 for
reporting purposes, whereas the Bank utilizes a fiscal year which ends on
December 31 for such purposes. The consolidated financial information presented
herein combines the financial information of the Company as of its fiscal year
end and the Bank as of the twelve months ending September 30. For the period
January 31, 1999 and 1998, the Bank's financial information was prepared as of
and for the three months ended December 31, 1998 and 1997 and combined with
the Company's financial information as of and for the three months ended
January 31, 1999 and 1998.


                                       12




<PAGE>
 
<PAGE>




         COOPER LIFE SCIENCES, INC. AND SUBSIDIARIES - PROFORMA SELECTED
                           CONSOLIDATED FINANCIAL DATA

         The following sets forth a comparison of selected financial data which
reflects the balances and results of operations on an unaudited proforma
consolidated basis as if the acquisition of The Berkshire Bank had become
effective on October 31, 1998, 1997 and 1996, in the case of balance sheet
information presented, and at the beginning of the periods indicated, in the
case of operations information presented. Period end amounts have been utilized
to calculate performance ratios (dollars in thousands, except per share
amounts):
<TABLE>
<CAPTION>


                                                                    THREE MONTHS ENDED                TWELVE MONTHS ENDED
                                                                        JANUARY 31,                       OCTOBER 31,
                                                                  ------------------------     ----------------------------------
                                                                       1999          1998         1998         1997        1996
                                                                  ---------     ---------      ---------     --------   ---------
<S>                                                               <C>           <C>            <C>           <C>        <C>  

EARNINGS SUMMARY:

Interest income                                                   $   2,251     $   2,086      $   9,392     $  6,076   $   4,617
Interest expense                                                        824           871          3,642        3,836       4,292
                                                                  ---------     ---------      ---------     --------   ---------
Net interest income                                                   1,427         1,215          5,750        2,240         325
Provision for possible loan losses                                       15            15             60           60         455
                                                                  ---------     ---------      ---------     --------   ---------
Net interest income after provision for possible loan losses          1,412         1,200          5,690        2,180        (130)
Other income (loss)                                                     208        39,013         39,311       17,336      (1,023)
Other expenses                                                          972         1,011          4,474        4,214       4,195
                                                                  ---------     ---------      ---------     --------   ---------
Income (loss) before income taxes and extraordinary items               648        39,202         40,527       15,302      (5,348)
Income taxes                                                            305         3,316          3,258          145          14
                                                                  ---------     ---------      ---------     --------   ---------
Income (loss) before extraordinary items                                343        35,886         37,269       15,157      (5,362)
Extraordinary items                                                      --            --            150           --          --
                                                                  ---------     ---------      ---------     --------   ---------
Net income (loss)                                                 $     343     $  35,886      $  37,119     $ 15,157   $  (5,362)
                                                                  =========     =========      =========     ========   =========

PER SHARE DATA:

Weighted average common shares outstanding- basic                     2,126         2,126          2,126        2,147       2,149
Weighted average common shares outstanding- diluted                   2,259         2,253          2,258        2,244       2,149
Net income per common share- basic                                $     .16     $   16.85      $   17.46     $   7.06   $   (2.50)
Net income per common share- diluted                              $     .15     $   15.93      $   16.44     $   6.75   $   (2.43)
Dividends paid per common share                                          --            --      $     .72           --          --
Balance Sheet Summary:

Investment securities                                             $  54,156     $  40,902      $  50,785     $ 75,696   $  70,000
Cash and cash equivalents                                            64,800        66,410         47,472       18,816       8,800
Loans, net                                                           39,071        36,338         38,994       36,992      24,380
Allowance for loan losses                                              (791)         (741)          (803)        (723)       (824)
Total assets                                                        176,175       175,668        155,388      152,961     118,953
Deposits                                                            106,152       103,495         86,232       89,469      61,581
Stockholder's equity                                              $  65,849     $  65,277      $  64,958     $ 60,176   $  30,064
PERFORMANCE RATIOS:

Return on average assets                                                .75%        81.71%         23.89%        9.91%      (4.51)%
Return on average equity                                               2.08        219.90          57.14        25.19      (17.84)
Average equity to average assets                                      37.38         37.16          41.80        39.34       25.27
Net Interest Margin                                                    3.77          3.34           3.95         2.34         .45
</TABLE>


                                       13




<PAGE>
 
<PAGE>




RESULTS OF OPERATIONS

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JANUARY 31, 1999 COMPARED TO
THE THREE MONTHS ENDED JANUARY 31, 1998.

GENERAL

         On January 4, 1999, the Company, through its wholly owned subsidiary,
Greater American Finance Group, Inc. ("GAFG"), acquired approximately 99% of the
outstanding shares of the common stock of The Berkshire Bank (the "Berkshire
Bank" or the "Bank") for $25.2 million (see Note 2). At the date of the
acquisition, the Bank had total assets of $119.4 million. The acquisition was
accounted for as a purchase and, accordingly, the results of operations of the
Bank have been included in the consolidated statements of income from the date
of acquisition.

         Prior to the acquisition of the Bank, the Company was not engaged in
any business operations. Therefore, the comparison of the results of operations
for the three months ended January 31, 1999 to the three months ended January
31, 1998 (a period when the Company was not engaged in any business operations)
is not meaningful.

NET INCOME

         The Company's net income for the three months ended January 31, 1999,
including the results of operations of the Bank from January 4, 1999, the date
of the acquisition, was $431,000, or $.19 per diluted share. For the three
months ended January 31, 1998, the Company's net income was $36,075,000, or
$16.01 per diluted share, including the pre tax gain of $38,926,000, or $17.00
per diluted share, from the sale of investment securities.

NET INTEREST INCOME

         The largest source of operating revenue for the Company is net interest
income. Net interest income represents the difference between total interest
income earned on earning assets and total interest expense paid on
interest-bearing liabilities. The amount of interest income is dependent upon
many factors including the amount of interest-earning assets that the Bank can
maintain based upon its funding sources; (ii) the relative amounts of
interest-earning assets versus interest-bearing liabilities; and (iii) the
difference between the yields earned on those assets and the rates paid on those
liabilities. Non-performing loans adversely affect net interest income because
they must still be funded by interest-bearing liabilities, but they do not
provide interest income. Furthermore, when the Bank designates an asset as
non-performing, all interest which has been accrued but not actually received is
deducted from current period income, further reducing net interest income.

         Net interest income amounted to $1,034,000 and $610,000 for the three
months ended January 31, 1999 and 1998, respectively. The increase in net
interest income of $424,000 was due to the higher level of funds invested.

                                       14




<PAGE>
 
<PAGE>




         The following table sets forth, for the periods indicated, information
regarding the Company's (i) total dollar amount of interest and dividend income
from interest-earning assets and the resultant average yields; (ii) total dollar
amount of interest expense on interest bearing liabilities and the resultant
average cost; (iii) net interest/dividend income; (iv) interest-rate spread; (v)
interest margin; and (vi) ratio of average interest-earning assets to average
interest earning liabilities (in thousands):

<TABLE>
<CAPTION>


                                                                  PROFORMA
                                                                (UNAUDITED)
                                                       THREE MONTHS ENDED JANUARY 31,
                                        -----------------------------------------------------------------------------------------
                                                              1999                                        1998
                                        ----------------------------------------        -----------------------------------------


                                                      INTEREST           AVERAGE                      INTEREST            AVERAGE
                                        AVERAGE         AND               YIELD/         AVERAGE         AND               YIELD/
                                        BALANCE      DIVIDENDS             RATE          BALANCE      DIVIDENDS            RATE
                                        -------      ---------             ----          -------      ---------            ----

<S>                                     <C>           <C>               <C>             <C>            <C>               <C>
INTEREST-EARNING ASSETS:

Loans (1)                               $ 40,412      $   813               8.04%       $ 37,457       $   826              8.82%
Investment securities                     48,620          695               5.72          38,525           564              5.86
Other (2)(5)                              62,179          743               4.78          69,583           696              4.00
                                        --------      -------              -----        --------       -------            -------
Total interest-earning assets            151,211        2,251               5.95         145,565         2,086              5.73
                                                                           -----                                          -------
Noninterest-earning assets                19,253                                          18,510
                                        --------                                        --------
Total Assets                            $170,464                                        $164,075
                                        ========                                        ========

INTEREST-BEARING LIABILITIES:

Interest bearing deposits                 48,481          387               3.19          54,483           545              4.00
Time deposits                             33,169          414               4.99          24,439           326              5.33
Fed Funds Purchased and other
 borrowings                                1,500           23               6.13
                                        --------      -------              -----        --------       -------            -------
Total interest-bearing
 liabilities                              83,150          824               3.96          78,922           871              4.41
                                                      -------                                          -------            -------
Demand deposits                           18,790                                          14,984
Noninterest-bearing liabilities            2,930                                           6,451
Stockholders' equity (5)                  65,594                                          63,718
                                        --------                                        --------

Total liabilities and
 stockholders' equity                   $170,464                                        $164,075
                                        ========                                        ========

Net interest income                                   $ 1,427                                          $ 1,215
                                                      =======                                          =======

Interest-rate spread (3)                                                    1.99%                                            1.32%
                                                                           =====                                          =======

Net interest margin (4)                                                     3.77%                                            3.34%
                                                                           =====                                          =======

Ratio of average interest-earning
 assets to average interest
 bearing liabilities                        1.82%                                           1.84%
                                        ========                                        ========
</TABLE>

----------------------
(1) Includes nonaccrual loans.
(2) Includes interest-bearing deposits, federal funds sold and securities
    purchased under agreements to resell.
(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 interest margin is net interest income as a percentage of average
    interest-earning assets.
(5) Average balances for Cooper Life Sciences have been calculated on a
    monthly basis.

                                       15




<PAGE>
 
<PAGE>


         The following table sets forth, for the periods indicated, information
regarding the Company's (i) total dollar amount of interest and dividend income
from interest-earning assets and the resultant average yields; (ii) total dollar
amount of interest expense on interest bearing liabilities and the resultant
average cost; (iii) net interest/dividend income; (iv) interest-rate spread; (v)
interest margin; and (vi) ratio of average interest-earning assets to average
interest earning liabilities (in thousands):

<TABLE>
<CAPTION>

                                                                  Proforma
                                                                (Unaudited)
                                                      Twelve Months Ended October 31,
                          ------------------------------------------------------------------------------------------------------
                                              1998                                                 1997
                          --------------------------------------------           -----------------------------------------------


                                                      INTEREST          AVERAGE                        INTEREST          AVERAGE
                                        AVERAGE         AND              YIELD/         AVERAGE         AND              YIELD/
                                        BALANCE       DIVIDENDS           RATE          BALANCE        DIVIDENDS          RATE
                                        -------       ---------           ----          -------        ---------          ----

<S>                                       <C>           <C>                 <C>           <C>            <C>                <C> 
INTEREST-EARNING ASSETS:
Loans (1)                               $ 39,085      $ 3,325               8.51%       $ 31,081       $ 2,771              8.92%
Investment securities                     45,569        2,713               5.95          76,095         2,284              3.00
Other (2)(5)                              61,051        3,354               5.49          19,352         1,021              5.27
                                       ------------  --------------   ------------     ------------   -------------    -----------
Total interest-earning assets            145,705        9,392               6.45         126,528         6,076              4.80
                                                                      ------------                                     -----------
Noninterest-earning assets                18,222                                          16,556
                                       ------------                                    ------------
Total Assets                            $163,927                                        $143,084
                                       ============                                    ============

INTEREST-BEARING LIABILITIES:
Interest bearing deposits                 58,273        2,320               3.98          39,234         1,442              3.67
Time deposits                             25,203        1,299               5.15          31,926         1,663              5.21
Fed Funds Purchased and other
 borrowings                                  382           23               6.02           8,151           731              8.97
                                       ------------  --------------   ------------     ------------   -------------    -----------
Total interest-bearing
 liabilities                              83,858        3,642               4.34          79,311         3,836              4.84
                                                     --------------                                   -------------    -----------
Demand deposits                           13,144                                           8,721
Noninterest-bearing liabilities            2,623                                             972
Stockholders' equity (5)                  64,302                                          54,080
                                       ------------                                    ------------

Total liabilities and
 stockholders' equity                   $163,927                                        $143,084
                                       ============                                    ============

Net interest income                                   $ 5,750                                          $ 2,240
                                                     ==============                                   =============

Interest-rate spread (3)                                                    2.11%                                           (.84)%
                                                                      ============                                     ===========

Net interest margin (4)                                                     3.95%                                           2.34%
                                                                      ============                                     ===========

Ratio of average interest-earning
 assets to average interest
 bearing liabilities                      1.74%                                           1.59%
                                       ============                                    ============

</TABLE>

----------------------
(1)  Includes nonaccrual loans.
(2)  Includes interest-bearing deposits, federal funds sold and securities
     purchased under agreements to resell.
(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 interest margin is net interest income as a percentage of average
     interest-earning assets.
(5)  Average balances for Cooper Life Sciences have been calculated on a
     monthly basis.

                                       16




<PAGE>
 
<PAGE>




         The following table sets forth, for the periods indicated, information
regarding the Company's (i) total dollar amount of interest and dividend income
from interest-earning assets and the resultant average yields; (ii) total dollar
amount of interest expense on interest bearing liabilities and the resultant
average cost; (iii) net interest/dividend income; (iv) interest-rate spread; (v)
interest margin; and (vi) ratio of average interest-earning assets to average
interest earning liabilities (in thousands):

<TABLE>
<CAPTION>

                                        PROFORMA
                                       (UNAUDITED)
                             TWELVE MONTHS ENDED OCTOBER 31,
                           -----------------------------------
                                          1996

                           -----------------------------------

                                                               INTEREST          AVERAGE
                                                 AVERAGE        AND               YIELD/
                                                 BALANCE       DIVIDENDS           RATE
                                                 -------       ---------           ----

<S>                                                <C>           <C>                 <C> 
INTEREST-EARNING ASSETS:
Loans (1)                                        $ 24,199      $ 2,018               8.34%
Investment securities                              69,350        2,083               3.00
Other (2)(5)                                        9,682          516               5.33
                                                ------------  --------------   ------------
Total interest-earning assets                     103,231        4,617               4.47
                                                                               ------------
Noninterest-earning assets                         15,647

                                                ------------
Total Assets                                     $118,878
                                                ============

INTEREST-BEARING LIABILITIES:

Interest bearing deposits                          30,609        1,109               3.62
Time deposits                                      23,073        1,158               5.02
Fed Funds Purchased and other borrowings           27,315        2,025               7.41
                                                ------------  --------------   ------------
Total interest-bearing
 liabilities                                       81,015        4,292               5.30
                                                              --------------   ------------
Demand deposits                                     5,572
Noninterest-bearing liabilities                     1,681
Stockholders' equity (5)                           30,610
                                                ------------

Total liabilities and
 stockholders' equity                            $118,878
                                                ============
Net interest income                                            $   325
                                                              ==============

Interest-rate spread (3)                                                             (.83)%
                                                                               ============

Net interest margin (4)                                                               .45%
                                                                               ============

Ratio of average interest-earning
 assets to average interest
 bearing liabilities                               1.27%
                                                ============
</TABLE>

----------------------
(1)  Includes nonaccrual loans.
(2)  Includes interest-bearing deposits, federal funds sold and securities
     purchased under agreements to resell.
(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 interest margin is net interest income as a percentage of average
     interest-earning assets.
(5)  Average balances for Cooper Life Sciences have been calculated on a
     monthly basis.


                                       17




<PAGE>
 
<PAGE>




INTEREST RATE RISK

         Fluctuations in market interest rates can have a material effect on the
Bank's net interest income because the yields earned on loans and investments
may not adjust to market rates of interest with the same frequency, or with the
same speed, as the rates paid by the Bank on its deposits.

         Most of the Bank's deposits are either interest-bearing demand
deposits or short term certificates of deposit and other interest-bearing
deposits with interest rates that fluctuate as market rates change. Management
of the Bank seeks to reduce the risk of interest rate fluctuations by
concentrating on loans and securities investments with either short terms to
maturity or with adjustable rates or other features that cause yields to adjust
based upon interest rate fluctuations. In addition, to cushion itself against
the potential adverse effects of a substantial and sustained increase in market
interest rates, the Bank has purchased off balance sheet interest rate cap
contracts which generally provide that the Bank will be entitled to receive
payments from the other party to the contract if interest rates exceed specified
levels. These contracts are entered into with major financial institutions.

         The Company seeks to maximize its net interest margin within an
acceptable level of interest rate risk. Interest rate risk can be defined as the
amount of the forecasted net interest income that may be gained or lost due to
favorable or unfavorable movements in interest rates. Interest rate risk, or
sensitivity, arises when the maturity or repricing characteristics of assets
differ significantly from the maturity or repricing characteristics of
liabilities.

                                       18






<PAGE>
 
<PAGE>



         In the banking industry, a traditional measure of interest rate
sensitivity is known as "gap" analysis, which measures the cumulative
differences between the amounts of assets and liabilities maturing or repricing
at various time intervals. The following table sets forth the Company's proforma
interest rate repricing gaps for selected maturity periods at January 31, 1999:


<TABLE>
<CAPTION>

                                                     PROFORMA INTEREST SENSITIVITY GAP AT JANUARY 31, 1999
                                                     ------------------------------------------------------
                                                     (IN THOUSANDS, EXCEPT FOR PERCENTAGES)
                                    3 MONTHS         3 THROUGH        1 THROUGH           OVER
                                     OR LESS         12 MONTHS         3 YEARS           3 YEARS           TOTAL
                                 ----------------  ---------------  ---------------  ---------------- ----------------

<S>                                     <C>               <C>              <C>               <C>             <C>   
Federal funds sold                  $   22,000        $      --        $      --         $      --       $   22,000
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Interest bearing deposits in banks      41,093               --               --                --           41,093
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Loans (1)(2)
  Adjustable rate loans                 10,847            6,355            3,878             2,504           23,584
  Fixed rate loans                         295              622              727            14,606           16,250
  Other loans                               28               --               --                --               28
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Total loans                             11,170            6,977            4,605            17,110           39,862
Investments (3)(4)                       9,864            1,810            3,361            39,121           54,156
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Total rate-sensitive assets             84,127            8,787            7,966            56,231          157,111
                                 ----------------  ---------------  ---------------  ---------------- ----------------

Deposits accounts (5)
  Savings and NOW                        6,351               --            4,533                --           10,884
  Money market                          26,447               --           15,437                --           41,884
  Time deposits                         24,923            5,552              285             1,536           32,296
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Total deposit accounts                  57,721            5,552           20,255             1,536           85,064
Other borrowings                            --               --               --             1,500            1,500
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Total rate sensitive liabilities        57,721            5,552           20,255             3,036           86,564
                                 ----------------  ---------------  ---------------  ---------------- ----------------
Gap (repricing differences)          $  26,406         $  3,235        $ (12,289)        $  52,660        $  70,547
                                 ================  ===============  ===============  ================ ================
Cumulative Gap                          26,406           29,641           17,352            70,547
                                 ================  ===============  ===============  ================
Cumulative Gap to Total
  Rate Sensitive Assets                  16.81%           18.87%           11.04%            44.90%
                                 ================  ===============  ===============  ================

</TABLE>

----------------------
(1)  Adjustable-rate loans are included in the period in which the interest
     rates are next scheduled to adjust rather than in the period in which the
     loans mature. Fixed-rate loans are scheduled according to their maturity
     dates.
(2)  Includes nonaccrual loans.
(3)  Investments are scheduled according to their respective repricing (variable
     rate loans) and maturity (fixed rate securities) dates.
(4)  Investments are stated at book value.
(5)  NOW accounts and savings accounts are regarded as readily accessible
     withdrawal accounts. The balances in such accounts have been allocated
     amongst maturity/repricing periods based upon The Berkshire Bank's
     historical experience. All other time accounts are scheduled according to
     their respective maturity dates.


                                       19






<PAGE>
 
<PAGE>



         Changes in net interest income may also be analyzed by segregating the
volume and rate components of interest income and interest expense. The
following tables set forth certain information regarding changes in interest
income and interest expense of the Company for the years indicated. For each
category of interest-earning assets and interest-bearing liabilities,
information is provided on changes attributable to (1) changes in rate (change
in rate multiplied by prior volume), (2) changes in volume (changes in volume
multiplied by prior rate) and (3) changes in rate-volume (change in rate
multiplied by change in volume) (in thousands):

<TABLE>
<CAPTION>

                                                                            PROFORMA
                                                                 THREE MONTHS ENDED JANUARY 31,
                                                                        1998 VERSUS 1997
                                                                     INCREASE (DECREASE) DUE TO
                                        --------------------------------------------------------------------------
                                                                                     RATE/
                                                RATE             VOLUME             VOLUME             TOTAL
                                          ----------------- -----------------  ----------------- -----------------

<S>                                               <C>               <C>                <C>               <C>      
Interest-earning assets:
 Loans                                            $    (73)         $     66           $     (6)         $    (13)
 Investment securities                                 (13)              147                 (3)              131
 Other                                                 135               (74)               (14)               47
                                          ----------------- -----------------  ----------------- -----------------
Total                                                   49               139                (23)              165
                                          ----------------- -----------------  ----------------- -----------------

Interest-bearing
 liabilities:
Deposit accounts:
 Interest bearing deposits                            (110)              (60)                12              (158)
 Time deposits                                         (20)              115                 (7)               88
 Other borrowings                                       --                --                 23                23
                                          ----------------- -----------------  ----------------- -----------------
Total deposit accounts                                (130)               55                 28               (47)
                                          ----------------- -----------------  ----------------- -----------------

Net change in net interest
 income before provision
 for loan losses                                   $   179          $     84          $     (51)         $    212
                                          ================= =================  ================= =================

</TABLE>


<TABLE>
<CAPTION>

                                                                            PROFORMA
                                                                 TWELVE MONTHS ENDED OCTOBER 31,
                                                                        1998 VERSUS 1997
                                                                   INCREASE (DECREASE) DUE TO
                                          --------------------------------------------------------------------------
                                                                                      RATE/
                                                 RATE              VOLUME            VOLUME              TOTAL
                                          ------------------  ----------------- -----------------  -----------------

<S>                                                <C>                <C>               <C>                <C>     
Interest-earning assets:
 Loans                                             $   (127)          $    714          $    (33)          $    554
 Securities                                             (19)               452                (4)               429
 Other                                                   43              2,198                92              2,333
                                          ------------------  ----------------- -----------------  -----------------
Total                                                  (103)             3,364                55              3,316
                                          ------------------  ----------------- -----------------  -----------------

Interest-bearing
 liabilities:
Deposit accounts:
 Interest bearing deposits                              121                698                59                878
 Time deposits                                          (18)              (350)                4               (364)
 Other borrowings                                      (240)              (697)              229               (708)
                                          ------------------  ----------------- -----------------  -----------------
Total deposit accounts                                 (137)              (349)              292               (194)
                                          ------------------  ----------------- -----------------  -----------------

Net change in net interest
 income before provision
 for loan losses                                   $     34          $   3,713           $  (237)          $  3,510
                                          ==================  ================= =================  =================

</TABLE>


                                       20






<PAGE>
 
<PAGE>

<TABLE>
<CAPTION>

                                                                            PROFORMA
                                                                 TWELVE MONTHS ENDED OCTOBER 31,
                                                                        1997 VERSUS 1996
                                                                   INCREASE (DECREASE) DUE TO
                                        -------------------------------------------------------------------------
                                                                                    RATE/
                                                RATE             VOLUME            VOLUME             TOTAL
                                          ----------------- -----------------  ---------------  -----------------

<S>                                               <C>               <C>              <C>                <C>     
Interest-earning assets:
 Loans                                            $    140          $    574         $     39           $    753
 Securities                                             65               131                5                201
 Other                                                  (5)              515               (5)               505
                                          ----------------- -----------------  ---------------  -----------------
Total                                                  200             1,220               39              1,459
                                          ----------------- -----------------  ---------------  -----------------

Interest-bearing
 liabilities:
Deposit accounts:
 Interest bearing deposits                              16               312                5                333
 Time deposits                                          44               444               17                505
 Other borrowings                                      426            (1,421)            (299)            (1,294)
                                          ----------------- -----------------  ---------------  -----------------
Total deposit accounts                                 486              (665)            (277)              (456)
                                          ----------------- -----------------  ---------------  -----------------

Net change in net interest
 income before provision
 for loan losses                                  $   (286)          $ 1,885         $    316            $ 1,915
                                          ================= =================  ===============  =================

</TABLE>


PROVISION FOR LOAN LOSSES

         The allowance for loan losses is established through a provision for
loan losses based on management's evaluation of the risks inherent in the Bank's
loan portfolio and the general economy. The allowance for loan losses is
maintained at an amount management considers adequate to cover loan losses which
are deemed probable and can be estimated. The allowance is based upon a number
of factors, including the size of the loan portfolio, asset classifications,
economic trends, industry experience and trends, industry and geographic
concentrations, estimated collateral values, management's assessment of the
credit risk inherent in the portfolio, historical loan loss experience and the
Bank's underwriting policies. In general, it is the Bank's policy to maintain a
minimum allowance equal to 1% of outstanding loans plus outstanding commitments
and letters of credit. In addition, the Bank evaluates all loans identified as
problem loans and augments the allowance based upon the perceived risks
associated with such problem loans.

         Management believes it uses a reasonable and prudent methodology to
project potential future losses in the loan portfolio, and hence assess the
adequacy of the allowance for loan losses. However, any such assessment is
speculative and future adjustments may be necessary if economic conditions or
the Bank's actual experience differ substantially from the assumptions upon
which the evaluation of the allowance was based. Furthermore, state and federal
regulators, in reviewing the Bank's loan portfolio as part of a future
regulatory examination, may request the Bank to increase its allowance for loan
losses, thereby negatively affecting the Bank's financial condition and earnings
at that time. Moreover, future additions to the allowance may be necessary based
on changes in economic and real estate market conditions, new information
regarding existing loans, identification of additional problem loans and other
factors, both within and outside of management's control.

OTHER INCOME

         Other income consists primarily of service fee income and the realized
gains (or losses) on investment securities. Other income in the 1999 period
includes a one time gain of $125,000 from the settlement of matters not related
to the Company's present business.

                                       21







<PAGE>
 
<PAGE>



OTHER EXPENSE

         The major categories of other expense include salaries and employee
benefits, occupancy and equipment expenses, legal and professional fees and
other operating expenses associated with the day-to-day operations of the
Company. The amortization of intangible assets of $61,000 in 1999 is a result of
the goodwill recorded in the acquisition of the Bank.

LOAN PORTFOLIO

         Loan Portfolio Composition. The Bank's loans consist primarily of
mortgage loans secured by residential and non-residential properties as well as
commercial loans which are either unsecured or secured by personal property
collateral. Most of the Bank's loans are either made to individuals or
personally guaranteed by the principals of the business to which the loan is
made. At January 31, 1999, the Bank had total loans of $42.3 million and an
allowance for loan losses of approximately $800,000. From time to time, the Bank
may originate residential mortgage loans and then sell them on the secondary
market, normally recognizing fee income in connection with the sale.

         Interest rates on loans are affected by the demand for loans, the
supply of money available for lending, credit risks, the rates offered by
competitors and other conditions. These factors are in turn affected by, among
other things, economic conditions, monetary policies of the federal government,
and legislative tax policies.

         In order to manage interest rate risk, the Bank focuses its efforts on
loans with interest rates that adjust based upon changes in the prime rate or
changes in United States Treasury or similar indices. Generally, credit risks on
adjustable-rate loans are somewhat greater than on fixed-rate loans primarily
because, as interest rates rise, so do borrowers' payments, increasing the
potential for default. The Bank seeks to impose appropriate loan underwriting
standards in order to protect against these and other credit related risks
associated with its lending operations.

         In addition to analyzing the income and assets of its borrowers when
underwriting a loan, the Bank obtains independent appraisals on all material
real estate in which the Bank takes a mortgage. The Bank generally obtains title
insurance in order to protect against title defects on mortgaged property.

         Commercial Mortgage Loans. The Bank originates commercial mortgage
loans secured by office buildings, retail establishments, multi-family
residential real estate and other types of commercial property. Substantially
all of the properties are located in the New York City metropolitan area.

         The Bank makes commercial mortgage loans with loan to value ratios not
to exceed 75% and with terms to maturity that do not exceed 15 years. Loans
secured by commercial properties generally involve a greater degree of risk than
one- to four-family residential mortgage loans. Because payments on such loans
are often dependent on successful operation or management of the properties,
repayment may be subject, to a greater extent, to adverse conditions in the real
estate market or the economy. The Bank seeks to minimize these risks through its
underwriting policies. The Bank evaluates the qualifications and financial
condition of the borrower, including credit history, profitability and
expertise, as well as the value and condition of the underlying property. The
factors considered by the Bank include net operating income; the debt coverage
ratio (the ratio of cash net income to debt service); and the loan to value
ratio. When evaluating the borrower, the Bank considers the financial resources
and income level of the borrower, the borrower's experience in owning or
managing similar property and the Bank's lending experience with the borrower.
The Bank's policy requires borrowers to present evidence of the ability to repay
the loan without having to resort to the sale of the mortgaged property. The
Bank also seeks to focus its commercial mortgage loans on loans to companies
with operating businesses, rather than passive real estate investors.

                                       22







<PAGE>
 
<PAGE>



         Commercial Loans. The Bank makes commercial loans to businesses for
inventory financing, working capital, machinery and equipment purchases,
expansion, and other business purposes. These loans generally have higher yields
than mortgages loans, with maturities of one year, after which the borrower's
financial condition and the terms of the loan are re-evaluated.

          Commercial loans tend to present greater risks than mortgage loans
because the collateral, if any, tends to be rapidly depreciable, difficult to
sell at full value and is often easier to conceal. In order to limit these
risks, the Bank evaluates these loans based upon the borrower's ability to repay
the loan from ongoing operations. The Bank considers the business history of the
borrower and perceived stability of the business as important factors when
considering applications for such loans. Occasionally, the borrower provides
commercial or residential real estate collateral for such loans, in which case
the value of the collateral may be a significant factor in the loan approval
process.

         Origination of Loans. Loan originations can be attributed to
depositors, retail customers, telephone inquiries, advertising, the efforts of
the Bank's loan officers, and referrals from other borrowers and real estate
brokers and builders. The Bank originates loans primarily through its own
efforts. Occasionally, the Bank may obtain loan opportunities as a result of
referrals from loan brokers.

         Prior to the Company's acquisition of the Bank in January 1999, the
Bank's total capital was approximately $10 million, and thus it was generally
not permitted to make loans to one borrower in excess of approximately $1.5
million, with an additional approximately $1.0 million being permitted if
secured by readily marketable collateral. The Bank was also not permitted to
make any single mortgage loan in an amount in excess of approximately $1.5
million. At January 31, 1999, the Bank was in compliance with these standards.

         Delinquency Procedures. When a borrower fails to make a required
payment on a loan, the Bank attempts to cause the deficiency to be cured by
contacting the borrower. The Bank reviews past due loans on a case by case
basis, taking the action it deems appropriate in order to collect the amount
owed. Litigation may be necessary if other procedures are not successful.
Judicial resolution of a past due loan can be delayed if the borrower files a
bankruptcy petition because collection action cannot be continued unless the
Bank first obtains relief from the automatic stay provided by the Bankruptcy
Code.

         If the Bank acquires mortgaged property at foreclosure sale or accepts
a voluntary deed in lieu of foreclosure, the acquired property is then
classified as real estate owned. When real estate is acquired in full or partial
satisfaction of a loan, it is recorded at the lower of the principal balance of
the loan or fair value less costs of sale. Any shortfall between that amount and
the carrying value of the loan is then charged to the allowance for loan losses.
Subsequent changes in the value of the property are charged to the expense of
real estate operations. The Bank is permitted to finance sales of real estate
owned by "loans to facilitate," which may involve a lower down payment or a
longer repayment term or other more favorable features than generally would be
granted under the Bank's underwriting guidelines. At January 31, 1999 the Bank
had no "loans to facilitate."

         If a non-mortgage loan becomes delinquent and satisfactory arrangements
for payment cannot be made, the Bank seeks to realize upon any personal property
collateral to the extent feasible and collect any remaining amount owed from the
borrower through legal proceedings, if necessary.

         It is the Bank's policy to discontinue accruing interest on a loan when
it is 90 days past due or if management believes that continued interest
accruals are unjustified. The Bank may continue interest accruals if a loan is
more than 90 days past due if the Bank determines that the nature of the
delinquency and the collateral are such that collection of the principal and
interest on the loan in full is reasonably assured. When the accrual of interest
is discontinued, all accrued but unpaid interest is charged against current
period income. Once the

                                       23







<PAGE>
 
<PAGE>



accrual of interest is discontinued, the Bank records interest as and when
received until the loan is restored to accruing status. If the Bank determines
that collection of the loan in full is in reasonable doubt, then amounts
received are recorded as a reduction of principal until the loan is returned to
accruing status.

         The following tables set forth information concerning the Bank's loan
portfolio by type of loan at the dates indicated (dollars in thousands):

<TABLE>
<CAPTION>

                                                               PROFORMA
                                                              JANUARY 31,
                                   --------------------------------------------------------------------
                                         1999                               1998
                                   -------------------------------- -----------------------------------
                                                      % OF                                 % OF
                                            AMOUNT    TOTAL                      AMOUNT    TOTAL
                                   ----------------  -------------- --------------------  -------------

<S>                                         <C>        <C>                       <C>        <C> 
Commercial and
 professional loans                       $  3,483      8.7 %                  $  6,033     16.3 %
Secured by real                             33,623     84.4                      27,689     74.7
 estate
Personal                                     1,494      3.7                       2,054      5.5
Other                                        1,262      3.2                       1,303      3.5
                                   ----------------  -------------- --------------------  -------------

Total loans                                 39,862    100.0 %                    37,079    100.0 %
                                                     ==============                       =============

Less:
 Allowance for loan
 losses                                        791                                  741
                                   ----------------                 --------------------

Loans, net                                $ 39,071                             $ 36,338
                                   ================                 ====================

</TABLE>


<TABLE>
<CAPTION>


                                                                                PROFORMA
                                                                               OCTOBER 31,
                                   -------------------------------------------------------------------------------------------------
                                         1998                             1997                             1996
                                   -------------------------------- -------------------------------- -------------------------------
                                                      % OF                              % OF                             % OF
                                            AMOUNT    TOTAL                   AMOUNT    TOTAL                  AMOUNT    TOTAL
                                   ----------------  -------------- -----------------  ------------- -----------------  ------------

<S>                                         <C>        <C>                    <C>        <C>                   <C>        <C> 
Commercial and
 professional loans                       $  3,548      8.9 %               $  7,011     18.6 %              $  5,646     22.4 %
Secured by real                             33,015     82.9                   27,164     72.0                  16,152     64.1
 estate
Personal                                     1,970      5.0                    2,275      6.0                   2,447      9.7
Other                                        1,264      3.2                    1,265      3.4                     959      3.8
                                   ----------------  -------------- -----------------  ------------- -----------------  ------------

Total loans                                 39,797    100.0 %                 37,715    100.0 %                25,204    100.0 %
                                                     ==============                    =============                    ============
Less:
 Allowance for loan
 losses                                        803                               723                              824
                                   ----------------                 -----------------                -----------------

Loans, net                                $ 38,994                          $ 36,992                         $ 24,380
                                   ================                 =================                =================


</TABLE>




                                       24







<PAGE>
 
<PAGE>




IMPAIRED LOAN BALANCE NON ACCRUAL LOANS AND LOANS GREATER THAN 90 DAYS STILL
ACCRUING

The following table sets forth certain information regarding nonaccrual loans,
including the ratio of such loans to total assets as of the dates indicated, and
certain other related information. The Bank had no foreclosed real estate during
these periods (dollars in thousands).

<TABLE>
<CAPTION>

                                                                                           Proforma
                                                              January 31,                     January 31,
                                                                  1999                            1998
                                                         ----------------------          ----------------------

<S>                                                      <C>                              <C>
Nonaccrual loans:
Secured by real estate                                     $               --              $              237
                                                         ----------------------          ----------------------

Total nonaccrual loans                                                     --                             237
                                                         ----------------------          ----------------------


Total nonperforming loans                                  $               --              $              237
                                                         ======================          ======================

Total nonperforming loans to total assets                                  --  %                          .64  %
                                                         ======================          ======================

</TABLE>


<TABLE>
<CAPTION>

                                                                                  Proforma
                                                                                October 31,
                                                 ----------------------------------------------------------------------------------
                                                          1998                      1997                            1996
                                                 ----------------------    ----------------------          ----------------------
<S>                                              <C>                       <C>                        <C>

Nonaccrual loans:

Commercial and Other Loans                         $              --              $            --              $              114
Secured by real estate                                            30                          237                             555
                                                 ---------------------     ----------------------          ----------------------

Total nonaccrual loans                                            30                          237                             669
                                                 ---------------------     ----------------------          ----------------------

Total nonperforming loans                          $              30              $           237              $              669
                                                 =====================     ======================          ======================

Total nonperforming loans to total assets                        .08   %                      .63  %                         2.65  %
                                                 =====================     ======================          ======================

</TABLE>






















                                       25








<PAGE>
 
<PAGE>



         The following tables present information regarding the Bank's total
allowance for loan losses as well as the allocation of such amounts to the
various categories of loans at the dates indicated (dollars in thousands):

<TABLE>
<CAPTION>

                                                        PROFORMA
                                                      JANUARY 31,
                          -------------------------------------------------------------------------------------------------------
                                               1999                                               1998
                          ---------------------------------------------------  --------------------------------------------------
                              ALLOWANCE                                           ALLOWANCE
                               FOR LOAN        PERCENT OF      PERCENT OF          FOR LOAN       PERCENT OF         PERCENT OF
                                LOSSES         ALLOWANCE       TOTAL LOANS          LOSSES        ALLOWANCE          TOTAL LOANS
                          ------------------  --------------  ---------------  ----------------  ------------------ -------------

<S>                       <C>                 <C>             <C>              <C>               <C>                <C>


Commercial and
 professional loans                $     --      --  %            -- %                $     --      --  %               -- %
Secured by real estate                   30      3.8             0.1                       115     15.5                0.3
Personal and other                        2      0.2              --                         5      0.7                 --
General allowance (1)                   759     96.0             1.9                       621     83.8                1.7
                          ------------------  --------------  ---------------  ----------------  ------------------ -------------

Total allowance
 for loan losses                   $    791    100.0 %           2.0 %                $    741    100.0 %              2.0 %
                          ==================  ==============  ===============  ================  ================== =============

</TABLE>


--------------------
(1) The allowance for loan losses is allocated to specific loans as necessary.


                                       26







<PAGE>
 
<PAGE>

<TABLE>
<CAPTION>

                                                             PROFORMA
                                                        OCTOBER 31, 1998
                                      -----------------------------------------------------------
                                          ALLOWANCE
                                           FOR LOAN        PERCENT OF          PERCENT OF
                                            LOSSES         ALLOWANCE           TOTAL LOANS
                                      ------------------  ------------------  -------------------

<S>                                   <C>                 <C>                 <C>
Commercial and
 professional loans                            $     --      --  %                -- %
Secured by real estate                               64      8.0                 0.2
Personal and other                                    2      0.2                  --
General allowance (1)                               737     91.8                 1.8
                                      ------------------  ------------------  -------------------

Total allowance
 for loan losses                               $    803    100.0 %               2.0 %
                                      ==================  ==================  ===================

</TABLE>

--------------------
(1) The allowance for loan losses is allocated to specific loans as necessary.


<TABLE>
<CAPTION>

                                                                  PROFORMA
                                                              OCTOBER 31, 1997
                                      -----------------------------------------------------------
                                          ALLOWANCE
                                           FOR LOAN        PERCENT OF          PERCENT OF
                                            LOSSES         ALLOWANCE           TOTAL LOANS
                                      ------------------  ------------------  -------------------

<S>                                   <C>                 <C>                  <C>
Commercial and
 professional loans                            $     --      --  %                -- %
Secured by real estate                              119     16.5                 0.3
Personal and other                                    6      0.8                  --
General allowance (1)                               598     82.7                 1.6
                                      ------------------  ------------------  -------------------

Total allowance 
 for loan losses                               $    723    100.0 %               1.9 %
                                      ==================  ==================  ===================

</TABLE>


--------------------
(1) The allowance for loan losses is allocated to specific loans as necessary.


<TABLE>
<CAPTION>

                                                             PROFORMA
                                                         OCTOBER 31, 1996
                                      -----------------------------------------------------------
                                          ALLOWANCE
                                           FOR LOAN        PERCENT OF          PERCENT OF
                                            LOSSES         ALLOWANCE           TOTAL LOANS
                                      ------------------  ------------------  -------------------

<S>                                   <C>                 <C>                  <C>
Commercial and
 professional loans                            $      6      0.7 %                -- %
Secured by real estate                              322     39.0                 1.3
Personal and other                                   57      6.9                 0.2
General allowance (1)                               439     53.4                 1.8
                                      ------------------  ------------------  -------------------

Total allowance 
 for loan losses                               $    824    100.0 %               3.3 %
                                      ==================  ==================  ===================

</TABLE>


--------------------
(1) The allowance for loan losses is allocated to specific loans as necessary.




                                       27







<PAGE>
 
<PAGE>



         The following table sets forth proforma information regarding the
aggregate maturities of the Bank's loans in the specified categories and the
amount of such loans which have fixed and variable rates at January 31, 1999
(dollars in thousands):


<TABLE>
<CAPTION>
                                                    WITHIN           1 TO            AFTER
                                                    1 YEAR          5 YEARS         5 YEARS          TOTAL
                                                   --------        ---------       ---------        ------

<S>                                                <C>             <C>              <C>             <C>  
Real estate construction-
 fixed rate                                        $     --          $     --        $     --        $     --
Commercial-fixed rate                                   150                46              --             196
                                                   --------          --------        --------        --------
Total fixed rate                                        150                46              --             196
                                                   --------          --------        --------        --------
Real estate construction-

 adjustable rate                                         --                --              --              --

Commercial-adjustable rate                            1,119             1,897             271           3,287
                                                   --------          --------        --------        --------
Total adjustable rate                                 1,119             1,897             271           3,287
                                                   --------          --------        --------        --------
Total                                              $  1,269          $  1,943        $    271        $  3,483
                                                   ========          ========        ========        ========
</TABLE>


         The following table sets forth information with respect to activity in
the Bank's allowance for loan losses during the periods indicated (dollars in
thousands):

<TABLE>
<CAPTION>

                                                                          PROFORMA
                                                               THREE MONTHS ENDED JANUARY 31,
                                                           1999                            1998
                                                           ----                            ----

<S>                                                  <C>                            <C>               
Average loans outstanding....................        $          40,412              $           37,457
                                                    =====================          ======================

Allowance at beginning of period..........                         803                             723
Charge-offs:
    Real Estate Loans.........................                      31                              --
                                                    ---------------------          ----------------------
        Total loans charged-off..............                       31                              --
                                                    ---------------------          ----------------------

Recoveries:

    Commercial and Other Loans...........                            4                               3
                                                    ---------------------          ----------------------
        Total loans recovered.................                       4                               3
                                                    ---------------------          ----------------------
        Net (charge-offs)
        recoveries.....................                             27                             (3)
    Provision for loan losses charged to
        operating expenses...................                       15                              15
                                                    ---------------------          ----------------------
    Allowance at end of period.............                        791                             741
                                                    =====================          ======================

    Ratio of net recoveries (charge-offs) to 
        average loans outstanding.............                      .07   %                       (.01)  %
                                                    =====================          ======================

    Allowance as a percent of total loans..                        1.98   %                        2.00  %
                                                    =====================          ======================

    Total loans at end of period.............        $           39,862              $           37,079
                                                    =====================          ======================

</TABLE>






                                       28







<PAGE>
 
<PAGE>


<TABLE>
<CAPTION>

                                                                                     Proforma
                                                                        Twelve Months Ending October 31,
                                                   -------------------------------------------------------------------------------
                                                           1998                       1997                            1996
                                                   ---------------------     ----------------------          ---------------------

<S>                                                 <C>                       <C>                             <C>              
Average loans outstanding....................       $          39,085         $          31,081               $          24,199
                                                   =====================     =====================           =====================

Allowance at beginning of period..........                        723                       824                             893
Charge-offs:
    Commercial and Other Loans...........                          --                        --                             314
    Real Estate Loans.........................                     --                       196                             232
                                                   ---------------------     ---------------------           ---------------------

        Total loans charged-off..............                      --                       196                             546
                                                   ---------------------     ---------------------           ---------------------

Recoveries:
    Commercial and Other Loans...........                          20                        28                              22
    Real Estate Loans.........................                     --                         7                               _
        Total loans recovered.................                     20                        35                              22
                                                   ---------------------     ---------------------           ---------------------
        Net (charge-offs)                                         (20)                      161                             524
        recoveries.....................
                                                   ---------------------     ---------------------           ---------------------

    Provision for loan losses charged to
        operating expenses...................                      60                        60                             455
                                                   ---------------------     ---------------------           ---------------------
    Allowance at end of period.............                       803                       723                             824
                                                   =====================     =====================           =====================

    Ratio of net recoveries (charge-offs) to        
        average loans outstanding............                    (.15)  %                   .19   %                        2.17   %
                                                   =====================     =====================           =====================

    Allowance as a percent of total          
        loans................................                     2.02  %                  1.92   %                        3.27   %
                                                   =====================     =====================           =====================

    Total loans at end of period.............       $          39,797         $          37,715               $          25,204
                                                   =====================     =====================           =====================


</TABLE>




                                       29







<PAGE>
 
<PAGE>



INVESTMENT ACTIVITIES

         GENERAL. The investment policy of the Bank, which is approved by the
Board of Directors, is designed primarily to provide satisfactory yields while
maintaining adequate liquidity, a balance of high quality, diversified
investments, and minimal risk. The Bank does not invest in equity securities.
The largest component of the Bank's securities investments, representing more
than 50% of total securities investments, are debt securities issued by the
Federal Home Loan Mortgage Corporation (Freddy Mac), the Federal National
Mortgage Association (Fanny Mae) or the Government National Mortgage Association
(Ginny Mae). The remainder of the Bank's debt securities investments are
primarily short term debt securities issued by the United States or its
agencies. The Bank maintains a small portfolio of less than $2 million of
high-yield corporate debt securities. Recognizing the higher credit risks of
these securities, the Bank underwrites these securities in a manner similar to
its loan underwriting procedures.

         As required by the Statement of Financial Accounting Standard No. 115
("SFAS No. 115"), securities are classified into three categories: trading,
held-to-maturity and available-for-sale. Securities that are bought and held
principally for the purpose of selling them in the near term are classified as
trading securities and are reported at fair value with unrealized gains and
losses included in trading account activities in the statement of income.
Securities that the Bank has the positive intent and ability to hold to maturity
are classified as held-to-maturity and reported at amortized cost. All other
securities are classified as available-for-sale. Available-for-sale securities
are reported at fair value with unrealized gains and losses included, on an
after-tax basis, as a separate component of net worth. The Bank does not have a
trading securities portfolio and has no current plans to maintain such a
portfolio in the future. The Bank generally classifies all newly purchased debts
securities as available for sale in order to maintain the flexibility to sell
those securities if the needs arises. The Bank has a limited portfolio of
securities classified as held to maturity, represented principally by securities
purchased a number of years ago.

         FEDERAL HOME LOAN BANK STOCK. The Bank owns stock of the Federal Home
Loan Bank of New York (the "FHLBNY") which is necessary for it to be a member of
the FHLBNY. Membership requires the purchase of stock equal to 1% of the Bank's
residential mortgage loans. If the Bank borrows from the FHLBNY, the Bank must
own stock at least equal to 5% of its borrowings.

         The following table sets forth the cost and estimated fair value of
available-for-sale and held-to-maturity securities as of the dates indicated (in
thousands):

<TABLE>
<CAPTION>

                                                                 Cost                          Fair Value
                                                     -----------------------------       ----------------------

<S>                                                                     <C>                          <C>     
        Proforma
    January 31, 1999
   Available-For-Sale

US Government Agencies                                                  $ 42,306                     $ 42,270
Corporate Notes                                                            1,817                        1,677
Federal Home Loan Bank Stock                                                 535                          535
                                                     -----------------------------       ----------------------
Total                                                                   $ 44,658                     $ 44,482
                                                     =============================       ======================
   Held-To-Maturity
US Government Agencies                                                  $  7,429                     $  7,416
Corporate Notes                                                            2,245                        2,242
                                                     -----------------------------       ----------------------
Total                                                                   $  9,674                     $  9,658
                                                     =============================       ======================

</TABLE>






                                       30







<PAGE>
 
<PAGE>



<TABLE>
<CAPTION>

                                                                 Cost                          Fair Value
                                                     -----------------------------       ----------------------

<S>                                                                     <C>                          <C>     
        Proforma
    October 31, 1998
   Available-For-Sale
US Government Agencies                                                  $ 33,586                     $ 33,687
Corporate Notes                                                            1,893                        1,815
Federal Home Loan Bank Stock                                                 535                          535
                                                     -----------------------------       ----------------------
Total                                                                   $ 36,014                     $ 36,037
                                                     =============================       ======================
   Held-To-Maturity
US Government Agencies                                                  $ 12,504                     $ 12,468
Corporate Notes                                                            2,244                        2,242
                                                     -----------------------------       ----------------------
Total                                                                   $ 14,748                     $ 14,710
                                                     =============================       ======================

         Proforma
     October 31, 1997
   Available-For-Sale
Marketable Securities                                                   $  4,007                     $ 38,067
US Government Agencies                                                    15,542                       15,445
Corporate Notes                                                            2,276                        2,320
Federal Home Loan Bank Stock                                                 535                          535
                                                     -----------------------------       ----------------------
Total                                                                   $ 22,360                     $ 56,367
                                                     =============================       ======================
   Held-To-Maturity
US Government Agencies                                                  $ 17,088                     $ 16,985
Corporate Notes                                                            2,241                        2,247
                                                     -----------------------------       ----------------------
Total                                                                   $ 19,329                     $ 19,232
                                                     =============================       ======================

</TABLE>

         CAPITAL REQUIREMENTS. The Federal Reserve requires that the Company, as
a bank holding company, must maintain certain minimum ratios of capital to
assets. The Federal Reserve's regulations divide capital into types. Primary
capital includes common equity, surplus, undivided profits, perpetual preferred
stock, mandatory convertible instruments, the allowance for loan and lease
losses, contingency and other capital reserves, and minority interests in equity
accounts of consolidated subsidiaries. Secondary capital includes limited-life
preferred stock, subordinated notes and debentures and certain unsecured long
term debt.

         The Federal Reserve requires that bank holding companies maintain a
ratio of primary capital to total assets of 5.5% and a level of total capital
(primary plus secondary capital) equal to 6% of total assets. In calculating
capital ratios, the allowance for loan losses, which is a component of primary
capital, is added back in determining total assets. Certain capital components,
such as debt and perpetual preferred stock, are includable as capital only if
they satisfy certain definitional tests.

         The Company must also meet a risk-based capital standard. Capital, for
the risk-based capital requirement, is divided into Tier 1 capital and
Supplementary capital, determined as discussed below in connection with the FDIC
capital requirements imposed on the Bank. The Federal Reserve requires that the
Bank maintain a ratio of total capital (defined as Tier 1 plus Supplementary
capital) to risk-weighted assets of at least 8%, of which at least 4% must be
Tier 1 capital. Risk weighted assets are also determined in a manner comparable
to the determination of risk-weighted assets under FDIC regulations as discussed
below.

                                       31







<PAGE>
 
<PAGE>



         At January 31, 1999, the Company satisfies all applicable Federal
Reserve minimum capital requirements.

         The FDIC requires that the Berkshire Bank maintain certain minimum
ratios of capital to assets. The FDIC's regulations divide capital into two
tiers. The first tier ("Tier I") includes common equity, retained earnings,
certain non-cumulative perpetual preferred stock (excluding auction rate issues)
and minority interests in equity accounts of consolidated subsidiaries, minus
goodwill and other intangible assets (except mortgage servicing rights and
purchased credit card relationships subject to certain limitations).
Supplementary ("Tier II") capital includes, among other items, cumulative
perpetual and long-term limited- life preferred stock, mandatory convertible
securities, certain hybrid capital instruments, term subordinated debt and the
allowance for loan and lease losses, subject to certain limitations, less
required deductions.

         The FDIC requires that the highest rated banks maintain a Tier 1
leverage ratio (Tier 1 capital to adjusted total assets) of at least 3.0%. All
other banks subject to FDIC capital requirements must maintain a Tier 1 leverage
ratio of 4.0% to 5.0% or more. As of January 31, 1999, the Bank's Tier I
leverage capital ratio was 9.5%.

         The Bank must also meet a risk-based capital standard. The risk-based
standard, requires the Bank to maintain total capital (defined as Tier 1 and
Supplementary capital) to risk-weighted assets of at least 8% of which at least
4% must be Tier 1 capital. In determining the amount of risk-weighted assets,
all assets, plus certain off-balance sheet assets, are multiplied by a risk-
weight of 0% to 100%, based on the risks the FDIC believes are inherent in the
type of asset. As of January 31, 1999, the Bank maintained a 21.0% Tier I risk-
based capital ratio and a 22.2% total risk-based capital ratio.

REGULATORY RESTRICTIONS AND CAPITAL ADEQUACY

         Quantitative measures established by regulation to ensure capital
adequacy require the Company and The Berkshire Bank to maintain minimum amounts
and ratios of total and Tier I capital (as defined in the regulations) to
risk-weighted assets (as defined), and Tier I capital (as defined) to average
assets (as defined). As of January 31, 1999, the most recent notification from
the FDIC categorized the Bank as well capitalized under the regulatory framework
for prompt corrective action. To be categorized as well capitalized, the Bank
must maintain certain Total risk-based, Tier I risk-based, and Tier I leverage
ratios. There are no conditions or events since the notification that management
believes have changed the Bank's category.

                                       32








<PAGE>
 
<PAGE>




          The following table sets forth the actual and required regulatory
capital amounts and ratios of the Berkshire Bank as of January 31, 1999 and 1998
and October 31, 1998, 1997 and 1996 (dollars in thousands):

                               THE BERKSHIRE BANK

                                    Proforma

<TABLE>
<CAPTION>

                                                                                                To be well
                                                                                            capitalized under
                                                                  For capital              prompt corrective
                                                  Actual         adequacy purposes        action provisions
                                               Amount   Ratio     Amount    Ratio          Amount        Ratio
                                               ------   -----     ------    -----          ------        -----

<S>                                           <C>       <C>       <C>       <C>           <C>            <C>
JANUARY 31, 1999

Total Capital (to Risk-Weighted Assets)       $11,493    22.2%    $ 4,139    >=8.0%          $ 5,174     >=10.0%

Tier I Capital (to Risk-Weighted Assets)       10,845    21.0%      2,070    >=4.0%            3,104      >=6.0%

Tier I Capital (to Average Assets)             10,845     9.5%      4,557    >=4.0%            5,696      >=5.0%


JANUARY 31, 1998

Total Capital (to Risk-Weighted Assets)         9,572    20.2%      3,791    >=8.0%            4,739     >=10.0%

Tier I Capital (to Risk-Weighted Assets)        8,977    18.9%      1,900    >=4.0%            2,850      >=6.0%

Tier I Capital (to Average Assets)              8,977     8.7%      4,127    >=4.0%            5,159      >=5.0%


OCTOBER 31, 1998

Total Capital (to Risk-Weighted Assets)        10,573    22.2%      3,817    >=8.0%            4,771     >=10.0%

Tier I Capital (to Risk-Weighted Assets)        9,974    20.9%      1,909    >=4.0%            2,863      >=6.0%

Tier I Capital (to Average Assets)              9,974     9.1%      4,397    >=4.0%            5,497      >=5.0%


OCTOBER 31, 1997

Total Capital (to Risk-Weighted Assets)         9,180    19.8%      3,714    >=8.0%            4,642     >=10.0%

Tier I Capital (to Risk-Weighted Assets)        8,598    18.5%      1,857    >=4.0%            2,785      >=6.0%

Tier I Capital (to Average Assets)              8,598     8.8%      3,899    >=4.0%            4,874      >=5.0%


October 31, 1996

Total Capital (to Risk-Weighted Assets)         8,427    27.6%      2,445    >=8.0%            3,056     >=10.0%

Tier I Capital (to Risk-Weighted Assets)        8,040    26.3%      1,222    >=4.0%            1,834      >=6.0%

Tier I Capital (to Average Assets)              8,040    11.4%      2,811    >=4.0%            3,514      >=5.0%

</TABLE>




                                       33







<PAGE>
 
<PAGE>



          The following table sets forth the actual and required regulatory
capital amounts and ratios of the Company as of January 31, 1999 and 1998 and
October 31, 1998, 1997 and 1996 (dollars in thousands):

                                  THE COMPANY
                                    PROFORMA

<TABLE>
<CAPTION>
                                                                                                     TO BE WELL
                                                                                                 CAPITALIZED UNDER
                                                                             FOR CAPITAL         PROMPT CORRECTIVE
                                                        ACTUAL            ADEQUACY PURPOSES      ACTION PROVISIONS
                                                   ----------------       ------------------    ------------------
                                                   AMOUNT      RATIO      AMOUNT     RATIO      AMOUNT       RATIO
                                                   ------      -----      ------     -----      ------       -----
<S>                                                <C>        <C>        <C>        <C>        <C>        <C>
JANUARY 31, 1999
Total Capital (to Risk-Weighted Assets)            $52,043      99.3%     $4,139     >=8.0%     $5.174     >=10.0%
Tier I Capital (to Risk-Weighted Assets)            51,395     100.6%      2,070     >=4.0%      3,104      >=6.0%
Tier I Capital (to Average Assets)                  51,395      33.0%      6,236     >=4.0%      7,795      >=5.0%

JANUARY 31, 1998
Total Capital (to Risk-Weighted Assets)             51,538     109.0%      3,783     >=8.0%      4,729     >=10.0%
Tier I Capital (to Risk-Weighted Assets)            50,943     107.7%      1,891     >=4.0%      2,837      >=6.0%
Tier I Capital (to Average Assets)                  50,943      34.1%      5,981     >=4.0%      7,476      >=5.0%

OCTOBER 31, 1998
Total Capital (to Risk-Weighted Assets)             51,563     108.5%      3,801     >=8.0%      4,751     >=10.0%
Tier I Capital (to Risk-Weighted Assets)            50,964     107.3%      1,900     >=4.0%      2,851      >=6.0%
Tier I Capital (to Average Assets)                  50,964      34.1%      5,975     >=4.0%      7,468      >=5.0%

OCTOBER 31, 1997
Total Capital (to Risk-Weighted Assets)             15,450      18.3%      6,747     >=8.0%      8,435     >=10.0%
Tier I Capital (to Risk-Weighted Assets)            14.868      17.6%      3,371     >=4.0%      5,061      >=6.0%
Tier I Capital (to Average Assets)                  14,868      11.6%      5,141     >=4.0%      6,426      >=5.0%

OCTOBER 31, 1996
Total Capital (to Risk-Weighted Assets)             13,334      20.9%      5,096     >=8.0%      6,370     >=10.0%
Tier I Capital (to Risk-Weighted Assets)            12,947      20.3%      2,548     >=4.0%      3,822      >=6.0%
Tier I Capital (to Average Assets)                  12.947      12.4%      4,173     >=4.0%      5,216      >=5.0%

</TABLE>


                                       34









<PAGE>
 
<PAGE>




LIQUIDITY

         Liquidity management in banking involves the ability to generate funds
to support asset growth and meet the cash flow requirements of customers and
other obligations. The Berkshire Bank's primary source of funds has
traditionally been deposits. In addition, the Bank derives funds from loan and
security repayments and prepayments and revenues from operations. The Bank has
borrowing facilities available to it through the Federal Home Loan Bank of New
York (the "FHLBNY") for use in the event of unanticipated funding needs which
cannot be satisfied from other sources. The Bank has also engaged, to a limited
extent, in borrowings with the FHLBNY on a longer term basis when the Bank is
able to match the term of a borrowing with the term of a loan and lock in a
satisfactory spread, subject to credit and prepayment risks.

         For the parent company, Cooper Life Sciences, Inc., liquidity means
having cash available to, among other things, fund operating expenses, support
asset growth at the Bank, acquire new business operations, and pay shareholder
dividends. At January 31, 1999 the Company had approximately $40.0 million of
cash and is not dependent upon the receipt of dividends from the Bank to fund
its obligations.

CAPITAL

         The capital ratios of the Company and the Berkshire Bank are presently
in excess of the requirements necessary to meet the "well capitalized" capital
category established by bank regulators (see "Regulatory Restrictions and
Capital Adequacy" above. Management believes that the Company's cash on hand and
internally generated funds will be sufficient to meet its needs and that the
Company has sufficient financing options available to fund commitments that may
arise in the future. At January 31, 1999, the Company had no commitments for
material capital expenditures.

IMPACT OF INFLATION AND CHANGING PRICES

         The Bank prepares its financial reports according to Generally Accepted
Accounting Principles, which generally require the measurement of financial
condition and operating results in terms of historical dollar amounts without
considering the changes in the relative purchasing power of money over time due
to inflation. Unlike industrial companies, nearly all of the assets and
liabilities of the Bank are monetary in nature. As a result, interest rates have
a greater impact on the Bank's performance than do the effects of general levels
of inflation. Interest rates do not necessarily move in the same direction or to
the same extent as the price of goods and services. However, interest rates
generally increase during periods when the rate of inflation is increasing and
decrease during periods of decreasing inflation. Periods of high inflation are
ordinarily accompanied by high interest rates. Changes in the rate of inflation
could also result in changing market interest rates, which could adversely
affect the Bank as discussed above under the caption "Interest Rate Risk."

IMPACT OF THE YEAR 2000

         The Company has reviewed its financial and other systems and estimates
that the total cost of the Year 2000 preparedness program will not be material.
The Company will modify and/or replace those systems which may be impacted by
the arrival of the year 2000.

         The Bank has an ongoing program to ensure that its operational and
financial systems will not be adversely affected by year 2000 software failures.
The Bank has purchased, installed and converted to new hardware and banking
software, and has successfully completed a series of tests to ensure Year 2000
compliance. The cost of such conversion and other Year 2000 preparations is
estimated to be approximately $200,000. The Bank has developed a contingency
plan which should allow it to continue operations while unforeseen software
problems are corrected. The contingency plan calls for the creation of complete
system backups of critical data on critical dates, the creation of duplicate

                                       35







<PAGE>
 
<PAGE>



account balances and transaction files, and the downloading of account balances
and transaction files to personal computer spreadsheets. In the event that any
software problems are encountered during processing, either at century roll over
or leap year, the Bank expects that it will be able to manage its operations by
using the files noted above, along with manual reports. Given the size of the
Bank, the number of accounts, and the number of daily transactions, management
believes that the Bank could continue operations while such software problems
are corrected.

         While the Bank believes it is taking all appropriate steps to assure
year 2000 compliance, it is dependent on vendor compliance to some extent. The
Bank is requiring its systems and software vendors to represent that the
services and products provided are, or will be, year 2000 compliant. The Bank
estimates that the cost to redevelop, replace or repair its technology will not
have a material impact on its financial results.

         In addition to possible expenses related to the Bank's systems and
those of its service providers, the Bank could incur losses if Year 2000
problems affect any of the Bank's depositors or borrowers. Such problems could
include, among other things, delayed loan payments. Due to the diversity of the
loan portfolio and the fact that the Bank's market area is not dependent on one
employer or industry, the Bank does not expect any such Year 2000 related
difficulties that may affect its depositors and borrowers to significantly
affect net earnings or cash flow.

PART II.  OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

a.       Exhibits

<TABLE>
<CAPTION>

         Exhibit
         Number            Description
         -------           -----------
<S>                        <C>
         27                Financial Data Schedule.

</TABLE>

b.       Reports on Form 8-K

         The Company filed a current report on Form 8-K dated January 7, 1999
which sets forth information in connection with the Acquisition of The Berkshire
Bank and Pro Forma Financial Information.

         The Company filed a current report on Form 8-K/A, Amendment No. 1 to
Form 8-K, dated January 13, 1999 which sets forth information under Item 2.
Acquisition of The Berkshire Bank and Item 7. Financial Statements, Pro Forma
Financial Information and Exhibits in connection with said Acquisition.

                                       36







<PAGE>
 
<PAGE>


                                   SIGNATURES

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



                                            COOPER LIFE SCIENCES, INC.
                                            --------------------------
                                                 (REGISTRANT)



Date:  March 22, 1999                  By:  /s/ Steven Rosenberg     
       --------------                       --------------------------
                                            STEVEN ROSENBERG
                                            VICE PRESIDENT AND CHIEF
                                            FINANCIAL OFFICER





                                       37







<PAGE>
 
<PAGE>





                                  EXHIBIT INDEX

<TABLE>
<CAPTION>

Exhibit                                                                         Sequential
Number            Description                                                   Page Number
------            -----------                                                   -----------
<S>               <C>                                                           <C>
27                Financial Data Schedules                                         39

</TABLE>



                          STATEMENT OF DIFFERENCES
                          ------------------------

The greater-than or equal-to signs shall be expressed as..................... >=







                                       38




<PAGE>