<PAGE>

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

                                   FORM 10-QSB

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
       JUNE 30, 2002 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:  000-49736

                      FIRST COMMUNITY FINANCIAL CORPORATION
--------------------------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)

             PENNSYLVANIA                                 23-2321079
-----------------------------------------      ---------------------------------
     (State or other jurisdiction of                   (I.R.S. Employer
      incorporation or organization)                  Identification No.)

TWO NORTH MAIN STREET, MIFFLINTOWN, PENNSYLVANIA                17059
------------------------------------------------              ---------
  (Address of principal executive offices)                    (Zip Code)

                                 (717) 436-2144
              ----------------------------------------------------
                (Issuer's telephone number, including area code)


          APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                        DURING THE PROCEEDING FIVE YEARS

Check whether registrant filed all documents and reports required to be filed by
Section 12, 13, or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes [_] No [_]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practical date: COMMON STOCK, Par Value $5.00 per share
                                        ----------------------------------------
700,000 shares outstanding as of July 31, 2002
----------------------------------------------

Transitional Small Business Disclosure Format (Check one): Yes [_]  No [X]

<PAGE>

PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
--------------------------------------------------------------------------------
                      FIRST COMMUNITY FINANCIAL CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                  (Dollars In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                             (Unaudited)
                                                                            June 30, 2002                 December 31, 2001
                                                                         ---------------------------------------------------
<S>                                                                      <C>                      <C>
ASSETS
Cash & Due from Banks                                                              $    4,815                 $       7,268
Interest Bearing Deposits with Banks                                                      692                           694
Federal Funds Sold                                                                      1,954                            34
                                                                         ---------------------    --------------------------
Cash & Cash Equivalents                                                                 7,461                         7,996
Investment Securities Held to Maturity (fair value of $15,898 and
$16,316)                                                                               15,603                        16,350
Investment Securities Available for Sale                                               28,281                        30,793
Loans - Net of Unearned Income                                                        123,163                       115,835
Less: Allowance for Loan Losses                                                         1,061                         1,038
                                                                         ---------------------    --------------------------
Net Loans                                                                             122,102                       114,797
Premises and Equipment                                                                  6,604                         6,620
Other Assets                                                                            6,474                         5,935
                                                                         ---------------------    --------------------------

TOTAL ASSETS                                                                       $  186,525                 $     182,491
                                                                         =====================    ==========================

LIABILITIES
Deposits
      Non-Interest Bearing                                                         $   14,719                 $      15,469
      Interest Bearing                                                                147,183                       138,553
                                                                         ---------------------    --------------------------
Total Deposits                                                                        161,902                       154,022
Short-Term Borrowings                                                                   1,778                         6,082
Long-Term Borrowings                                                                    8,000                         8,200
Other Liabilities                                                                       1,060                         1,128
                                                                         ---------------------    --------------------------

TOTAL LIABILITIES                                                                     172,740                       169,432
                                                                         ---------------------    --------------------------

STOCKHOLDERS' EQUITY
Preferred stock, without par value;
     10,000,000 shares authorized;
     no shares issued or outstanding                                                        -                             -
Common stock, $ 5 par value;
     10,000,000 shares authorized;
     700,000 shares issued & outstanding                                                3,500                         3,500
Surplus                                                                                   245                           245
Retained Earnings                                                                       9,478                         8,822
Accumulated Other Comprehensive Income                                                    562                           492
                                                                         ---------------------    --------------------------
Total Stockholders' Equity                                                             13,785                        13,059
                                                                         ---------------------    --------------------------

TOTAL LIABILITIES & STOCKHOLDERS' EQUITY                                           $  186,525                 $     182,491
                                                                         =====================    ==========================
</TABLE>

                                       2

<PAGE>

PART I - FINANCIAL INFORMATION, CONTINUED
Item 1. Financial Statements, continued
--------------------------------------------------------------------------------
                      FIRST COMMUNITY FINANCIAL CORPORATION
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)
                      (In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                   Three Months Ended                  Six Months Ended
                                                        June 30,                           June 30,
                                                  2002            2001             2002               2001
                                              -------------   -------------    --------------    ----------------
<S>                                           <C>             <C>              <C>               <C>
INTEREST INCOME
Interest & Fees on Loans                            $2,347          $2,217            $4,653              $4,381
Interest on Taxable Securities                         412             418               836                 830
Interest on Tax-Exempt Securities                      168             157               337                 264
Other Interest & Dividends                              36             104                53                 160
                                              -------------   -------------    --------------    ----------------
TOTAL INTEREST INCOME                                2,963           2,896             5,879               5,635
                                              -------------   -------------    --------------    ----------------

INTEREST EXPENSE
Interest on Deposits                                 1,284           1,546             2,599               3,014
Interest on Short Term Borrowings                        5              21                21                  63
Interest on Long Term Borrowings                       121             128               240                 235
                                              -------------   -------------    --------------    ----------------
TOTAL INTEREST EXPENSE                               1,410           1,695             2,860               3,312
                                              -------------   -------------    --------------    ----------------

NET INTEREST INCOME                                  1,553           1,201             3,019               2,323
Provision for Loan Losses                               30              18                60                  36
                                              -------------   -------------    --------------    ----------------
NET INTEREST INCOME AFTER
         PROVISION FOR LOAN LOSSES                   1,523           1,183             2,959               2,287

NON-INTEREST INCOME
Service Charges                                         91              87               177                 172
Fiduciary Income                                        36              36                72                  72
Realized Gain on Sale of Securities                      -               -                 -                  77
Earnings on Life Insurance                              57              45               117                  89
Other Income                                           100             108               191                 196
                                              -------------   -------------    --------------    ----------------
TOTAL OTHER INCOME                                     284             276               557                 606
                                              -------------   -------------    --------------    ----------------

NON-INTEREST EXPENSES
Salaries & Benefits                                    611             554             1,249               1,171
Occupancy Expense                                      109              78               204                 159
Furniture & Equipment Expense                          117             112               221                 227
Professional Fees                                       51              11                78                  27
Pennsylvania Bank Shares Tax                            26               8                58                  32
Other Non-Interest Expenses                            323             333               633                 581
                                              -------------   -------------    --------------    ----------------
TOTAL NON-INTEREST EXPENSES                          1,237           1,096             2,443               2,197
                                              -------------   -------------    --------------    ----------------

Income Before Income Taxes                             570             363             1,073                 696
Applicable Income Taxes                                123              63               228                 131
                                              -------------   -------------    --------------    ----------------
NET INCOME                                          $  447          $  300            $  845              $  565
                                              =============   =============    ==============    ================

Basic and Diluted Earnings Per Share                $ 0.64          $ 0.43            $ 1.21              $ 0.81
                                              =============   =============    ==============    ================
Dividends Per Share                                 $0.135          $0.125            $ 0.27              $ 0.25
                                              =============   =============    ==============    ================
</TABLE>

                                       3

<PAGE>

PART I - FINANCIAL INFORMATION, CONTINUED
Item 1. Financial Statements, continued
--------------------------------------------------------------------------------
                      FIRST COMMUNITY FINANCIAL CORPORATION
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                     For the Six Months Ended June 30, 2001
                                   (Unaudited)
                      (In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                                    Accumulated
                                                                                      Other
                                      Common                        Retained      Comprehensive
                                       Stock         Surplus        Earnings          Income         Total
                                       -----         -------        --------          ------         -----
                                      ------         -------        --------      -------------     --------
<S>                                   <C>            <C>            <C>           <C>               <C>
Balance December 31, 2000             $3,500         $   245          $7,878               $307     $ 11,930
Comprehensive income:
Net Income                                                               565                             565
Net change in unrealized gains
    on securities available for
    sale, net of taxes ($73)                                                                141          141
                                                                                                    --------
Total comprehensive income                                                                               706

Cash dividends, $.25 per share                                          (175)                           (175)
                                      ------         -------        --------      -------------     --------

Balance June 30, 2001                 $3,500         $   245          $8,268               $448     $ 12,461
                                      ======         =======         =======      =============     ========
</TABLE>



                      FIRST COMMUNITY FINANCIAL CORPORATION
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                     For the Six Months Ended June 30, 2002
                                   (Unaudited)
                      (In Thousands, Except Per Share Data)

<TABLE>
<CAPTION>
                                                                                    Accumulated
                                                                                      Other
                                      Common                        Retained      Comprehensive
                                       Stock         Surplus        Earnings          Income         Total
                                       -----         -------        --------          ------         -----
                                      ------         -------        --------      -------------     --------
<S>                                   <C>            <C>            <C>           <C>               <C>
Balance December 31, 2001             $3,500         $   245          $8,822               $492     $ 13,059
Comprehensive income:
Net Income                                                               845                             845
Net change in unrealized gains
    on securities available for
    sale, net of taxes ($34)                                                                 70           70
                                                                                                    --------
Total comprehensive income                                                                               915

Cash dividends, $.27 per share                                          (189)                           (189)
                                      ------         -------        --------      -------------     --------

Balance June 30, 2002                 $3,500         $   245          $9,478               $562     $ 13,785
                                      ======         =======         =======      =============     ========
</TABLE>

                                       4

<PAGE>

PART I - FINANCIAL INFORMATION, CONTINUED
Item 1. Financial Statements, continued
--------------------------------------------------------------------------------
                      FIRST COMMUNITY FINANCIAL CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
                             (Dollars In Thousands)

<TABLE>
<CAPTION>
                                                                            Six Months Ended
                                                                                June 30,
                                                                          2002            2001
                                                                       -----------    ------------
<S>                                                                    <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income                                                                    845              565
Adjustments to reconcile net income to net cash provided by
Operating activities:
    Provision for loan losses                                                  60               36
    Depreciation and amortization                                             250              220
    Net amortization (accretion) of securities premium (discount)             103               (3)
    Net realized gain on sale of securities                                     -              (77)
    Earnings on life insurance                                               (117)             (89)
    Increase in other assets                                                 (428)            (183)
    Decrease in other liabilities                                            (108)             (36)
    Other, net                                                                 21               13
                                                                       -----------    -------------
         Net cash provided by operating activities                            626              446

CASH FLOWS FROM INVESTING ACTIVITIES
Securities held to maturity:
     Maturities, calls and principal repayments                             1,314            2,800
     Purchases                                                               (579)          (6,467)
Securities available for sale:
     Maturities, calls and principal repayments                             6,655            7,713
     Purchases                                                             (4,130)         (11,053)
     Proceeds from sales                                                        -              685
Net increase in loans receivable                                           (7,374)          (6,232)
Proceeds from sales of foreclosed real estate                                   -                4
Purchases of premises and equipment                                          (234)            (111)
                                                                       -----------    -------------
         Net cash used in investing activities                             (4,348)         (12,661)

CASH FLOWS FROM FINANCING ACTIVITIES
Net increase in non-interest bearing demand and
savings deposits                                                            2,403            1,724
Net increase in time deposits                                               5,477            9,169
Net decrease in short-term borrowings                                      (4,304)          (1,547)
Proceeds from long-term borrowings                                              -            2,000
Repayment of long-term borrowings                                            (200)          (1,000)
Dividends paid                                                               (189)            (175)
                                                                       -----------    -------------
         Net cash provided by financing activities                          3,187           10,171

Net increase (decrease) in cash and cash equivalents                         (535)          (2,044)

Cash and due from banks:
Beginning of year                                                           7,996            9,124
                                                                       ===========    =============
End of period                                                               7,461          $ 7,080
                                                                       ===========    =============

SUPPLEMENTAL DISCLOSURES:
Cash payments for interest                                                $ 2,916          $ 3,391
                                                                       ===========    =============
Cash payments for taxes                                                   $   214          $   134
                                                                       ===========    =============
</TABLE>

                                       5

<PAGE>

PART I - FINANCIAL INFORMATION, CONTINUED
Item 1. Financial Statements, continued
--------------------------------------------------------------------------------
                      FIRST COMMUNITY FINANCIAL CORPORATION
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

June 30, 2002

Note A - Basis of Presentation

The consolidated financial statements include the accounts of First Community
Financial Corporation (the "Corporation") and its wholly-owned subsidiary, The
First National Bank of Mifflintown (the "Bank"). All material inter-company
transactions have been eliminated. First Community Financial Corporation was
organized on November 13, 1984 and is subject to regulation by the Board of
Governors of the Federal Reserve System.

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and are presented in accordance with the instructions to
Form 10-QSB and Rule 10-01 of the Securities and Exchange Commission Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the six months ended June 30, 2002, are not
necessarily indicative of the results that may be expected for the year ended
December 31, 2002.

The consolidated financial statements presented in this report should be read in
conjunction with the audited financial statements and the accompanying notes for
the year ended December 31, 2001, included in the Registration Statement on Form
10-SB of First Community Financial Corporation filed with the Securities and
Exchange Commission on April 17, 2002, as amended.

Note B - Accounting Policies

The accounting policies of the Corporation as applied in the interim financial
statements presented, are substantially the same as those followed on an annual
basis as presented in the Registration Statement on Form 10-SB of First
Community Financial Corporation filed April 17, 2002, as amended.

                                        6

<PAGE>

Note C - Comprehensive Income

The only comprehensive income item that the Corporation presently has is
unrealized gains (losses) on securities available for sale. The components of
the change in unrealized gains (losses) are as follows:

<TABLE>
<CAPTION>
                                                                    Three Months Ended       Six Months Ended
                                                                         June 30,                 June 30,
                                                                     2002       2001          2002       2001
                                                                 ------------------------------------------------
                                                                      (In Thousands)           (In Thousands)
<S>                                                               <C>        <C>          <C>         <C>
Unrealized holding gains (losses) arising during the period       $     282  $       39   $      104  $      291
Reclassification adjustment (net of tax)                                  -           -            -         (77)
                                                                        282          39          104         214

Tax effect                                                              (94)        (15)         (34)        (73)
                                                                 -----------------------  -----------------------

Net change in unrealized gains during the period                  $     188  $       24   $       70  $      141
                                                                 =======================  =======================
</TABLE>

Note D - Earnings Per Share

Earnings Per Share for the quarters ended March 31, 2002 and 2001 was calculated
as follows:

<TABLE>
<CAPTION>
                                                                    Three Months Ended       Six Months Ended
                                                                         June 30,                 June 30,
                                                                     2002       2001          2002       2001
                                                                 ----------------------- ------------------------
                                                                      (In Thousands)           (In Thousands)
<S>                                                               <C>        <C>          <C>         <C>
Net Income                                                        $     447  $      300   $      845  $      565
Weighted Avg. Shares Outstanding                                        700         700          700         700
                                                                 -----------------------  -----------------------

Earnings Per Share                                                $    0.64  $     0.43   $     1.21  $     0.81
                                                                 =======================  =======================
</TABLE>

Note E - New Accounting Standards

Financial Accounting Standard Board ("FASB") Statement No. 142 "Goodwill and
Other Intangible Assets," prescribes that goodwill associated with a business
combination and intangible assets with an indefinite useful life should not be
amortized but should be tested for impairment at least annually. The Statement
requires intangibles that are separable from goodwill and that have a
determinable useful life to be amortized over the determinable useful life. The
provisions of this Statement became effective for the Corporation in January
2002. Upon adoption of this statement, goodwill and other intangible assets
arising from acquisitions completed before July 1, 2001 would be accounted for
in accordance with the provisions of this statement. This transition provision
could require a reclassification of a previously separately recognized
intangible to goodwill and vice versa if the intangibles in question do not meet
the

                                        7

<PAGE>

new criteria for classification as a separately recognizable intangible. At June
30, 2002, the Corporation had intangible assets with a net book value of
$177,000, which will continue to be amortized under the new rules pursuant to
the requirements of Statement No. 72, Accounting for Certain Acquisitions of
Banking or Thrift Institutions. Amortization expense related to these assets was
$14,000 and $14,000 for the six months ended June 30, 2002 and 2001,
respectively.

In July 2001, the FASB issued Statement 143, "Accounting for Asset Retirement
Obligations," which addresses the financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs. This Statement requires that the fair value
of a liability for an asset retirement obligation be recognized in the period in
which it is incurred if a reasonable estimate of fair value can be made. The
associated asset retirement costs are capitalized as part of the carrying amount
of the long-lived asset. This Statement will become effective for the
Corporation on January 1, 2003 and is not expected to have any impact on the
Corporation's financial condition or results of operations.

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

Forward-Looking Statements

Except for historical information, this report may be deemed to contain
"forward-looking" statements regarding the Corporation. Examples of
forward-looking statements include, but are not limited to, (a) projections or
statements regarding future earnings, expenses, net interest income, other
income, earnings or loss per share, asset mix and quality, growth prospects,
capital structure and other financial terms, (b) statements of plans and
objectives of management or the board of directors, and (c) statements of
assumptions, such as economic conditions in the Corporation's market areas. Such
forward-looking statements can be identified by the use of forward-looking
terminology such as "believes", "expects", "may", "intends", "will", "should",
"anticipates", or the negative of any of the foregoing or other variations
thereon or comparable terminology, or by discussion of strategy.

No assurance can be given that the future results covered by forward-looking
statements will be achieved. Such statements are subject to risks,
uncertainties, and other factors that could cause actual results to differ
materially from future results expressed or implied by such forward-looking
statements. Important factors that could impact the Corporation's operating
results include, but are not limited to, (i) the effects of changing economic
conditions in the Corporation's market areas and nationally, (ii) credit

                                       8

<PAGE>

risks of commercial, real estate, consumer and other lending activities, (iii)
significant changes in interest rates, (iv) changes in federal and state banking
laws and regulations which could impact the Corporation's operations, (v)
funding costs, and (iv) other external developments which could materially
affect the Corporation's business and operations.

Critical Accounting Policies

Note 1 to the consolidated financial statements of First Community Financial
Corporation for the year ended December 31, 2001 (included in Part F/S of the
First Community Financial Corporation Registration Statement on Form 10-SB,
filed with the Securities and Exchange Commission on April 17, 2002, as amended)
lists significant accounting policies used in the development and presentation
of its financial statements. This discussion and analysis, the significant
accounting policies, and other financial statement disclosures identify and
address key variables and other qualitative and quantitative factors that are
necessary for an understanding and evaluation of the Corporation and its results
of operations.

Financial Condition

Total assets of the Corporation increased $4,034,000 or 2.2% during the first
six months of 2002. Loans increased $7,305,000 or 6.4% since December 31, 2001,
which was partially offset by a decline in investments of $3,259,000 and a
decline in cash and cash equivalents of $535,000. The increase in loans was
primarily in residential and commercial mortgages.

Total deposits increased by $7,880,000 since year-end 2001. Short term
borrowings declined by $4,304,000 during the same time period. The current rate
environment contributed to the growth in deposits, along with the Corporation's
expansion and business development. The February 2002 opening of the branch in
Shermans Dale, Pennsylvania also contributed to the increase in deposits.

Results of Operations

Net income for the six month period ending June 30, 2002 was $845,000 or $1.21
per share compared to $565,000 or $0.81 per share for the same period in 2001.
This reflects a 49.6% increase in net income for the first six months of this
year compared to last year. Annualized return on average equity was 12.59% for
the first six months of 2002 and 9.26% for the same period in 2001. Annualized
return on average assets was 0.93% for the first six months of 2002 and 0.71%
for the same period in 2001.

                                       9

<PAGE>

Net income for the quarter ending June 30, 2002 was $447,000 or $0.64 per share
compared to $300,000 or $0.43 per share for the same period in 2001. Annualized
return on average equity was 13.21% for the second quarter 2002 and 9.66% for
the same period in 2001. Annualized return on average assets for the second
quarter 2002 was 0.96% compared to 0.73% during the second quarter 2001.

Net interest income for the first six months of 2002 increased by $696,000 or
30.0% compared to the same period in 2001. This increase is a result of
increased volume of interest earning assets and an improved net interest margin.
For the first six months of 2002, the net interest margin on a fully tax
equivalent (FTE) basis was 3.86% compared to 3.44% for the same period in 2001.
The FTE basis is calculated by grossing up the yield on tax-exempt securities
and loans by the federal tax rate of 34%, in order that the yield on tax-exempt
assets may be comparable to interest earned on taxable assets. The primary
driver of the increase in the net interest margin was the decline in cost of
funds of 1.17% from 4.61% to 3.44%. This decline was primarily in deposits and
was a result of the Federal Reserve decreasing rates several times during 2001.
The yield on interest earning assets was 7.30% during the first six months of
2002 compared to 8.05% a year ago. While the margin has improved for the first
six months, the Corporation anticipates it will again start to compress as the
year progresses.

Net interest income for the quarter ending June 30, 2002 increased by $352,000
compared to the same period last year. Net interest margin for the quarter was
3.90% compared to 3.47% during the same period in 2001. The decrease in the cost
of funds from 4.55% to 3.33% more than offset the decrease in the yield on
earning assets from 8.02% to 7.23%.

The Corporation recorded a $60,000 provision for loan losses for the first six
months of 2002, as compared to a provision of $36,000 for the first six months
of 2001. The provision for the second quarter 2002 was $30,000 compared to
$18,000 during the same period in 2001. As a percentage of loans, the allowance
for loan losses was 0.86% at June 30, 2002, compared to 0.90% at year-end 2001
and 0.93% at June 30, 2001. Provisions for loan losses are charged to income to
bring the allowance for loan losses to a level deemed appropriate by management.
Management determines the adequacy of the allowance based on on-going quarterly
assessments of the loan portfolio, including such factors as: changes in the
nature and volume of the portfolio, effects of concentrations of credit, current
and projected economic and business conditions, regulatory and consultant
recommendations, repayment patterns on loans, borrower's financial condition,
current charge-offs, trends in volume and severity of past due loans and
classified loans, potential problem loans and supporting collateral. Management

                                       10

<PAGE>

believes the allowance is presently adequate to cover the inherent risks
associated with the Corporation's loan portfolio.

Excluding the $77,000 securities gain in the first six months of 2001,
non-interest income in the first six months of 2002 increased by $28,000 or
5.29% compared to the same period in 2001. Service charges on deposit accounts
as well as income from fiduciary activities did not change by material amounts,
while earnings from bank-owned life insurance increased $28,000.

Non-interest income for the quarter ending June 30, 2002 was $284,000 compared
to $276,000 for the same time period in 2001.

Total non-interest expense increased in the first six months of 2002 by $246,000
compared to the first six months of 2001. Salaries and employee benefits,
increased by $78,000 or 6.7% compared to the same period in 2001. Several
factors contributed to this increase including payroll increases as a result of
normal merit increases, additions to staff, and increases in medical insurance.
Increases in salary and benefits are anticipated as the Corporation continues to
grow in size and number of locations. Also, occupancy expense increased $45,000,
professional fees increased $51,000 and other non-interest expense increased
$52,000. The increase in other non-interest expense was primarily related to
increases in directors' deferred compensation, ATM expenses and advertising and
promotion.

During the quarter ending June 30, 2002, total non-interest expense increased
$141,000 compared to the second quarter of 2001. Salaries and employee benefits
increased by $57,000, occupancy expense increased by $31,000, and professional
fees increased $40,000 during the second quarter as compared to the same period
in 2001. The costs involved with the Corporation's registration with the
Securities and Exchange Commission were the primary reason for the increase in
professional fees for the quarter and the six month period ending June 30, 2002.

A portion of the increases in operating expenses noted in both the six months
and the quarter ended June 30, 2002 were related to the addition of the Shermans
Dale Branch in February 2002. As the Corporation continues to add new offices
and services, additional operating costs will be generated. Over time it is
anticipated these costs will be offset by the additional income generated
through the expansion of services to our customers and community and new
business development.

                                       11

<PAGE>

Income tax expense was $228,000 for the six month time period ending June 30,
2002 compared to $131,000 for the same time period in 2001. Income tax expense
as a percentage of income before income taxes was 21.2% for the period compared
to 18.8% for 2001. Income tax expense for the quarter ending June 30, 2002 was
$123,000, an effective rate of 21.6%, compared to $63,000, an effective rate of
17.4%, during the same period in 2001. The reason for the increase in the
effective tax rate for the periods in 2002 compared to 2001 is due primarily to
the tax exempt income representing a smaller portion of income before taxes in
2002 compared to 2001.

The decrease in the Corporation' effective tax rate away from the statutory rate
of 34.0% is a result of tax-exempt income on loans, securities and bank-owned
life insurance.

Liquidity

Liquidity represents the Corporation's ability to efficiently manage cash flows
to support customers' loan demand, withdrawals by depositors, the payment of
operating expenses, as well as the ability to take advantage of business and
investment opportunities as they arise. One of the Corporation's sources of
liquidity is $133,552,000 in core deposits at June 30, 2002. Other sources of
liquidity at June 30, 2002 are available from the following: (1) investments in
interest-bearing deposits with banks and federal funds sold, which totaled
$2,646,000, (2) securities maturing in one year or less, which totaled
$1,207,000, and (3) investments in mortgage-backed securities, which supply
income and principal cash flow streams on an ongoing basis. In addition, the
Corporation has established federal funds lines of credit with Atlantic Central
Bankers Bank and with the Federal Home Loan Bank of Pittsburgh, which can be
drawn upon if needed as a source of liquidity. Management is of the opinion that
the Corporation's liquidity is sufficient to meet its anticipated needs.

Capital Resources

Total stockholders' equity was $13,785,000 as of June 30, 2002, representing a
$726,000 increase from December 31, 2001. The growth in capital was primarily a
result of net earnings retention of $656,000, and an increase in accumulated
other comprehensive income of $70,000.

At June 30, 2002, the Corporation had a leverage ratio of 7.06%, a Tier I
capital to risk-based assets ratio of 12.82% and a total capital to risk-based
assets ratio of 14.11%. The Bank's ratios did not differ materially from those
of the Corporation. These ratios indicate the Corporation and the Bank exceed
the federal regulatory minimum requirements to be "well capitalized ".

                                       12

<PAGE>

During the second quarter of 2002, the Corporation filed a Registration
Statement on Form 10-SB with the Securities and Exchange Commission to register
its common stock with the Commission. This registration became effective June
17, 2002.

Item 3. Quantitative and Qualitative Disclosure about Market

There are no material changes in the Corporation's interest rate risk exposure
since December 31, 2001. Please refer to the Registration Statement on Form
10-SB of First Community Financial Corporation, filed with the Securities and
Exchange Commission on April 17, 2002, as amended.

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

         Not Applicable

Item 2.  Changes in Securities

         Not Applicable

Item 3.  Defaults Upon Senior Securities

         Not Applicable

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

         At the annual shareholders' meeting on April 9, 2002 the following
         directors were elected as Class B Directors of the Corporation for a
         term of three years expiring in 2005, as follows:

                                  For              Against              Abstain
                                  ---              -------              -------

Joseph E. Barnes, Sr.           572,334                500                 0
Nancy E. Bratton                571,527              1,307                 0
Samuel F. Metz                  520,517             52,317                 0
Charles C. Saner                572,334                500                 0

The following directors are continuing as Class C Directors of the Corporation
for three-year terms expiring in 2003:

         Samuel G. Kint
         Clair E. McMillen
         Roger Shallenberger
         Lowell M. Shearer

The following directors are continuing as Class A Directors of the Corporation
for three-year terms expiring in 2004:

                                       13

<PAGE>

        John P. Henry

        James R. McLaughlin

        John A. Tetwiler

        Frank L. Wright

Item 5. Other Information

        Not Applicable

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

Exhibit    Title
-------    -----

3.1        Articles of Incorporation of the Corporation. (Incorporated by
           reference to Exhibit 2(a) to the Corporation's December 31, 2001
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

3.2        Bylaws of the Corporation. (Incorporated by reference to Exhibit 2(b)
           to the Corporation's Registration Statement on Form 10-SB, as filed
           with the Securities and Exchange Commission on April 17, 2002.)

10.1       Lease Agreement - Delaware Branch Office (Incorporated by reference
           to Exhibit 6(b)(1) to the Corporation's Registration Statement on
           Form 10-SB, as filed with the Securities and Exchange Commission on
           April 17, 2002.)

10.2       Lease Agreement - East Waterford Branch Office (Incorporated by
           reference to Exhibit 6(b)(2) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.3       Lease Agreement - Shermans Dale Branch Office (Incorporated by
           reference to Exhibit 6(b)(3) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.4       Salary Continuation Agreement dated August 19,1997 between James
           McLaughlin and The First National Bank of Mifflintown (Incorporated
           by reference to Exhibit 6(c) (1) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.5       Salary Continuation Agreement dated September 22,1997 between Leona
           Shellenberger and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (2) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.6       Salary Continuation Agreement dated August 28,1997 between Jody
           Graybill and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (3) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

                                       14

<PAGE>

10.7       Salary Continuation Agreement dated September 18,1997 between Timothy
           Stayer and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (4) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.8       Salary Continuation Agreement dated April 10,2000 between Marcie A.
           Barber and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (5) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.9       Salary Continuation Agreement dated November 5,2001 between Richard
           R. Leitzel and The First National Bank of Mifflintown (Incorporated
           by reference to Exhibit 6(c) (6) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.10      Officer Group Term Replacement Plan (Incorporated by reference to
           Exhibit 6(c) (7) to the Corporation's Registration Statement on Form
           10-SB, as filed with the Securities and Exchange Commission on April
           17, 2002.)

10.11      Director Deferred Fee Agreement dated September 29,1997 between James
           McLaughlin and The First National Bank of Mifflintown (Incorporated
           by reference to Exhibit 6(c) (8) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.12      Director Deferred Fee Agreement dated September 29,1997 between
           Joseph Barnes and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (9) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.13      Director Deferred Fee Agreement dated September 30,1997 between Roger
           Shallenberger and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (10) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.14      Director Deferred Fee Agreement dated April 9,2002 between Nancy S.
           Bratton and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (11) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.15      Director Deferred Fee Agreement dated April 9,2002 between John P.
           Henry and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (12) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

10.16      Director Deferred Fee Agreement dated April 9,2002 between Samuel G.
           Kint and The First National Bank of Mifflintown (Incorporated by
           reference to Exhibit 6(c) (13) to the Corporation's Registration
           Statement on Form 10-SB, as filed with the Securities and Exchange
           Commission on April 17, 2002.)

                                       15

<PAGE>

10.17      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between James McLaughlin and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (14) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.18      Director Revenue Neutral Retirement Agreement dated September 30,1997
           between John H. Sheaffer and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (15) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.19      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between Donald Adams and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (16) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.20      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between Joseph Barnes and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (17) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.21      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between Samuel F. Metz and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (18) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.22      Director Revenue Neutral Retirement Agreement dated September 30,1997
           between Clair E. McMillen and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (19) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.23      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between Roger Shallenberger and The First National Bank of
           Mifflintown (Incorporated by reference to Exhibit 6(c) (20) to the
           Corporation's Registration Statement on Form 10-SB, as filed with the
           Securities and Exchange Commission on April 17, 2002.)

10.24      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between John Tetweiler and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (21) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.25      Director Revenue Neutral Retirement Agreement dated September 29,1997
           between Richard Weible and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (22) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

10.26      Director Revenue Neutral Retirement Agreement dated March 31,1998
           between Lowell M. Shearer and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (23) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

                                       16

<PAGE>

10.27      Director Revenue Neutral Retirement Agreement dated March 24,1998
           between Charles C. Saner and The First National Bank of Mifflintown
           (Incorporated by reference to Exhibit 6(c) (24) to the Corporation's
           Registration Statement on Form 10-SB, as filed with the Securities
           and Exchange Commission on April 17, 2002.)

99.1       Certification Of Chief Executive Officer of First Community Financial
           Corporation Pursuant To Section 906 Of The Sarbanes-Oxley Act Of 2002

99.2       Certification of Chief Financial Officer of First Community Financial
           Corporation Pursuant to Section 906 of the Surbanes-Oxley Act of 2002


(b) Form 8-K
         There were no reports filed on Form 8-K during the quarter ending June
30, 2002.

                                       17

<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.

                                        FIRST COMMUNITY FINANCIAL CORPORATION
                                        -------------------------------------
                                                    (Registrant)


Date: August 9, 2002                                BY: /s/  James R. McLaughlin
      --------------                                   -------------------------
                                                    James R. McLaughlin
                                                    President and
                                                    Chief Executive Officer

Date: August 9, 2002                                BY: /s/ Richard R. Leitzel
      --------------                                   -----------------------
                                                    Richard R. Leitzel
                                                    Vice President and
                                                    Chief Financial Officer

                                       18