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 September 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 0-18279
                         ------------------------------

                        TRI-COUNTY FINANCIAL CORPORATION
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

Maryland                                                       52-1652138
-------------------------------                              -------------------
(State of other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                               Identification No.)

 3035 Leonardtown Road, Waldorf, Maryland                           20601
--------------------------------------------                      ----------
 (Address of principal executive offices)                         (Zip Code)

                                 (301) 843-0854
                                 --------------
              (Registrant's telephone number, including area code)

                                      N/A
              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

     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
                                             ---    ---

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest practical date.

     As of November 6, 2002 registrant had outstanding  760,934 shares of Common
Stock.
                                       1
<PAGE>

TRI-COUNTY FINANCIAL CORPORATION

FORM 10-Q                                                                 INDEX
                                                                          -----


PART I - FINANCIAL INFORMATION                                           PAGE

   Item 1 - Financial Statements (Unaudited)

     Consolidated Balance Sheets - September 30, 2002
       and December 31, 2001                                              3

     Consolidated Statements of Income and Comprehensive Income -
       Three And Nine Months Ended September 30, 2002 and 2001            4

     Consolidated Statements of Cash Flows - Nine Months
       Ended September 30, 2002 and 2001                                  5 - 6

     Notes to Consolidated Financial Statements                           7

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

Item 3 - Quantitative and Qualitative Disclosure about Market Risk        15

Item 4 - Controls and Procedures                                          15

PART II - OTHER INFORMATION

Item 6 - Exhibits and Reports on Form 8-K                                 16


SIGNATURES AND CERTIFICATIONS                                             17


                                       2
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS (UNAUDITED)
TRI-COUNTY FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2002 AND DECEMBER 31, 2001

                                                      ASSETS
<TABLE>
<CAPTION>
                                                                               September 30, 2002   December 31, 2001
<S>                                                                                <C>                   <C>
Cash and due from banks                                                            $ 4,308,293       $     693,439
Interest-bearing deposits with banks                                                 3,058,193           7,678,158
Investment securities available for sale - at fair value                            48,250,010          41,673,742
Investment securities held to maturity - at amortized cost                           2,288,620           2,289,354
Stock in Federal Home Loan Bank and Federal Reserve Bank - at cost                   3,035,550           3,035,550
Loans held for sale                                                                         --           2,354,315
Loans receivable - net of allowance for loan losses
of $2,295,188 and $2,281,581, respectively                                         198,302,353         193,450,011
Premises and equipment, net                                                          6,162,097           5,432,848
Foreclosed real estate                                                                 770,014           1,800,569
Accrued interest receivable                                                          1,131,893           1,049,401
Other assets                                                                         3,919,903           2,499,903
                                                                                 -------------       -------------
Total assets                                                                     $ 271,226,926       $ 261,957,290
                                                                                 =============       =============
                                       LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Noninterest-bearing deposits                                                      $ 24,355,516        $ 17,738,165
Interest-bearing deposits                                                          168,023,713         165,378,369
                                                                                 -------------       -------------
Total deposits                                                                     192,379,229         183,116,534
Short-term borrowings                                                                  734,748           1,813,317
Long-term debt                                                                      47,250,000          48,650,000
Accrued expenses and other liabilities                                               4,647,126           2,790,981
                                                                                 -------------       -------------
Total liabilities                                                                  245,011,103         236,370,832
                                                                                 -------------       -------------
STOCKHOLDERS' EQUITY:
Common stock - par value $.01; authorized - 15,000,000 shares;
issued - 762,411 and 756,805 shares, respectively                                        7,624               7,568
Surplus                                                                              7,697,825           7,545,590
Retained earnings                                                                   18,150,962          17,678,367
Accumulated other comprehensive income                                                 522,457             555,513
Unearned ESOP shares                                                                  (163,045)           (200,580)
                                                                                 -------------       -------------
Total stockholders' equity                                                          26,215,823          25,586,458
                                                                                 -------------       -------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                       $ 271,226,926       $ 261,957,290
                                                                                 =============       =============
</TABLE>
See notes to consolidated financial statements

                                       3
<PAGE>
TRI-COUNTY FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
<TABLE>
<CAPTION>
                                                              THREE MONTHS ENDED            NINE MONTHS ENDED
                                                                SEPTEMBER 30,                 SEPTEMBER 30,
                                                       ----------------------------   ----------------------------
                                                            2002            2001           2002            2001
<S>                                                    <C>             <C>            <C>             <C>
INTEREST INCOME:
   Interest and fees on loans                          $  3,604,299    $  3,863,424   $ 10,671,659    $ 11,493,494
   Taxable interest and dividends on
     investment securites                                   662,707         746,375      1,921,272       2,629,682
   Interest on bank deposits                                 14,928          20,561         63,748          64,691
                                                       ------------    ------------   ------------    ------------
        Total interest income                             4,281,934       4,630,360     12,656,679      14,187,867
                                                       ------------    ------------   ------------    ------------
INTEREST EXPENSE:
   Interest on deposits                                     865,583       1,484,060      2,640,487       4,782,318
   Interest on long term debt                               618,793         646,736      1,889,676       1,897,052
   Interest on other borrowings                                  --           2,008             --         257,354
                                                       ------------    ------------   ------------    ------------
        Total interest expense                            1,484,376       2,132,804      4,530,163       6,936,724
                                                       ------------    ------------   ------------    ------------

NET INTEREST INCOME                                       2,797,558       2,497,556      8,126,516       7,251,143
PROVISION FOR LOAN LOSSES                                    30,000          90,000        130,000         270,000
                                                       ------------    ------------   ------------    ------------
NET INTEREST INCOME AFTER PROVISION
  FOR LOAN LOSSES                                         2,767,558       2,407,556      7,996,516       6,981,143
                                                       ------------    ------------   ------------    ------------
NONINTEREST INCOME:
   Loan appraisal, credit, and miscellaneous charges         57,921          64,193        146,269         161,092
   Net gain on sale of loans held for sale                   81,557          43,158        289,539         127,893
   Service charges                                          242,534         230,495        727,903         727,188
   Other income                                               4,901           6,560         18,610          29,619
                                                       ------------    ------------   ------------    ------------
        Total noninterest income                            386,913         344,406      1,182,321       1,045,792
                                                       ------------    ------------   ------------    ------------
NONINTEREST EXPENSE:
   Salary and employee benefits                           1,031,744       1,001,742      3,129,922       2,841,474
   Occupancy expense                                        200,914         232,963        592,582         537,769
   Data processing expense                                   94,102          63,967        432,558         240,574
   Loss on disposal of obsolete equipment                        --              --         65,104              --
   Advertising                                               91,675         110,758        254,641         223,638
   Equipment depreciation                                    58,380          53,301        279,576         169,987
   Telephone communications                                  74,794          37,643        268,174          98,040
   Valuation allowance on foreclosed real estate                 --              --      1,044,070              --
   Other                                                    482,137         362,530      1,353,475       1,042,275
                                                       ------------    ------------   ------------    ------------
        Total noninterest expense                         2,033,746       1,862,904      7,420,102       5,153,757
                                                       ------------    ------------   ------------    ------------

INCOME BEFORE INCOME TAXES                                1,120,725         889,058      1,758,735       2,873,178
INCOME TAXES                                                391,000         322,000        621,000       1,005,700
                                                       ------------    ------------   ------------    ------------
NET INCOME                                                  729,725         567,058      1,137,735       1,867,478

OTHER COMPREHENSIVE INCOME, NET OF TAX
   Net unrealized holding gains (losses) arising
     during the period                                      (10,628)        451,325        (33,056)        860,372
                                                       ------------    ------------   ------------    ------------
COMPREHENSIVE INCOME                                   $    719,097    $  1,018,383   $  1,104,679    $  2,727,850
                                                       ============    ============   ============    ============
EARNINGS PER SHARE
   Basic                                               $        .96    $        .71   $       1.49    $       2.42
   Diluted                                                      .91             .68           1.41            2.33
</TABLE>

See notes to consolidated financial statements

                                       4
<PAGE>
TRI-COUNTY FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
<TABLE>
<CAPTION>
                                                                                       NINE MONTHS ENDED
                                                                                        SEPTEMBER 30,
                                                                                ------------------------------
                                                                                   2002               2001
<S>                                                                             <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income                                                                      $ 1,137,735        $ 1,867,478
Adjustments to reconcile net income to net
   cash (used) provided by operating activities:
   Valuation allowance on foreclosed real estate                                  1,044,070                 --
   Provision for loan losses                                                        130,000            270,000
   Depreciation and amortization                                                    339,392            242,650
   Loss on disposal of obsolete equipment                                            65,104                 --
   Net amortization of premium/discount on investment securities                     21,869             51,054
   Deferred income tax benefit                                                     (477,000)          (110,000)
    (Increase) decrease in accrued interest receivable                              (82,492)           176,186
    (Decrease) Increase in deferred loan fees                                       (41,248)             9,586
   Increase in accounts payable, accrued expenses,
     and other liabilities                                                        1,856,145            614,473
   Increase in other assets                                                      (1,220,565)          (864,271)
   Gain on disposal of premises and equipment                                        (4,458)            (8,386)
   Origination of loans held for sale                                           (13,860,196)        (7,812,412)
   Gain on sales of loans held for sale                                            (289,540)          (127,893)
   Proceeds from sale of loans held for sale                                     12,518,971          8,036,305
                                                                                -----------        -----------
          Net cash provided by operating activities                               1,137,787          2,344,770
                                                                                -----------        -----------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Net increase in interest-bearing deposits with banks                           4,619,965            291,389
   Purchase of investment securities available for sale                         (43,041,197)       (20,961,399)
   Proceeds from sale, redemption or principal payments
    of investment securities available for sale                                  36,394,570         36,538,900
   Purchase of investment securities held to maturity                            (1,201,212)          (100,000)
   Proceeds from maturities or principal payments
    of investment securities held to maturity                                     1,201,946            606,497
   Loans originated or acquired                                                 (67,672,186)       (69,123,620)
   Principal collected on loans                                                  66,716,172         50,579,419
   Proceeds from disposal of premises and equipment                                  13,000              8,963
   Purchase of foreclosed real estate                                               (29,562)                 -
   Purchase of premises and equipment                                            (1,142,287)          (853,200)
   Proceeds from foreclosed real estate                                             309,046             (5,697)
                                                                                -----------        -----------
       Net cash used in investing activities                                     (3,831,745)        (3,018,748)
                                                                                -----------        -----------
</TABLE>

                                       5
<PAGE>
TRI-COUNTY FINANCIAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001 (CONTINUED)
<TABLE>
<CAPTION>
                                                                                       NINE MONTHS ENDED
                                                                                        SEPTEMBER 30,
                                                                                ------------------------------
                                                                                   2002               2001
<S>                                                                             <C>                <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
   Net increase in deposits                                                     $ 9,262,695        $ 9,709,542
   Proceeds from long-term borrowings                                                    --         10,250,000
   Payments of long-term borrowings                                              (1,400,000)        (5,000,000)
   Net decrease in other borrowed funds                                          (1,078,569)       (12,913,074)
   Exercise of stock options                                                        141,906             31,817
   Net change in unearned ESOP shares                                                47,999            (47,998)
   Dividends paid                                                                  (385,129)          (309,204)
   Redemption of common stock                                                      (280,090)          (673,956)
                                                                                -----------        -----------
      Net cash provided by financing activities                                   6,308,812          1,047,127
                                                                                -----------        -----------

INCREASE IN CASH AND CASH EQUIVALENTS                                             3,614,854            373,148

CASH AND CASH EQUIVALENTS - JANUARY 1                                               693,439            645,817

CASH AND CASH EQUIVALENTS - SEPTEMBER 30                                        $ 4,308,293        $ 1,018,965
                                                                                ===========        ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the nine months for:
Interest                                                                        $ 4,773,641        $ 6,959,887
                                                                                ===========        ===========
Income taxes                                                                    $ 1,130,000        $ 1,017,000
                                                                                ===========        ===========
Noncash transfers from loans to other assets                                    $ 1,040,000        $ 1,273,320
                                                                                ===========        ===========

</TABLE>

See notes to consolidated financial statements

                                       6
<PAGE>

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------

1.   BASIS OF PRESENTATION

     General - The  consolidated  financial  statements of Tri-County  Financial
     Corporation (the "Company") and its wholly owned subsidiary, Community Bank
     of Tri-County  (the "Bank")  included herein are unaudited;  however,  they
     reflect all adjustments  consisting only of normal recurring accruals that,
     in the opinion of  Management,  are necessary to present fairly the results
     for  the  periods  presented.  Certain  information  and  note  disclosures
     normally  included in  financial  statements  prepared in  accordance  with
     accounting  principles  generally  accepted in the United States of America
     have been condensed or omitted pursuant to the rules and regulations of the
     Securities  and  Exchange   Commission.   The  Company  believes  that  the
     disclosures are adequate to make the information  presented not misleading.
     There have been no significant changes to the Company's Accounting Policies
     as disclosed in 2001 Annual Report. The results of operations for the three
     and nine months ended September 30, 2002 are not necessarily  indicative of
     the results of  operations  to be expected  for the  remainder of the year.
     Certain  previously  reported  amounts have been restated to conform to the
     2002 presentation.

     It is suggested  that these  consolidated  financial  statements be read in
     conjunction with the consolidated  financial  statements and notes included
     in the Company's Annual Report for the year ended December 31, 2001.

2.   EARNINGS PER SHARE

     Basic  and  diluted  earnings  per  share,  have  been  computed  based  on
     weighted-average   common  and  common  equivalent  shares  outstanding  as
     follows:
<TABLE>
<CAPTION>
                                 NINE MONTHS ENDED           THREE MONTHS ENDED
                                   SEPTEMBER 30,               SEPTEMBER 30,
                               -------------------------------------------------
                                 2002         2001           2002          2001
     <S>                       <C>           <C>           <C>           <C>
     Basic                     761,563       770,519       763,084       761,895
     Diluted                   804,971       803,099       806,291       796,601
</TABLE>

                                       7
<PAGE>

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

This  document  contains  forward-looking  statements  within the meaning of the
Private  Securities  Litigation  Reform Act of 1995,  including  discussions  of
Tri-County  Financial  Corporation's  (the  "Company's")  goals,  strategies and
expected  outcomes;  estimates  of risks and future  costs;  and  reports of the
Company's   ability  to  achieve   its   financial   and  other   goals.   These
forward-looking  statements are subject to  significant  known and unknown risks
and  uncertainties  because  they are based  upon  future  economic  conditions,
particularly  interest  rates,   competition  within  and  without  the  banking
industry,  changes in laws and regulations applicable to the Company and various
other matters.  Because of these  uncertainties,  there can be no assurance that
actual  results,  performance  or  achievements  of the Company  will not differ
materially  from any future results,  performance or  achievements  expressed or
implied by these forward-looking statements.

GENERAL

The Company is a bank  holding  company  organized in 1989 under the laws of the
State of Maryland. It presently owns all the outstanding shares of capital stock
of  the  Community  Bank  of  Tri-County  (the  "Bank"),  a   Maryland-chartered
commercial  bank.  The Company  engages in no  significant  activity  other than
holding  the  stock  of the  Bank  and  operating  the  business  of  the  Bank.
Accordingly,  the  information  set forth in this  report,  including  financial
statements and related data, relates primarily to the Bank and its subsidiaries.

The Bank serves the  southern  Maryland  area  through its main office and eight
branches  located in  Waldorf,  Bryans  Road,  Dunkirk,  Leonardtown,  La Plata,
Charlotte Hall, and California,  Maryland. The Bank is engaged in the commercial
and retail banking  business as authorized by the banking  statutes of the State
of Maryland and applicable Federal regulations. The Bank accepts demand and time
deposits,  and originates loans to individuals,  associations,  partnerships and
corporations.  The Bank makes real estate loans including  residential first and
second  mortgage  loans,  home equity  lines of credit and  commercial  mortgage
loans. The Bank makes  commercial  loans including  secured and unsecured loans.
The Bank is a member of the Federal  Reserve and Federal Home Loan Bank ("FHLB")
Systems. The Savings Association  Insurance Fund ("SAIF") of the Federal Deposit
Insurance  Corporation  ("FDIC")  provides  deposit  insurance  coverage  up  to
applicable limits.

Since its conversion to a state chartered  commercial bank in 1997, the Bank has
sought to increase its commercial,  commercial real estate, construction, second
mortgage,  home equity,  and consumer  lending  business as well as the level of
transactional  deposits to levels  consistent  with similarly  sized  commercial
banks. As a result of this emphasis, the Bank's percentage of assets invested in
residential first mortgage lending and investment  securities has declined since
1997. Conversely,  targeted loan types have increased. The Bank has also seen an
increase  in  transactional  deposit  accounts  while  the  percentage  of total
liabilities   represented  by   certificates  of  deposits  has  also  declined.
Management believes that these changes will enhance the Bank's overall long-term
financial performance.

Management recognizes that the shift in composition of the Bank's loan portfolio
will tend to increase its exposure to credit  losses.  The Bank has continued to
evaluate  its  allowance  for  loan  losses  and  the  associated  provision  to
compensate  for the  increased  risk.  Any  evaluation of the allowance for loan
losses is inherently inexact and reflects management's expectations as to future
economic  conditions  in the  Southern  Maryland  area  as  well  as  individual
borrower's circumstances. Management believes that its allowance for loan losses
is adequate. For further information on the Bank's allowance for loan losses see
the discussion in the financial  condition  section of this form, as well as the
relevant  discussions  in the Form 10-K and  annual  report  for the year  ended
December 31, 2001.

In the last several  quarters,  the national economy has recovered slowly from a
mild  recession  while our local economy has remained  strong in relation to the
national and statewide  economy.  Prospects for growth appear to be steady,  and
local employment remains strong. The Bank remains exposed to asset deterioration
should the local economy  experience a prolonged period of economic decline.  In
addition,  any Federal  Reserve  action on interest  rates may affect the Bank's
financial performance.

In the second  quarter,  the Bank  established a valuation  allowance on certain
foreclosed  real estate  based on  indications  that the market  value was below
carrying value. The establishment of valuation  allowances decreased earnings by
approximately  $1.0 million pretax and $675 thousand after taxes.  The effect of
these write downs was to decrease  basic and diluted  earnings per share for the
nine months  ending  September  30, 2002 by $.89 and $.84,  respectively.  For a
discussion  of the Bank's  accounting  policies  regarding  the  accounting  for
foreclosed  real  estate,  see Note 1 to the  Company's  Consolidated  Financial
Statements  for the year  ended  December  31,  2001.  For a  discussion  of the
specific  events leading to the  establishment  of the valuation  allowances and
other  relevant  facts  regarding  these  properties,  see the discussion of the
Company's financial condition.

                                       8
<PAGE>

In the second quarter,  the Bank also incurred  significant costs related to its
conversion to a new provider of data processing  services.  These costs included
payments  made to the previous  vendor for  conversion  related  work  including
facilitating  the  transfer  of customer  data to the new system,  costs for the
production of certain reports and other items. Other conversion related expenses
included employee training,  system  installation,  and the write off of certain
incompatible  equipment.  Total  costs  related  to the data  conversion  in the
quarter were  approximately  $805 thousand.  Of this amount,  approximately $415
thousand was expensed in the first nine months of 2002.  These  additional costs
reduced  earnings  per share by $.35 and $.33 per  share on a basic and  diluted
basis respectively.  For a summary of costs incurred and results affected by the
establishment  of the  allowance  and other  additional  expenses  see the table
below:
<TABLE>
<CAPTION>
                                                                                        Effect of
                                                                                       establishing
                                                      Income             Effect        an allowance     Income from
                                                     as reported       of systems      on foreclosed    continuing
                                                     under GAAP        conversion       real estate     operations
<S>                                                  <C>                 <C>             <C>          <C>
NET INTEREST INCOME AFTER PROVISION
 FOR LOAN LOSSES                                      $7,996,516         $      --       $        --   $7,996,516

NONINTEREST INCOME:                                    1,182,321                --                --    1,182,321

NONINTEREST EXPENSE:
   Salary and employee benefits                        3,129,922                --                --    3,129,922
   Occupancy expense                                     592,582                --                --      592,582
   Data processing expense                               432,558           142,553                --      290,005
   Loss on disposal of obsolete equipment                 65,104            65,104                --           --
   Advertising                                           254,641                --                --      254,641
   Equipment depreciation                                279,576            60,000                --      219,576
   Telephone communications                              268,174           101,365                --      166,809
   Valuation allowance on  foreclosed real estate      1,044,070                --         1,044,070           --
   Other                                               1,353,475            46,034                --    1,307,441
                                                     -----------         ---------       -----------   ----------
        Total noninterest expenses                     7,420,102           415,056         1,044,070    5,960,976

INCOME (LOSS) BEFORE INCOME TAXES                      1,758,735          (415,056)       (1,044,070)   3,217,861
INCOME TAX EXPENSE (BENEFIT)                             621,000          (146,554)         (368,656)   1,136,210
NET INCOME (LOSS)                                      1,137,735          (268,502)         (675,414)   2,081,651

EARNINGS (LOSS) PER SHARE
   Basic                                              $     1.49         $   (0.35)      $     (0.89)  $     2.73
   Diluted                                            $     1.41         $   (0.33)      $     (0.84)  $     2.58

Equipment and software acquired                               --           310,519                --           --
</TABLE>

On April 28, 2002, a tornado  caused damages to property in our market area. The
Company's  facilities  suffered no damage,  and we are not aware of any customer
who  suffered   material  losses  which  would  affect  their  ability  to  meet
obligations to repay loans. We do not believe that the storm will cause material
long term economic damage to our market area.

In the last several  years,  the Bank has increased  its sources of  noninterest
income through fees gathered on transactional  accounts, the sale of non-deposit
products  including  investments,  and  continued  operation of our  residential
mortgage  operation.  These fees have  continued  to grow over the last  several
quarters,  while the Bank's fee income  from the  residential  mortgage  lending
business has decreased due to the Bank's shift in lending  emphasis.  Management
believes that the Bank's strong local focus and responsiveness to customers will
enable it to increase its fee income over time.


                                       9
<PAGE>

SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
                                                        NINE MONTHS ENDED
                                                          SEPTEMBER 30,
                                                  ------------------------------
                                                      2002            2001
<S>                                               <C>                <C>
Condensed Income Statement
Interest Income                                   $12,656,679        $14,187,867
Interest Expense                                    4,530,163          6,936,724
Net Interest Income                                 8,126,516          7,251,143
Provision for Loan Loss                               130,000            270,000
Noninterest Income                                  1,182,321          1,045,792
Noninterest Expense                                 7,420,102          5,153,757
Income Before Income Taxes                          1,758,735          2,873,178
Income Taxes                                          621,000          1,005,700
Net Income                                          1,137,735          1,867,478


Per Common Share
Basic Earnings                                    $      1.49        $      2.42
Diluted Earnings                                         1.41               2.33
Book Value                                              34.39              33.30
</TABLE>

RESULTS OF OPERATIONS

Net income for the nine month period ended September 30, 2002 totaled $1,137,735
($1.49  basic and $1.41  diluted  earnings per share)  compared  with a total of
$1,867,478  ($2.42  basic and $2.33  diluted  earnings  per  share) for the same
period in the prior year.  This  decrease  of $730  thousand or 39.1% was caused
primarily by additional  expenses  incurred by the Company in the current period
relating to the systems conversion and the valuation  allowance  established for
certain foreclosed real estate as noted previously. The combined effect of these
events was to decrease  pretax income in the current  period by $1.5 million and
after tax income by approximately $1 million.

For the nine month period ended September 30, 2002,  interest income declined by
$1.5 million or 10.8% to $12.7 million. This decline was caused by the continued
decline in interest  rates  particularly  the  declines  in the Prime,  and one,
three,  and five year  treasury  rates.  Many loan  products are priced based on
these  rates.  This  decline in interest  rates was  partially  offset by higher
average asset balances.

Interest  expense also decreased to $4.5 million in the nine month period ending
September  30, 2002 as compared to $6.9  million in the same period in the prior
year a decrease of $2.4 million or 34.7%.  This decrease was a reflection of the
declining interest rate environment  experienced during the last year.  Interest
expense also declined as a result of the Bank's increase in noninterest  bearing
deposit accounts.  The Bank's interest expense declined faster than its interest
income because the Bank was able to aggressively  cut funding costs by repricing
certain of its  deposit  products.  Further  declines  in  interest  rates would
probably not lead to similar results as the Bank has decreased interest rates on
certain products to extremely low levels.  The Bank is attempting to protect its
interest  rate  position  in  the  event  of  increases  in  interest  rates  by
lengthening,  to the extent  possible,  average  maturities on  liabilities  and
adding interest rate sensitive loans.

Provision for loan losses  declined from prior year levels to $130 thousand from
$270  thousand for the nine month  periods  ending  September 30, 2002 and 2001,
respectively.  Management will continue to periodically review its allowance for
loan  losses and the  related  provision  and adjust as deemed  necessary.  This
review will include a review of economic  conditions  nationally and locally, as
well as a review of the  performance of significant  major loans and the overall
portfolio.

Noninterest  income  increased to $1.2 million for the nine month period  ending
September  30, 2002,  an increase of $136  thousand or 13.1% over the prior year
total of $1.0  million.  Increased  income was  primarily  the result of a large
increase in gains on selling mortgage loans, which increased by $162 thousand or
126.4% to $290  thousand in the  current  period.  This large gain offset  small
declines in other areas of noninterest income.

Noninterest expense for the nine month period increased by $2.3 million or 44.0%
to $7.4 million from $5.2 million in the same period for the prior year.  Salary
and employee benefits  increased by 10.2% to $3.1 million from $2.8 for the same
period in the prior  year.  The  increase  was  attributable  to an  increase in
employees  and to increases  in average  salary  costs per

                                       10
<PAGE>

employee.  Occupancy expense  increased from $538 thousand to $592 thousand,  an
increase of 10.2%.  This  increase  was caused by larger  amounts of repairs and
maintenance at the Bank's branch  locations as well as the opening of the Bank's
permanent  facility at Charlotte Hall. Data processing expense increased by $192
thousand to $433 thousand or an increase of 79.8%.  This increase was the result
of fees paid to the former  data  processing  provider  for  conversion  related
services, fees paid to the new provider for system installation,  configuration,
and  training,  and for payments to both  providers  for a short period (about 6
weeks) where both providers  provided basic monthly services.  In 2001, the Bank
did not incur these same data processing  costs. In 2002, the Bank also disposed
of  certain  computer  equipment  which  was  incompatible  with  the  new  data
processing  system.  Advertising  expense  increased  by $31  thousand  or 13.9%
primarily  due to increased  marketing  efforts  related to various  transaction
based  accounts.  Depreciation  increased to $280  thousand an increase of 64.5%
over the prior year level of $170  thousand.  The increase was  primarily due to
the obsolescence of computer and other equipment  incompatible with the new data
processing system.  Expenses related to telephone  communications also increased
to $268 thousand for the nine months ended  September 30, 2002 from $98 thousand
in the same period in the prior year,  an increase of 174%.  This  increase  was
primarily  related to the data  conversion.  As noted above, for the nine months
ended  September  30,  2002,  the Bank  established  a  valuation  allowance  on
foreclosed assets in the amount of $1.0 million. In 2001, there were no expenses
in this category. Other expenses increased by $311 thousand to $1.4 million from
the prior year total of $1.0 million, an increase of 29.9%.

Income taxes decreased to $621 thousand or 35.3% of pretax income in the current
year  compared to $1 million or 35.0% of pretax  income in the prior  year.  The
increase in the tax rate was primarily  attributable to an increase in the state
income tax burden. In the prior period, taxes were substantially reduced because
income earned on investment securities held by the Bank's investment corporation
subsidiary,  Tri-County Investment Corporation ("TCIC") which was not subject to
the state income tax. In the current year,  reductions in the assets invested in
TCIC and a reduction  in the overall  yield on invested  assets have reduced the
amount of income  sheltered from state income tax,  increasing the effective tax
rate.

RESULTS OF OPERATIONS -- THIRD QUARTER

The Company  recorded net income for the third  quarter of 2002 of $730 thousand
($.96 and $.91 basic and diluted earnings per share),  compared to net income of
$567 thousand ($.71 and $.68 basic and diluted  earnings per share) for the same
period in 2001.  This  increase  was the result of the  increase in net interest
income noted above,  combined with strong noninterest  income growth,  partially
offset by increases in noninterest expense. Increases in net interest income and
noninterest  income were affected by the declines in interest rates as mentioned
in the general and year to date discussions above.

Net interest  income  increased by $300  thousand or 12.0%.  Noninterest  income
increased by $43 thousand or 12.3% in the third quarter of 2002, compared to the
third quarter of 2001.  This increase was the result of increases in income from
service charges,  increased gains on selling residential  mortgage loans and was
offset by declines in loan service charges. Total non-interest expense increased
by $171 thousand or 9.2% for the third quarter  compared to the same period last
year  primarily due to increased  personnel,  data  processing  and other costs.
Salary and benefits  expense  increased  by 3.0% due to an  increased  number of
employees  and higher  benefits  costs.  Occupancy  expense  declined as certain
maintenance and other costs were incurred in the second quarter. Data processing
expense  increased to $94 thousand,  an increase of $30 thousand or 47.1%.  This
increase was due to the switch to the new data  processing  system.  Advertising
expenses decreased slightly to $92 thousand due to a slightly decreased level of
advertising  activity in the third  quarter.  Depreciation  increased due to the
purchases of new equipment for the conversion  and new branches.  Other expenses
increased  primarily due to increases in the overall level of financial activity
in the Bank including higher assets and new branches.

FINANCIAL CONDITION

Assets

Total  assets as of  September  30,  2002  increased  by $9.3  million to $271.3
million  from the  December  31, 2001 level of $262  million.  Cash and due from
banks  increased  by $3.6  million,  or 521% from  December  31,  2001's  total.
Interest-bearing  deposits  with banks  declined by $4.6 million or 60.2% during
the  period to $3.1  million  at  September  30,  2002.  Investment  securities,
including both the available for sale and held to maturity portfolios, increased
from  $44.0  million  to $50.5  million an  increase  of $6.6  million or 15.0%.
Increases were primarily the result of additional purchases of investments using
the proceeds of loan  prepayments and the conversion of certain interest bearing
deposits to investments.

The Bank's  loan  portfolio  increased  by $4.9  million or 2.5% during the nine
month period  ending  September  30, 2002 to $198 million from  December  2001's
total of $193 million. The increase was primarily the result of increases in the
Commercial,  Commercial  Real  Estate,  and  Consumer  portfolios  which  offset
declines in the Residential First Mortgage portfolio.  At September 30, 2002 the
Bank's  allowance  for loan losses totals $2.3 million or 1.14% of loan balances
as

                                       11
<PAGE>

compared  to $2.3  million  or 1.18% of loan  balances  at  December  31,  2001.
Management's  determination  of the  adequacy  of the  allowance  is  based on a
periodic  evaluation of the portfolio  with  consideration  given to the overall
loss experience;  current economic conditions; volume, growth and composition of
the loan  portfolio;  financial  condition of the borrowers;  and other relevant
factors that, in  management's  judgment,  warrant  recognition  in providing an
adequate allowance.  Management  believes that the allowance is adequate.  Loans
held for sale  declined to $0 from $2.3 million at December  31,  2001.  Certain
loan  information  is  presented  below  (amounts  in  000's).  Additional  loan
information  for prior  years is  presented  in the Form 10-K for the year ended
December 31, 2001:
<TABLE>
<CAPTION>
LOAN PORTFOLIO                                                September 30,                        December 31,
                                                                  2002                                 2001
                                                        ----------------------              -----------------------
                                                         Amount            %                 Amount            %
                                                         ------          -----               ------          -----
<S>                                                     <C>              <C>                <C>              <C>
Real Estate Loans
  Residential first mortgage                            $ 58,070         28.85%             $ 61,430         31.26%
  Commercial                                              72,615         36.07%               65,617         33.39%
  Construction and land development                       12,014          5.97%               18,136          9.23%
  Home equity and second mortgage                         19,253          9.56%               18,580          9.46%
Commercial loans                                          25,783         12.81%               18,539          9.44%
Consumer loans                                            13,577          6.74%               14,187          7.22%
                                                       ---------        ------             ---------        ------
    Total loans                                          201,312        100.00%              196,489        100.00%
  Less: Deferred loan fees                                   717        ======                   757        ======
        Loan loss reserve                                  2,295                               2,282
                                                       ---------                           ---------
    Loans receivable net                               $ 198,300                           $ 193,450
                                                       ---------                           ---------
</TABLE>
<TABLE>
<CAPTION>
LOAN LOSS ALLOWANCE
                                                      9 Months Ended                      9 Months Ended
                                                    September 30, 2002                  September 30, 2001
                                                    ------------------                  ------------------
<S>                                                      <C>                                 <C>
Beginning Balance                                        $ 2,282                             $ 1,930
Charge Offs                                                 (119)                                 --
Recoveries                                                     3                                  26
Net Charge Offs                                             (116)                                 26
Additions charged to operations                              130                                 270
                                                         -------                             -------
Balance at end of period                                 $ 2,296                             $ 2,226
                                                         =======                             =======
Ratio of net charge-offs during the period to
average loans                                              0.01%                               0.01%
                                                           ====                                ====
</TABLE>
<TABLE>
<CAPTION>
NON-PERFORMING LOANS
                                                         Balances as of       Balances as of
                                                       September 30, 2002   December 31, 2001

<S>                                                          <C>                <C>
Restructured Loans                                           $     --           $     --
                                                             --------           --------
Accruing loans which are contractually
past due 90 days or more:                                    $    232           $     25
                                                             --------           --------

Loans accounted for on a nonaccrual basis                    $     --           $    204
                                                             --------           --------

Total non-performing loans                                   $    232           $    229
                                                             ========           ========

Non-performing loans to total loans                             0.12%              0.12%
                                                                ====               ====

Allowance for loan losses to non-performing loans             989.22%            996.07%
                                                              ======             ======
</TABLE>

There were no loans as of  September  30, 2002 not  reflected in the above table
where known  information  about  possible  credit  problems of borrowers  caused
management to have serious doubts as to the ability of those borrowers to comply
with present loan repayment terms.

                                       12
<PAGE>

Premises and  equipment  increased due to equipment  replacement  needed for the
data  processing  conversion  as  well  as  construction  costs  related  to the
permanent Charlotte Hall facility.

Foreclosed  real estate  declined to  $770,000 at  September  30, 2002 from $1.8
million at December 31, 2001  primarily  due to the  establishment  of valuation
allowances  on two  properties.  The  larger  property  was a 54-acre  parcel of
undeveloped  land in Charles  County which the Bank  acquired by deed in lieu of
foreclosure  in July 2001 and  which had a  carrying  value of $1.3  million  at
December 31, 2001.  The original  borrower had planned to develop this  property
into  150  single-family  lots and had  received  preliminary  approval  for the
project's  first  phase  (consisting  of 41  lots) in July  1999.  Subsequently,
however, the county sought to retroactively impose more restrictive requirements
for preliminary approvals and took the position that the preliminary approval of
the first  phase was no longer  in force.  While the  borrower  sought to secure
preliminary approval under the new rules, another lender threatened  foreclosure
on another of the borrower's Charles County projects (which had not received any
preliminary approvals) and the borrower offered to deed the property over to the
Bank.

At the time of acquiring the property,  the Bank was advised by counsel that the
prior grant of preliminary approval was binding on the county. In addition,  the
county had announced that it would adopt a fee-based  permitting scheme in 2003,
which was expected to facilitate the  development of phase 2 of the project.  In
light  of  these  circumstances,  an  independent  appraisal  obtained  prior to
December 31, 2001  determined  that the  property's  market  value  exceeded its
carrying  value.  Accordingly,  no valuation  allowances were  established  with
respect to the property at the time of acquisition or at December 31, 2001.

After  obtaining  title,  the Bank  challenged  the county's  position  that its
preliminary  approval  of the first  phase was no longer in force and  secured a
change in the rules that  accepted the validity of the  preliminary  approval in
June 2002.  The Bank  thereupon  put the entire  parcel out for bid but the bids
received were substantially  below the Bank's price target.  Bidders advised the
Bank that they were  concerned  that the county  would  change  the rules  again
before  phase 2 could  be  completed  and were  therefore  unwilling  to  assign
significant  value  to that  part of the  parcel.  Based on the  results  of the
bidding, the Bank determined that a valuation allowance of $776,000 was required
to adjust the carrying value of the property to the value indicated by the bids.
Subsequently,  the Bank sought other  bidders and is now  negotiating a possible
sale at a price that would not indicate any further write-downs are required.

The other property has been previously acquired by the Bank and originally had a
carrying  value of  $275,000.  In  evaluating  the  property for sale during the
second quarter, it was discovered that there was a "vernal pool" on the property
causing it to be  treated as wetland  under  state and  federal  law.  Since the
property  could no  longer be  developed  as  planned,  the Bank  established  a
$250,000  valuation  allowance  to bring its  carrying  value  down to a nominal
$25,000.  Although the Bank will  continue to explore  alternative  uses for the
property, there are no current developments which would justify a higher value.

Liabilities

Deposit  balances  increased  by $9.3  million or 5.1% for the nine months ended
September 30, 2002. This increase was primarily in noninterest bearing deposits.
Management  believes  that the  recent  stock  market  volatility  may make bank
deposits  more  attractive  to the general  public,  and the low  interest  rate
environment   makes  noninterest   accounts   relatively  less  unattractive  to
consumers.  Short term borrowings remain at very low levels, $734 thousand. Long
term debt  declined  slightly to $47.2  million at September 30, 2002 from $48.7
million at December 31,  2001.  Other  liabilities  increased to $4.6 million at
September 30, 2002 from $2.8 million at December 31, 2001, an increase of 66.5%.

Stockholders' Equity

Stockholders'  equity  increased  $629  thousand  or 2.5% to  $26.2  million  at
September 30, 2002 compared to $25.6 million at December 31, 2001. This reflects
the net income of $1.1 million for the nine month period partially offset by the
$385,129 in cash dividends.  Accumulated other comprehensive income decreased by
$33,056.  Other  changes in equity  occurred  as a result of using  $280,090  to
purchase  shares in the open  market  and retire  them,  the  exercise  of stock
options of $141,905, and a change in unearned ESOP shares of $47,999. Book value
on a per share  basis,  $34.39 at September  30, 2002,  as compared to $33.80 at
December  31,  2001,  reflects  a 1.7%  increase,  with  a  slight  increase  in
outstanding shares, partially offsetting the gains noted previously.

As  reported  on Form 8-K filed on July 28,  2002 the Board has  approved of the
purchase of up to 38,000 shares of the Company's stock, for retirement.  For the
nine months ended  September 30, 2002,  the Company  purchased  8,755 shares for
$282,990.

                                       13
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The Company  currently has no business  other than that of the Bank and does not
currently have any material funding commitments. The Company's principal sources
of liquidity are cash on hand and dividends  received from the Bank. The Bank is
subject to various regulatory restrictions on the payment of dividends.

The Bank's  principal  sources of funds for  investments  and operations are net
income,  deposits from its primary market area,  principal and interest payments
on loans,  interest received on investment securities and proceeds from maturing
investment securities. Its principal funding commitments are for the origination
or  purchase  of loans  and the  payment  of  maturing  deposits.  Deposits  are
considered  a  primary  source  of  funds  supporting  the  Bank's  lending  and
investment activities.

The Bank's most liquid assets are cash and cash  equivalents,  which are cash on
hand,  amounts due from  financial  institutions,  federal funds sold, and money
market  mutual  funds.  The levels of such  assets are  dependent  on the Bank's
operating financing and investment  activities at any given time. The variations
in levels of cash and cash  equivalents  are  influenced  by  deposit  flows and
anticipated future deposit flows.

The Bank may borrow up to 35% of  consolidated  Bank assets on a line  available
from the FHLB. As of September 30, 2002, the maximum  available  under this line
would be $91 million,  while current outstanding advances totaled $48.7 million.
In  order  to draw on this  line  the  Bank  must  have  sufficient  collateral.
Qualifying  collateral  includes  residential  1-4 family first mortgage  loans,
certain second mortgage loans, certain commercial real estate loans, and various
investment securities.


REGULATORY MATTERS

The Bank is subject to Federal  Reserve  Board capital  requirements  as well as
statutory  capital  requirements  imposed  under  Maryland law. At September 30,
2002, the Bank's  tangible,  leverage and risk-based  capital ratios were 9.47%,
9.48% and 13.82%, respectively.  These levels are well in excess of the required
4.0%, 4.0% and 8.0% ratios required by the Federal Reserve Board.

CRITICAL ACCOUNTING POLICIES

The Company's  financial  statements are prepared in accordance  with accounting
principles  generally  accepted  in the  United  States  (GAAP).  The  financial
information  contained  within the  financial  statements  is, to a  significant
extent,  financial information that is based on measures of financial effects of
transactions and events that have already  occurred.  A variety of factors could
affect the ultimate  value that is obtained when earning of income,  recognizing
an expense, recovering an asset or relieving a liability. We use historical loss
factors as one in determining  the inherent loss that may be present in our loan
portfolio.  Actual losses could differ significantly from the historical factors
that we use. In addition GAAP itself may change from one  previously  acceptable
method to another method.  Although the economics of our  transactions  would be
the same, the timing of events that would impact our transactions could change.

The Company considers the allowance for loan losses to be a critical  accounting
policy.  The  allowance for loan losses is an estimate of the losses that may be
sustained in our loan portfolio.  The allowance is based on two basic principles
of accounting:  (1) SFAS 5, "Accounting for Contingencies",  which requires that
losses be accrued when they are probable of occurring and estimable and (2) SFAS
114,  "Accounting  by Creditors for  Impairment of a Loan",  which requires that
losses be accrued  based on the  differences  between  the value of  collateral,
present  value of  future  cash  flows or  values  that  rae  observable  in the
secondary market and the loan balance.

Management has  significant  discretion in making the judgments  inherent in the
determination  of the  provision  and  allowance  for loan losses,  including in
connection  with  the  valuation  of  collateral,   a  borrower's  prospects  of
repayment,  and in establishing allowance factors on the formula allowance.  The
establishment  of  allowance  factors  is  a  continuing   exercise,   based  on
management's  continuing assessment of the global factors such as delinquencies,
loss  history,  trends  in the  volume  and term of  loans,  national  and local
economic  trends,  concentration  of  credit,  loan  classification,  and  other
factors. Changes in allowance factors will have a direct impact on the amount of
the provision and a corresponding  effect on net income.  Errors in management's
perception  and  assessment  of the  global  factor  sand  their  impact  on the
portfolio  could result in the allowance  not being  adequate to cover losses in
the portfolio  could result in the allowance not being  adequate to cover losses
in the portfolio, and may result in additional provisions or chargeoffs.


                                       14
<PAGE>


ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Not applicable.




ITEM 4 CONTROLS AND PROCEDURES

     The Company's  Chief  Executive  Officer and Chief  Financial  Officer have
evaluated  the Company's  disclosure  controls and  procedures  (as such term is
defined in Rule 13a-14(c) under the Exchange Act) as of a date within 90 days of
the date of filing of this Form 10-Q. Based upon such evaluation,  the Company's
Chief  Executive  Officer and Chief  Financial  Officer have concluded that such
controls and procedures are effective to ensure that the information required to
be  disclosed  by the Company in the reports it files under the  Exchange Act is
gathered, analyzed and disclosed with adequate timeliness.

     There have been no significant  changes in the Company's  internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of the evaluation described above.

                                       15
<PAGE>

                        TRI-COUNTY FINANCIAL CORPORATION
                        --------------------------------


                           PART II - OTHER INFORMATION
                           ---------------------------


Item 6 - Exhibits and reports on Form 8-K


          A.   Exhibits- The  following  exhibits are being filed with this Form
               10-Q
               99.1  Certification  pursuant  to Section  906 of the  Sarbanes -
               Oxley Act of 2002

          B.   Reports  on Form 8-K.  A report on form 8-K was filed on July 28,
               2002. In this Form 8-K, the Company reported under Item 5 that it
               intended to  repurchase  up to 38,000 shares of its common stock.
               No financial statements were filed with this report.


                                       16
<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.

                                        TRI-COUNTY FINANCIAL CORPORATION:



Date: November 14, 2002                 By:/s/ Michael L. Middleton
                                           -------------------------------------
                                           Michael L. Middleton, President
                                           and Chairman of the Board





Date: November 14, 2002                 By:/s/ William J. Pasenelli
                                           -------------------------------------
                                           William J. Pasenelli, Executive
                                           Vice President and Chief
                                           Financial Officer

                                       17
<PAGE>
                                  CERTIFICATION


I, Michael L.  Middleton,  President and Chief  Executive  Officer of Tri-County
Financial Corporation, certify that:

1. I have reviewed this  quarterly  report on Form 10-Q of Tri-County  Financial
Corporation;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     (a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     (b)  Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     (c)  Presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
the  registrant's  board or  directors  (or persons  fulfilling  the  equivalent
functions):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

Date: November 14, 2002


                                       /s/ Michael L. Middleton
                                       ---------------------------------------
                                       Michael L. Middleton
                                       President and Chief Executive Officer

                                       18
<PAGE>

                                  CERTIFICATION


I, William J. Pasenelli, Executive Vice President, Treasurer and Chief Financial
Officer of Tri-County Financial Corporation, certify that:

1. I have reviewed this  quarterly  report on Form 10-Q of Tri-County  Financial
Corporation;

2. Based on my  knowledge,  this  quarterly  report  does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made, not  misleading  with respect to the period covered by this quarterly
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included in this quarterly  report,  fairly present in all material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     (a)  Designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

     (b)  Evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

     (c)  Presented  in  this  quarterly   report  our  conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
the  registrant's  board or  directors  (or persons  fulfilling  the  equivalent
functions):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
quarterly report whether there were significant  changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent  evaluation,  including any corrective  actions with
regard to significant deficiencies and material weaknesses.

Date: November 12, 2002

                            /s/ William J. Pasenelli
                            ----------------------------------------------------
                            William J. Pasenelli
                            Executive Vice President and Chief Financial Officer

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