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        December 31, 1997
                               -------------------------------------------------

                                  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             0-18764
                                                      -------------


                               PULSE BANCORP, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


          NEW JERSEY                                       22-3016360
--------------------------------------------------------------------------------
(State or other  jurisdiction of incorporation          (IRS Employer
or  organization)                                      Identification No.)



6 JACKSON ST.,   SOUTH RIVER, N.J.                              08882
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)



Registrant's telephone number, including area code          732-257-2400
                                                     ---------------------------


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


Indicate by check whether the registrant  (1) has filed all reports  required to
be  filed  by  Section  13 or 15(d) of the  Securities  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
                                 -------                          -------

The  number of shares  outstanding  of each of the  issuer's  classes  of common
stock, as of the latest practicable date January 30, 1998

                      CLASS                         OUTSTANDING
                      ------                        -----------
            $1.00 par value common stock         3,092,148 Shares



<PAGE>



                      PULSE BANCORP, INC. AND SUBSIDIARIES



                                      Index

<TABLE>
<CAPTION>

                                                                             Page Number

<S>                                                                            <C>
PART I - CONSOLIDATED  FINANCIAL INFORMATION
     
          Consolidated Statements of Financial Condition at September 30,
          1997 and December 31, 1997 (unaudited)                                  1

          Consolidated Statements of Income for the Three Months
          Ended December 31, 1996  and 1997 (unaudited)                           2

          Consolidated Statements of Cash Flows for the Three Months Ended
          December 31, 1996 and 1997 (unaudited)                                  3

          Notes to Consolidated Financial Statements                            4-6

          Managements Discussion and Analysis of Financial Condition and
          Results of Operations                                                7-10


PART II - OTHER INFORMATION                                                   11-12

          SIGNATURES                                                             13


</TABLE>
<PAGE>


                      PULSE BANCORP, INC. AND SUBSIDIARIES
                 Consolidated Statements of Financial Condition

<TABLE>
<CAPTION>
                                                                                    September 30,          December 31,
                                                                                        1997                   1997
ASSETS                                                                                                     (Unaudited)
------                                                                              -----------------------------------
<S>                                                                                <C>                    <C>         
Cash and amounts due from depository institutions...............................   $  3,550,908           $  4,624,570
Federal funds sold..............................................................     11,925,000              5,000,000
                                                                                    -----------------------------------
    Total cash and cash equivalents.............................................     15,475,908              9,624,570

Investment securities held to maturity; estimated fair value of
  $96,386,850 and $90,804,454, respectively.....................................     96,551,885             90,543,218
Mortgage backed securities held to maturity, net; estimated fair
  value of $163,645,986 and $153,486,793, respectively..........................    162,763,525            152,343,198
Investment securities available for sale........................................     60,741,955             89,937,068
Mortgage-backed securities available for sale...................................     53,393,335             49,594,396
Loans receivable, net...........................................................    127,310,525            136,310,196
Premises & equipment, net.......................................................      1,322,718              1,433,243
Real estate owned, net..........................................................        136,491                748,491
Federal Home Loan Bank of New York stock, at cost...............................      2,775,500              2,775,500
Interest receivable.............................................................      4,584,337              5,086,729
Other assets....................................................................        959,530                925,423
                                                                                   -----------------------------------    
     Total assets...............................................................   $526,015,709           $539,322,032
                                                                                   ===================================  


LIABILITIES AND 
   STOCKHOLDERS' EQUITY
Liabilities:
Deposits........................................................................   $411,020,719           $416,555,821
Borrowings......................................................................     67,675,000             73,675,000
Advance payments by borrowers for taxes & insurance.............................        805,394                687,775
Other liabilities...............................................................      3,308,037              4,200,476
                                                                                  -------------------------------------
     Total liabilities..........................................................    482,809,150            495,119,072
                                                                                  -------------------------------------


Stockholders' Equity:
Preferred stock; authorized 5,000,000 shares; issued and
   outstanding - none...........................................................           -                     -
Common stock; par value $1.00; authorized 10,000,000 shares;
   4,112,128 shares issued and 3,050,048 outstanding and
   4,149,978 shares issued and 3,087,898 outstanding,
   respectively.................................................................      4,142,628              4,149,978
Paid in capital in excess of par value..........................................     12,293,206             12,384,706
Retained earnings- substantially restricted.....................................     42,676,884             43,421,136
Unrealized gain on securities available for sale, net of tax....................        771,341                924,640
Treasury Stock; at cost; 1,062,080 common shares, respectively..................    (16,677,500)           (16,677,500)
                                                                                   ------------------------------------
     Total stockholders' equity.................................................     43,206,559             44,202,960
                                                                                   ------------------------------------
     Total liabilities and stockholders' equity.................................   $526,015,709           $539,322,032
                                                                                   ====================================
</TABLE>

See accompanying notes to consolidated financial statements.

                                        1
<PAGE>
                      PULSE BANCORP, INC. AND SUBSIDIARIES
                        Consolidated Statements of Income
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                            Three Months Ended     
                                                               December 31,        
                                                      ---------------------------        
                                                           1996          1997  
                                                      ---------------------------
<S>                                                   <C>            <C>            
Interest income:
   Loans ..........................................   $  2,919,887   $  2,735,222   
   Mortgage-backed securities .....................      3,353,891      3,502,049   
   Investments and other interest-earning assets ..      2,569,124      3,050,781   
                                                         ------------------------   
      Total interest income .......................      8,842,902      9,288,052   
                                                         ------------------------   

Interest expense:
   Deposits .......................................      4,525,440      4,775,511   
   Borrowings .....................................        961,643      1,123,370   
                                                         ------------------------   
      Total interest expense ......................      5,487,083      5,898,881   
                                                         ------------------------   
Net interest income ...............................      3,355,819      3,389,171   
                                                         ------------------------   
Net interest income after provision for loan losses      3,355,819      3,389,171   
                                                         ------------------------   

Non-interest income:
   Other fees and service charges on loans ........         80,732         69,097   
   Income from real estate operations .............         90,566         24,440   
   Miscellaneous ..................................         29,689         22,640   
                                                         ------------------------   
      Total non-interest income ...................        200,987        116,177   
                                                         ------------------------   
Non-interest expenses:
   Salaries and employee benefits .................        653,699        735,832   
   Occupancy expense ..............................         76,747        117,777   
   Equipment expense ..............................        131,193        141,637   
   Advertising ....................................         94,707         97,990   
   Federal deposit insurance premium ..............        176,844         64,622   
   Miscellaneous ..................................        322,973        256,903   
                                                         ------------------------   
      Total non-interest expenses .................      1,456,163      1,414,761   
                                                         ------------------------   

Income before income taxes ........................      2,100,643      2,090,587   
Income taxes ......................................        768,372        728,756   
                                                         ------------------------   
      Net income ..................................   $  1,332,271   $  1,361,831   
                                                         ========================   

Basic earnings per common share ...................   $       0.44   $       0.44   
                                                         ========================   
                                                                                    
Diluted earnings per common share .................   $       0.43   $       0.42   
                                                         ========================   

Dividends per common share ........................   $      0.175   $       0.20   
                                                         ========================   
                                                                                   
Diluted common shares outstanding .................      3,130,615      3,243,610   
                                                         ========================   
                                                                                    
</TABLE>

See accompanying notes to consolidated financial statements.

                                       2
<PAGE>



                      PULSE BANCORP, INC. AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                                                Three Months Ended
                                                                                                   December 31,
                                                                                          ---------------------------
                                                                                               1996           1997
                                                                                          ---------------------------
<S>                                                                                      <C>             <C>         
Cash flows from operating activities:
  Net income ..........................................................................  $  1,332,271    $  1,361,831
  Adjustments to reconcile net income to net cash provided by
     operating activities:
    Depreciation of premises and equipment.............................................        37,397          42,010
    Provision for losses on real estate owned .........................................        32,850            --
    Amortization of premiums, discounts and fees, net..................................       (36,628)        (30,515)
    Gain on sale of real estate owned .................................................      (104,172)           --
    Decrease (increase) in interest receivable ........................................           749        (502,392)
    Decrease in other assets ..........................................................       168,031          34,107
    (Decrease) increase in other liabilities ..........................................    (1,814,399)        892,439
                                                                                         ----------------------------
      Net cash (used in) provided by operating activities .............................      (383,901)      1,797,480
                                                                                         ----------------------------

Cash flows from investing activities:
    Proceeds from maturities and calls of investment securities held to maturity ......     7,000,000       6,010,000
    Purchase of investment securities held to maturity ................................    (5,000,000)           --
    Principal repayments of investment securities available for sale ..................          --         4,310,242
    Purchase of investment securities available for sale ..............................          --       (33,345,000)
    Purchase of mortgage-backed securities held to maturity ...........................   (12,587,646)     (1,007,187)
    Purchase of mortgage-backed securities available for sale .........................          --              --
    Principal repayments on mortgage-backed securities held to maturity ...............     4,581,594      11,420,764
    Principal repayments on mortgage-backed securities available for sale .............       728,314       3,800,883
    Net decrease (increase) in loans receivable .......................................     5,229,895      (9,584,738)
    Additions to premises and equipment ...............................................       (33,882)       (152,535)
    Proceeds from sale of real estate owned ...........................................     2,317,146            --
                                                                                         ----------------------------
      Net cash provided by (used in) investing activities .............................     2,235,421     (18,547,571)
                                                                                         ----------------------------

Cash flows from financing activities:
    Net increase in deposits ..........................................................     6,847,942       5,535,102
    Net increase in borrowings ........................................................     1,050,000       6,000,000
    Decrease in advance payments by borrowers
      for taxes and insurance .........................................................       (40,682)       (117,619)
    Issuance of common stock ..........................................................         2,210          98,850
    Cash dividends paid ...............................................................      (533,758)       (617,580)
                                                                                         ----------------------------
      Net cash provided by financing activities........................................     7,325,712      10,898,753
                                                                                         ----------------------------

Net increase (decrease) in cash and cash equivalents ..................................     9,177,232      (5,851,338)
Cash and cash equivalents - beginning .................................................     4,749,883      15,475,908
                                                                                         ----------------------------
Cash and cash equivalents - ending ....................................................  $ 13,927,115    $  9,624,570
                                                                                         ============================

Supplemental schedule of non-cash investing activities:
      Transfer of loans receivable to real estate owned ...............................  $    150,000    $    612,000
                                                                                         ============================
Cash paid during the period for:
      Income taxes.....................................................................  $       --      $    209,140
                                                                                         ============================
      Interest.........................................................................  $  5,478,297    $  5,773,299
                                                                                         ============================
</TABLE>

See accompanying notes to consolidated financial statements.
                                       3.

<PAGE>

                      PULSE BANCORP, INC. AND SUBSIDIARIES
                   Notes To Consolidated Financial Statements

1. PRINCIPLES OF CONSOLIDATION
------------------------------
The  consolidated  financial  statements  include the accounts of Pulse Bancorp,
Inc. (the "Corporation") and its wholly owned subsidiaries,  Pulse Savings Bank,
Pulse Insurance  Services,  Pulse Real Estate,  and Pulse  Investment,  Inc. The
Corporation's   business  is  conducted   principally   through  the  Bank.  All
significant  intercompany  accounts and  transactions  have been  eliminated  in
consolidation

2. BASIS OF PRESENTATION
------------------------
The accompanying  unaudited  consolidated  financial statements were prepared in
accordance  with  instructions  for Form 10-Q  and,  therefore,  do not  include
information or footnotes  necessary for a complete  presentation of consolidated
financial  condition,  results of operations,  and cash flows in conformity with
generally accepted accounting principles.  However, all adjustments,  consisting
only of normal recurring adjustments,  which, in the opinion of management,  are
necessary for fair presentation of the consolidated  financial statements,  have
been included. The results of operations for the three months ended December 31,
1997 are not necessarily indicative of the results which may be expected for the
entire fiscal year.

3. LOANS RECEIVABLE, NET                                         
------------------------  
<TABLE>
<CAPTION>

                                                                                                September 30,  December 31,    
                                                                                                    1996          1997
                                                                                             ----------------------------
<S>                                                                                           <C>            <C>         
Real Estate Mortgage:
   One-to-four family .....................................................................   $ 77,761,695   $ 86,679,368
   Multi family ...........................................................................     15,088,127     14,338,665
   Commercial .............................................................................     22,321,707     22,811,302
                                                                                              ---------------------------
                                                                                               115,171,529    123,829,335
                                                                                              ---------------------------

Construction Loans ........................................................................        219,256        145,590

Consumer:
   Home equity ............................................................................     14,348,020     14,695,450
   Passbook or certificate ................................................................        229,173        203,485
                                                                                              ---------------------------
                                                                                                14,577,193     14,898,935
                                                                                              ---------------------------
        Total loans .......................................................................    129,967,978    138,873,860
                                                                                              ---------------------------

Less: Allowance for loan losses ...........................................................      2,357,396      2,315,403
         Deferred loan fees and discounts .................................................        300,057        248,261
                                                                                              ---------------------------
                                                                                                 2,657,453      2,563,664
                                                                                              ---------------------------
                                                                                              $127,310,525   $136,310,196
                                                                                              ===========================
</TABLE>

<TABLE>
<CAPTION>
An analysis of the allowance for loan losses is as follows:                                        Three Months Ended
                                                                                                      December 31,
                                                                                              ---------------------------
                                                                                                    1996           1997
                                                                                                    ----           ----
<S>                                                                                           <C>            <C>         
                     Balance-beginning.....................................................   $  2,458,777   $  2,357,396
                     Provisions charged to operations......................................          -              -
                     Losses charged to allowance...........................................        (29,504)       (41,993)
                                                                                              ---------------------------
                     Balance-ending........................................................   $  2,429,273   $  2,315,403
                                                                                              ===========================
</TABLE>

                                       4


<PAGE>



                            PULSE BANCORP, INC. AND SUBSIDIARIES
                         Notes To Consolidated Financial Statements
<TABLE>
<CAPTION>


4. INVESTMENT SECURITIES
------------------------
                                                                               September 30, 1997
                                               ------------------------------------------------------------------------------------
                                                                             Gross                 Gross                Estimated
                                                    Carrying               Unrealized            Unrealized                Fair
Held To Maturity                                      Value                   Gains                 Losses                 Value
                                               ------------------------------------------------------------------------------------
<S>                                                 <C>                     <C>                    <C>                 <C>        
U.S. Government (including agencies)                $95,954,388             $313,494               $503,532            $95,764,350
Obligations of state and political
    subdivisions                                        597,497               25,003                   --                  622,500
                                               ------------------------------------------------------------------------------------
                                                    $96,551,885             $338,497               $503,532            $96,386,850
                                               ====================================================================================

Available For Sale
U.S. Government Agency Debentures                   $59,822,275             $333,264               $237,084            $59,918,455
Equity securities                                       800,000               23,500                   --                 $823,500
                                               ------------------------------------------------------------------------------------
                                                    $60,622,275             $356,764               $237,084            $60,741,955
                                               ====================================================================================
</TABLE>

<TABLE>
<CAPTION>


                                                                             December 31, 1997
                                               ------------------------------------------------------------------------------------
                                                                              Gross                 Gross                Estimated
                                                    Carrying                Unrealized            Unrealized                Fair
Held To Maturity                                      Value                   Gains                 Losses                 Value
                                               ------------------------------------------------------------------------------------
<S>                                                 <C>                     <C>                    <C>                 <C>        
U.S. Government (including agencies)                $89,955,714             $353,340               $122,264            $90,186,790
Obligations of state and political                      587,504               30,160                   --                 $617,664
    subdivisions
                                               ------------------------------------------------------------------------------------
                                                    $90,543,218             $383,500               $122,264            $90,804,454
                                               ====================================================================================

Available For Sale
U.S. Government Agency Debentures                   $88,174,330             $576,840               $112,602            $88,638,568
Equity securities                                     1,238,750               59,750                   --               $1,298,500
                                               ------------------------------------------------------------------------------------
                                                    $89,413,080             $636,590               $112,602            $89,937,068
                                               ====================================================================================

</TABLE>


                                        5

<PAGE>
               PULSE BANCORP, INC. AND SUBSIDIARIES             
            Notes To Consolidated Financial Statements        
                                                        
                                                        
5. MORTGAGE-BACKED SECURITIES      
-----------------------------      
<TABLE>
<CAPTION>
                                                                  September 30, 1997              
                                           ---------------------------------------------------------
                                                              Gross            Gross      Estimated
                                             Carrying        Unrealized      Unrealized      Fair
Held To Maturity                              Value           Gains            Losses        Value
----------------                           ---------------------------------------------------------
<S>                                        <C>            <C>            <C>            <C>         
Government National Mortgage Association   $ 62,595,447   $  1,404,217   $       --     $ 63,999,664
Federal Home Loan Mortgage Corporation       35,726,553        409,980        265,291     35,871,242
Federal National Mortgage Association        30,556,079        182,409        155,962     30,582,526
Collateralized mortgage obligations          33,885,446          1,836        694,728     33,192,554
                                           ---------------------------------------------------------
                                           $162,763,525   $  1,998,442   $  1,115,981   $163,645,986
                                           =========================================================
Available For Sale
Government National Mortgage Association   $ 33,217,483   $    774,300   $       --     $ 33,991,783
Federal Home Loan Mortgage Corporation        9,473,817        189,614           --        9,663,431
Federal National Mortgage Association         9,616,497        121,624           --        9,738,121
                                           ---------------------------------------------------------
                                           $ 52,307,797   $  1,085,538   $       --     $ 53,393,335
                                           =========================================================
</TABLE>

<TABLE>
<CAPTION>
                                                        
                                                                   December 31, 1997               
                                           ---------------------------------------------------------
                                                                Gross         Gross       Estimated
                                              Carrying        Unrealized   Unrealized       Fair
Held To Maturity                                Value           Gains         Losses        Value
                                           ---------------------------------------------------------
<S>                                        <C>            <C>            <C>            <C>         
Government National Mortgage Association   $ 58,385,017   $  1,269,643   $       --     $ 59,654,660
Federal Home Loan Mortgage Corporation       31,927,291        438,184        254,269     32,111,206
Federal National Mortgage Association        28,888,719        435,519        132,477     29,191,761
Collateralized mortgage obligations          33,142,171          1,892        614,897     32,529,166
                                           ---------------------------------------------------------
                                           $152,343,198   $  2,145,238   $  1,001,643   $153,486,793
                                           =========================================================
Available For Sale
Government National Mortgage Association   $ 30,416,395   $    581,844   $       --     $ 30,998,239
Federal Home Loan Mortgage Corporation        9,155,151        220,814           --        9,375,965
Federal National Mortgage Association         9,102,090        118,102           --        9,220,192
                                           ---------------------------------------------------------
                                           $ 48,673,636   $    920,760   $       --     $ 49,594,396
                                           =========================================================
</TABLE>

                                                        
6. NET INCOME PER COMMON SHARE                                                  
------------------------------                                                  
                                                        
The  Corporation  adopted  SFAS No.  128 (SFAS 128)  "Earnings  per Share" as of
December 31, 1997 and basic earnings per common share has been calculated  based
on the weighted average number of shares outstanding. Fully diluted earnings per
share  includes  common  stock   outstanding  plus  the  shares  that  would  be
outstanding  assuming the exercise of dilutive stock  options,  all of which are
considered  to be common stock  equivalents.  The number of shares that would be
issued  from the  exercise of stock  options  has been  reduced by the number of
shares that could have been  purchased from the proceeds at the average price of
the  Corporation's  common  stock.  Earnings per share data for the three months
ending  December 31, 1996 has been restated  pursuant to the  provisions of SFAS
128.
                                                        
                                                        
                                                        
                                       6.


<PAGE>



                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FINANCIAL CONDITION

The  Corporation's  assets at December 31, 1997 totaled  $539.3  million,  which
represents  an  increase  of $13.3  million or 2.5% when  compared  with  $526.0
million at September  30, 1997.  Total  deposits at December 31, 1997  increased
$5.6 million or 1.4% to $416.6  million  when  compared  with $411.0  million at
September  30,  1997.  Investment  securities  held to maturity  decreased  $6.0
million or 6.2% to $90.5  million at December 31, 1997 when  compared with $96.5
million  at  September  30,  1997.  Investment  securities  available  for  sale
increased  $29.2  million or 48.1% to $89.9  million at  December  31, 1997 when
compared to $60.7  million at September  30, 1997.  The increase was a result of
purchases of $33.3 million,  which more than offset principal repayments of $4.3
million.  Mortgage-backed securities held to maturity decreased by $10.4 million
or 6.4% to $152.3  million at December 31, 1997 when compared to $162.8  million
at  September  30,  1997.  The decrease in  mortgage-backed  securities  held to
maturity was  primarily  due to  repayments  of $11.4  million,  which more than
offset purchases of $1.0 million.  Mortgage-backed securities available for sale
decreased $3.8 million or 7.1% to $49.6 million at December 31, 1997 compared to
$40.3 million at September 30, 1997. The decrease in mortgage-backed  securities
available  for sale  was due to  principal  repayments  of $3.8  million.  Loans
receivable increased $9.0 million or 7.1% to $136.3 million at December 31, 1997
when compared to $127.3 million at September 30, 1997. The increase was a result
of loan  originations  of $11.3  million and the  purchases  of 1-4 family loans
totaling  $2.6  million,  which more than offset  principal  repayments  of $4.3
million,  along with the transfer of a $612,000  multi-family loan to other real
estate  owned.  Other  liabilities  increased  by $0.9  million or 27.0% to $4.2
million at December 31, 1997 compared to $3.3 million at September 30, 1997. The
increase  was  primarily  due to an  increase  in the  Corporation's  income tax
liability.  Other assets remained  relatively  unchanged at $925,000 at December
31,  1997.  Real  estate  owned,  which  consists  of real  estate  acquired  in
settlement  of loans,  totaled  $748,000  and  $136,000 at December 31, 1997 and
September  30, 1997,  respectively.  The  increase  was due to one  multi-family
mortgage  loan of $612,000  that  transferred  during the period.  Stockholders'
equity  amounted  to $44.2  million and $43.2  million at December  31, 1997 and
September 30, 1997, respectively.


Results of operations for three months ended December 31, 1997 and 1996

Net income increased $30,000 or 2.2% to $1.36 million for the three months ended
December  31, 1997  compared  to $1.33  million  for the same 1996  period.  The
increase  was  attributable  to an  increase  in  interest  income  along with a
decrease in non-interest expense, which more than offset an increase in interest
expense and a decrease in non-interest  income.  Interest income on loans during
the three months  ended  December  31, 1997  decreased  $184,000 or 6.3% to $2.7
million when compared to $2.9 million during the same 1996 period.  The decrease
during the 1997 period  resulted from a decrease in the average balance of loans
outstanding,  along with a decrease in the average yield on the loan  portfolio.
Interest on mortgage-backed  securities increased by $148,000 or 4.4% during the
three months ended  December 31, 1997 when compared with the same 1996 period as
a result  of  increased  balances.  Interest  earned  on  investments  and other
interest-earning  assets increased  $482,000 or 18.8% to $3.1 million during the
three months ended  December 31, 1997 when  compared to $2.6 million  during the
same 1996 period. The increase during the 1997 period resulted primarily from an
increase in the average balance of investments and other interest-earning assets
outstanding.


                                          7

<PAGE>




Interest on deposits  increased  $250,000 or 5.5% to 4.78  million for the three
months ending  December 31, 1997 compared to $4.53 million  during the same 1996
period  primarily as a result of increased  deposits  outstanding  along with an
increase in the bank's cost of funds.  Interest on  borrowings  was $1.1 million
for the three months ended December 31, 1997 compared with $962,000 for the same
1996 period.  The increase was due to a higher  average  balance  outstanding of
securities sold under repurchase agreements during the 1997 period.

During the three months  ended  December 31, 1997 and 1996 the Bank did not make
any provisions for loan losses.  Although no provisions were made, as management
believes the levels of reserves were  adequate,  no assurances  can be made that
future  increases to the reserve will not be  necessary.  The allowance for loan
losses is based on  management's  evaluation  of the risk  inherent  in its loan
portfolio  and  gives  due  consideration  to  the  changes  in  general  market
conditions and in the nature and volume of loan  activity.  At December 31, 1997
and September 30, 1997, the Bank's  non-performing  loans,  which includes loans
delinquent 90 days or more, totaled $2.4 million and $1.7 million, respectively.
The allowance  for loan losses  amounted to $2.3 million or 1.67% of total loans
at December 31, 1997 and $2.4  million or 1.82% of total loans at September  30,
1997.

Non-interest  income  decreased  $85,000 or 42.2% to  $116,000  during the three
months ended December 31, 1997 when compared with $201,000  during the same 1996
period.  The decrease  during the 1997 period  resulted from decreases in income
from  real  estate  operations,  other  fees and  service  charges  on loans and
miscellaneous income of $66,000, $12,000 and 7,000,  respectively.  The decrease
in income  from real  estate  operations  was  mostly  due to a gain of  $73,000
recorded on a sale during the 1996 period.

Non-interest  expenses  decreased  $41,000 or 2.8% to $1.41  million  during the
three months ended December 31, 1997 when compared with $1.46 million during the
same 1996 period.  During the three months ended December 31, 1997, FDIC deposit
insurance  and   miscellaneous   expense  decreased  by  $112,000  and  $66,000,
respectively.  The large decrease in FDIC insurance  expense was a direct result
of the lower  insurance  premiums  that took  effect  January 1, 1997 due to the
recapitalization  of the SAIF insurance  fund.  Salaries and employee  benefits,
occupancy,  equipment,  and advertising  expenses increased by $82,000,  41,000,
$10,000, and 3,000, respectively.

Income tax expense  totaled  $729,000 and $768,000 during the three months ended
December 31, 1997 and 1996,  respectively.  The decrease was  primarily due to a
decrease in taxable income.


Liquidity and Capital Resources

Liquidity is a measurement  of the Bank's  ability to generate  sufficient  cash
flow,  in  order  to meet all  current  and  future  financial  obligations  and
commitments  as they arise.  The Bank adjusts its  liquidity  levels in order to
meet  funding  needs for deposit  outflows,  payment of real  estate  taxes from
escrow accounts on mortgage loans,  repayments of borrowings,  when  applicable,
and loan  funding  commitments.  The Bank also  adjusts its  liquidity  level as
appropriate to meet its asset/liability  objectives.  The Bank's primary sources
of funds are deposits, amortization and prepayments of loan and mortgage- backed
securities principal, maturities of investment securities, and funds provided by
operations  and  short  and  medium  term   borrowings.   While  scheduled  loan
amortization  and maturing  investment  securities are a relatively  predictable
source  of  funds,   deposit  flow  and  loan  and  mortgage-backed   securities
prepayments are greatly influenced by market interest rates, economic conditions
and competition. The Bank manages the pricing

                                          8

<PAGE>



of its deposits to maintain a steady  deposit  balance.  In  addition,  the Bank
invests  its  excess  funds in federal  funds and  overnight  deposits  with the
FHLB-NY which  provides  liquidity to meet lending  requirements.  Federal funds
sold at December 31, 1997 and  September 30, 1997 totaled $5.0 million and $11.9
million,  respectively.  The  Bank's  liquidity,  represented  by cash  and cash
equivalents, is a product of its operating,  investing and financing activities.
These activities are summarized as follows:

<TABLE>
<CAPTION>

                                                       Three months ended December 31,
                                                       -------------------------------
                                                             1996        1997
                                                       -------------------------------
                                                               (In Thousands)

<S>                                                        <C>         <C>     
Cash and cash equivalents- beginni                         $  4,750    $ 15,476
                                                           --------------------
Operating activities:
  Net income                                                  1,332       1,362
  Adjustments to reconcile net
  income to net cash provided
   by operating activities                                   (1,716)        435
                                                           --------------------

Net cash (used in)provided by operating activities             (384)      1,797

Net cash provided by (used in) investing activities           2,235     (18,548)
Net cash  provided by financing activities                    7,326      10,900
                                                           --------------------
Net increase (decrease) in cash and
          cash equivalents                                    9,177      (5,851)
                                                           --------------------
Cash and cash equivalents- ending                          $ 13,927    $  9,625
                                                           ====================

</TABLE>

Cash was  generated by operating  activities  during the 1997 period and used by
operating  activities  during the 1996 period.  The primary  source of cash from
operating  activities during both periods was net income.  The primary operating
use of cash during the 1996 period was the one time special insurance assessment
to the FDIC of  approximately  $2.6  million.  The  primary  sources and uses of
investing  activity of the Bank are proceeds from net  maturities and repayments
and the purchase of investment and mortgage-backed securities, net loan activity
and from  borrowing.  Net loans  increased  $9.6 million during the three months
ended  December 31, 1997 compared to a decrease of $5.2 million  during the same
1996 period. During the three months ended December 31, 1997 and 1996, purchases
of   mortgage-backed   securities   totaled  $1.0  million  and  $12.6  million,
respectively,  and principal  repayments totaled $11.4 million and $4.6 million,
respectively.  During  the  three  months  ended  December  31,  1997 and  1996,
purchases of  investment  securities  totaled  $33.3  million and $5.0  million,
respectively,  and  maturities and calls totaled $10.3 million and $7.0 million,
respectively.  In addition to funding new loan  production  and the  purchase of
investment  and  mortgage-backed  securities  through  operations  and financing
activities,  these  activities  were also  funded  by  principal  repayments  on
existing loans and mortgage-backed  securities and also through short and medium
term borrowings.

The primary source of financing  activities during the 1997 and 1996 periods was
from an increase  in deposits  outstanding  amounting  to $5.5  million and $6.8
million, respectively. Net borrowings also

                                          9

<PAGE>



increased  $6.0  million and $1.0  million  during 1997 and 1996,  respectively.
During the three months  ended  December  31, 1997 and 1996,  cash  dividends of
$618,000  and  $534,000,  respectively,  were paid on the  Corporation's  common
stock.

Liquidity  management  is  both a  daily  and  long-term  function  of  business
management.  Excess liquidity is generally  invested in short-term  investments,
such as federal funds and interest-bearing  deposits. If the Bank requires funds
beyond its ability to generate them internally,  borrowing agreements exist with
the FHLB-NY, which provides an additional source of funds.

The Bank  anticipates  that it will have sufficient  funds available to meet its
current  commitments  to  originate  loans and to purchase  mortgage-backed  and
investment  securities.  At December  31,  1997,  such  outstanding  commitments
amounted to $13.7 million.  Certificates  of deposit  scheduled to mature in one
year or less, at December 31, 1997, totaled $217.1 million.  Management believes
that a significant portion of such deposits will remain with the Bank.

The Bank is subject to regulatory capital  requirements  mandated by the Federal
Deposit Insurance Corporation ("FDIC"). The Bank is required to maintain minimum
regulatory capital ratios, defined by the FDIC as risk-based ratio capital (Tier
1 and Total) and  leverage  ratio  capital.  The  following  table  presents the
minimum  capital  requirement  ratios and the actual  ratios as of December  31,
1997:


                                 Requirement         Actual       Excess
                                 ---------------------------------------
       Risk-based Capital
                     Tier 1         4.00%            25.63%       21.63%
                     Total          8.00%            26.88%       18.88%

             Leverage ratio         4.00%             7.51%        3.51%



                                          10

<PAGE>




                       PULSE BANCORP, INC. AND SUBSIDIARY

                                     Part II

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  stockholders'  meeting  held on January 22,  1998,  the
          following matters were submitted to the stockholders:

          A. Election of two directors:
                                                  Votes            Votes
                                                   For            Withheld
                   (i)Mr. Joseph Chadwick       2,288,448          28,500
                  (ii)Mr. Edwin A. Kolodziej    2,287,848          29,100

          The following directors' terms of office as a director continued after
the meeting:

                      Mr. Benjamin S. Konopacki
                      Mr. George T. Hornyak, Jr.
                      Mr. Wayne A. Kronowski
                      Mr. Edwin A. Roginski

          B. The  appointment of KPMG Peat Marwick LLP as  independent  auditors
          for the registrant's 1998 fiscal year was ratified.

          2,305,228 votes in favor; 11,320 against; 400 abstaining

ITEM 5.  Other Materially Important Events
------------------------------------------

          Not applicable

ITEM 6.  Exhibits and Reports on Form 8-K
-----------------------------------------

          Not applicable


                                          11

<PAGE>



                       PULSE BANCORP, INC. AND SUBSIDIARY

                                     Part II


ITEM 7.  Quantitative and Qualitative Disclosures about Market Risk
--------------------------------------------------------------------

          Not applicable














                                          12

<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.




                                  PULSE BANCORP, INC

Date:      2/4/98                 By: /s/ George T. Hornyak, Jr.
      ----------------                ----------------------------------------
                                  George T. Hornyak, Jr.
                                  President
                                  Chief Executive Officer
                                  (Duly Authorized Officer)


Date:      2/4/98                 By: /s/ Thomas B. Konopacki
      ----------------               -----------------------------------------
                                  Thomas B. Konopacki
                                  Executive Vice President
                                  Chief Financial Officer










                                          13