<PAGE>

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

                                    FORM 10-Q

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

                      For the quarter ended September 30, 2004

                                       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 000-32605

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

        Pennsylvania                                      23-2400383
-----------------------------------            ---------------------------------
  (State or other jurisdiction of                 (IRS Employer Identification
  incorporation or organization)                             No.)

              5629 PA Route 873, P.O. Box 10, Neffs, PA 18065-0010
         --------------------------------------------------------------
                    (Address of principal executive offices)

                                 (610) 767-3875
                 ----------------------------------------------
                           (Issuer's telephone number)

     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 past 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 by a check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.)

                        Yes [ ]         No [X]

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

As of 9/30/04, 197,091 shares of common stock, par value of $1.00, were
outstanding.

                                       1

<PAGE>

                               NEFFS BANCORP, INC.

                                      INDEX

<TABLE>
<S>                                                                                                                   <C>
PART I.       FINANCIAL INFORMATION

Item 1.       Consolidated Financial Statements

              Consolidated Statements of Financial Condition (Unaudited)
              September 30, 2004 and December 31, 2003...........................................................      3

              Consolidated Statements of Income (Unaudited)
              Three months ended September 30, 2004 and September 30, 2003
              Nine months ended September 30, 2004 and September 30, 2003........................................      4

              Consolidated Statements of Stockholders' Equity  (Unaudited)
              Nine months ended September 30, 2004 and September 30, 2003........................................      5

              Consolidated Statements of Cash Flows (Unaudited)
              Nine months ended September 30, 2004 and September 30, 2003........................................      6

              Notes to the Interim Consolidated Financial Statements (Unaudited).................................      7

Item 2.       Management's Discussion and Analysis of Financial Condition
              and Results of Operations..........................................................................      9

Item 3.       Quantitative and Qualitative Disclosures about Market Risk.........................................     20

Item 4.       Controls and Procedures............................................................................     20

PART II.      OTHER INFORMATION

Item 1.       Legal Proceedings..................................................................................     21

Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds........................................     21

Item 3.       Defaults Upon Senior Securities....................................................................     21

Item 4.       Submission of Matters to a Vote of Security Holders................................................     21

Item 5.       Other Information..................................................................................     21

Item 6.       Exhibits ..........................................................................................     21

SIGNATURES ......................................................................................................     23
</TABLE>

                                       2

<PAGE>

                       NEFFS BANCORP, INC. AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                  (Unaudited)

<TABLE>
<CAPTION>
                                                                           September 30,     December 31,
Dollars in thousands, except per share data                                     2004             2003
                                                                           ------------------------------
<S>                                                                        <C>               <C>
                                   ASSETS

Cash and due from banks                                                      $   4,346         $   4,806
Interest bearing deposits with banks                                                28                46
Federal funds sold                                                               3,249             9,390
Securities available for sale                                                   39,644            27,382
Securities held to maturity, fair value
    2004 $82,759; 2003 $85,460                                                  80,321            82,705

Loans                                                                           74,618            70,886
   Less allowance for loan losses                                                 (664)             (637)
                                                                             ---------------------------
                       Net loans                                                73,954            70,249
                                                                             ---------------------------

Premises and equipment, net                                                      2,277             2,355
Other assets                                                                     1,967             1,637
                                                                             ---------------------------
                       Total assets                                          $ 205,786         $ 198,570
                                                                             ==========================

                    LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:
     Deposits
           Non-interest bearing                                              $  13,868         $  13,107
           Interest bearing                                                    154,198           149,587
                                                                             ---------------------------
                       Total deposits                                          168,066           162,694
     Other liabilities                                                             735               821
                                                                             ---------------------------
                       Total liabilities                                       168,801           163,515
                                                                             ---------------------------
Stockholders' Equity
     Common stock, $1 par value, authorized 2,500,000 shares;
           issued 200,000 shares; outstanding 197,091 shares                       200               200
     Paid-in capital                                                               690               690
     Retained earnings                                                          36,880            34,853
     Accumulated other comprehensive loss                                         (223)             (126)
     Treasury stock, at cost 2,909 shares                                         (562)             (562)
                                                                             ---------------------------
                           Total stockholders' equity                           36,985            35,055
                                                                             ---------------------------
                           Total liabilities and stockholders' equity        $ 205,786         $ 198,570
                                                                             ===========================
</TABLE>

See Notes to Consolidated Financial Statements.

                                       3

<PAGE>

                        NEFFS BANCORP, INC AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                Three Months Ended          Nine Months Ended
                                                                    September 30,              September 30,
Dollars in thousands,except per share data                      2004          2003          2004          2003
                                                              ----------------------      ----------------------
<S>                                                           <C>           <C>           <C>           <C>
Interest income:
    Interest and fees on loans                                $  1,172      $  1,297      $  3,531      $  3,816
    Interest and dividends on investments:
           Taxable                                                 805           467         2,273         1,771
           Exempt from federal income taxes                        530           578         1,637         1,688
    Interest on federal funds sold                                  11            31            44           102
                                                              ----------------------      ----------------------
                        Total interest income                    2,518         2,373         7,485         7,377
                                                              ----------------------      ----------------------
Interest Expense:
    Interest on deposits                                         1,006         1,112         3,055         3,343
                                                              ----------------------      ----------------------

                        Total interest expense                   1,006         1,112         3,055         3,343
                                                              ----------------------      ----------------------
                        Net interest income                      1,512         1,261         4,430         4,034

Provision for loan losses                                            6            15            36            45
                                                              ----------------------      ----------------------
                     Net interest income after provision
                            for loan losses                      1,506         1,246         4,394         3,989
                                                              ----------------------      ----------------------
Other income:
    Service charges on deposit accounts                             49            46           130           136
    Other service charges and fees                                  21            18            51            63
    Other income                                                     -             6            12            18
                                                              ----------------------      ----------------------
                        Total other income                          70            70           193           217
                                                              ----------------------      ----------------------

Other expenses:
    Salaries and employee benefits                                 283           293           834           835
    Occupancy                                                       52            46           121           121
    Furniture and equipment                                         39            35           117           105
    Pennsylvania shares tax                                         63            78           225           231
    Other expenses                                                 129           118           475           393
                                                              ----------------------      ----------------------
                        Total other expenses                       566           570         1,772         1,685
                                                              ----------------------      ----------------------
                        Income before income taxes               1,010           746         2,815         2,521

Income tax expense                                                 178            79           443           329
                                                              ----------------------      ----------------------
                        Net income                            $    832      $    667      $  2,372      $  2,192
                                                              ======================      ======================

Per share data:
    Earnings per share, basic                                 $   4.22      $   3.40      $  12.03      $  11.16
                                                              ======================      ======================

    Weighted average common shares outstanding                 197,091       196,431       197,091       196,431
                                                              ======================      ======================

    Cash dividends declared per share                         $      -      $      -      $   1.75      $   1.20
                                                              ======================      ======================
</TABLE>

See Notes to Consolidated Financial Statements.

                                       4

<PAGE>

                        NEFFS BANCORP, INC AND SUBSIDIARY
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                           Accumulated
                                                                                              Other                        Total
                                                 Common        Paid-In        Retained     Comprehensive    Treasury   Stockholders'
Dollars in thousands, except per share data       Stock        Capital        Earnings      Income(Loss)      Stock        Equity
                                                ------------------------------------------------------------------------------------
<S>                                             <C>            <C>            <C>          <C>              <C>        <C>
Balance, December 31, 2002                      $    200       $    609       $ 32,610       $     21       $   (615)    $ 32,825
                                                                                                                         --------
    Comprehensive Income:
       Net income                                      -              -          2,192              -              -        2,192
       Change in unrealized net gains
           (losses) on securities available
            for sale,net of tax                                                                  (113)                       (113)
                                                                                                                         --------
          Total comprehensive income                                                                                        2,079
                                                                                                                         --------
    Cash dividends declared on common
          stock, $1.20  per share                      -              -           (236)             -              -         (236)
                                                ---------------------------------------------------------------------------------
Balance, September 30, 2003                     $    200       $    609       $ 34,566       $    (92)      $   (615)    $ 34,668
                                                =================================================================================
</TABLE>

<TABLE>
<CAPTION>
                                                                                         Accumulated
                                                                                            Other                        Total
                                              Common        Paid-In        Retained     Comprehensive    Treasury     Stockholders'
Dollars in thousands, except per share data    Stock        Capital        Earnings          Loss          Stock        Equity
                                             --------------------------------------------------------------------------------------
<S>                                          <C>            <C>            <C>          <C>              <C>          <C>
Balance, December 31, 2003                   $    200       $    690       $ 34,853       $   (126)      $   (562)      $ 35,055
                                                                                                                        --------
    Comprehensive Income:
       Net income                                   -              -          2,372              -              -          2,372
       Change in unrealized net losses
           on securities available for
           sale,net of tax                                                                     (97)                          (97)
                                                                                                                        --------
          Total comprehensive income                                                                                       2,275
                                                                                                                        --------
    Cash dividends declared on common
          stock, $1.75  per share                   -              -           (345)             -              -           (345)
                                             -----------------------------------------------------------------------------------
Balance, September 30, 2004                  $    200       $    690       $ 36,880       $   (223)      $   (562)      $ 36,985
                                             ===================================================================================
</TABLE>

See Notes to Consolidated Financial Statements.

                                       5

<PAGE>

                        NEFFS BANCORP, INC AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>
Dollars in thousands
Nine Months Ended September 30,                                   2004           2003
                                                                --------       --------
<S>                                                             <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
    Net income                                                  $  2,372       $  2,192
    Adjustments to reconcile net income to net cash
        provided by operating activities:
        Depreciation                                                  95             80
        Provision for loan losses                                     36             45
        Net amortization of securities                               136            167
        Change in assets and liabilities:
             Increase in:
                    Accrued interest receivable                     (134)          (229)
                    Income taxes receivable                          (59)          (158)
                    Other assets                                     (97)           (79)
             Decrease in:
                    Accrued interest payable                         (73)          (111)
                    Other liabilities                                (13)           (23)
                                                                --------       --------
             Net cash provided by operating activities             2,263          1,884
                                                                --------       --------

CASH FLOWS FROM INVESTING ACTIVITIES
    Net (increase) decrease in interest bearing
        deposits with banks                                           18             (5)
    Net decrease in federal funds sold                             6,141          2,568
    Purchase of securities available for sale                    (17,942)       (17,065)
    Proceeds from maturities/calls of securities available
        for sale                                                   5,384          4,979
    Purchase of securities held to maturity                       (7,624)       (30,529)
    Proceeds from maturities/calls of securities held to
        maturity                                                  10,021         31,488
    Net increase in loans                                         (3,741)          (521)
    Purchases of premises and equipment                              (17)           (62)
    Proceeds from sale of foreclosed real estate                      10              -
                                                                --------       --------
         Net cash used in investing activities                    (7,750)        (9,147)
                                                                --------       --------
CASH FLOWS FROM FINANCING ACTIVITIES
    Net increase in deposits                                       5,372          9,161
    Dividends paid                                                  (345)          (236)
                                                                --------       --------
         Net cash provided by financing activities                 5,027          8,925
                                                                --------       --------
         Increase (decrease) in cash and cash equivalents           (460)         1,662

Cash and cash equivalents:
    Beginning                                                      4,806          2,732
                                                                --------       --------
    Ending                                                      $  4,346       $  4,394
                                                                ========       ========

Supplementary Cash Flows Information
    Interest Paid                                               $  3,128       $  3,454
                                                                ========       ========

    Income Taxes Paid                                           $    836       $    798
                                                                ========       ========
</TABLE>

See Notes to Consolidated Financial Statements.

                                       6

<PAGE>

                               NEFFS BANCORP, INC.
             NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2004
                                   (UNAUDITED)

NOTE 1.  BASIS OF PRESENTATION

The consolidated financial statements include the accounts of Neffs Bancorp,
Inc. (the "Corporation") and its wholly owned subsidiary, The Neffs National
Bank (the "Bank"). All material intercompany accounts and transactions have been
eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles in the United States
of America for interim financial information. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments considered necessary for a fair presentation have been included and
are of a normal, recurring nature. Operating results for the nine-month period
ended September 30, 2004, are not necessarily indicative of the results that may
be expected for the year ending December 3l, 2004. These statements should be
read in conjunction with notes to the financial statements contained in the 2003
Annual Report to Stockholders.

For further information, refer to the financial statements and footnotes thereto
included in the Neffs Bancorp, Inc. Annual Report for the year ended December
31, 2003.

NOTE 2.  COMMITMENTS AND CONTINGENCIES

The Corporation is subject to certain routine legal proceedings and claims
arising in the ordinary course of business. It is management's opinion that the
ultimate resolution of these claims will not have a material adverse effect on
the Corporation's financial position or results of operations.

                                       7

<PAGE>

NOTE 3. COMPREHENSIVE INCOME

The components of other comprehensive income and related tax effects for the
nine months and three months ended September 30, 2004 and 2003 are as follows:

<TABLE>
<CAPTION>
                                                   Three Months Ended      Nine Months Ended
                                                       September 30,          September 30,
                                                   2004        2003        2004        2003
                                                   -----       -----       ----        ----
                                                                (In Thousands)
<S>                                                <C>         <C>         <C>         <C>
Unrealized holding gains (losses) on
   available for sale securities                   $ 720       $(230)      $(147)      $(171)

Tax effect                                          (244)         78          50          58
                                                   -----       -----       -----       -----
Other comprehensive income (loss), net of tax      $ 476       $(152)      $ (97)      $(113)
                                                   =====       =====       =====       =====
</TABLE>

NOTE 4. EARNINGS PER SHARE

Earnings per share is based on the weighted average shares of common stock
outstanding during each year. The Corporation currently maintains a simple
capital structure, thus there are no dilutive effects on earnings per share.

NOTE 5. GUARANTEES

The Corporation does not issue any guarantees that would require liability
recognition or disclosure, other than its standby letters of credit. Standby
letters of credit written are conditional commitments issued by the Corporation
to guarantee the performance of a customer to a third party. Generally, all
letters of credit, when issued have expiration dates within one year. The credit
risk involved in issuing letters of credit is essentially the same as those that
are involved in extending loan facilities to customers. The Corporation,
generally, holds collateral and/or personal guarantees supporting these
commitments. The Corporation has $326,000 of standby letters of credit as of
September 30, 2004. Management believes that the proceeds obtained through a
liquidation of collateral and the enforcement of guarantees would be sufficient
to cover the potential amount of future payment required under the corresponding
guarantees. The current amount of the liability as of September 30, 2004 for
guarantees under standby letters of credit issued is not material.

NOTE 6. NEW ACCOUNTING STANDARDS

In March 2004, the SEC released Staff Accounting Bulleting (SAB) No. 105,
"Application of Accounting Principles to Loan Commitments." SAB 105 provides
guidance about the measurements of loan commitments recognized at fair value
under FASB Statement No. 133, "Accounting for Derivative Instruments and Hedging
Activities." SAB 105 also requires companies to disclose their accounting policy
for those loan commitments including methods and assumptions used to estimate
fair value and associated hedging strategies. SAB 105 is

                                       8

<PAGE>

effective for all loan commitments accounted for as derivatives that are entered
into after March 31, 2004. The adoption of SAB 105 is not expected to have an
effect on our consolidated financial statements.

In March 2004, the FASB's Emerging Issues Task Force (EITF) reached a consensus
on EITF Issue No., 03-1, "The Meaning of Other-Than-Temporary Impairment and Its
Application to Certain Investments" (EIFT 03-1). EIFT 03-1 provides guidance
regarding the meaning of other-than-temporary impairment and its application to
investments classified as either available-for-sale or held-to-maturity under
FASB Statement No. 115, "Accounting for Certain Investments in Debt and Equity
Securities," and to equity securities accounted for under the cost method.
Included in EIFT 03-1 is guidance on how to account for impairments that are
solely due to interest rate changes, including changes resulting from increases
in sector credit spreads. This guidance was to become effective for reporting
periods beginning after June 15, 2004. However, on September 30, 2004, the FASB
issued a Staff Position that delays the effective date for the recognition and
measurement guidance of EITF 03-1 until additional clarifying guidance is
issued. This additional guidance is expected to be issued during and be
effective for the fourth quarter of 2004. We are not able to assess the impact
of the adoption of EIFT 03-1 until final guidance is issued.

Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of
Operations analyzes the major elements of the Corporation's balance sheets and
statements of income. This section should be read in conjunction with the
Corporation's financial statements and accompanying notes.

Management of the Corporation has made forward-looking statements in this Form
10-Q. These forward-looking statements may be subject to risks and
uncertainties. Forward-looking statements include the information concerning
possible or assumed future results of operations of the Corporation and its
subsidiary. When words such as "believes," "expects," "anticipates" or similar
expressions occur in this Form 10-Q, management is making forward-looking
statements.

Readers should note that many factors, some of which are discussed elsewhere in
this report and in the documents that management incorporates by reference,
could affect the future financial results of the Corporation and its subsidiary,
both individually and collectively, and could cause those results to differ
materially from those expressed in the forward-looking statements contained or
incorporated by reference in this Form 10-Q. These factors include the
following:

-        operating, legal and regulatory risks;

                                       9

<PAGE>

-        economic, political and competitive forces affecting banking,
         securities, asset management and credit services businesses; and

-        the risk that management's analyses of these risks and forces could be
         incorrect and/or that the strategies developed to address them could be
         unsuccessful.

The Corporation undertakes no obligation to publicly revise or update these
forward-looking statements to reflect events or circumstances that arise after
the date of this report. Readers should carefully review the risk factors
described in other documents that the Corporation files periodically with the
Securities and Exchange Commission.

CRITICAL ACCOUNTING POLICIES

Disclosure of the Corporation's significant accounting policies is included in
Note 1 to the financial statements of the Corporation's Annual Report on Form
10-K for the year ended December 31, 2003. Some of these policies are
particularly sensitive, requiring significant judgments, estimates and
assumptions to be made by management, most particularly in connection with
determining the provision for loan losses and the appropriate level of the
allowance for loan losses. Additional information is contained in this Form 10-Q
on page 11 under the paragraph titled "Provision for Loan Losses" and on page 14
under the paragraphs titled "Loan and Asset Quality and Allowance for Loan
Losses".

OVERVIEW

Net income for the third quarter of 2004 increased 25% to $832,000 as compared
to $667,000 for the third quarter of 2003 and total revenues increased 6% from
$2.443 million to $2.588 million for the quarter. Net income per common share
increased 24% to $4.22 per share from $3.40 per share in the third quarter a
year ago. At September 30, 2004, the Corporation had total assets of $206
million, total loans of $74.6 million, and total deposits of $168.1 million.

RESULTS OF OPERATIONS

Average Balances and Average Interest Rates

Interest earning assets averaged $198.5 million for the third quarter of 2004 as
compared to $185.7 million for the same period in 2003. The yield on earning
assets for the third quarter of 2004 was 5.1%, which remained unchanged as
compared to the same period in 2003.

The growth in interest earning assets was funded primarily by an increase of $12
million in the average balance of deposits. Average interest-bearing liabilities
increased from $144.4 million during the third quarter of 2003 to $155.7 million
during the third quarter of 2004. Growth in average interest bearing liabilities
was the result of increases in interest bearing demand deposits, savings, and
time deposits of $130,000, $10.5 million, and $596,000, respectively. Deposit
account growth was attributed to the banks favorable interest rate structure
combined with the general decline in confidence in the stock market.

                                       10

<PAGE>

The average rate paid on interest-bearing liabilities was 2.58% for the third
quarter of 2004 and 3.08% for the third quarter of 2003, a decrease of 50 basis
points. This was the result of the declining interest rate environment that was
experienced during much of 2003.

Net Interest Income and Net Interest Margin

Net interest income is the difference between interest income earned on assets
and interest expense incurred on liabilities used to fund those assets. Interest
earning assets primarily include loans and securities and Federal Funds Sold.
Liabilities used to fund such assets include deposits. Changes in net interest
income and margin result from the interaction between the volume and composition
of earning assets, related yields and associated funding costs.

Interest income increased by $145,000, or 6% over the third quarter of 2003. The
increase in interest income is attributed to the slight rise in interest rates
on the Bank's loan and securities portfolios and the increase in average earning
assets. Interest expense for the third quarter of 2004 decreased by $106,000, or
9.5%, compared to the third quarter of 2003. The decrease was due to the general
decline in rates being offered and paid on interest bearing deposits, mainly
certificates of deposit and savings accounts.

Net interest income increased by $251,000 or 19.9% over the third quarter of
2003. As marketplace rates continued to decrease on loans and securities, the
Corporation reduced rates being offered on interest bearing deposit accounts.
Net income for the third quarter of 2004 continued to be positively affected by
those downward rate adjustments.

For the nine months ended September 30, 2004, interest income increased by
$108,000 or 1.5%, over the same period in 2003. Interest earning assets for the
first nine months of 2004 averaged $196.1 million versus $180.3 million for the
comparable period in 2003. The yield on those assets for 2004 was 5.1% as
compared to 5.5% the first nine months of 2003.

Interest expense for the first nine months of 2004 declined by $288,000 or 8.6%
for the first nine months of 2004. Average interest-bearing liabilities
increased from $141 million for the first nine months of 2003 to $154.7 million
for the first nine months of 2004. The average rate paid for these nine months
was 2.6%, down 60 basis points from 3.2% for the comparable period in the prior
year.

Net interest income for the first nine months of 2004 increased by $396,000 or
9.8% over the same period in 2003. The company's net interest margin decreased
to 3.0% for the first nine months of 2004, from 3.2% over the same period in
2003.

Net interest margin represents the difference between interest income, including
net loan fees earned, and interest expense, reflected as a percentage of average
earning assets. Net interest margin for the third quarter of 2004 was 3.1%,
which is a slight increase from 2.7% for the third quarter of 2003. During the
third quarter of 2004, yields on earning assets remained constant at 5.1% from
the third quarter of 2003, yields on interest bearing deposits decreased to
2.6%, as compared to 3.1%, for the third quarter of 2003.

                                       11

<PAGE>

Provision for Loan Losses

The provision for loan losses was $6,000 during the third quarter of 2004 as
compared to $15,000 for the third quarter of 2003. The provision for loan losses
was $36,000 for the nine months ended September 30, 2004 compared to $45,000 for
the nine months ended September 30, 2003. The decrease in the provision is due
to decreased risk in the portfolio along with minimal growth in the loan
portfolio.

Non-interest Income

Non-interest income for the third quarter of 2004 was $70,000 for the three
months ending September 30,2004, remaining unchanged from the same period in
2003.

Recurring core noninterest income for the first nine months of 2004 was $181,000
as compared to $199,000 for the nine months of 2003, a decrease of 9.1%. The
decrease is mainly attributable to a decrease in deposit account service charge
income and fee income derived from the sale of loan related insurance.

Non-interest Expense

For the third quarter of 2004, non-interest expenses decreased by $4,000, or
..7%, to $566,000, compared to $570,000 over the same period in 2003. This
decrease is primarily the result of a decrease in Pennsylvania Shares Tax of
$15,000 due to the recognition of the Education Improvement tax credit. The tax
credit relates to the $50,000 Education improvement donation made to the
Northern Lehigh School District Foundation which was expensed in the second
quarter.

Salary expenses and employee benefits, which represent the largest component,
50%, of non-interest expenses, decreased by $10,000, or 3.4%, for the third
quarter of 2004. This slight decrease is due to the retirement of an executive
officer.

Occupancy expense for the third quarter of 2004 increased by $6,000 or 13% as
compared to the third quarter of 2003. This increase is the result of normal
building maintenance performed throughout the third quarter of 2004.

Furniture and equipment expenses for the third quarter of 2004 increased by
$4,000 or 11.4% as compared to the third quarter of 2003. This increase is due
to increased depreciation expense on equipment additions.

Other expenses increased by $11,000 or 9.3% throughout the third quarter of 2004
as compared to the third quarter of 2003. This increase is mostly related to
increases in travel expenses, supplies expenses, and other miscellaneous
expenses.

For the first nine months of 2004, non-interest expense increased by $87,000 or
5.2% over the same period in 2003.

                                       12

<PAGE>

Salary expenses and employee benefits, which represents the largest component,
47.1% of non-interest expenses, decreased by $1,000, over the first nine months
of 2003. The decrease was due to normal salary adjustments and hiring of
additional staff, partially offset by the retirement of an executive officer as
mentioned above.

Occupancy and furniture and equipment expenses for the first nine months of 2004
increased by $12,000 or 5.3% as compared to the same period of 2003. This
increase is related to normal building maintenance performed throughout the
first nine months of 2004.

Net other expenses increased by $82,000 or 20.9% for the first nine months ended
September 30, 2004 over the first nine months of 2003. This increase is mostly
related to a $50,000 donation made to Northern Lehigh School District
Educational Foundation. The Bank will receive a 90% or $45,000 state tax credit
to offset this donation.

One key measure used to monitor progress in controlling overhead expenses is the
ratio of net non-interest expense to average assets. Net non-interest expenses
equal noninterest expenses (excluding foreclosed real estate expenses) less
non-interest income (exclusive of nonrecurring gains), divided by average
assets. This annualized ratio was .96% for the three months ended September 30,
2004, slightly lower than 1.04% for the three months ended September 30, 2003.
It was 1.03% for the first nine months of 2004 compared to 1.02% for the
comparable period in 2003.

Another productivity measure is the operating efficiency ratio. This ratio
expresses the relationship of non-interest expenses (excluding foreclosed real
estate expenses) to net interest income plus noninterest income (excluding
nonrecurring gains). For the quarter ended September 30, 2004, the operating
efficiency ratio was 35.8% compared to 42.8% for the similar period in 2003. For
the nine months ended September 30, 2004, this ratio was 38.3% compared to 39.6%
for the nine months ended September 30, 2003.

Provision for Federal Income Taxes

The provision for federal income taxes was $178,000 for the third quarter of
2004, as compared to $79,000 for the same period in 2003. For nine months ended
September 30, the provision was $443,000 and $329,000 for 2004 and 2003,
respectively. The effective tax rate, which is the ratio of income tax expense
to income before income taxes, was 17.6% for the third quarter of 2004 and 10.6%
for the third quarter of 2003. The effective tax rate for the first nine months
of 2004 and 2003 were 15.7% and 13.1%, respectively. The increase in the
effective tax rate is due to increased income before income taxes combined with
lower tax-exempt income.

Net Income

Net income for the third quarter of 2004 was $832,000, an increase of $165,000
or 24.7% over the $667,000 recorded in the third quarter of 2003. This increase
was mainly due to the

                                       13

<PAGE>

favorable interest rate climate as deposit account growth funded higher yielding
securities, resulting in a $251,000 increase in net interest income.

Net income for the first nine months of 2004 was $2.4 million, an increase of
$180,000 or 8.2% as compared to the same period of 2003. This was mainly due to
a favorable interest rate climate, enhanced by growth in short term; low rate
deposits accounts and subsequent growth in higher yielding securities, resulting
in a $396,000 increase in net interest income.

Return on Average Assets

Return on average assets (ROA) measures the Corporation's net income in relation
to its total average assets. The Corporation's annualized ROA for the third
quarter of 2004 was 1.6% compared to 1.4% for the third quarter of 2003. The ROA
for the first nine months of 2004 remained constant from 2003 at 1.6%.

Return on Average Equity

Return on average equity (ROE) indicates how effectively the Corporation can
generate net income on the capital invested by its stockholders. ROE is
calculated by dividing net income by average stockholders' equity. For purposes
of calculating ROE, average stockholders' equity includes the effect of
unrealized gains or losses, net of income taxes, on securities available for
sale. The annualized ROE for the third quarter of 2004 was 9.2% as compared to
7.8% for the third quarter of 2003. The ROE for the first nine months of 2004
was 8.8% as compared to 8.7% for the same period of 2003.

FINANCIAL CONDITION

Securities

Federal funds sold decreased by $6.2 million from $9.4 million to $3.2 million
during the first nine months of 2004 from December 31, 2003. This decrease was
due mainly to purchases of securities available for sale and held to maturity,
which were offset by calls of bonds and continued growth in deposit accounts.
Total securities and federal funds sold aggregated $123.2 million at September
30, 2004, and represented 59.9% of total assets.

Held to maturity securities decreased by $2.4 million from $82.7 million to
$80.3 million during the first nine months of 2004 from December 31, 2003. This
decrease was mainly due to calls and maturity of bonds. These proceeds received
helped to fund the increase in available for sale securities.

During the first nine months of 2004 securities available for sale increased by
$12.2 million from $27.4 million at December 31, 2003 to $39.6 million at
September 30, 2004. This increase is a result of increased purchases of
mortgage-backed securities. The securities available for sale portfolio is
comprised of mortgage-backed securities and equity securities.

                                       14

<PAGE>

The average yield on the combined securities portfolio for the first nine months
of 2004 was 4.4% as compared to 4.5% for the similar period of 2003. For the
third quarter of 2004, the average yield on the combined securities portfolio
was 4.4% as compared to 4.0% for the same period in 2003.

The weighted average life of the combined securities portfolio was approximately
12 years at September 30, 2004 with a weighted yield of 4.4% as compared to 4.0%
for the same period in 2003.

Net Loans Receivable

During the first nine months of 2004 net loans receivable increased by $3.7
million from $70.2 million at December 31, 2003, to $73.9 million on September
30, 2004. The increase in net loans receivable is the result of a $2.7 million
increase in commercial and commercial real estate loans, $500,000 increase in
consumer real estate and related loans and $500,000 increase in personal and
retail installment loans. Loans receivable represented 44.0% of total deposits
and 36.3% of total assets at September 30, 2004, as compared to 43.2% and 35.4%,
respectively, at December 31, 2003.

Loan and Asset Quality and Allowance for Loan Losses

As of September 30, 2004, total loans receivable increased $3.7 million as
compared to December 31, 2003.

Total non-accrual loans at September 30, 2004, were $166,000, or .22%, of total
loans as compared to $148,000, or .21%, of total loans at December 3l, 2003.
There was no foreclosed real estate held by the Corporation as of September 30,
2004 as compared to $10,000 held at December 31, 2003.

                                       15

<PAGE>

The following summary table presents information regarding non-performing loans
and assets as of September 30, 2004 and December 31, 2003.

                         Nonperforming Loans and Assets
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                              September 30,   December 31,
                                                  2004           2003
<S>                                           <C>             <C>
Nonaccrual Loans:
Commercial                                        $ --           $ --
Real Estate:                                        --             --
    Construction                                    --             --
    Mortgage                                       166            148
                                                  ----           ----
            Total nonaccrual                       166            148
Restructured loans                                  --             --
Loans past due 90 days or more                      51            327
                                                  ----           ----
            Total nonperforming loans              217            475
Foreclosed real estate                              --             10
                                                  ----           ----
            Total nonperforming assets             217            485
                                                  ====           ====
Nonperforming loans to total loans                0.29%          0.67%
Nonperforming assets to total assets              0.11%          0.24%
</TABLE>

The following table sets forth the Corporation's provision and allowance for
loan losses.

                            Allowance for Loan Losses
                             (Dollars in Thousands)

<TABLE>
<CAPTION>
                                                    9 Months         9 Months
                                                     Ending           Ending
                                                  September 30,     September 30,
                                                      2004             2003
<S>                                               <C>               <C>
Balance at beginning of period                        $ 637            $ 564
Provisions charged to operating expenses                 36               45
Recoveries of loans previously charged-off:
              Commercial                                  -                9
              Consumer                                   13               10
              Real estate                                 -                -
                                                      -----            -----
Total Recoveries                                         13               19
Loans Charged-off:
              Commercial                                  -                -
              Consumer                                  (22)              (5)
              Real Estate                                 -                -
                                                      -----            -----
Total Charged-off                                       (22)              (5)
                                                      -----            -----
Net (Charge-off) recoveries                              (9)              14
                                                      -----            -----
Balance at end of period                              $ 664            $ 623
                                                      =====            =====
Net Charge-offs as a percentage of
       average loans outstanding                       0.01%               -
Allowance for loan losses as a percentage of
       period end loans                                0.89%            0.89%
</TABLE>

                                       16

<PAGE>

Deposits

Total deposits at September 30, 2004, were $168.1 million, up $5.4 million, or
3.3%, over total deposits of $162.7 million at December 3l, 2003. The average
balances for the first nine months of 2004 and 2003 are presented in the
following table:

<TABLE>
<CAPTION>
                                                               Nine Months Ended September 30,
                                                                   (Dollars in thousands)
                                                              2004                          2003
                                                     Average        Average        Average       Average
                                                     Balance          Rate         Balance         Rate
                                                     -------          ----         -------         ----
<S>                                                  <C>            <C>          <C>             <C>
Demand Deposits:
   Noninterest-bearing                               $ 13,434                    $ 13,285
   Interest-bearing                                     8,606          .61%         8,254         1.29%
Savings                                                68,288         1.59%        57,380         2.64%
Time deposits:
   <$100,000                                           54,225         3.55%        54,534         4.34%
   >$100,000                                           22,626         4.41%        21,563         3.21%
                                                     --------                    --------
Total Deposits                                       $167,179                    $155,016
                                                     ========                    ========
</TABLE>

Interest Rate Sensitivity

The management of interest rate sensitivity seeks to avoid fluctuating net
interest margins and to provide consistent net interest income through periods
of changing interest rates.

The Corporation's risk of loss arising from adverse changes in the fair value of
financial instruments, or market risk, is composed primarily of interest rate
risk. The primary objective of the Corporation's asset/liability management
activities is to maximize net interest income while maintaining acceptable
levels of interest rate risk. The Bank's Asset/Liability Committee (ALCO) is
responsible for establishing policies to limit exposure to interest rate risk,
and to ensure procedures are established to monitor compliance with those
policies. The Corporation's Board of Directors approves the guidelines
established by ALCO.

An interest rate sensitive asset or liability is one that, within a defined
period, either matures or experiences an interest rate change in line with
general market interest rates. Historically, the most common method of
estimating interest rate risk was to measure the maturity and repricing
relationships between interest-earning assets and interest-bearing liabilities
at specific points in time (GAP), typically one year. Under this method, a
company is considered liability sensitive when the amount of its
interest-bearing liabilities exceeds the amount of its interest-earning assets
within the one-year horizon. However, assets and liabilities with similar
repricing characteristics may not reprice at the same time or to the

                                       17

<PAGE>

same degree. As a result, the Corporation's GAP does not necessarily predict the
impact of changes in general levels of interest rates on net interest income.

Management believes the simulation of net interest income in different interest
rate environments provides a more meaningful measure of interest rate risk.
Income simulation analysis captures not only the potential of all assets and
liabilities to mature or reprice, but also the probability that they will do so.
Income simulation also attends to the relative interest rate sensitivities of
these items, and projects their behavior over an extended period of time.
Finally, income simulation permits management to assess the probable effects on
the balance sheet not only of changes in interest rates, but also of proposed
strategies for responding to them.

The Corporation's income simulation model analyzes interest rate sensitivity by
projecting net interest income over the next 12 months in a flat rate scenario
versus net income in alternative interest rate scenarios. Management continually
reviews and refines its interest rate risk management process in response to the
changing economic climate. Currently, the Corporation's model projects a
proportionate 200 basis point change during the next year.

The Corporation's ALCO policy has established that income sensitivity will be
considered acceptable if overall net income volatility in a plus or minus 200
basis point scenario is within 5% of net interest income in a flat rate
scenario. At September 30, 2004, the Corporation's simulation model indicates
net interest income would increase 2.9% within the first year if rates increased
as described above. The model projects that net interest income would decrease
by 3.4% in the first year if rates decreased as described above. All of these
forecasts are within an acceptable level of interest rate risk per the policies
established by ALCO.

Liquidity

Liquidity management involves the ability to generate cash or otherwise obtain
funds at reasonable rates to support asset growth and reduce assets to meet
deposit withdrawals, to maintain reserve requirements, and to otherwise operate
the Corporation on an ongoing basis. Liquidity needs are generally met by
converting assets into cash or obtaining sources of additional funds, mainly
deposits. Primarily cash and federal funds sold, and the cash flow from the
amortizing securities and loan portfolios provide liquidity sources from asset
categories. The primary source of liquidity from liability categories is the
generation of additional core deposit balances.

Additionally, the Corporation has established secondary sources of liquidity
consisting of federal funds lines of credit and borrowing capacity at the
Federal Home Loan Bank, which can be drawn upon if needed. In view of the
primary and secondary sources as previously mentioned, management believes that
the Corporation is capable of meeting its anticipated liquidity needs.

                                       18

<PAGE>

Off-Balance Sheet Arrangements

The Corporation's financial statements do not reflect off-balance sheet
arrangements that are made in the normal course of business. Those off-balance
sheet arrangements consist of unfunded loans and letters of credit made under
the same standards as on-balance sheet instruments. These commitments, at
September 30, 2004 totaled $8.398 million. This consisted of $3.457 million in
tax-exempt loans, commercial real estate, construction, and land development
loans, $3.268 million in home equity lines of credit, $326.0 thousand in standby
letters of credit and the remainder in other unused commitments. Because these
instruments have fixed maturity dates, and because many of them will expire
without being drawn upon, they do not generally present any significant
liquidity risk to the Corporation.

Management believes that any amounts actually drawn upon can be funded in the
normal course of operations. The Corporation has no investment in or financial
relationship with any unconsolidated entities that are reasonably likely to have
a material effect on liquidity or the availability of capital resources.

Capital Adequacy

At September 30, 2004, stockholders' equity totaled $37 million, up 5.5% over
stockholders' equity of $35 million at December 31, 2003. The increase in
stockholders' equity for the nine months ended September 30, 2004 included a
$97,000 unrealized loss, net of income taxes, on securities available for sale.
Excluding this unrealized loss, gross stockholders' equity changed by an
increase of $2,027,000 in retained net income.

Risk-based capital provides the basis for which all banks are evaluated in terms
of capital adequacy. The risk-based capital standards require all banks to have
Tier 1 capital of at least 4% and total capital, including Tier 1 capital, of at
least 8% of risk-adjusted assets. Tier 1 capital includes common stockholders'
equity together with related surpluses and retained earnings. Total capital may
be comprised of total Tier 1 capital plus qualifying debt instruments, and the
allowance for loan losses.

                                       19

<PAGE>

The following table provides a comparison of the Corporation's risk-based
capital ratios and leverage ratios to the minimum regulatory requirements for
the periods indicated:

<TABLE>
<CAPTION>
                                                                 For Capital
                                September 30,    December 31,      Adequacy
                                    2004             2003          Purposes
                                    ----             ----          --------
<S>                             <C>              <C>             <C>
Risk-Based Capital Ratios:

     Tier 1 Capital                 40.85%          40.40%           4.00%

     Total Capital                  41.57           41.10            8.00

     Leveraged Capital              18.08           18.00            4.00
</TABLE>

The Bank's capital ratios are not materially different from that of the
Corporation. At September 30 2004, the capital levels of the Bank met the
definition of a "well capitalized" institution.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Corporation's exposure to market risk has not changed significantly since
December 31, 2003. The market risk principally includes interest rate risk,
which is discussed in the Management's Discussion and Analysis above.

ITEM 4.

Controls and Procedures

The Corporation maintains controls and procedures designed to ensure that
information required to be disclosed in the reports that the Corporation files
or submits under the Securities and Exchange Act of 1934 is recorded, processed,
summarized and reported within the time periods specified in the rules and forms
of the SEC. Based upon their evaluation of those controls and procedures as of
September 30, 2004, the chief executive officer and principal financial officer
of the Corporation concluded that the Corporation's disclosure controls and
procedures were adequate.

The Corporation made no changes in its internal controls or in other factors
that has materially affected, or is reasonably likely to materially affect these
controls during the quarter ended September 30, 2004, including any corrective
actions with regard to significant deficiencies and material weaknesses.

                                       20

<PAGE>

PART II.

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In the opinion of the management of the Corporation, there are no proceedings
pending to which the Corporation or its subsidiary are a party or to which their
property is subject, which, if determined adversely to the Corporation or its
subsidiary, would be material in relation to the Corporation's or its
subsidiary's financial condition. There are no proceedings pending other than
ordinary routine litigation incident to the business of the Corporation or its
subsidiary. In addition, no material proceedings are pending or are known to be
threatened or contemplated against the Corporation or its subsidiary by
government authorities.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

         Not applicable

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

         Not applicable

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         Not applicable

ITEM 5.  OTHER INFORMATION

         Not applicable

ITEM 6.  EXHIBITS

         3(i)     Amended and Restated Articles of Incorporation for Neffs
                  Bancorp, Inc. (Incorporated by reference to Exhibit 3 (i) to
                  the Form 10 filed with the Commission on April 27, 2001, as
                  amended on June 29, 2001 and July 20, 2001.)

         3(ii)    Amended and Restated By-laws of Neffs Bancorp, Inc.
                  (Incorporated by reference to Exhibit 99.1 to the Form 8K
                  filed with the Commission on February 27, 2002.)

         31.1     Certification of Chief Executive Officer pursuant to Section
                  302 of the Sarbanes Oxley Act of 2002

                                       21

<PAGE>

         31.2     Certification of Principal Financial Officer pursuant to
                  Section 302 of the Sarbanes Oxley Act of 2002

         32.1     Certification of Chief Executive Officer pursuant to Section
                  1350 of the Sarbanes-Oxley Act of 2002.

         32.2     Certification of Principal Financial Officer pursuant to
                  Section 1350 of the Sarbanes-Oxley Act of 2002.

                                       22

<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.

                                            NEFFS BANCORP, INC.

Date: 11/12/04                              /s/ John J. Remaley
                                            ------------------------------------
                                            John J. Remaley, President

                                       23