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

                                FORM 10-Q

(Mark One)   Quarterly Report Pursuant to Section 13 or 15(d) of
    [X]            the Securities Exchange Act of 1934
              For the quarterly period ended June 30, 2003
                                       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 No.: 0-29826
                                           -------

                           LONG ISLAND FINANCIAL CORP.
                           ---------------------------
             (Exact name of registrant as specified in its charter)

                 Delaware                                11-3453684
                 --------                                ----------
     (State or other jurisdiction of       (I.R.S. Employer Identification No.)
     incorporation or organization)

   One Suffolk Square, Islandia, New York                   11749
   --------------------------------------                   -----
   (Address of Principal Executive Offices)                (Zip Code)

                                 (631) 348-0888
                                 --------------
              (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [X] No [ ]


Indicate  by 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.

Common Stock par value $.01, per share.  The registrant had 1,482,691  shares of
Common Stock outstanding as of August 11, 2003.


<PAGE>

<TABLE>


                                                              Form 10-Q
                                                     LONG ISLAND FINANCIAL CORP.

                                                                INDEX
                                                                                                        Page
PART I - FINANCIAL INFORMATION                                                                         Number
------------------------------                                                                         ------
<S>                                <C>                                                                  <C>
ITEM 1.       Consolidated Financial Statements - Unaudited

              Consolidated Balance Sheets at June 30, 2003
                    and December 31, 2002                                                                 2
              Consolidated Statements of Earnings for the Three Months and
                    Six Months Ended June 30, 2003 and 2002                                               3
              Consolidated Statement of Changes in Stockholders' Equity
                    for the Six Months Ended June 30, 2003                                                4
              Consolidated Statements of Cash Flows for the Six Months
                    Ended June 30, 2003 and 2002                                                          5
              Notes to Consolidated Financial Statements                                                  6

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

ITEM 3.       Quantitative and Qualitative Disclosures About Market Risk                                  19

ITEM 4.       Controls and Procedures                                                                     20


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

ITEM 1.       Legal Proceedings                                                                           20

ITEM 2.       Changes in Securities and Use of Proceeds                                                   20

ITEM 3.       Defaults Upon Senior Securities                                                             20

ITEM 4.       Submission of Matters to a Vote of Security Holders                                         20

ITEM 5.       Other Information                                                                           21

ITEM 6.       Exhibits and Reports on Form 8-K                                                            21

SIGNATURES                                                                                                22
</TABLE>



                                       1
<PAGE>



PART I - FINANCIAL INFORMATION
------------------------------

Item 1.       Consolidated Financial Statements
-------       ---------------------------------
<TABLE>
                                                     LONG ISLAND FINANCIAL CORP.
                                                     Consolidated Balance Sheets
                                                             (Unaudited)
                                                  (In thousands, except share data)

                                                                                     June 30,          December 31,
                                                                                       2003                2002
                                                                                       ----                ----
Assets:

<S>                                                                                <C>                 <C>
Cash and due from banks                                                             $  17,790          $  20,443
Interest earning deposits                                                               1,299                 47
Federal funds sold                                                                     51,000              5,300
                                                                                       ------              -----
              Total cash and cash equivalents                                          70,089             25,790
Securities held-to-maturity  (fair value of $14,908 and $14,027, respectively)         12,467             12,461
Securities available-for-sale, at fair value                                          183,707            219,590
Federal Home Loan Bank stock, at cost                                                   3,250              3,588
Loans, net of unearned income and deferred fees                                       217,383            217,731
Less allowance for loan losses                                                         (2,416)            (2,346)
                                                                                       ------             ------
              Loans, net                                                              214,967            215,385
Premises and equipment, net                                                             4,411              3,530
Accrued interest receivable                                                             2,416              2,654
Bank owned life insurance                                                               8,025              7,859
Prepaid expenses and other assets                                                       1,231              1,094
                                                                                        -----              -----
              Total assets                                                          $ 500,563          $ 491,951
                                                                                    =========          =========

Liabilities and Stockholders' Equity:

Deposits:
    Demand deposits                                                                 $  88,882          $  78,697
    Savings deposits                                                                   93,060             73,780
    NOW and money market deposits                                                     108,960            130,636
    Time certificates issued in excess of $100,000                                     15,156             20,516
    Other time deposits                                                                92,241             96,905
                                                                                       ------             ------
              Total deposits                                                          398,299            400,534
Other borrowings                                                                       65,000             55,000
Accrued expenses and other liabilities                                                  3,108              3,344
                                                                                        -----              -----
              Total liabilities                                                       466,407            458,878
                                                                                      -------            -------

Guaranteed preferred beneficial interest in junior subordinated
    debentures                                                                          7,500              7,500
                                                                                        -----              -----

Stockholders' equity:
    Common stock (par value $.01 per share; 10,000,000 shares authorized;
        1,812,347 and 1,783,126 shares issued; 1,475,447 and
        1,446,226 shares outstanding, respectively)                                        18                 18
    Surplus                                                                            20,751             20,281
    Accumulated surplus                                                                 8,912              7,625
    Accumulated other comprehensive income                                              1,153              1,827
    Treasury stock at cost, (336,900 shares in 2003 and 2002)                          (4,178)            (4,178)
                                                                                       ------             ------
              Total stockholders' equity                                               26,656             25,573
                                                                                       ------             ------
              Total liabilities and stockholders' equity                            $ 500,563          $ 491,951
                                                                                    =========          =========


    See accompanying notes to consolidated financial statements.
</TABLE>



                                       2
<PAGE>

<TABLE>


                                                     LONG ISLAND FINANCIAL CORP.
                                                 Consolidated Statements of Earnings
                                                             (Unaudited)
                                                  (In thousands, except share data)

                                                                       For the Three Months            For the Six Months
                                                                          Ended June 30,                 Ended June 30,
                                                                          --------------                 --------------
<S>                                                                  <C>             <C>             <C>          <C>
                                                                        2003             2002             2003        2002
                                                                        ----             ----             ----        ----
Interest income:
     Loans                                                           $ 3,800         $  3,610        $   7,593    $  7,022
     Securities                                                        2,094            2,267            4,387       4,596
     Federal funds sold                                                   37               27               48          54
     Earning deposits                                                      1                2                2           4
                                                                           -                -                -           -
         Total interest income                                         5,932            5,906           12,030      11,676
                                                                       -----            -----           ------      ------

Interest expense:
     Savings deposits                                                    299              248              577         401
     NOW and money market deposits                                       212              221              473         413
     Time certificates issued in excess of $100,000                       86              191              162         418
     Other time deposits                                                 838              980            1,732       2,062
     Borrowed funds                                                      720              669            1,398       1,334
                                                                         ---              ---            -----       -----
         Total interest expense                                        2,155            2,309            4,342       4,628
                                                                       -----            -----            -----       -----

         Net interest income                                           3,777            3,597            7,688       7,048
                                                                       -----            -----            -----       -----

Provision for loan losses                                                  -               60               60         150
                                                                          --               --               --         ---

         Net interest income after provision
             for loan losses                                           3,777            3,537            7,628       6,898
                                                                       -----            -----            -----       -----

Other operating income:
     Service charges on deposit accounts                                 518              423              980         842
     Net gain on sale of securities                                      153                -              242           -
     Net gain on sale of residential loans                               170              173              327         336
     Earnings on bank owned life insurance                               102               96              204         192
     Other                                                               120               99              258         218
                                                                         ---               --              ---         ---
         Total other operating income                                  1,063              791            2,011       1,588
                                                                       -----              ---            -----       -----

Other operating expenses:
     Salaries and employee benefits                                    1,846            1,513            3,615       2,962
     Occupancy expense                                                   235              215              491         429
     Premises and equipment expense                                      326              292              647         582
     Capital securities                                                  205              206              411         405
     Other                                                             1,012              883            2,015       1,796
                                                                       -----              ---            -----       -----
         Total other operating expenses                                3,624            3,109            7,179       6,174
                                                                       -----            -----            -----       -----

         Income before income taxes                                    1,216            1,219            2,460       2,312

Income taxes                                                             434              420              880         795
                                                                         ---              ---              ---         ---

         Net income                                                  $   782         $    799        $   1,580    $  1,517
                                                                     =======         ========        =========    ========

Basic earnings per share                                             $   .53         $    .55        $    1.08    $   1.05
                                                                     =======         ========        =========    ========
Diluted earnings per share                                           $   .51         $    .53        $    1.03    $   1.02
                                                                     =======         ========        =========    ========
Weighted average shares outstanding                                1,471,263        1,446,226        1,460,457   1,443,332
                                                                   =========        =========        =========   =========
Diluted weighted average shares outstanding                        1,547,694        1,497,044        1,530,485   1,486,930
                                                                   =========        =========        =========   =========

See accompanying notes to consolidated financial statements.
</TABLE>



                                       3
<PAGE>

<TABLE>


                                                     LONG ISLAND FINANCIAL CORP.
                                      Consolidated Statement of Changes in Stockholders' Equity
                                               For the Six Months Ended June 30, 2003
                                                             (Unaudited)
                                                  (In thousands, except share data)
<S>                                        <C>           <C>         <C>            <C>           <C>        <C>
                                                                                 Accumulated
                                                                                    other
                                            Common                 Accumulated  comprehensive   Treasury
                                             stock       Surplus     surplus        income        stock      Total
                                             -----       -------     -------        ------        -----      -----

Balance at December 31, 2002               $   18        20,281      7,625          1,827         (4,178)    25,573

Comprehensive income:
    Net income                                  -             -      1,580              -              -      1,580
      Other comprehensive income,
        net of tax:
         Unrealized depreciation in
         available-for-sale securities,
         net of reclassification adjustment     -             -          -           (674)                     (674)
                                                                                                               ----
Total comprehensive income                                                                                      906

Exercise of stock options and related
     tax benefit, issued 27,003 shares          -           409          -              -              -        409

Dividend reinvestment and stock purchase
     plan, issued 2,218 shares                  -            61          -              -              -         61

Dividends declared on common stock
     ($.20 per common share)                    -             -       (293)             -              -       (293)
                                           -------------------------------------------------------------------------

Balance at June 30, 2003                   $   18        20,751      8,912          1,153         (4,178)    26,656
                                           =========================================================================






See accompanying notes to consolidated financial statements.
</TABLE>


                                       4
<PAGE>


<TABLE>


                                                     LONG ISLAND FINANCIAL CORP.
                                                Consolidated Statements of Cash Flows
                                                             (Unaudited)
                                                           (In thousands)
<S>                                                                                 <C>              <C>
                                                                                      For the Six Months
                                                                                        Ended June 30,
                                                                                        --------------
                                                                                     2003             2002
                                                                                     ----             ----
Cash flows from operating activities:
    Net income                                                                $     1,580      $     1,517
    Adjustments to reconcile net income to net cash
    provided by operating activities:
     Provision for loan losses                                                         60              150
     Depreciation and amortization                                                    471              450
     Amortization of premiums, net of discount accretion                            1,086              582
     Net gain on sale of securities                                                  (242)               -
     Loans originated for sale, net of proceeds
         from sales and gains                                                         573             (209)
     Net deferred loan origination fees                                                52               56
     Earnings on bank owned life insurance                                           (204)            (192)
     Deferred income taxes                                                              -              (66)
     Change in other assets and liabilities:
         Accrued interest receivable                                                  238              (90)
         Prepaid expenses and other assets                                            145              138
         Accrued expenses and other liabilities                                       (95)            (629)
                                                                                      ---             ----
         Net cash provided by operating activities                                  3,664            1,707
                                                                                    -----            -----

Cash flows from investing activities:
     Purchases of securities held-to-maturity, available-for-sale                (487,495)        (623,248)
     Net redemption (purchase) of Federal Home Loan Bank stock                        338             (727)
     Proceeds from the sale of securities available-for-sale                       17,958                -
     Proceeds from maturities of securities                                       482,904          651,018
     Principal repayments on securities                                            20,607           22,226
     Loan originations net of principal repayments                                   (267)         (14,004)
     Purchase of premises and equipment                                            (1,352)            (556)
                                                                                   ------             ----
         Net cash provided by investing activities                                 32,693           34,709
                                                                                   ------           ------

Cash flows from financing activities:
     Net increase (decrease) in demand deposit, savings, NOW,
         and money market accounts                                                  7,789           (9,405)
     Net decrease in certificates of deposit                                      (10,024)          (8,684)
     Net decrease in federal funds purchased and securities sold
         under agreements to repurchase                                                 -           (4,500)
     Net increase in other borrowings                                              10,000                -
     Proceeds from exercise of stock options                                          409               90
     Proceeds from shares issued under the dividend reinvestment
         and stock purchase plan                                                       61                -
     Payments for cash dividends                                                     (293)            (260)
                                                                                     ----             ----
         Net cash provided by (used in) financing activities                        7,942          (22,759)
                                                                                    -----          -------

         Net increase in cash and cash equivalents                                 44,299           13,657

Cash and cash equivalents at beginning of period                                   25,790           30,626
                                                                                   ------           ------
Cash and cash equivalents at end of period                                    $    70,089      $    44,283
                                                                              ===========      ===========

Supplemental disclosure of cash flow information: Cash paid during the period
for:
     Interest                                                                 $     4,431      $     5,231
                                                                              ===========      ===========
     Income taxes                                                             $       991      $       987
                                                                              ===========      ===========
See accompanying notes to consolidated financial statements.
</TABLE>



                                       5
<PAGE>



                           LONG ISLAND FINANCIAL CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

Private Securities Litigation Reform Act Safe Harbor Statement

Statements  contained  in this Form  10-Q  which  are not  historical  facts are
forward-looking  statements  as that term is defined in the  Private  Securities
Litigation  Reform Act of 1995.  Amounts stated herein could vary as a result of
market and other factors.  Such forward-looking  statements are subject to risks
and  uncertainties  which could cause actual results to differ  materially  from
those currently  anticipated due to a number of factors,  which include, but are
not limited to, factors  discussed in documents  filed by Long Island  Financial
Corp. (the  "Company") with the Securities and Exchange  Commission from time to
time. Such forward-looking statements may be identified by the use of such words
as "believe," "expect," "anticipate," "should," "planned," "estimated," "intend"
and "potential".  Examples of forward looking  statements  include,  but are not
limited to,  estimates  with  respect to the  financial  condition,  expected or
anticipated revenue,  results of operations and business of the Company that are
subject to various factors which could cause actual results to differ materially
from these  estimates.  The Company's  ability to predict  results or the actual
effect of future plans or  strategies  is  inherently  uncertain.  Factors which
could have a material  adverse effect on the operations of the Company  include,
but are not limited to, changes in: interest rates; general economic conditions;
monetary and fiscal policies of the U. S. Government,  including policies of the
U.S.  Treasury and the Federal Reserve Board;  the quality or composition of the
loan or investment portfolios; demand for loan and non-deposit products; deposit
flows;  real estate  values;  the level of defaults,  losses and  prepayments on
loans held by the Company in its  portfolio  or sold in the  secondary  markets;
demand  for  financial  services  in the  Company's  market  area;  competition;
accounting  principles,  policies,  practices  or  guidelines;   legislation  or
regulation;  and other  economic,  competitive,  governmental,  regulatory,  and
technological factors affecting the Company's operations,  pricing, products and
services.  The  forward-looking  statements are made as of the date of this Form
10-Q,  and,  except as  required  by  applicable  law,  the  Company  assumes no
obligation to update the forward-looking statements or to update the reasons why
actual  results  could  differ  from  those  projected  in  the  forward-looking
statements.  These risks and  uncertainties  should be  considered in evaluating
forward-looking  statements,  which speak only as of the date of this Form 10-Q,
and undue reliance should not be placed on such statements.


1. BASIS OF PRESENTATION

The  accompanying   unaudited  consolidated  financial  statements  include  the
accounts of Long Island Financial Corp. and its wholly-owned  subsidiaries.  All
significant  inter-company  accounts and  transactions  have been  eliminated in
consolidation.

The accompanying  unaudited  consolidated  financial  statements included herein
reflect  all  normal  recurring   adjustments  which  are,  in  the  opinion  of
management,  necessary  for a fair  presentation  of the results for the interim
periods presented. The results of operations for the six month period ended June
30, 2003 are not necessarily indicative of the results of operations that may be
expected for the entire fiscal year.  Certain  information and note  disclosures
normally included in financial statements prepared in accordance with accounting
principles  generally  accepted  in the  United  States  of  America  have  been
condensed or omitted pursuant to the rules and regulations of the Securities and
Exchange  Commission.  Certain  reclassifications  have been made to prior  year
amounts  to  conform  to  the  current  year   presentation.   These   unaudited
consolidated financial statements should be read in conjunction with the audited
consolidated financial statements,  and notes thereto, included in the Company's
2002 Annual Report on Form 10-K.


                                       6
<PAGE>

The Company makes  available  through its Internet  website,  www.licb.com,  its
annual reports on Form 10-K,  quarterly reports on Form 10-Q, current reports on
Form 8K, and all  amendments  to those  reports  filed or furnished  pursuant to
Section 13(a) or 15(d) of the Securities  Exchange Act of 1934. Such reports are
free of charge and are  available as soon as  reasonably  practicable  after the
Company  electronically  files  such  material  with,  or  furnishes  it to, the
Securities and Exchange Commission.

2. SECURITIES

The following table sets forth certain information  regarding amortized cost and
estimated fair values of the securities  held-to-maturity and available-for-sale
as of the dates indicated:
<TABLE>

<S>                                                          <C>               <C>       <C>                <C>
                                                                  June 30, 2003             December 31, 2002
                                                                  -------------             -----------------
                                                             Amortized        Fair        Amortized       Fair
                                                               Cost           Value         Cost          Value
                                                               ----           -----         ----          -----
                                                                                (In thousands)
    Held-to-maturity:
    Corporate debt                                         $   12,467        14,908    $   12,461         14,027
                                                               ------        ------        ------         ------
         Total held-to-maturity                            $   12,467        14,908    $   12,461         14,027
                                                           ==========        ======    ==========         ======

    Available-for-sale:
    U.S. Government and Agency obligations                 $  111,631       112,356    $  129,345        130,422
    Mortgage-backed securities:
       GNMA                                                    51,671        52,429        62,565         63,971
       FHLMC                                                    7,978         8,062        12,920         13,122
       FNMA                                                     8,605         8,782         9,879         10,015
    Corporate debt                                              2,012         2,078         2,013          2,060
                                                                -----         -----         -----          -----
        Total securities available-for-sale                $  181,897       183,707    $  216,722        219,590
                                                           ==========       =======    ==========        =======
</TABLE>

3. LOANS, NET
<TABLE>

Loans, net, are summarized as follows:

                                                                June 30, 2003                  December 31, 2002
                                                                -------------                  -----------------
                                                                            (Dollars in thousands)

<S>                                                        <C>            <C>                <C>           <C>
    Commercial and industrial loans                        $    45,099    20.4    %          $    54,001   24.3   %
    Commercial real estate loans                               135,952    61.3                   130,275   58.7
    Automobile loans                                            37,577    17.0                    34,188   15.4
    Consumer loans                                               2,258     1.0                     2,238    1.0
    Residential real estate loans held-for-sale                    616      .3                     1,189     .6
                                                                   ---      --                     -----     --
                                                               221,502   100.0                   221,891  100.0
    Less:
    Unearned income                                              3,303                             3,396
    Deferred fees, net                                             816                               764
    Allowance for loan losses                                    2,416                             2,346
                                                                 -----                             -----
                                                           $   214,967                       $   215,385
                                                           ===========                       ===========
</TABLE>

4. STOCK BASED COMPENSATION

The Company applies the intrinsic-value based method of accounting prescribed by
Accounting Principles Board (APB) Opinion No. 25, Accounting for Stock Issued to
Employees, and related interpretations  including Financial Accounting Standards
Board  (FASB)   Interpretation  No.  44,  Accounting  for  Certain  Transactions
involving Stock Compensation, an interpretation of APB Opinion No. 25, issued in
March 2000,  to account for its  fixed-plan  stock  options.  Under this method,
compensation expense is recorded on the date of grant only if the current market
price  of  the  stock  exceeded  the  exercise  price.  Statement  of  Financial
Accounting  Standards (SFAS) No. 123,  Accounting for Stock Based  Compensation,
established  accounting and  disclosure  requirements  using a  fair-value-based
method of accounting for stock-based employee  compensation plans. As allowed by
SFAS  No.   123,   the   Company   has   elected  to   continue   to  apply  the
intrinsic-value-based method of accounting described above, and has adopted only
the disclosure requirements of SFAS No. 123.

                                       7
<PAGE>

The following table illustrates the effect on net income if the fair-value-based
method had been applied to all stock options granted or vested in each period.

<TABLE>
                                                                       For the Three Months           For the Six Months
                                                                          Ended June 30,                Ended June 30,
                                                                         ----------------              --------------
<S>                                                                    <C>          <C>            <C>        <C>
                                                                         2003        2002              2003      2002
                                                                         ----        ----              ----      ----
                                                                        (Dollars in thousands, except per share data)
       Net income as reported                                          $  782       $ 789          $  1,580   $ 1,517
       Deduct total stock-based employee compensation
                expense determined under fair-value-based
                method for all awards, net of tax                          53          33               188        91
                                                                           --          --               ---        --
       Pro forma net income                                            $  729       $ 756          $  1,392   $ 1,426
                                                                       ======       =====          ========   =======

       Earnings per share:
       Basic                                   As Reported             $  .53       $ .55          $   1.08   $  1.05
                                               Pro forma                  .50         .52               .95       .99
       Diluted                                 As Reported                .51         .53              1.03      1.02
                                               Pro forma                  .47         .50               .91       .96
</TABLE>

5. RECENT DEVELOPMENTS

On May 21,  2003,  the Board of  Directors  of the Company  declared a quarterly
dividend of ten cents ($0.10) per common share. The dividend was paid on July 1,
2003, to shareholders of record as of June 20, 2003.

6. OTHER COMMITMENTS AND CONTINGENT LIABILITIES

In the normal course of business,  the Bank enters into  commitments to purchase
investment securities. At June 30, 2003, the Bank had outstanding commitments of
$5 million to purchase investment securities.

7. RECENT ACCOUNTING  PRONOUNCEMENTS

In May, 2003, the FASB issued SFAS No. 150,  "Accounting  for Certain  Financial
Instruments with Characteristics of both Liabilities and Equity." Under previous
guidance,  issuers could account for certain  financial  instruments  as equity.
SFAS No. 150 addresses the  accounting for those  instruments  and requires that
those  instruments  be classified as  liabilities  in the  consolidated  balance
sheets.  SFAS No. 150 is effective for all such  financial  instruments  entered
into or modified after May 31, 2003, and otherwise is effective at the beginning
of the first interim  period  beginning  after June 15, 2003.  The impact on the
Company's  consolidated balance sheets upon adoption of SFAS No. 150 will be the
reclassification  of the  guaranteed  preferred  beneficial  interest  in junior
subordinated  debentures  from in between total  liabilities  and  stockholders'
equity to borrowed funds. The impact on the Company's consolidated statements of
earnings upon adoption of SFAS No. 150 will be to change the  classification  of
the interest expense related to the guaranteed  preferred beneficial interest in
junior subordinated  debentures from non-interest expense to interest expense on
borrowed funds.

In April 2003,  the FASB issued SFAS No. 149,  "Amendment  of  Statement  133 on
Derivative  Instruments  and  Hedging  Activities."  SFAS  No.  149  amends  and
clarifies  accounting for derivative  instruments  (collectively  referred to as
derivatives),   including  certain  derivative  instruments  embedded  in  other
contracts and for hedging activities under SFAS 133,  "Accounting for Derivative
Instruments and Hedging Activities." SFAS 149 is effective for contracts entered
into or modified after June 30, 2003, and for hedging  relationships  designated
after June 30, 2003, and is to be applied prospectively.  The provisions of SFAS
No.  149 that  relate to  Statement  133  Implementation  Issues  that have been
effective for fiscal  quarters that began prior to June 15, 2003,  will continue
to be applied in accordance with their respective  effective dates. In addition,
certain  provisions  relating  to  forward  purchases  or sales  of  when-issued
securities  or  other  securities  that do not yet  exist,  will be  applied  to
existing  contracts as well as new  contracts  entered into after June 30, 2003.
The  adoption  of  SFAS  No.  149  did  not  have  an  impact  on the  Company's
consolidated balance sheets or consolidated statements of earnings.

                                       8
<PAGE>

In January 2003, FASB issued FASB Interpretation  ("FIN") No.46,  "Consolidation
of  Variable  Interest  Entities."  FIN 46 requires a company to  consolidate  a
variable interest entity ("VIE") if the company has variable interests that give
it a majority  of the  expected  losses or a majority of the  expected  residual
returns of the entity.  FIN 46 is effective  immediately  for VIEs created after
January 31, 2003.  For VIEs created prior to February 1, 2003, FIN 46 will apply
in the first interim  period or fiscal year  beginning  after June 15, 2003. The
implementation  of FIN 46 has not had an  impact on the  Company's  consolidated
balance sheets or consolidated statements of earnings.

In November  2002,  FASB issued FIN 45,  "Guarantor's  Accounting and Disclosure
Requirements for Guarantees,  Including  Indirect  Guarantees of Indebtedness of
Others,  an  interpretation of FASB Statements No. 5, 57, and 107 and Rescission
of FIN 34." This Interpretation clarifies the requirements of FASB Statement No.
5, "Accounting for  Contingencies,"  relating to the guarantor's  accounting for
and  disclosure of the issuance of certain types of  guarantees.  The disclosure
provisions of the  Interpretation  are  effective  for  financial  statements in
interim or annual reports for periods that end after December 15, 2002. However,
the  provisions  for initial  recognition  and  measurement  are  effective on a
prospective  basis for guarantees that are issued or modified after December 31,
2002,  irrespective  of  the  guarantor's  year-end.  The  application  of  this
Interpretation  did not have a  material  impact on the  Company's  consolidated
balance sheet or consolidated statement of earnings.


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

The principal business of Long Island Financial Corp.  consists of the operation
of  a  wholly-owned  subsidiary,   Long  Island  Commercial  Bank.  Long  Island
Commercial Bank is a New York state-chartered  commercial bank, founded in 1989,
which  is  engaged  in  commercial  banking  in  Islandia,  New  York,  and  the
surrounding communities of Suffolk,  Nassau, and Kings counties. The Bank offers
a broad range of commercial and consumer  banking  services,  including loans to
and deposit accounts for small and medium-sized businesses,  professionals, high
net worth  individuals  and consumers.  The Bank is an  independent  local bank,
emphasizing personal attention and responsiveness to the needs of its customers.

Critical Accounting Policies

The Company identifies  accounting policies critical to the Company's operations
and  understanding of the Company's  results of operations.  Certain  accounting
policies  are  considered  to be important  to the  portrayal  of the  Company's
financial condition, since they require management to make complex or subjective
judgments, some of which may relate to matters that are inherently uncertain.

The Company has determined that the methodology used in determining the level of
its allowance for loan losses is critical in the presentation and  understanding
of the  Company's  consolidated  financial  statements.  The  allowance for loan
losses  represents  management's  estimate  of probable  losses  inherent in the
portfolio.  The  evaluation  process  for making  provisions  for loan losses is
subject to numerous  estimates and judgments.  Changes in those  estimates would
have a direct  impact on the  provision  for loan  losses and could  result in a
change  in  the  allowance.  While  management  uses  available  information  to
determine  losses on loans,  future  additions to the allowance may be necessary
based on,  among other  things,  unanticipated  changes in economic  conditions,
particularly in the counties of Suffolk and Nassau.

                                       9
<PAGE>

In  evaluating  the  portfolio,  management  takes into  consideration  numerous
factors such as the Company's loan growth,  prior loss  experience,  present and
potential  risks  of the  loan  portfolio,  risk  ratings  assigned  by  lending
personnel, ratings assigned by the independent loan review function, the present
financial  condition of the borrowers,  current economic  conditions,  and other
portfolio risk  characteristics.  The Company's formalized process for assessing
the adequacy of the allowance  for loan losses and the  resultant  need, if any,
for periodic  provisions  to the  allowance  charged to income  consists of both
individual  loan analyses and loan pool analyses.  The individual  loan analyses
are periodically  performed on individually  significant loans or when otherwise
deemed necessary and primarily  encompass  commercial real estate and commercial
and industrial loans.  Management believes that the Company's allowance for loan
losses at June 30, 2003 is adequate to provide  for  estimated  probable  losses
inherent in the portfolio.

Financial Condition

The Company's total assets were $500.6 million as of June 30, 2003,  compared to
$492.0  million at December 31, 2002. The increase in total assets was primarily
reflected  in the  increase  in federal  funds sold of $45.7  million  from $5.3
million at December 31, 2002, to $51.0 million at June 30, 2003, relating to the
overnight investment of seasonal municipal balances on deposit at June 30, 2003.
Offsetting  the  increase  in cash and cash  equivalents  was a  decline  in the
securities  available-for-sale  portfolio,  which  decreased  $35.9 million,  or
16.3%,  as the  proceeds  of  maturing  short-term  U.S.  Government  and agency
obligations  purchased  in December  2002 were used to pay a portion of maturing
seasonal  municipal  deposits.  In addition,  loans,  net of unearned income and
deferred fees, decreased $348,000,  from $217.7 million at December 31, 2002, to
$217.4 million at June 30, 2003,  reflecting a decrease  primarily in commercial
and industrial loans.

Total deposits  decreased $2.2 million,  or .6%, from $400.5 million at December
31, 2002 to $398.3 million at June 30, 2003,  primarily reflecting a decrease in
NOW and money market deposits.  The decrease in NOW and money market deposits of
$21.6  million,  or 16.6%,  from $130.6  million at December  31, 2002 to $109.0
million at June 30, 2003,  is  attributable  to the  withdrawal  of a portion of
seasonal municipal  deposits.  Time certificates in excess of $100,000 decreased
$5.3 million, or 26.1%, from $20.5 million at December 31, 2002 to $15.2 million
at June 30, 2003.  The effects of those  declines were offset in part by a $19.3
million,  or 26.1%,  increase in savings deposits and a $10.2 million, or 12.9%,
increase in demand deposits. There were no federal funds purchased or securities
sold under  agreements to repurchase at June 30, 2003. Other  borrowings,  which
consist of Federal Home Loan Bank of New York advances, increased $10.0 million,
or 18.2%, to $65.0 million at June 30, 2003.

Stockholders'  equity increased $1.1 million,  or 4.2%, to $26.7 million at June
30,  2003  compared to $25.6  million at  December  31,  2002.  The  increase to
stockholders equity included $1.6 million of net income for the six months ended
June 30,  2003.  Offsetting  that  increase in part were  dividends  declared of
$293,000.

Analysis of Net Interest Income

Net interest income represents the difference between income on interest-earning
assets and expense on interest-bearing  liabilities. Net interest income depends
upon the volume of interest-earning assets and interest-bearing  liabilities and
the interest rates earned or paid on them.

The  following  tables set forth certain  information  relating to the Company's
consolidated average balance sheets and its consolidated  statements of earnings
for the three and six  months  ended June 30,  2003 and 2002,  and  reflect  the
average yield on  interest-earning  assets and average cost of  interest-bearing
liabilities for the periods indicated.  Yields and costs are derived by dividing
annualized income or expense by the average balance of  interest-earning  assets
or interest-bearing liabilities, respectively. Average balances are derived from
average daily balances. Average loan balances include non-accrual loans although
they are not material.



                                       10
<PAGE>

<TABLE>


                                                                  Three Months Ended June 30,
                                                                  ---------------------------
                                               -----------2003-----------             -----------2002-----------
<S>                                           <C>            <C>        <C>           <C>          <C>       <C>
                                                                     Average                               Average
                                              Average                Yield /         Average               Yield /
                                              Balance    Interest     Cost           Balance    Interest    Cost
                                              -------    --------     ----           -------    --------    ----
Interest-earning assets:                                              (Dollars in thousands)
     Federal funds sold and
         interest-earning deposits      $     13,820   $      38      1.10 %    $     6,843   $      29     1.70 %
     Securities, net (1)                     208,676       2,094      4.01          183,725        2,267    4.94
     Loans, net (2)                          215,375       3,800      7.06          189,990       3,610     7.60
                --                           -------       -----      ----          -------       -----     ----
         Total interest-earning assets       437,871       5,932      5.42          380,558       5,906     6.21
Non-interest-earning assets                   39,007                                 32,080
                                              ------                                 ------
Total assets                            $    476,878                            $   412,638
                                        ============                            ===========

Interest-bearing liabilities:
     Savings deposits                   $     88,159         299      1.36      $     60,169         248    1.65
     NOW and money market deposits            89,544         212       .95            72,460         221    1.22
     Certificates of deposit                 106,366         924      3.47           123,300       1,171    3.80
                                             -------         ---      ----           -------       -----    ----
         Total interest-bearing deposits     284,069       1,435      2.02           255,929       1,640    2.56
     Borrowed funds                           69,884         720      4.12            57,349         669    4.67
                                              ------         ---      ----            ------         ---    ----
         Total interest-bearing liabilities  353,953       2,155      2.44           313,278       2,309    2.95
Other non-interest bearing liabilities        96,724                                  76,739
                                              ------                                  ------
Total liabilities                            450,677                                 390,017
Stockholders' equity                          26,201                                  22,621
                                              ------                                  ------
Total liabilities and
     stockholders' equity               $    476,878                            $    412,638
                                        ============                            ============


Net interest income/
     interest rate spread (3)                          $   3,777      2.98 %                  $    3,597    3.26 %
                          ==                           =========      ====                    ==========    ====

Net interest margin (4)                                               3.45 %                                3.78 %
                    ==                                                ====                                  ====

Ratio of interest-earning assets to
     interest-bearing liabilities                                     1.24x                                 1.21x
                                                                      ====                                  ====


(1)  Unrealized appreciation / depreciation on available-for-sale securities are
     recorded in non-interest earning assets.
(2)  Amount excludes  residential real estate loans  held-for-sale and allowance
     for loan losses, and includes deferred loan fees and non-performing loans.
(3)  Interest  rate  spread  represents  the  difference  between  the  yield on
     interest-earning assets and the cost of interest-bearing liabilities.
(4)  Net  interest  margin  represents  net interest  income  divided by average
     interest-earning assets.
</TABLE>



                                       11
<PAGE>

<TABLE>


                                                                    Six Months Ended June 30,
                                                                    -------------------------
                                               -----------2003-----------             -----------2002-----------
<S>                                           <C>            <C>        <C>           <C>          <C>       <C>
                                                                     Average                               Average
                                              Average                Yield /         Average               Yield /
                                              Balance    Interest     Cost           Balance    Interest    Cost
                                              -------    --------     ----           -------    --------    ----
Interest-earning assets:                                              (Dollars in thousands)
     Federal funds sold and
         interest-earning deposits      $      9,081   $      50      1.10 %    $      6,960   $      58    1.67 %
     Securities, net (1)                     214,279       4,387      4.09           185,285       4,596    4.96
     Loans, net (2)                          215,192       7,593      7.06           185,591       7,022    7.57
                --                           -------       -----      ----           -------       -----    ----
         Total interest-earning assets       438,552      12,030      5.49           377,836      11,676    6.18
Non-interest-earning assets                   40,237                                  31,579
                                              ------                                  ------
Total assets                            $    478,789                            $    409,415
                                        ============                            ============

Interest-bearing liabilities:
     Savings deposits                   $     85,543         577      1.35      $     53,230         401    1.51
     NOW and money market deposits            98,411         473       .96            72,933         413    1.13
     Certificates of deposit                 108,629       1,894      3.49           127,666       2,480    3.89
                                             -------       -----      ----           -------       -----    ----
         Total interest-bearing deposits     292,583       2,944      2.01           253,829       3,294    2.60
     Borrowed funds                           66,528       1,398      4.20            57,650       1,334    4.63
                                              ------       -----      ----            ------       -----    ----
         Total interest-bearing liabilities  359,111       4,342      2.42           311,479       4,628    2.97
Other non-interest bearing liabilities        93,754                                  75,621
                                              ------                                  ------
Total liabilities                            452,865                                 387,100
Stockholders' equity                          25,924                                  22,315
                                              ------                                  ------
Total liabilities and
     stockholders' equity               $    478,789                             $   409,415
                                        ============                             ===========


Net interest income/
     interest rate spread (3)                          $   7,688      3.07 %                   $   7,048    3.21 %
                          ==                           =========      ====                     =========    ====

Net interest margin (4)                                               3.51 %                                3.73 %
                    ==                                                ====                                  ====

Ratio of interest-earning assets to
     interest-bearing liabilities                                     1.22x                                 1.21x
                                                                      ====                                  ====


(1)  Unrealized appreciation / depreciation on available-for-sale securities are
     recorded in non-interest earning assets.
(2)  Amount excludes  residential real estate loans  held-for-sale and allowance
     for loan losses, and includes deferred loan fees and non-performing loans.
(3)  Interest  rate  spread  represents  the  difference  between  the  yield on
     interest-earning assets and the cost of interest-bearing liabilities.
(4)  Net  interest  margin  represents  net interest  income  divided by average
     interest-earning assets.
</TABLE>


                                       12
<PAGE>

Comparison  of  Operating  Results for the Three  Months Ended June 30, 2003 and
2002

General

The Company reported net income of $782,000, or basic earnings per share of $.53
and  diluted  earnings  per share of $.51 for the quarter  ended June 30,  2003,
compared to $799,000,  or basic earnings per share of $.55 and diluted  earnings
per  share of $.53,  for the prior  year  period.  The  decrease  in net  income
occurred as increased  operating expenses exceeded  improvements in net interest
income after provision for loan losses and other operating income.

Interest Income

Interest income increased  $26,000,  or .4%, for the three months ended June 30,
2003,  compared to the three  months  ended June 30,  2002.  That  increase  was
attributable to the $57.3 million, or 15.1%,  increase in the average balance of
interest-earning  assets from $380.6 million for the three months ended June 30,
2002, to $437.9  million for the three months ended June 30, 2003.  The increase
in the  average  balance of interest  earning  assets was offset in part by a 79
basis point decrease in the average yield on interest-earning  assets from 6.21%
for the three  months  ended June 30,  2002,  to 5.42% for the  comparable  2003
period.   The  decrease  in  average  yield  on   interest-earning   assets  was
attributable  to a 93 basis point  decrease in yield on  securities,  net, which
declined  from 4.94% for the three months ended June 30, 2002,  to 4.01% for the
three months ended June 30, 2003. The average yield on loans, net,  decreased 54
basis points from 7.60% for the three  months ended June 30, 2002,  to 7.06% for
the  comparable  2003  period.  Partially  offsetting  the decline in yield from
period to period was a $25.0 million,  or 13.6% increase in the average  balance
of securities, net, from $183.7 million for three months ended June 30, 2002, to
$208.7 million for the three months ended June 30, 2003. The average  balance of
loans, net, increased $25.4 million,  or 13.4% from $190.0 million for the three
months ended June 30, 2002, to $215.4 million for the comparable 2003 period.

Interest Expense

Interest  expense for the three  months  ended June 30,  2003 was $2.2  million,
compared to $2.3 million for the three months ended June 30, 2002, a decrease of
$154,000, or 6.7%. The decrease was attributable to a 51 basis point decrease in
the average cost of interest-bearing liabilities from 2.95% for the three months
ended  June 30,  2002 to 2.44% for the three  months  ended June 30,  2003.  The
decrease in average  cost was  partially  offset by a $40.7  million,  or 13.0%,
increase  in the  average  balance of total  interest-bearing  liabilities  from
$313.3  million for the three months  ended June 30, 2002 to $354.0  million for
the three months ended June 30, 2003.  The increase in average  interest-bearing
liabilities, when compared to the prior year period, reflects increases of $28.1
million in the average balance of interest-bearing deposits and $12.6 million in
the average balance of borrowed funds.

Interest expense on interest-bearing  deposits decreased $205,000, or 12.5%, for
the three months ended June 30,  2003,  from $1.6 million for the  corresponding
2002 period to $1.4 million for the current period.  That decrease was primarily
due to a 54 basis point  decrease in the average  rate paid on  interest-bearing
deposits  from  2.56%  for three  months  ended  June 30,  2002 to 2.02% for the
corresponding period in 2003.  Offsetting,  in part, the decrease in the average
rate paid was an increase in the average balance of interest-bearing deposits of
$28.1  million for the three months  ended June 30, 2003 from the  corresponding
period in 2002. The increase in the average balance of interest-bearing deposits
was the result of increases in the average balance of savings  deposits of $28.0
million,  or 46.5%, and in the average balances of NOW and money market deposits
of $17.1  million,  or 23.6% from  period to  period.  The  increase  in average
balances  of  interest-bearing  deposits is the result of the  Company's  branch
expansion and the  development  of  competitive  deposit  products that meet the
needs of its commercial and consumer customers.



                                       13
<PAGE>



Interest expense on borrowed funds increased $51,000, or 7.6%, from $669,000 for
the three  months  ended June 30,  2002,  to $720,000 for the three months ended
June 30,  2003.  The increase  was  primarily  due to an increase in the average
balance of borrowed funds of $12.6 million, or 21.9%, from $57.3 million for the
three  months  ended June 30, 2002 to $69.9  million for the three  months ended
June 30, 2003.  Offsetting  the  increase in the average  balance was a 55 basis
point  decrease  in the average  cost of borrowed  funds from 4.67% for the 2002
period, to 4.12% for the 2003 period.

Net Interest Income

Net interest  income  increased by $180,000,  or 5.0%, from $3.6 million for the
three  months  ended June 30,  2002,  to $3.8 million for the three months ended
June 30, 2003. The average cost of total  interest-bearing  liabilities  for the
period  decreased  51 basis points from 2.95% in the 2002 period to 2.44% in the
2003 period. The average yield on total  interest-earning  assets for the period
decreased  79 basis  points  from 6.21% in the 2002  period to 5.42% in the 2003
period.  The net interest rate spread decreased 28 basis points,  from 3.26% for
the three months  ended June 30, 2002,  to 2.98% for the three months ended June
30, 2003.

Provision for Loan Losses

The Company  made no  provision  for loan losses for the three months ended June
30,  2003,  compared to a $60,000  provision  for loan losses made for the three
months ended June 30, 2002. The  determination  not to make a provision for loan
losses  for  the  three  months  ended  June  30,  2003  reflects   management's
qualitative and quantitative  assessment of the loan portfolio,  net charge-offs
and collection of delinquent  loans.  The allowance for loan losses  amounted to
$2.4  million  and  $2.3  million  at June  30,  2003  and  December  31,  2002,
respectively.  The  allowance for loan losses as a percentage of loans was 1.11%
and 1.08% at June 30, 2003 and December 31, 2002, respectively.

The following table sets forth information regarding non-accrual loans and loans
delinquent 90 days or more and still accruing  interest at the dates  indicated.
It is the  Company's  general  policy to  discontinue  accruing  interest on all
loans,  which  are  past-due  more  than 90  days or  when,  in the  opinion  of
management,  such suspension is warranted.  When a loan is placed on non-accrual
status,  the Company ceases the accrual of interest owed and previously  accrued
interest is charged against  interest  income.  Loans are generally  returned to
accrual  status when  principal  and interest  payments  are  current,  there is
reasonable  assurance that the loan will be fully  collectable  and a consistent
record of performance has been demonstrated.

<TABLE>

                                                                 June 30, 2003         December 31, 2002
                                                                 -------------         -----------------
                                                                          (Dollars in thousands)
<S>                                                                     <C>                    <C>
Non-accrual loans:
     Commercial and industrial loans                               $       205            $    307
     Automobile loans                                                       15                   -
                                                                            --                  --
         Total non-accrual and non-performing loans                        220                 307
                                                                           ---                 ---


Allowance for loan losses as a percentage
     of loans (1)                                                         1.11   %            1.08   %
Allowance for loan losses as a percentage
     of total non-performing loans                                    1,098.18   %          764.17   %
Non-performing loans as a percentage of loans (1)                          .10   %             .14   %

(1)  Loans include loans, net, excluding the allowance for loan losses.
</TABLE>

                                       14
<PAGE>


Other Operating Income

Other operating  income  increased  $272,000,  or 34.4%, to $1.1 million for the
three months ended June 30, 2003.  Service charges on deposit accounts increased
$95,000,  or 22.5%,  reflecting  overall  growth in the depositor  base, and the
introduction  of new  electronic  banking  services.  In  addition,  the Company
realized a gain on the sale of securities of $153,000 for the three months ended
June 30, 2003.

Other Operating Expenses

Other operating expenses increased $515,000,  or 16.6%, from $3.1million for the
three  months  ended June 30,  2002,  to $3.6 million for the three months ended
June 30,  2003.  The  increase  over the prior period  resulted  primarily  from
increases in salaries and employee benefits, premises and equipment expense, and
other expense attributable to the Bank's branch expansion.

Income Taxes

Income taxes  increased  $14,000,  or 3.3%,  from  $420,000 for the three months
ended June 30, 2002,  to $434,000 for the three months ended June 30, 2003, as a
result of an increase in income before income taxes. The effective tax rates for
the three  months  ended June 30,  2003 and those ended June 30, 2002 were 35.7%
and 34.5%, respectively.


Comparison of Operating Results for the Six Months Ended June 30, 2003 and 2002

General

The Company reported net income of $1.6 million,  or basic earnings per share of
$1.08 and diluted  earnings per share of $1.03 for the six months ended June 30,
2003, compared to $1.5 million, or basic earnings per share of $1.05 and diluted
earnings  per share of $1.02,  for the prior year  period.  The  increase in net
income was  attributable  primarily  to a  $730,000,  or 10.6%  increase  in net
interest  income  after  provision  for loan  losses  and an  increase  in other
operating income of $423,000, or 26.6%. Offsetting those increases, in part, was
a $1.0 million, or 16.3% increase in other operating expenses.

Interest Income

Interest income increased  $354,000,  or 3.0%, for the six months ended June 30,
2003,  compared  to the six  months  ended  June 30,  2002.  This  increase  was
attributable to the increase in the average balance of  interest-earning  assets
of $60.8  million,  or 16.1%,  from $377.8 million for the six months ended June
30, 2002, to $438.6 million for the six months ended June 30, 2003. The increase
in the  average  balance of interest  earning  assets was offset in part by a 69
basis point decrease in the average yield on interest-earning  assets from 6.18%
for the six months ended June 30, 2002, to 5.49% for the comparable 2003 period.
The decrease in average yield on interest-earning  assets was attributable to an
87 basis point decrease in yield on  securities,  net, which declined from 4.96%
for the six months ended June 30,  2002,  to 4.09% for the six months ended June
30, 2003. The average yield on loans, net,  decreased 51 basis points from 7.57%
for the six months ended June 30, 2002, to 7.06% for the comparable 2003 period.
Partially  offsetting  the  decline in yield  from  period to period was a $29.0
million,  or 15.6%  increase in the average  balance of  securities,  net,  from
$185.3 million for six months ended June 30, 2002, to $214.3 million for the six
months ended June 30, 2003. The average balance of loans,  net,  increased $29.6
million, or 15.9% from $185.6 million for the six months ended June 30, 2002, to
$215.2 million for the comparable 2003 period.

                                       15
<PAGE>

Interest Expense

Interest  expense  for the six  months  ended  June 30,  2003 was $4.3  million,
compared to $4.6  million for the six months  ended June 30, 2002, a decrease of
$286,000, or 6.2%. The decrease was attributable to a 55 basis point decrease in
the average cost of  interest-bearing  liabilities from 2.97% for the six months
ended  June 30,  2002 to 2.42%  for the six  months  ended  June 30,  2003.  The
decrease in average  cost was  partially  offset by a $47.6  million,  or 15.3%,
increase  in the  average  balance of total  interest-bearing  liabilities  from
$311.5  million for the six months ended June 30, 2002 to $359.1 million for the
six months  ended  June 30,  2003.  The  increase  in  average  interest-bearing
liabilities  reflects  increases  of $38.8  million  in the  average  balance of
interest-bearing  deposits and $8.8  million in the average  balance of borrowed
funds when compared to the prior year period.

Interest expense on interest-bearing  deposits for the six months ended June 30,
2003  decreased  $350,000,  or 10.6%,  to $2.9 million from $3.3 million for the
corresponding  2002 period.  This decrease was primarily due to a 59 basis point
decrease in the average rate paid on  interest-bearing  deposits  from 2.60% for
six months  ended June 30, 2002 to 2.01% for the  corresponding  period in 2003.
Offsetting  the decrease in the average rate paid was an increase in the average
balance of  interest-bearing  deposits of $38.8 million for the six months ended
June 30, 2003 from the corresponding period in 2002. The increase in the average
balance of interest-bearing  deposits was the result of increases in the average
balance of savings  deposits  of $32.3  million,  or 60.7%,  and in the  average
balances of NOW and money market deposits of $25.5 million, or 34.9% from period
to period.

Interest expense on borrowed funds increased $64,000, or 4.8%, from $1.3 million
for the six months ended June 30, 2002, to $1.4 million for the six months ended
June 30,  2003.  The increase  was  primarily  due to an increase in the average
balance of borrowed funds of $8.8 million,  or 15.4%, from $57.7 million for the
six months  ended June 30, 2002 to $66.5  million for the six months  ended June
30, 2003.  Offsetting  the increase in the average  balance was a 43 basis point
decrease in the average  cost of borrowed  funds from 4.63% for the 2002 period,
to 4.20% for the 2003 period.

Net Interest Income

Net interest  income  increased by $640,000,  or 9.1%, from $7.0 million for the
six months  ended June 30,  2002,  to $7.7 million for the six months ended June
30, 2003. The average cost of total interest-bearing  liabilities for the period
decreased  55 basis  points  from 2.97% in the 2002  period to 2.42% in the 2003
period.  The  average  yield on total  interest-earning  assets  for the  period
decreased  69 basis  points  from 6.18% in the 2002  period to 5.49% in the 2003
period.  The net interest rate spread decreased 14 basis points,  from 3.21% for
the six months ended June 30,  2002,  to 3.07% for the six months ended June 30,
2003.

Provision for Loan Losses

The Company  made a $60,000  provision  for loan losses for the six months ended
June 30,  2003,  compared  to a $150,000  provision  for loan losses for the six
months ended June 30, 2002.  The  provision for loan losses is based on analysis
of the loan portfolio and reflects an amount, which in management's  judgment is
adequate to provide for probable loan losses in the existing portfolio.

Other Operating Income

Other operating income increased $423,000, or 26.6%, to $2.0 million for the six
months ended June 30, 2003. The Company realized gains on the sale of securities
of $242,000 for the six months ended June 30, 2003. In addition, service charges
on deposit accounts increased $138,000,  or 16.4%,  reflecting overall growth in
the depositor  base, and the  introduction of new electronic  banking  services.

                                       16
<PAGE>

Other Operating Expenses

Other operating expenses increased $1.0 million, or 16.3%, from $6.2 million for
the six months  ended June 30,  2002,  to $7.2  million for the six months ended
June 30, 2003.  The increase  resulted  primarily from increases in salaries and
employee benefits, premises and equipment expense, and other expense for the six
months ended June 30, 2003 attributable to the Bank's branch expansion.

Income Taxes

Income taxes increased $85,000, or 10.7%, from $795,000 for the six months ended
June 30, 2002,  to $880,000 for the six months ended June 30, 2003,  as a result
of the increase in income before  income taxes.  The effective tax rates for the
six months  ended  June 30,  2003 and those  ended June 30,  2002 were 35.8% and
34.4%, respectively.


Liquidity

Liquidity management for the Company requires that funds be available to pay all
deposit  withdrawal and maturing  financial  obligations and meet credit funding
requirements  promptly and fully in accordance with their terms. For most banks,
including the Bank,  maturing assets provide only a limited portion of the funds
required to pay maturing liabilities over a short time frame. The balance of the
funds  required is provided by liquid assets and the  acquisition  of additional
liabilities, making liability management integral to liquidity management in the
short term.

The Company's  liquid assets  consist of cash and due from banks,  federal funds
sold, interest-earning deposits with other financial institutions and securities
classified as  available-for-sale,  less securities  pledged as collateral.  The
Company has  established a minimum  liquidity  level,  average  liquid assets to
average  assets,  at 10%.  Average  balances  are  derived  from  average  daily
balances.  During the six months  ended June 30,  2003,  the  Company's  average
minimum liquidity level was 23.0%.

The Company maintains levels of liquidity that it considers adequate to meet its
current  needs.  The  Company's  principal  sources  of  cash  include  incoming
deposits, the repayment of loans and conversion of investment  securities.  When
cash  requirements  increase  faster  than  cash is  generated,  either  through
increased loan demand or withdrawal of deposited  funds, the Company can arrange
for the sale of loans or liquidate  available-for-sale  securities.  It can also
access its lines of credit,  totaling $6.5 million, with unaffiliated  financial
institutions,  which enable it to borrow federal funds on an unsecured basis. In
addition,  the Company has available  lines of credit with the Federal Home Loan
Bank of New York (FHLB) equal to 10.0% of the Company's assets at June 30, 2003,
which  enable it to borrow  funds on a secured  basis.  The  Company  could also
engage in other forms of borrowings, including reverse repurchase agreements.

At June 30, 2003, the Company's  borrowings  consisted of convertible and medium
term advances from the FHLB. The  convertible  feature of these advances  allows
the FHLB, at a specified  call date and quarterly  thereafter,  to convert those
advances into  replacement  funding for the same or a lesser  principal  amount,
based on any advance then offered by the FHLB, at then current market rates.  If
the FHLB elects to convert those advances, the Bank may repay any portion of the
advances  without  penalty.  The  convertible  advances  are  secured by various
mortgage-backed and callable U.S. agency securities.


                                       17
<PAGE>

<TABLE>

At June 30, 2003, convertible and medium term advances outstanding were as follows:
<S>                                       <C>                <C>                  <C>                   <C>
                                                                               Call                Contractual
                                        Amount              Rate               Date                 Maturity
                                        ------              ----               ----                 --------
    Convertible advance          $     14,000,000           5.49  %           8/19/2003             2/19/2008
    Convertible advance                15,000,000           4.59              7/21/2003             1/21/2009
    Convertible advance                14,000,000           4.97              1/19/2004             1/19/2011
    Convertible advance                 3,000,000           4.11             12/11/2005            12/12/2011
    Convertible advance                10,000,000           2.64              5/28/2008             5/28/2013
    Medium term advance                 4,000,000           3.31             12/11/2003            12/11/2003
    Medium term advance                 5,000,000           3.99             12/13/2004            12/13/2004
                                        ---------
                  Total          $     65,000,000
</TABLE>

The primary  investing  activities of the Company are the purchase of securities
available-for-sale and the origination of loans. During each of the three months
ended June 30, 2003, and 2002, the Company's  purchases of securities  that were
classified   available-for-sale  totaled  $487.5  million  and  $623.2  million,
respectively.  Loan originations,  net of principal repayments on loans, totaled
$.3 million and $14.0 million for the six months ended June 30, 2003,  and 2002,
respectively. Borrowings, principal repayments and maturities of securities were
used primarily to fund those activities.

Capital Resources

The Bank is subject to the risk based  capital  guidelines  administered  by the
banking  regulatory  agencies.  The  guidelines  currently  require all banks to
maintain  a minimum  ratio of total risk  based  capital to total risk  weighted
assets of 8%, including a minimum ratio of Tier 1 capital to total risk weighted
assets of 4% and a Tier 1 capital to average  adjusted  assets of 4%. Failure to
meet minimum capital  requirements can initiate certain mandatory,  and possibly
additional discretionary,  actions by regulators that, if undertaken, could have
a direct material effect on the Bank's financial statements.  As of December 31,
2002,  the  most  recent   notification  from  the  federal  banking  regulators
categorized  the Bank as well  capitalized  under the  regulatory  framework for
prompt corrective action.

In accordance  with the  requirements of the FDIC and the New York State Banking
Department, the Bank must meet certain measures of capital adequacy with respect
to leverage and risk-based capital. As of June 30, 2003, the Bank exceeded those
requirements  with a  leverage  capital  ratio,  risk-based  capital  ratio  and
total-risk based capital ratio of 5.78%, 9.66%, and 10.51%, respectively.

The Company achieves what it considers "capital adequacy" through the continuous
monitoring of its financial performance and plans for expansion.  Sources of the
Company's  capital are generated  primarily  through current period earnings and
the issuance of common stock via the dividend  reinvestment plan or the exercise
of stock options. Uses of capital currently result from the payment of dividends
on common stock or the  repurchase  of common stock  through a stock  repurchase
program.  In February 2003, the Board of Directors,  suspended the current stock
repurchase  program that had enabled the Company to repurchase  75,000 shares of
its  outstanding  common stock.  There have been no repurchases  made under that
stock purchase  program since its  announcement in May, 2001. In determining the
extent  and timing of stock  repurchase  programs,  the  Company  considers,  in
addition to capital adequacy,  the effect on the Company's financial  condition,
average daily trading volume, and listing requirements  applicable to the NASDAQ
National  Market  System.  At June 30, 2003,  the Company held 336,900 shares of
treasury stock at an average cost of $12.40 per share.


                                       18
<PAGE>

Item 3.       Quantitative and Qualitative Disclosures About Market Risk
-------       ----------------------------------------------------------

The principal objective of the Company's interest rate management is to evaluate
the interest rate risk inherent in certain balance sheet accounts, determine the
level of risk  appropriate  given the  Company's  business  strategy,  operating
environment,  capital and liquidity requirements and performance objectives, and
manage the risk consistent  with guidelines  approved by the Board of Directors.
Through such management,  the Company seeks to reduce the  vulnerability of it's
operations to changes in interest  rates.  The Board has directed the Investment
Committee to review the  Company's  interest  rate risk  position on a quarterly
basis.

Funds  management  is the  process by which the Company  seeks to  maximize  the
profit  potential  which is derived from the spread  between the rates earned on
interest-earning  assets  and the  rates  paid on  interest-bearing  liabilities
through  the  management  of  various  balance  sheet  components.  It  involves
virtually every aspect of the Company's management and decision-making  process.
Accordingly,  the Company's  results of operations  and financial  condition are
largely  dependent on the movements in market  interest  rates and the Company's
ability to manage its assets and liabilities in response to such movements.

At June 30, 2003,  76.9% of the Company's  gross loans had  adjustable  interest
rates and its loan portfolio had an average  weighted  maturity of 8.8 years. At
that date, $56.6 million,  or 28.4%, of the Company's  securities had adjustable
interest rates, and its securities  portfolio had a weighted average maturity of
1.7 years.  At June 30, 2003, the Company had $73.8 million of  certificates  of
deposit with  maturities  of one year or less and $15.2 million of deposits over
$100,000,  which tend to be less stable sources of funding when compared to core
deposits,  and  which  represented  23.7%  of  the  Company's   interest-bearing
liabilities.   In   a   rising   interest   rate   environment   the   Company's
interest-bearing  liabilities may adjust upwardly more rapidly than the yield on
its  adjustable-rate  assets.  Thus, due to the Company's  level of shorter term
certificates  of deposit,  the Company's cost of funds may increase at a greater
rate in a  rising  rate  environment  than if it had a  greater  amount  of core
deposits  which,  in turn,  may  adversely  affect net  interest  income and net
income.

The Company's  interest rate sensitivity is monitored by management  through the
use of a quarterly  interest  rate risk analysis  model which  evaluates (i) the
potential  change in the net interest  income over the  succeeding  four quarter
period and (ii) the potential change in the fair market value of equity,  of the
Company  ("Net  Economic   Value  of  Equity"),   which  would  result  from  an
instantaneous  and sustained  interest rate change of zero and plus or minus 200
basis points in 100 basis point increments.

At June 30,  2003,  the effect of  instantaneous  and  sustained  interest  rate
changes on the  Company's Net Interest  Income and Net Economic  Value of Equity
are as follows:
<TABLE>

             Change in                   Potential Change in                       Potential Change in
           Interest Rates                Net Interest Income                  Net Economic Value of Equity
           in Basis Points             $ Change      % Change                  $ Change          % Change
           ---------------             --------      --------                  --------          --------
                                                                     (Dollars in thousands)
<S>             <C>                  <C>                 <C>                       <C>                <C>
                200                  $ 1,146             6.85 %                $ (6,594)            (22.90) %
                100                    1,381             8.25                    (4,169)            (14.48)
              Static                      --               --                        --                 --
               (100)                    (570)           (3.41)                   (2,417)             (8.40)
               (200)                  (1,747)          (10.44)                   (2,378)             (8.26)
</TABLE>



                                       19
<PAGE>

Item 4.       Controls and Procedures
-------       -----------------------

1    Evaluation of disclosure  controls and  procedures.  The Company  maintains
     controls and procedures designed to ensure that information  required to be
     disclosed  in the  reports  that the  Company  files or  submits  under the
     Securities  Exchange Act of 1934 is  recorded,  processed,  summarized  and
     reported  within the time  periods  specified in the rules and forms of the
     Securities and Exchange  Commission.  Based upon their  evaluation of those
     controls and procedures  required by paragraph (b) of Section 240.13a-15 or
     Section 240.15d-15 of this chapter,  as of the end of the period covered by
     the report, the Chief Executive and Chief Financial officers of the Company
     concluded  that the  Company's  disclosure  controls  and  procedures  were
     adequate.

2    Changes in internal  controls.  The Company made no significant  changes in
     its internal controls or in other factors that could  significantly  affect
     these  controls  subsequent to the date of the evaluation of those controls
     by the Chief Executive and Chief Financial officers.


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


Item 1.   Legal Proceedings
-------   -----------------
          Not applicable.


Item 2.   Changes in 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
-------   ---------------------------------------------------

          The Company's  Annual Meeting of  Stockholders  was held on April
          23, 2003, and the following individuals were elected as Directors
          for a term of three years each:

                                    Vote       Votes      Broker
                                     For     Withheld   Abstentions  Non-Votes
                                     ---     --------   -----------  ---------
          John L. Ciarelli, Esq.  1,123,950    4,304          -             -
          Waldemar Fernandez      1,123,950    4,304          -             -
          Werner S. Neuberger     1,123,950    4,304          -             -
          John C. Tsunis, Esq     1,121,550    6,704          -             -

          The  term  of the  following  Directors  continued  after  the  Annual
          Meeting:  Harvey Auerbach,  Donald Del Duca, Perry B. Duryea, Frank J.
          Esposito,  Roy M.  Kern,  Sr.,  Gordon A. Lenz,  Douglas C.  Manditch,
          Thomas F. Roberts III, Alfred Romito.


                                       20
<PAGE>

Item 5.   Other Information
-------   -----------------
          Not applicable.


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

          a. Exhibits
             --------
             11.0 Statement Re: Computation of Per Share Earnings
             31.1 Certification of Chief Executive Officer pursuant to Section
                  302 of Sarbanes-Oxley Act of 2002
             31.2 Certification of Chief Financial Officer pursuant to Section
                  302 of Sarbanes-Oxley Act of 2002
             32.1 Certification of Chief Executive Officer pursuant to Section
                  906 of Sarbanes-Oxley Act of 2002
             32.2 Certification of Chief Financial Officer pursuant to Section
                  906 of Sarbanes-Oxley Act of 2002


          b. Reports on Form 8-K
             -------------------
             On April 21, 2003 the Company  filed a Form 8-K to disclose  that
             the Company has issued a press  release to announce the Company's
             first quarter earnings and declaration of a dividend.



                                       21
<PAGE>



                                   SIGNATURES

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



                                  LONG ISLAND FINANCIAL CORP.
                                  (Registrant)



Date:    August 14, 2003          By: /s/ Douglas C. Manditch
                                      -----------------------
                                          Douglas C. Manditch
                                          President and Chief Executive Officer


Date:    August 14, 2003          By: /s/ Thomas Buonaiuto
                                      --------------------
                                          Thomas Buonaiuto
                                          Vice President and Treasurer



                                       22
<PAGE>