UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 100
F Street NE
 Washington,
D.C. 20549
 
 FORM
10-K/A
 
 Amendment
No. 1
 
 [X]
                Annual
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934For
      the Fiscal Year Ended September 30,
2008
  or
 [  ]
                Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934For
      the transition period from _______________
      to  ______________________
 
 
 Commission File No. 0-51500
 
 American Bancorp of New
Jersey, Inc.
 (Exact
name of registrant as specified in its charter)
 
  New
      Jersey
              
              55-0897507(State or other
      jurisdiction of
              
              (I.R.S.
      Employerincorporation or
      organization)
              
              Identification
      Number)
  365
      Broad Street, Bloomfield, New Jersey
                
                07003(Address of
      Principal Executive Offices)
                
                Zip
    Code
 (973)
748-3600
 (Registrant’s
telephone number)
 
 Securities
registered pursuant to Section 12(g) of the Exchange
Act:   None
 
 Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act. [  ] Yes  [X] No
 
 Indicate by check mark if the
registrant is not required to file reports pursuant to Section 13 or Section
15(d) of the Act. [  ] Yes  [X] No
 
 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. [X]
Yes  [  ] No
 
 Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of registrant’s knowledge, in
definitive proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment to this
Form 10-K.  [X]
 
 Indicate by check mark whether the
registrant is a large accelerated file, an accelerated filer, a non-accelerated
filer, or a smaller reporting company.  See definition of “large
accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule
12b-2 of the Exchange Act. (Check one):
 
 Large
      accelerated filer   [  ]
                Accelerated
      filer   [X ]Non-accelerated
      filer     [  ]
                Smaller
      reporting
company  [  ]
 (Do
not check if a Smaller Reporting Company)
 
 Indicate by check mark whether the
registrant is a shell company (as defined in Exchange Act Rule 12b-2).
[  ] Yes   [X] No
 
 The aggregate market value of the
voting and non-voting common equity held by nonaffiliates of the registrant,
computed by reference to the closing price of the registrant’s common stock on
the NASDAQ Stock Market on December 11, 2008, was $ 73,433,167.  The
exclusion from such amount of the market value of the shares owned by any person
shall not be deemed an admission by the registrant that such person is an
affiliate of the registrant.
 
 As of December 11, 2008, the registrant
had outstanding 10,859,692 shares of Common Stock.
 
 DOCUMENTS
INCORPORATED BY REFERENCE:   None
  
 Explanatory
Note
 
 This Form 10-K/A is being filed by
American Bancorp of New Jersey, Inc. (the “Company”) to amend its Annual Report
on Form 10-K for the year ended September 30, 2008, filed with the Securities
and Exchange Commission on December 12, 2008 to include the information required
by Items 10, 11, 12, 13 and 14 of the Annual Report on Form 10-K.
  2
 
 Item 10.
              Directors, Executive Officers and
      Corporate Governance.
 
 The Company’s Board of Directors
currently consists of seven (7) members.  Approximately one-fourth of
the directors are elected annually to serve for a four-year period or until
their respective successors are elected and qualified.
 
 Directors
and Executive Officers
 
 Joseph
Kliminski, age 65, serves as Chief Executive Officer of the Company and
American Bank of New Jersey (the “Bank”) and has been a member of the Board
since 1986.  He has been employed by the Bank since 1967 and became
President and Chief Executive Officer in 1987.  In 2005, Mr. Fred
Kowal replaced Mr. Kliminski as President. Mr. Kliminski is a member and past
president of the Bloomfield Lions Club, was previously president of the Advisory
Board to the Bloomfield Town Council, chairman emeritus of the Bloomfield
Education Foundation, and former chairman of the Deborah Hospital Children of
the World Golf Tournament. Mr. Kliminski also serves on the Executive Committee
of the Bloomfield Center Alliance, and is a member and former president of the
Board of Trustees of the Bloomfield Public Library.  He is also a
former member of the Board of Governors of the New Jersey League of Community
Bankers and past president of the Essex County Savings League.
 
 H. Joseph
North, age 76, has been a member of the Board since 1991. Mr. North
retired in 1987 as Town Administrator of Bloomfield, New Jersey after 20 years
of service as the municipality’s Chief Administrative Officer.  Mr.
North began his service to the Town of Bloomfield in 1958 as Town Clerk where
his duties included that of Corporation Secretary to the Municipality and
Executive Secretary to the Planning Board and Zoning Board of
Adjustment.  Mr. North is a past president and a lifetime member of
the New Jersey Municipal Management Association and is a former member of the
International City Management Association.  Mr. North is also a former
president of the Bloomfield Lions Club, Bloomfield Fifth Quarter Club and
Bloomfield Tennis Federation and a former member of the Board of Trustees of
Bloomfield College.
 
 W. George
Parker, age 83,has been a member of
the Board since 1967 and Chairman since 1990.  Prior to becoming
Chairman of American Bank of New Jersey, Mr. Parker served as Chairman of the
Board and CEO of the Cook & Dunn Paint Corporation for 20 years, retiring in
1995.  During his tenure at Cook & Dunn Paint Corporation, he
served as Northeast Regional Vice President of the National Paint Coatings Assn.
located in Washington, D.C.  He also served as Chairman and CEO of
Ur-Cryl Polymer Corp. and Thibaut & Walker, suppliers to the chemical
industry, for 12 and 20 years, respectively, retiring in 2005.  Mr.
Parker was the principal of Adco Chemical Company, serving as Chairman and CEO
and divested the Corporation in 2005.  He is a Senior Managing
Director of a private equity fund.
 
 Robert A.
Gaccione, age 67, has been a member of the Board since
2003.  He has been a senior partner of the law firm of Gaccione,
Pomaco & Malanga, P.C. in Belleville, New Jersey for thirty
years.  He is a former Federal Bureau of Investigation
agent.  Mr. Gaccione also serves as an Essex County Tax Board
Commissioner.  He served as a director of Franklin Community Bank, a
commercial bank located in Nutley, New Jersey for three years.  Mr.
Gaccione is a member and the past president of the Belleville Rotary Club, is
the president of the Clara Maass Foundation and is a member of the Belleville
Foundation.
 
 James H. Ward,
III, age 59, has been a member of the Board since 1991 and Vice Chairman
since 2003.  From 1998 to 2000, he was the majority stockholder and
Chief Operating Officer of Rylyn Group, which operated a restaurant in
Indianapolis, Indiana.  Prior to that, he was the majority stockholder
and Chief Operating Officer of Ward and Company, an insurance agency in
Springfield, New Jersey, where he was employed from 1968 to 1998.  He
is now a retired investor.
 
 Fred G.
Kowal, age 56, serves as President and Chief Operating Officer of the
Company and the Bank and has been a member of the Board since
2005.  He joined the Bank in March 2005.  Mr. Kowal was
previously Chairman and Chief Executive Officer of Warwick Community Bancorp,
Inc. until its merger into Provident Bancorp, Inc. in October
2004.  He joined Warwick Community Bancorp, Inc. in 1999 and also
served as Chairman of the Board of Directors of The Warwick Savings Bank and as
Chairman of the Board, President and Chief Executive Officer of The Towne Center
Bank, a de novo commercial bank formed by Warwick Community Bancorp, Inc. in
1999.  Prior to joining Warwick, he served as Senior Vice President of
First Union National Bank, where he worked for 16 years, and as Senior Vice
President of PNC Bank.
 
 3
 Vincent S.
Rospond, age 76, has been a member of the Board since 1981.  He
is an attorney and the majority stockholder of the law firm of Rospond, Rospond
& Conte, P.A. in Bloomfield, New Jersey. Rospond, Rospond & Conte serves
as general counsel to the Bank.  Mr. Rospond is the president and a
trustee of United Way of Bloomfield, is a member and the former legal counsel of
Bloomfield Chamber of Commerce, and was a member and the treasurer of North
Jersey Manufacturer’s & Businessmen Association.  He is also a
member of the Cornell Club of New Jersey, the Essex County Bar Association, the
Newark Art Museum, the Bloomfield Music Federation and the New Jersey Bar
Association.
 
 Executive
Officers of the Bank Who Are Not Also Directors
 
 Eric B.
Heyer, age 46, has been the Bank’s Senior Vice President, Treasurer and
Chief Financial Officer since 1997 and became Chief Financial Officer of the
Company upon its formation in June 2003.  Mr. Heyer has been employed
by the Bank since 1993.  He was previously the Chief Financial Officer
of Monarch Savings Bank in Kearny, New Jersey, where he was employed from 1986
to 1993.  Mr. Heyer is a member of the Financial Managers
Society.  He recently completed service as the Chairman of the
Stewardship & Finance Committee of Princeton United Methodist Church and
previously served as a trustee of Kingston United Methodist
Church.  Mr. Heyer also serves as a board member of the Mental Health
Clinic of Passaic in Clifton, New Jersey.
 
 Catherine M.
Bringuier, age 46, has been the Bank’s Senior Vice President and Chief
Lending Officer since January 2003. She has also served as the CRA Officer since
February 1993. Ms. Bringuier has been employed by the Bank since March 1990. Ms.
Bringuier currently serves as a member of the Loan Servicing Committee, the
Residential Lending & Affordable Housing Committee and the Mortgage Steering
Committee of the New Jersey League of Community Bankers. Ms. Bringuier is a
member of the Commercial Loan Committee and the Residential Lending Committee of
the Mortgage Bankers Association of New Jersey. She is a member and prior Vice
President of Sunny Acres Civic & Improvement Association in Cranford, New
Jersey and is a catechist for St. Michael’s Religious Education Program in
Cranford, New Jersey.
 
 Section
16(a) Beneficial Ownership Reporting Compliance
 
 Section 16(a) of the Securities
Exchange Act of 1934 requires American Bancorp of New Jersey, Inc.’s directors
and executive officers, and persons who own more than 10% of American Bancorp of
New Jersey, Inc.’s common stock to report their initial ownership of American
Bancorp of New Jersey, Inc.’s common stock and any subsequent changes in that
ownership to the SEC.  Specific due dates for these reports have been
established by the SEC and American Bancorp of New Jersey, Inc. is required to
disclose in this annual report any late filings or failures to
file.
 
 American Bancorp of New Jersey, Inc.
believes, based solely on a review of the copies of reports furnished to us and
written representations relative to the filing of certain forms, that all
Section 16(a) filing requirements applicable to our executive officers,
directors and greater than 10% beneficial owners were complied with during the
fiscal year ended September 30, 2008.
 
 Corporate
Governance, Code of Ethics and Business Conduct
 
 The Company has adopted a Code of
Ethics that applies to its principal executive officer, principal financial
officer, principal accounting officer or controller or persons performing
similar functions. The Company’s Code of Ethics will be provided without charge
upon request to the Corporate Secretary, American Bancorp of New Jersey, Inc.,
365 Broad Street, Bloomfield, New Jersey 07003.
 
 Director
Independence
 
 Directors Gaccione, North, Parker,
Rospond and Ward qualify as “independent” in accordance with the published
listing requirements of the NASDAQ Stock Market. The NASDAQ independence
definition includes a series of objective tests, such as that the director is
not an employee of the company and has not engaged in various types of business
dealings with the company.  As further required by the NASDAQ rules,
the Board has made a subjective determination as to each independent director
that no relationships exist which, in the opinion of the Board, would interfere
with the exercise of his or her independent judgment in carrying out the
responsibilities of a director.  In making these determinations, the
Board reviewed and discussed information provided by the directors and the
Company with regard to each director’s business and personal activities as they
may relate to the Company and its management.  In this regard, the
Board considered the Bank’s relationships with the law firms of which Directors
Gaccione and Rospond are principals, as described under “Certain Relationships
and Related Transactions.”
 
 4
 Shareholder
Communications with Directors
 
 Shareholders may communicate with the
Board of Directors by writing to: James H. Ward, III, Independent Director, 365
Broad Street, Bloomfield, New Jersey 07003.
 
 Board
Member Attendance at Annual Shareholder Meetings
 
 Although we do not have a formal policy
regarding director attendance at annual shareholder meetings, directors are
expected to attend these meetings absent extenuating
circumstances.  Every current director of the Company attended last
year’s annual meeting of shareholders.
 
 Board
Meetings and Committees
 
 The Board of Directors of American
Bancorp of New Jersey, Inc. generally meets on a quarterly basis, holding
additional special meetings as needed.  During fiscal 2008 the Board
of Directors of American Bancorp of New Jersey, Inc. held seven
meetings.  Meetings of the Board of Directors of American Bank of New
Jersey are generally held on a semi-monthly basis.  During fiscal 2008
the Board of Directors of American Bank of New Jersey held 26
meetings.  Only one incumbent director of American Bancorp of New
Jersey, Inc., W. George Parker, attended fewer than 75% of the meetings of the
Audit Committee on which he served during fiscal 2008, although Mr. Parker
attended all meetings of the Board of Directors of American Bancorp of New
Jersey, Inc and American Bank of New Jersey.
 
 The Board of Directors of American
Bancorp of New Jersey, Inc. has standing Compensation, Nominating and Audit
Committees.
 
 Compensation
Committee
 
 The Compensation Committee currently
consists of Directors Gaccione, North, Parker, Rospond and Ward, each of whom is
an independent director under the NASDAQ rules.  The Compensation
Committee met four times during fiscal year 2008.  The Compensation
Committee is responsible for:
 
 §
              determining
      compensation to be paid to our executive officers, including annual base
      salary levels, annual incentive opportunity levels and the goals and
      objectives to be used in determining incentive pay, equity incentive
      awards and retirement benefits;
 
 §
              make
      recommendations with regard to the compensation of
    directors;
 
 §
              overseeing
      the administration of our employee benefit plans covering employees
      generally; and
 
 §
              reviewing
      our compensation policies and
plans.
 
 The Compensation Committee operates
under a formal written charter adopted by the Board, a copy of which was
attached to the Company’s proxy statement filed with the Securities and Exchange
Commission on January 23, 2008.
 
 The charter of the Compensation
Committee does not specifically provide for delegation of any of the authorities
or responsibilities of the committee.  As discussed under
“Compensation Discussion and Analysis,” in setting certain components of the
compensation of executive officers other than the Chief Executive Officer and
the President and Chief Operating Officer, the Compensation Committee considers
the recommendations of the Chief Executive Officer and President and Chief
Operating Officer.
 
 5
 
 Nominating
Committee
 
 The Nominating Committee is currently
comprised of Directors Gaccione and Ward, each of whom is an independent
director under the NASDAQ rules.  This Committee met one time during
fiscal 2008. The Nominating Committee is responsible for identifying and
recommending director candidates to serve on the Board of
Directors.  Final approval of director nominees is determined by the
full Board, based on the recommendations of the Nominating
Committee.  The nominee for election at the annual meeting was
recommended to the Board by the Nominating Committee.
 
 The Nominating Committee operates under
a formal written charter adopted by the Board, a copy of which was attached to
the Company’s proxy statement filed with the Securities and Exchange Commission
on April 20, 2006, under which the Nominating Committee has the following
responsibilities:
 
 §
              identify,
      recruit and interview qualified individuals to be the Board’s nominees for
      election or appointment to the Board; in so doing, the Nominating
      Committee will seek nominees with excellent decision-making ability,
      business experience, personal integrity and reputation, and who are
      knowledgeable about the business activities and market areas in which the
      Company and its subsidiaries
operate;
 
 §
              annually
      present to the Board the names of the individuals recommended for
      selection by the Board as the Board’s nominees;
  and
 
 §
              perform
      any other duties or responsibilities expressly delegated to the Committee
      by the Board.
 
 As provided in the Nominating
Committee’s charter, the Committee’s process for identifying and evaluating
potential nominees may include soliciting recommendations from directors and
officers of the Company and the Bank. Additionally, the Committee may consider
persons recommended by shareholders of the Company and the Committee’s
evaluation of such persons will not differ from the manner of evaluation of
persons recommended by directors or officers of the Company or the
Bank.
 
 Procedures
for the Consideration of Board Candidates Submitted by Stockholders
 
 To be considered in the Nominating
Committee’s selection of its nominees, recommendations from shareholders must be
received by the Secretary of the Company in writing at least 120 days prior to
the date the proxy statement for the immediately preceding annual meeting was
first distributed to shareholders. Recommendations are to identify the
submitting shareholder, the person recommended for consideration, and the
reasons the submitting shareholder believes such person should be
considered.
 
 No nominations for directors may be
made at an annual meeting of shareholders except those made by the Board of
Directors, based on the recommendations of the Nominating Committee, and those
made by a shareholder who complies with the procedures for submitting
nominations set forth in Article II, Section 15 of the Company’s
bylaws.  Nominations from shareholders must be received by the Company
in writing by at least 60 days prior to the anniversary date of the previous
year’s annual meeting.  Nominations submitted by shareholders must be
accompanied by certain information specified in Article II, Section 15 of our
bylaws.  This information includes the following:
  (a)
      as to each person whom the shareholder proposes to nominate for election
      or re-election as  a directorand as to the shareholder giving
      the notice (i) the name, age, business address and  residence
      address ofsuch person, (ii) the principal occupation or employment of
      such  person, (iii) the class and number of shares of Company
      stock which are beneficially owned  by such person on the date
      of such shareholder notice, and (iv) all information that
      is  required to be disclosed in the solicitation of proxies for
      election as directors or is otherwise  required pursuant to
      Regulation 14A under the Securities Exchange Act of 1934,
      including  the proposed nominee’s written consent to serve as a
      director, if elected; and(b)
      as to the shareholder giving the notice, (i) the name and address, as they
      appear on the Company’sbooks, of the shareholder and any other
      shareholders known by the shareholder to be supporting theshareholder’s
      nominees, and (ii) the class and number of shares of Company stock which
      are beneficially owned by the shareholder and, to the extent known, by any
      other shareholders known by the shareholder to be supporting the
      shareholder’s nominees on the date of the shareholder’s
      notice.
  6
  In addition, nominations submitted by
shareholders must be accompanied by a certification, under oath before a notary
public, by each nominee that he or she meets the eligibility requirements to be
a director as set forth in Article III of the Company’s bylaws.
 
 The foregoing description is a summary
of our nominating process.  Any shareholder wishing to nominate a
candidate or recommend a nominee to our Nominating Committee for its
consideration should review and must comply in full with the procedures set
forth in our certificate of incorporation and bylaws, and New Jersey
law.
 
 Audit
Committee
 
 The Audit Committee is comprised of
Directors Parker, North and Ward, each of whom meets the independence standards
for audit committee members under the NASDAQ rules.  Each member of
the Audit Committee is qualified under the NASDAQ rules to serve as a member of
the Audit Committee; however, none qualifies as an audit committee financial
expert within the meaning of the regulations of the SEC.  The Board
has determined that, based on the business backgrounds and collective experience
of the current members of the Audit Committee, it is not necessary for the
committee to have a member who meets the audit committee financial expert
definition. The Audit Committee is scheduled to meet at least quarterly and on
an as-needed basis.  In fiscal 2008, this committee met six
times.
 
 The Audit Committee operates under a
formal written charter adopted by the Board, a copy of which was attached to the
Company’s proxy statement filed with the Securities and Exchange Commission on
April 20, 2006.  The Audit Committee assists our Board in its
oversight responsibility relating to the integrity of our financial statements
and the financial reporting process, the systems of internal accounting and
financial controls and compliance with legal and regulatory
requirements.  The Audit Committee, among other things:
 
 §
              oversees
      the entire audit function for the Company, both internal and
      independent;
 
 §
              hires,
      terminates and/or reappoints our independent
  auditors;
 
 §
              ensures
      the existence of effective accounting and internal control
      systems;
 
 §
              approves
      non-audit and audit services to be performed by the independent
      auditors;
 
 §
              reviews
      and approves all related party transactions for potential conflict of
      interest  situations; and
 
 §
              reviews
      and assesses the adequacy of the Audit Committee charter on an annual
      basis.
 
 The report of the Audit Committee is
set forth below under “Audit Committee Report.”
 
 Audit
Committee Report
 
 The Audit
Committee of American Bancorp of New Jersey, Inc. operates under a written
charter adopted by the full Board of Directors. In fulfilling its oversight
responsibility of reviewing the services performed by American Bancorp of New
Jersey, Inc.’s independent auditors, the Audit Committee carefully reviews the
policies and procedures for the engagement of the independent
auditors.  The Audit Committee also discussed with American Bancorp of
New Jersey, Inc.’s independent auditors the overall scope and plans for the
audit.  The Audit Committee met with the independent auditors to
discuss the results of its audit, the evaluation of American Bancorp of New
Jersey, Inc.’s internal controls, and the overall quality of American Bancorp of
New Jersey, Inc.’s financial reporting.  The Audit Committee also
reviewed and discussed with the independent auditors the fees paid to the
independent auditors.
 
 American
Bancorp of New Jersey, Inc.’s Chief Executive Officer and Chief Financial
Officer also reviewed with the Audit Committee the certifications that each such
officer will file with the SEC pursuant to the requirements of Sections 302 and
906 of the Sarbanes-Oxley Act of 2002.  Management also reviewed with
the Audit Committee the policies and procedures it has adopted to ensure the
accuracy of such certifications.
  7
  §
              The
      Audit Committee has reviewed and discussed with the Company’s management
      the Company’s fiscal 2008 audited financial
  statements;
 
 §
              The
      Audit Committee has discussed with the Company’s independent auditors
      (Crowe Horwath LLP) the matters required to be discussed by Statement on
      Auditing  Standards No. 61 and requirements of the Securities
      and Exchange Commission;
 
 §
              The
      Audit Committee has received the written disclosures and letter from the
      independent auditors required by Independence Standards Board No. 1 (which
      relates to the auditors’ independence from the Company and its related
      entities) and has discussed with the auditors their independence from the
      Company; and
 
 §
              Based
      on the review and discussions referred to in the three items above, the
      Audit Committee recommended to the Board of Directors that the fiscal 2008
      audited financial statements be included in the Company’s Annual Report on
      Form 10-K for the fiscal year ended September 30,
  2008.
 
 Submitted
by the Audit Committee of the Company’s Board of Directors:
 
 W.
George Parker
 H.
Joseph North
 James
H. Ward, III
 
 Item 11.
              Executive
      Compensation.
 
 Compensation
Discussion and Analysis
 
 Overview.  This
Compensation Discussion and Analysis provides important information about our
executive compensation program (the “program”) as it relates to the “named
executive officers” of the Company.  The discussion and analysis will
first present an overview of program governance followed by a review of the
goals and objectives of the program.  Next, we will identify the
executive officers to whom the program applies followed by a review of the
specific components of our executives’ compensation and the manner in which each
generally supports our program’s objectives.  We will then highlight
the specific program oversight and administration activities undertaken by the
Company and how such activities affected executive compensation during fiscal
2008.  Finally, this discussion and analysis will present an overview
of certain accounting and income tax considerations that are relevant to the
program.
 
 Governance of the
Program.The Compensation Committee (the “committee”) of the
Company’s  Board of Directors, which consists solely of the Company’s
outside directors, is responsible for the governance of our executive
compensation program.  These responsibilities include establishing the
goals and objectives of the program and developing and implementing the program
based upon those goals and objectives.  The committee’s
responsibilities also include all program oversight and administration
activities through which the various components of the program are regularly
reviewed and modified, where necessary, to ensure their continued alignment with
the program’s goals and objectives.
 
 Goals and
Objectives of our Executive Compensation Program.The program
is fundamentally based upon the goal of preserving the financial strength,
safety and soundness of the Company and the Bank while supporting long term
growth in shareholder value.  Toward that end, the committee has
established the following objectives for the program:
 
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry,
 §
              To
      provide a reasonable, fair and competitive level of current compensation
      to our executives in relation to their roles and
      responsibilities,
 §
              To
      provide a reasonable, fair and competitive level of retirement
      compensation to our executives in relation to their roles and
      responsibilities,
 §
              To
      provide meaningful and significant financial incentives to executives to
      achieve our stated business plan goals and
  objectives,
 
 
 
  8
  §
                To
      reward executives for corporate performance that exceeds our business plan
      goals and objectives,
 §
                To
      reward executives for individual job performance that exceeds the
      requirements and expectations of their roles and responsibilities,
      and
 §
                To
      align the financial interests of our executives with those of the
      Company’s shareholders toward the shared goal of growth in shareholder
      value.
 The goals
and objectives listed above are the guiding principles upon which the committee
has developed and implemented the Company’s executive compensation
program.  These same goals and objectives serve as the primary
criteria against which the committee regularly reviews and judges the
effectiveness of the structure of the program and the terms of its specific
components.
 
 Identification of
Named Executive Officers.The named executive officers falling
within the purview of this discussion and analysis include our principal
executive officer, our principal financial officer and the  two other
most highly compensated executive officers serving at fiscal year end based upon
total compensation for the fiscal year ended September 30,
2008.  These named executive officers are:
 
 §
              Joseph
      Kliminski, Chief Executive Officer,
 §
              Fred
      G. Kowal, President and Chief Operating
Officer,
 §
              Eric
      B. Heyer, Senior Vice President and Chief Financial Officer,
      and
 §
              Catherine
      M. Bringuier, Senior Vice President and Chief Lending
    Officer.
 
 Components of
Executive Compensation.The committee has established a
compensation package for our executives that includes base salary, annual
performance-based incentive compensation, equity-based compensation, retirement
benefits, medical and insurance benefits and perquisites.  Our
executive officers may also be protected under employment agreements with
severance and change in control provisions.
 
 The committee uses a variety of
quantitative and qualitative factors in determining if, and to what extent, the
named executive officers participate in the specific components of the executive
compensation program.  For any particular executive, the committee
establishes the level of compensation within each applicable component to
support a balanced achievement of the program’s goals and objectives noted
above.
 
 The remainder of this section will
present an overview of the specific components of our executive compensation
program.  This overview will identify and describe each component, its
specific purpose in relation to the program’s goals and objectives, the eligible
executives whose compensation includes that component and the general criteria
used by the committee to determine the level of an executive’s compensation
within that component.
 
 Base
Salary.  A base
salary is that component of an executive’s compensation that represents
remuneration for their effective performance of the day-to-day activities and
responsibilities that are required based upon the executive’s specific role
within the Company.
 
 In
relation to the goals and objectives of the executive compensation program, an
executive’s base salary generally serves two primary purposes:
 
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry, and
 §
              To
      provide a reasonable, fair and competitive level of base compensation to
      our executives in relation to their roles and
      responsibilities.
 
 Executive
base salaries are generally reviewed by the committee annually and modified,
where appropriate, to support the achievement of this component’s goals and
objectives as stated above.  The committee utilizes outside resources,
in part, to ascertain the appropriate level of base salary for each of the named
executive officers given their specified role within the
Company.  Such outside sources may include role-based compensation
surveys published for the banking industry by one or more qualified, independent
resources.  The committee is also cognizant of the salaries paid by
other financial services companies within our market area with which we compete
for executives.  The committee also evaluates the effectiveness with
which the executive has performed their specific role in considering any
modification to an executive’s level of base salary.  The committee is
solely responsible for evaluating the performance of the Chief Executive Officer
and the President and Chief Operating Officer.  However, the committee
considers the feedback of the Chief Executive Officer and the President and
Chief Operating Officer in their evaluation of performance of the two remaining
named executive officers.
 
 9
 Performance-Based
Incentive Compensation.  Performance-based
incentive compensation generally represents remuneration for an executive’s
contribution toward the achievement of specific goals and objectives outlined in
the Company’s business plan.  Toward this end, the committee has
established and maintains the Management Incentive Plan (“MIP”) which is the
primary source of short-term incentive compensation payable to the eligible
named executive officers.  MIP compensation is generally paid annually
based upon fiscal year performance.
 
 In
relation to the goals and objectives of the executive compensation program, the
MIP serves three primary purposes:
 
 §
              To
      provide meaningful and significant financial incentives to executives to
      achieve our stated business plan goals and
  objectives,
 §
              To
      reward executives for corporate performance that exceeds our business plan
      goals and objectives, and
 §
              To
      reward executives for individual job performance that exceeds the
      requirements and expectations of their roles and
      responsibilities.
 
 A named
executive officer’s participation in the MIP is determined annually by the
committee during the initial phase of the MIP administration cycle described
below.  Eligibility to participate in the MIP is largely determined
based upon the executive’s corporate role and responsibilities and their
resulting influence on, and contribution to, our success as measured by the
MIP.
 
 The MIP
is generally administered by the committee on an annual cycle.  The
administration process begins with the completion of the business plan and
budgeting process for the current fiscal year.  Once that process is
complete, the committee establishes the “MIP basis” upon which each eligible
executive’s potential incentive compensation for that year is based,
representing the targeted incentive award amount for the
executive.  Generally, the MIP basis is calculated as a percentage of
an executive’s base salary.  The committee then establishes specific
performance targets for each executive based upon the corporate goals and
objectives outlined in our updated business plan and budget as well as targets
relating to individual job performance.  Performance targets may
include both quantitative and qualitative factors which are established for the
executive based upon their specific role and responsibilities within the
Company.  Quantitative factors are based upon measurable, numerical
values while qualitative factors utilize numerical scalars to measure
performance for certain non-quantifiable targets.  These factors are
then “weighted” by the committee in relation to one another to reflect the
strategic priorities of our business plan.  Such “weightings”
determine the pro-rata allocation of the MIP basis by factor for each eligible
executive.
 
 Committee
members and executives monitor corporate and individual performance throughout
the year in relation to the levels targeted for each applicable
factor.  Upon completion of the fiscal year, the committee measures
actual performance for each executive’s factors against the targeted
levels.  With regard to qualitative factors, the committee is solely
responsible for measuring the performance of the Chief Executive Officer and the
President and Chief Operating Officer.  However, the committee may
consider the feedback of the Chief Executive Officer and the President and Chief
Operating Officer in measuring the performance of the other eligible named
executive officers in relation to applicable qualitative factors.
 
 Subject
to certain performance caps and floors established by the committee, the degree
to which each measured factor meets, exceeds or falls below the targeted level
determines the percentage of the MIP basis earned by the executive for that
factor.  The compensation earned by the executive through the MIP for
all applicable factors determines their total incentive compensation for the
fiscal year.
 
 The
incentive compensation earned by each of the eligible executive officers for
fiscal 2008 is reported in the Summary Compensation Table below.
 
 10
 Equity-Based
Compensation.  As
utilized within executive compensation program, equity-based compensation
represents non-cash remuneration earned by executives in the form of restricted
shares of the Company’s stock and stock options on Company
shares.  The Company has implemented two sets of restricted stock
(“RSP”) and stock option “(SOP”) plans.  The first set of plans was
approved by shareholders in January 2005 through which up to 208,295 restricted
shares and 694,315 stock options were approved for award to employees and
directors.  The number of restricted shares and options for this first
set of plans reflects an adjustment for the exchange of minority offering shares
during the Company’s second step conversion.  The second set of plans
received shareholder approval in May 2006 through which up to a total of 358,484
restricted shares and 722,633 options were approved for award to employees and
directors.
 
 Of the
566,779 restricted shares made available through the Company’s equity-based
compensation plans, a total of 327,909 or 57.9% were awarded to the named
executive officers.  Similarly, of the 1,416,948 stock options made
available through the Company’s plans, a total of 788,528 or 55.6% were awarded
to the named executive officers.  The remaining number of available
restricted shares and stock options were awarded to outside directors and other
officers.  Each award of restricted stock or stock options was granted
subject to a five year vesting period with 20% of such shares or options vesting
annually commencing on the first anniversary date of each award.  The
exercise price of all stock options awarded was based upon the closing share
value of the Company’s stock on the date of grant.
 
 In
relation to the goals and objectives of the executive compensation program, the
Company’s equity-based compensation plans serve two primary
purposes:
 
 §
              To
      align the financial interests of our executives with those of its
      shareholders toward the shared goal of growth in shareholder value,
      and
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry.
 
 The
committee has awarded restricted shares and stock options from the two sets of
plans noted above to each of the named executive officers.  The number
of restricted shares and stock options awarded to each executive was determined
by the committee, in part, based upon the executive’s corporate role and
responsibilities and their individual contribution to the Company’s strategic
achievements during their employment to date.  The number of RSP and
SOP awards granted to executives also reflects the comparative level of
employment retention incentive established by the committee for each
executive.
 
 Retirement
Benefits.    The
Company maintains two forms of retirement benefits in which substantially all
employees, including the named executive officers, are eligible to
participate.  These benefits include the Company’s Employee Stock
Ownership Plan (“ESOP”) and the Bank’s 401(k) profit sharing plan (“401(k)
plan”).  Additionally, our executive compensation program includes a
supplemental executive retirement plan, in which each of the named executive
officers participates.  The terms of the supplemental executive
retirement plan are established within Executive Salary Continuation Agreements
(“SERP agreements”) between the Bank and each of the named executive
officers.  In all cases, the compensation received by employees
through these plans is income tax deferred and the benefits relating to these
plans are subject to vesting.
 
 ESOP.  The ESOP
was initially established as part of the Company’s minority stock offering in
October 2003 and then substantially augmented through its second step conversion
in October 2005.  Through these transactions, the ESOP borrowed from
the Company the funds necessary to purchase a total of 1,133,571 shares of the
Company’s stock.   Shares issued to the ESOP are allocated to
eligible participants as of the end of each calendar year based on principal and
interest repayments made by the ESOP on the loan from the
Company.  The loan is secured by the Company shares purchased with the
loan proceeds and is being repaid by the ESOP with funds from the Bank’s
discretionary contributions to the ESOP and earnings on the ESOP’s
assets.  Principal and interest payments are scheduled to occur over a
twenty-year period.
 
 401(k)
Plan.  The
401(k) plan is designed to provide tax deferred retirement savings and income to
eligible employees.  Prior to the augmentation of the ESOP through the
Company’s second step conversion, the Bank had made annual, discretionary
“profit sharing” contributions to this plan.  However, such
contributions to the plan were discontinued after the ESOP was
augmented.  As such, Bank contributions in recent years have been
limited to the 401(k) component of the plan.  Through this component,
the Bank provides a “defined contribution” into each participant’s 401(k)
account that matches up to 50% of the first six percent of the wages and
salaries that are contributed by the employee into the
plan.  Investments held by the 401(k) include a variety of mutual
funds and other managed accounts including one fund comprised entirely of the
Company’s stock.
 
 11
 SERP
Agreements.  The SERP
agreements are intended to provide “defined benefit” retirement income to the
named executive officers to augment that provided through the Company’s other
plans and outside resources such as Social Security.  Benefits under
the SERP agreements are calculated as a percentage of an executive’s average
base salary during the years immediately preceding retirement with
post-retirement benefits paid in equal monthly installments until the death of
the participant.
 
 The Bank
has purchased bank-owned life insurance policies on each of the named executive
officers to provide income in the form of growth in each policy’s cash surrender
values over time to offset the costs of the SERP
agreements.  Additionally, these policies provide a form of life
insurance benefit under the terms of a Life Insurance Endorsement Method Split
Dollar Plan Agreement between the named executive officer and the
Bank.  This agreement provides for the payment of the value of the
expected SERP agreement benefit to the named executive officer’s designated
beneficiaries in the event of the named executive officer’s death.
 
 In relation to the goals and objectives
of the executive compensation program, the ESOP, 401(k) plan and SERP benefits
included in our executive compensation program serve two primary
purposes:
 
 §
              To
      provide a reasonable, fair and competitive level of retirement
      compensation to our executives in relation to their roles and
      responsibilities, and
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry.
 
 Each of
the named executive officers participates in the ESOP.  All employees
share ratably in the number of ESOP shares allocated annually.  The
number of shares allocated to any eligible employee, including the named
executive officers, is based upon their annual wages and salaries in relation to
that of all eligible participants, subject to certain caps for highly
compensated employees.  Such caps currently limit the number of shares
allocated annually to the Chief Executive Officer and President & Chief
Operating Officer. Similarly, each of the named executive officers also
participates in the 401(k) plan.
 
 As noted
above, the Bank has entered into SERP agreements that provide for supplemental
retirement benefits to each of the named executive officers.  The SERP
agreements for Mr. Kliminski and Mr. Heyer were executed in December
2002.  Ms. Bringuier’s SERP agreement was executed in April
2003.  The SERP agreement for Mr. Kowal, who joined the institution in
March 2005, was executed in December 2006.
 
 Within
each of the SERP agreements, the key variable in determining the level of an
executive’s supplemental retirement benefit is the percentage of average base
salary that will be paid to the executive as a post-retirement
benefit.  In determining the appropriate percentage for each
executive, the committee considered the aggregate amount of post-retirement
income which the executive would be forecasted to receive through their
employment with the Company assuming continuation of their current role and
responsibilities.  The committee considered such sources of retirement
income to include SERP agreement payments, distributions from the 401(k) plan,
distributions from the ESOP as well as payments received by the executive though
Social Security.  The aggregated level of expected post retirement
income was then evaluated by the committee in relation to the projected level of
the executive’s base salary at retirement.  The level of SERP
agreement benefit was generally targeted to provide an aggregate level of
post-retirement income in approximate ranges of projected pre-retirement base
salary of 65% to 75% for Mr. Kliminski and Mr. Kowal, 55% to 65% for Mr. Heyer
and 45% to 55% for Ms. Bringuier.
 
 Based on
these considerations, the percentage of each executive’s average base salary to
be paid as a SERP agreement benefit was established as follows:  Mr.
Kliminski - 50%, Mr. Kowal - 45%, Mr. Heyer - 40%, and Ms. Bringuier -
30%.  The average base salary providing the basis of the
post-retirement SERP agreement benefit is defined within the applicable SERP
agreements as the average of the three highest years’ base salaries during the
five years immediately preceding the executive’s retirement.
 
 12
 Health
Care and Life & Long Term Disability Insurance Benefits. Health care
benefits are a form of non-cash compensation designed to cover a significant
portion of the costs of providing health care protection to
employees.  We maintain a program of health care benefits covering
medical, dental and vision benefits that are available to substantially all
employees.  We also maintain programs through which we provide life
and long term disability insurance to substantially all employees.
 
 In
relation to the goals and objectives of the executive compensation program, the
health care and other insurance benefits included in our executive compensation
program serve two primary purposes:
 
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry, and
 §
              To
      provide a reasonable, fair and competitive level of current compensation
      to our executives in relation to their roles and
      responsibilities.
 
 We
generally provide health care and long term disability insurance benefits to
each of the named executive officers through the same plans providing such
coverage to other employees. Like all employees, executives are able to select
from the applicable level of health care coverage that protects the individual
employee and, where elected by the executive, their dependents.  The
level of dependent coverage determines the amount of mandatory contribution that
is made by the executive through a payroll deduction to partially defray our
cost of providing such coverage.
 
 In the
event that an employee were to incur a long term disability that prevented
active employment, our disability insurance generally compensates the employee
at 60% of their base salary through their normal retirement age as defined by
the Social Security.  Such protection is currently capped at $10,000
per month.  Consequently, based upon their current base salaries, Mr.
Heyer and Ms. Bringuier’s long term disability protection is currently limited
to $120,000 per year.  The employment agreements for Mr. Kliminski and
Mr. Kowal each contain provisions for supplemental long term disability
compensation to be paid directly by the Bank during the remaining term of their
respective contracts.  Thereafter, Mr. Kliminski’s and Mr. Kowal’s
long term disability compensation would be similarly capped at $120,000 per
year.
 
 We also
provide life insurance benefits to the named executive officers.  This
benefit is provided through separate coverage than that provided to other
employees.  Specifically, in accordance with the terms of an Executive
Life Insurance Agreement executed with the Bank, each named executive officer is
provided with life insurance protection equivalent to 300% of the executive’s
highest annual base salary in effect during the three calendar years preceding
their death.  The Bank has purchased bank-owned life insurance
policies on each of the named executive officers through which this coverage is
provided.
 
 Because
of the Company’s use of bank-owned life insurance to provide this benefit to its
executives, there are no recurring premiums paid by the Bank to maintain this
coverage.  However, the underlying value of insurance benefit provided
to each executive officer is included in their annual taxable
income.  This amount for each executive is reported in the Summary
Compensation table below.
 
 Perquisites. We limit our
provision of executive perquisites to the Chief Executive Officer and the
President and Chief Operating Officer.  Specifically, we lease
automobiles for Mr. Kliminski and Mr. Kowal for their use in support of Company
business.  Our cost of leasing the automobiles for Mr. Kliminski and
Mr. Kowal for fiscal 2008 was approximately $7,200 and $12,400
respectively.  The automobiles are also available for each executive’s
personal use.
 
 We also
pay for Mr. Kliminski’s country club membership, which is used to support the
building of business relationships and support our community involvement. The
cost of maintaining Mr. Kliminski’s club membership during fiscal 2008 was
approximately $7,800.
 
 Employment
Agreements. The manner in which
we implement the compensation components outlined above may be supported by one
or more agreements executed between the Company or the Bank and the named
executive officers.  In particular, the Bank has executed individual
employment agreements under which it specifically outlines the terms of
employment of each of the named executive officers.
 
 13
 In
relation to the goals and objectives of the executive compensation program, the
employment agreements included in the program serve two primary
purposes:
 
 §
              To
      attract and retain talented and experienced executives whose knowledge,
      skills and performance are critical to our success in a highly competitive
      community banking industry, and
 §
              To
      provide a reasonable, fair and competitive level of current compensation
      to our executives in relation to their roles and
      responsibilities.
 
 Employment
agreements achieve these purposes by codifying our level of commitment and
assurance to honor and protect the terms of the executive’s employment, while
providing appropriate remuneration for potential changes thereto, in return for
the executive’s commitment and assurance of continued service to
us.
 
 The Bank
has entered into employment agreements with Mr. Kliminski, Mr. Kowal, Mr. Heyer
and Ms. Bringuier.  The agreements with Mr. Kliminski and Mr. Kowal
each have terms of three years while Mr. Heyer’s and Ms. Bringuier’s agreements
each have terms of one year.  Each of the agreements provides for an
annual one-year extension of its terms upon determination by the committee that
the executive’s performance has met the requirements and the standards of the
Board of Directors such that the remaining term of the agreement is reset to
three years for Mr. Kliminski’s and Mr. Kowal’s agreements and one year for Mr.
Heyer’s and Ms. Bringuier’s agreements.
 
 As
discussed in the more detailed description of the employment agreements that
appears following the Grants of Plan-Based Awards table below, each of the
employment agreements provides for certain payments and benefits if the
executive’s employment is terminated under certain scenarios, including, but not
limited to, following a change in control of the Company.  The
employment agreements thus requires a “double trigger” in order for any payments
or benefits under the agreements to be provided to Mr. Kliminski, Mr. Kowal, Mr.
Heyer or Ms. Bringuier following a change in control.  In other words,
both a change in control and an involuntary
termination of employment (which includes a voluntary termination by the
executive following a material reduction in his or her duties, responsibilities
or benefits) must occur. The purpose of providing the change in control payments
and benefits is to attract and retain top level executives of the highest
caliber and mitigate the risk to these executives that their employment will be
involuntarily terminated in the event the Company is acquired.  At the
same time, the mere sale of the Company will not automatically trigger a payout,
as our intention is to induce the executive to remain employed following a
change in control so long as the acquiring company so desires without a material
reduction in the executive’s duties, responsibilities or benefits.
 
 Program Oversight
and Administration.The committee’s program oversight and
administration activities are generally conducted annually during the first
fiscal quarter ending December 31 although such activities may be performed
throughout the year as required by the committee to achieve program
objectives.  Through these activities, the committee reviews the
executive compensation program to ensure that each of its individual components
are functioning individually and collectively in a manner that supports the
stated objectives of the program.  Where appropriate, both the
structure and terms of the individual components, and the named executive
officers eligible to participate in each, are adjusted to support the program’s
overall goals and objectives.
 
 The following discussion reviews the
primary oversight and administration activities conducted by the committee for
each applicable component of the executive compensation program as they related
to the compensation of named executive officers during fiscal 2008.
 
 Base
Salary.  The
committee conducted its annual review and reassessment of executive base
salaries during the quarter ended December 31, 2007.  The committee’s
activities included the review of executive compensation information provided
through a number of independent sources with the greatest emphasis placed on
that provided by SNL Financial and L.R. Webber & Associates,
Inc.  Through these sources the committee compared, where available,
the level of comparable compensation based upon each named executive officer’s
functional role or title for similar institutions based on asset size, geography
and form of ownership.
 
 Next, the
committee qualitatively reviewed the manner in which each executive performed
their individual job functions in relation to the Board of Directors standards
and requirements for the executive’s role and responsibilities within the
Company.  Of particular importance to the committee was each
executive’s individual demonstrable role and influence on achieving the specific
goals and objectives of the Company’s business plan including, in particular,
those relating to growth in commercial lending, de novo branch expansion, growth
in core deposits and capital management.
 
 14
 Finally,
the committee also considered the level of each executive’s base salary in
relation to the total compensation earned by the executive including, in
particular, the level of equity-based and retirement compensation currently
earned by each executive.  Of particular importance to the committee
was the level of current expense associated with the aggregate level of each
executive’s compensation in relation to the near-term net income projected in
our updated business plan and budget.
 
 In
summary, the committee was generally satisfied that the level of base salary for
Mr. Kliminski, Mr. Kowal, Mr. Heyer and Ms. Bringuier remained reasonable based
on the information considered by the committee.  However, the
committee acknowledged the individual and collaborative efforts of Mr. Kowal,
Mr. Heyer and Ms. Bringuier to successfully achieve the goals and objectives of
the Company’s business plan.  As such, the committee increased the
base salaries of Mr. Kowal, Mr. Heyer and Ms. Bringuier for calendar year 2008
from the levels paid in calendar year 2007.  For those comparative
periods, Mr. Kowal’s base salary was increased to $258,750 from $225,000 while
Mr. Heyer’s base salary was increased to $165,328 from $155,328 and Ms.
Bringuier’s base salary was increased to $151,630from $144,130.  Mr.
Kliminski’s base salary remained unchanged at $258,750 for those same
comparative periods.  Additionally, Mr. Heyer and Ms. Bringuier began
to receive monthly automobile allowances of $400 each during fiscal
2008.
 
 Performance-Based
Incentive Compensation.  For
fiscal 2008, the committee identified Mr. Kowal, Mr. Heyer and Ms. Bringuier as
eligible participants in the MIP.  The committee established ten
percent of each executive’s base salary as the MIP basis, or the targeted
incentive award level for each executive, with twenty percent of each
executive’s base salary as the maximum award level.  Next, based upon
our updated business plan and budget, the committee established quantitative and
qualitative performance targets to be used in each executive’s MIP calculation
for fiscal 2008.  These performance targets were selected and
“weighted” in relation to one another based upon the expected long term earnings
impact and strategic value to the Company and each executive’s specific role and
responsibilities within the Company.
 
 Quantitative
loan-related targets utilized in the 2008 MIP primarily included those relating
to the origination of commercial loans, including multifamily and nonresidential
real estate loans, construction loans and business loans,  as well as
one-to four-family mortgages, including first mortgage loans, home equity loans
and home equity lines of credit.  Quantitative deposit-related targets
primarily included those relating to net growth in noninterest-bearing checking
account balances, net growth interest-bearing checking account balances and net
growth in savings account balances.  Finally, the committee generally
increased the impact of targeted net income as a specific quantitative factors
used in the 2008 MIP.  The increased focus on net income as a
quantitative target of the MIP emphasized the committee’s expected improvement
in fiscal 2008 earnings versus that reported for fiscal 2007 when net income was
detrimentally impacted by the execution of the branching strategies outlined in
our business plan.
 
 Finally,
qualitative performance targets were established based on applicable
non-quantifiable criteria designed to support the achievement of goals and
objectives of our updated business plan and budget.  These performance
targets were similarly based upon each executive’s specific role and
responsibilities within the Company and included criteria relating to asset
quality, capital management, risk management and internal control and regulatory
compliance including community support and reinvestment.
 
 The table
on the following page summarizes the total MIP compensation earned by each named
executive officer during fiscal 2008 and the allocation of such compensation
based upon the key performance targets and their respective weightings as
determined by the committee.  As described above under “Components of
Executive Compensation—Performance-Based Incentive Compensation,” the
quantitative performance factors were based on objectively measurable numerical
values while the qualitative performance factors were based on a subjective
assessment by the committee, utilizing a numerical scale to rate performance
under each qualitative factor.
  15
  Executive
                MIP
      Basis
                  (%)
                
                
                MIP
      Basis
                  ($)
                
                
                MIP
      Earned
                  ($)Performance
      Factor
                Factor
                  Weight
                  (%)
                2008
      Target Performance
                  by
      Factor
                  ($
      000’s)
                MIP
      Basis
                  by
      Factor
                  ($)
                2008
      Actual Performance
                  by
      Factor
                  ($
      000’s)
                MIP
      Earned
                  by
      Factor
                  ($)Fred
      G. Kowal
                10%
                
                
                25,875
                
                
                29,795Quantitative
      FactorsNet
      Income
                25%
                675,948
                
                6,469
                1,228,004
                
                11,708Commercial
      Loan Origination
                45%
                91,500,000
                
                11,644
                69,263,000
                
                11,6831-4
      Family Mortgage Loan Origination
                15%
                49,982,480
                
                3,881
                52,681,841
                
                4,075Checking
      & Savings Deposit Growth
                10%
                9,513,892
                
                2,588
                (45,092,425
                )
                -Qualitative
      FactorsAsset
      Quality
                5%
                
                
                1,293
                
                
                2,329Eric
      B. Heyer
                10%
                
                
                16,533
                
                
                20,451Quantitative
      FactorsNet
      Income
                20%
                675,948
                
                3,307
                1,228,004
                
                5,985Commercial
      Loan Origination
                20%
                91,500,000
                
                3,307
                69,263,000
                
                2,4801-4
      Family Mortgage Loan Origination
                10%
                49,982,480
                
                1,653
                52,681,841
                
                1,736Checking
      & Savings Deposit Growth
                10%
                9,513,892
                
                1,653
                (45,092,425
                )
                -Qualitative
      FactorsFinancial
      Planning, Reporting & Analysis
                5%
                
                
                827
                
                
                1,488Risk
      Management & Internal Control
                5%
                
                
                827
                
                
                1,157Capital
      Management
                20%
                
                
                3,307
                
                
                5,952Regulatory
      Examination & Compliance
                10%
                
                
                1,652
                
                
                1,653Catherine
      M. Bringuier
                10%
                
                
                15,163
                
                
                18,567Quantitative
      FactorsNet
      Income
                20%
                675,948
                
                3,033
                1,228,004
                
                5,489Commercial
      Loan Origination
                15%
                91,500,000
                
                2,275
                69,263,000
                
                1,7061-4
      Family Mortgage Loan Origination
                50%
                49,982,480
                
                7,581
                52,681,841
                
                7,581Qualitative
      FactorsRisk
      Management & Internal Control
                5%
                
                
                758
                
                
                1,365Asset
      Quality
                5%
                
                
                758
                
                
                1,365Regulatory
      Examination & Compliance
                5%
                
                
                758
                
                
                1,061
 
 Equity-Based
Compensation.   Based
upon the review of the equity-based compensation plans, the committee was
satisfied that the structure and level of equity-based compensation met the
stated goals and objectives of the program.  As such, the committee
made no other changes to the equity-based compensation component of the program
during fiscal 2008.
 
 Retirement
Benefits.  Based
upon the review of the various components of retirement compensation, the
committee was satisfied that the structure and level of such compensation met
stated goals and objectives of the program.  As such, the committee
made no changes to the retirement benefit component of the program during fiscal
2008.
 
 Health
Care and Life & Long Term Disability Insurance Benefits. Based upon the
review of the health care and insurance benefits provided to named executive
officers, the committee was satisfied that the structure and level of such
compensation met stated goals and objectives of the program.  As such,
the committee made no changes to the health care and insurance benefit component
of the program during fiscal 2008.
 
 Perquisites.  Based
upon the review of the limited perquisites provided to the eligible named
executive officers, the committee was satisfied that the nature and level of
such perquisites met stated goals and objectives of the program.  As
such, the committee made no changes to such perquisites component of the program
during fiscal 2008.
 
 16
 Employment
Agreements.  Based
upon the committee’s review of each executive’s performance of their role and
the manner in which each executive executed and fulfilled their responsibilities
in relation to the requirements of the Board of Director during fiscal 2008, the
Bank extended the term of the employment agreements for Mr. Kliminski, Mr.
Kowal, Mr. Heyer and Ms. Bringuier for an additional twelve month
period.
 
 Additionally,
the committee’s program administration activities during fiscal 2008 also
included modifying the applicable employment and benefit plan agreements where
required by newly-implemented Internal Revenue Service regulations.
 
 Accounting and Income Tax
Considerations.Based
upon our executive compensation program, the accounting and income tax treatment
of compensation has generally not been a factor in determining the forms and
amounts of compensation for our executive officers.  However, the
committee and management have considered the accounting and income tax impact of
program components and the compensation paid to each executive within each
component and in the aggregate.
 
 Internal Revenue Code Section
162(m).  Section 162(m) of the Internal Revenue Code of 1986,
as amended, generally disallows a tax deduction for compensation paid to any
“covered employee” (defined, per the guidance of the Internal Revenue Service,
as the principal executive officer and the three other most highly compensated
officers named in the Summary Compensation Table) in excess of $1.0 million per
year, to the extent such compensation is not “performance-based compensation”
under a plan approved by shareholders.  The committee reviews and
considers the potential consequences of Section 162(m) to the
Company.  Based upon the Company’s current executive compensation
program, the Company has no individuals with non-performance based compensation
paid in excess of the Internal Revenue Code 162(m) tax deduction
limit.  However, the Company reserves the right to use our discretion
judgment to authorize compensation to any employee that does not comply with the
Section 162(m) exemptions for compensation that we believe is
appropriate.
 
 Internal Revenue Code Section
280G.Section 280G of the Internal Revenue Code provides that
severance payments that equal or exceed three times the individual’s base amount
are deemed to be “excess parachute payments” if they are conditioned upon a
change of control.  Individuals receiving parachute payments in excess
of the three times their base amount are subject to a 20% excise tax on the
amount of the excess payments.  If excess parachute payments are made,
the Company would not be entitled to deduct the amount of the excess
payments.  Each employment agreement provides that severance and other
payments that are subject to a change of control will be reduced as much as
necessary to ensure that no amounts payable to the executive will be considered
excess parachute payments.
 
 17
 Summary
Compensation Table
 
 The
following table sets forth information concerning the compensation paid to or
earned by the named executive officers for 2008:
  Name and Principal Position
                                                                
                                                                Year
                                                                
                                                                Salary
                                                                  ($)
                                                                
                                                                Bonus
                                                                  ($)(1)
                                                                
                                                                Stock
      Awards
                                                                  ($)(2)
                                                                
                                                                Option
      Awards
                                                                  ($)(3)
                                                                
                                                                Non-Equity
      Incentive Plan Compensation
                                                                  ($)(4)
                                                                
                                                                Change
      in
                                                                  Pension
      Value
                                                                  and
                                                                  Nonqualified
                                                                  Deferred
                                                                  Compensation
                                                                  Earnings ($)(5)
                                                                
                                                                All
                                                                  Other
                                                                  Compensation
                                                                  ($)
                                                                
                                                                Total
      Compensation
                                                                  ($)Joseph
      Kliminski, Chief ExecutiveOfficer
                                                                
                                                                2008
                                                                
                                                                258,750
                                                                
                                                                ---
                                                                
                                                                249,223
                                                                
                                                                128,637
                                                                
                                                                ---
                                                                
                                                                281,508
                                                                
                                                                74,236
                                                                (6)
                                                                
                                                                992,3542007
                                                                
                                                                258,750
                                                                
                                                                ---
                                                                
                                                                249,223
                                                                
                                                                128,637
                                                                
                                                                22,605
                                                                
                                                                212,310
                                                                
                                                                75,735
                                                                (6)
                                                                
                                                                947,260Fred
      G. Kowal, President and
                                                                  Chief
      Operating Officer
                                                                
                                                                2008
                                                                
                                                                258,750
                                                                
                                                                ---
                                                                
                                                                196,071
                                                                
                                                                75,613
                                                                
                                                                29,795
                                                                
                                                                71,997
                                                                
                                                                51,755
                                                                (7)
                                                                
                                                                683,9812007
                                                                
                                                                225,000
                                                                
                                                                ---
                                                                
                                                                193,599
                                                                
                                                                74,217
                                                                
                                                                23,256
                                                                
                                                                43,330
                                                                
                                                                52,208
                                                                (7)
                                                                
                                                                611,610Eric
      B. Heyer, Senior Vice
                                                                  President  and
      Chief Financial
                                                                  Officer
                                                                
                                                                2008
                                                                
                                                                165,328
                                                                
                                                                ---
                                                                
                                                                113,539
                                                                
                                                                58,354
                                                                
                                                                20,451
                                                                
                                                                13,371
                                                                
                                                                35,342
                                                                (8)
                                                                
                                                                406,3852007
                                                                
                                                                155,328
                                                                
                                                                ---
                                                                
                                                                113,359
                                                                
                                                                58,354
                                                                
                                                                16,055
                                                                
                                                                11,429
                                                                
                                                                35,785
                                                                (8)
                                                                
                                                                390,490Catherine
      M. Bringuier, Senior
                                                                  Vice
      President and Chief Lending
                                                                
                                                                2008
                                                                
                                                                151,630
                                                                
                                                                ---
                                                                
                                                                105,303
                                                                
                                                                55,298
                                                                
                                                                18,567
                                                                
                                                                11,241
                                                                
                                                                33,380
                                                                (9)
                                                                
                                                                375,419Officer
                                                                
                                                                2007
                                                                
                                                                144,130
                                                                
                                                                ---
                                                                
                                                                105,303
                                                                
                                                                55,298
                                                                
                                                                10,051
                                                                
                                                                10,393
                                                                
                                                                32,707
                                                                (9)
                                                                
                                                                357,882
 _____________________
 
 (1)
                Bonus
      amounts are reported under the “Non-Equity Incentive Plan Compensation”
      column.(2)
                Reflects
      the dollar amount recognized for financial statement reporting purposes
      for the fiscal years ended September 30, 2008 and 2007, respectively, in
      accordance with FAS 123R, of restricted stock granted to the named
      executive officers (disregarding for this purpose the estimate of
      forfeitures related to service-based vesting conditions, and thus may
      include amounts from awards made in and prior to fiscal
      2008).  The assumptions used in the calculation of this amount
      are included in Note 11 of the Notes to Consolidated Financial Statements
      contained in the Company’s Annual Report on Form 10-K for the fiscal year
      ended September 30, 2008 filed with the Securities and Exchange
      Commission.
 (3)
              Reflects
      the dollar amount recognized for financial statement reporting purposes
      for the fiscal years ended September 30, 2008 and 2007, respectively, in
      accordance with FAS 123R, of stock options granted to the named executive
      officer (disregarding for this purpose the estimate of forfeitures related
      to service-based vesting conditions, and thus may include amounts from
      awards made in and prior to fiscal 2008).  The assumptions used
      in the calculation of these amounts are included in Note 11 of the Notes
      to Consolidated Financial Statements contained in the Company’s Annual
      Report on Form 10-K for the fiscal years ended September 30, 2008 and
      2007, respectively, filed with the Securities and Exchange
      Commission.
 (4)
              Represents
      incentive bonus amounts awarded for performance in fiscal 2008 and 2007,
      respectively, under the Management Incentive
  Plan.
 (5)
              Represents
      the change during fiscal 2008 and 2007, respectively, in the actuarial
      present value of the named executive officer’s accumulated benefit under
      the Company’s supplemental executive retirement plan.  The
      assumptions used for this calculation were the same as those used for the
      calculation of the present value of accumulated benefit in the table under
      “Pension Benefits.”
 (6)
              For
      Mr. Kliminski, the amounts reported for 2008 and 2007 under the All Other
      Compensation column consists of the following: personal use of Bank-leased
      automobile valued at $4,001 and $5,961, respectively; country club dues
      paid on Mr. Kliminski’s behalf of $7,821 and $7,751, respectively; life
      insurance premiums paid on Mr. Kliminski’s behalf valued at $14,909 and
      $13,397, respectively; employer matching contributions under the Bank’s
      401(k) profit sharing plan of $6,269 and $6,552, respectively; and
      allocation of shares under the ESOP, based on the closing price of the
      Company’s common stock on September 30, 2008 and 2007, of $41,236 and
      $42,074, respectively.
 (7)
              For
      Mr. Kowal, the amounts reported for 2008 and 2007 under the All Other
      Compensation column consists of the following: personal use of Bank-leased
      automobile valued at $5,917 and $5,715, respectively; life insurance
      premiums paid on Mr. Kowal’s behalf valued at $969 and $899, respectively;
      employer matching contributions under the Bank’s 401(k) profit sharing
      plan of $3,635 and $3,635, respectively; and allocation of shares under
      the ESOP, based on the closing price of the Company’s common stock on
      September 30, 2008 and 2007, of $41,234 and $41,959,
      respectively.
 (8)
              For
      Mr. Heyer, the amounts reported for 2008 and 2007 under the All Other
      Compensation column consists of the following: life insurance premiums
      paid on Mr. Heyer’s behalf valued at $1,734 and $1,617, respectively;
      employer matching contributions under the Bank’s 401(k) profit sharing
      plan of $5,141 and $4,481, respectively; and allocation of shares under
      the ESOP, based on the closing price of the Company’s common stock on
      September 30, 2008 and 2007, of $28,467 and $29,687,
      respectively.
 (9)
              For
      Ms. Bringuier, the amounts reported for 2008 and 2007 under the All Other
      Compensation column consists of the following: life insurance premiums
      paid on Ms. Bringuier’s behalf valued at $2,807 and $834, respectively;
      employer matching contributions under the Bank’s 401(k) profit sharing
      plan of $4,158 and $4,324, respectively; and allocation of shares under
      the ESOP, based on the closing price of the Company’s common stock on
      September 30, 2008 and 2007, of $26,415 and $27,549,
      respectively.
  18
 Grants
of Plan-Based Awards
  
 
 Estimated
      Possible Payouts Under Non-Equity Incentive PlanAwards
                                                  Estimated
      Future Payouts Under Equity Incentive Plan
      Awards
                                                  All
                                                      Other
                                                      Stock
      Awards:
                                                      Number
                                                      of
      Shares
                                                      of
      Stock
                                                      or
      Units
                                                      (#)
                                                  All
      Other
                                                      Option
                                                      Awards:
                                                      Number
      of
                                                      Securities
                                                      Underlying
                                                      Options
                                                      (#)
                                                  
                                                  Grant
                                                      Date
                                                      Fair
                                                      Value
                                                      of
                                                      Stock
                                                      and
                                                      Option
                                                      Awards
                                                      ($)Name
                                                  Grant
                                                      Date
                                                  Threshold
                                                      ($)
      (1)
                                                  Target
                                                      ($)
      (1)
                                                  Maximum
                                                      ($)
      (1)
                                                  Threshold
                                                      ($)
                                                  Target
                                                      ($)
                                                  Maximum
                                                      ($)
                                                  Exercise
      Price of Option Awards
                                                      ($/Sh)Joseph
      Kliminski
                                                  n/a
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---Fred
      G.
                                                    Kowal
                                                  n/a
                                                  ---
                                                  25,875
                                                  51,750
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---Eric
      B.
                                                    Heyer
                                                  n/a
                                                  ---
                                                  16,533
                                                  33,066
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---Catherine
      M. Bringuier
                                                  n/a
                                                  ---
                                                  15,163
                                                  30,326
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
                                                  ---
 ______________
 (1)
              For
      each named executive officer, represents the threshold (i.e. lowest),
      target and maximum amounts that were potentially payable for fiscal 2008
      under the Company’s Management Incentive Plan.  The actual
      amounts earned under these awards for fiscal 2008 are reflected in the
      Summary Compensation Table under the “Non-Equity Incentive Plan
      Compensation” column.  For additional information regarding the
      Management Incentive Plan, see “Compensation Discussion and
      Analysis—Performance-Based Incentive
  Compensation.”
 
 Employment
Agreements
 
 The Bank has employment agreements with
each of Mr. Kliminski, Mr. Kowal, Mr. Heyer and Ms. Bringuier.  Mr.
Kliminski’s and Mr. Kowal’s employment agreements have terms of three years,
while Mr. Heyer’s and Ms. Bringuier’s agreements have terms of one year. Each of
the agreements provides for an annual one-year extension of the term of the
agreement upon determination of the Board of Directors that the executive’s
performance has met the requirements and standards of the Board, so that the
remaining term of the agreement continues to be three years, in the case of Mr.
Kliminski and Mr. Kowal, and one year, in the case of Mr. Heyer and Ms.
Bringuier.
 
 If the
Bank terminates the employment of Mr. Kliminski, Mr. Kowal, Mr. Heyer or Ms.
Bringuier without “just cause,” as defined in the agreement, they will be
entitled to a continuation of their salary from the date of termination through
the remaining term of their agreement (but not less than two years for Mr.
Kliminski and one year for Mr. Kowal, Mr. Heyer and Ms. Bringuier), plus the
cost of their obtaining health, life, disability and other benefits which they
would have been eligible to receive through the salary continuation period, at
substantially the same benefit levels being provided on the employment
termination date.
 
 Mr.
Kliminski’s and Mr. Kowal’s employment agreements provide that if their
employment is involuntarily terminated without just cause, or voluntarily
terminated following a specified diminution in their duties, responsibilities or
benefits, during the term of the agreement following a change in control of the
Company or the Bank, or within 24 months following a change in control of the
Company or the Bank, they will be entitled to an amount equal to 2.99 times
their five-year average annual taxable compensation, subject to reduction to
avoid the payment of any “excess parachute payment” under the Internal Revenue
Code, payable, at their election, in a lump sum or in monthly installments over
a 36-month period.
 
 Mr.
Heyer’s and Ms. Bringuier’s employment agreements provide that if their
employment is involuntarily terminated without just cause, or voluntarily
terminated following a specified diminution in their duties, responsibilities or
benefits, during the term of the agreement following a change in control of the
Company or the Bank, or within 12 months following a change in control of the
Company or the Bank, they will be entitled to an amount equal to 2.00 times
their five-year average annual taxable compensation, subject to reduction to
avoid the payment of any “excess parachute payment” under the Internal Revenue
Code, payable, at their election, in a lump sum or in monthly installments over
a 24-month period. See “Potential Payments Upon Termination of
Employment.”
 
 19
 Outstanding
Equity Awards At September 30, 2008
 
 The
following table provides information regarding each unexercised stock option and
unvested restricted stock award held by each of the named executive officers as
of September 30, 2008:
 
 Option
      Awards
              Stock
      AwardsName
              Number
      of
                  Securities
                  Underlying
                  Unexercised
                  Options
      (#)
                  Exercisable
              Number
      of
                  Securities
                  Underlying
                  Unexercised
                  Options
      (#)
                  Unexercisable
              Equity
                  Incentive
                  Plan
                  Awards:
                  Number
      of
                  Securities
                  Underlying
                  Unexercised
                  Unearned
                  Options
      (#)
              Option
                  Exercise
                  Price
      ($)
              Option
                  Expiration
                  Date
              Number
                  of
                  Shares
      or
                  Units
      of
                  Stock
      That
                  Have
      Not
                  Vested
      (#)
              Market
                  Value
      of
                  Shares
      or
                  Units
      of
                  Stock
      That
                  Have
      Not
                  Vested
      ($)
              Equity
                  Incentive
                  Plan
                  Awards:
                  Number
      of
                  Unearned
                  Shares,
                  Units
                  or
      Other
                  Rights
                  That
      Have
                  Not
                  Vested
      (#)
              Equity
                  Incentive
                  Plan
                  Awards:
                  Market
      or
                  Payout
                  Value
      of
                  Unearned
                  Shares,
                  Units
      or
                  Other
                  Rights
                  That
      Have
                  Not
                  Vested
      ($)Joseph
              98,937
      (1)
              65,962(1)
              ---
              6.80
              01/20/15
              19,996(4)
              205,959
              
              ---
              ---Kliminski
              63,591(2)
              95,388(2)
              ---
              11.49
              05/23/16
              47,321(5)
              487,406
              
              ---
              ---Fred
      G. Kowal
              63,591(2)
              95,388(2)
              ---
              11.49
              05/23/16
              47,321(5)
              487,406
              
              ---
              ---3,818(3)
              15,276(3)
              ---
              11.87
              12/19/16
              5,000(6)
              51,500
              
              ---
              ---Eric
      B. Heyer
              44,781(1)
              29,858(1)
              ---
              6.80
              01/20/15
              9,166(4)
              94,410
              
              ---
              ---28,904(2)
              43,358(2)
              ---
              11.49
              05/23/16
              21,510(5)
              221,553
              
              ---
              ---Catherine
      M.
              44,781(1)
              29,858(1)
              ---
              6.80
              01/20/15
              9,166(4)
              94,410
              
              ---
              ---Bringuier
              26,014(2)
              39,023(2)
              ---
              11.49
              05/23/16
              19,359(5)
              199,398
              
              ---
              ---
 _____________
 (1)
              Vesting
      schedule of option is as follows:  20% on each of January 20,
      2006, 2007, 2008, 2009 and 2010.
 (2)
              Vesting
      schedule of option is as follows:  20% on each of May 23, 2007,
      2008, 2009, 2010 and 2011.
 (3)
              Vesting
      schedule of option is as follows: 20% on each of December 19, 2007, 2008,
      2009, 2010 and 2011.
 (4)
              Unvested
      portion of restricted stock award subject to the following vesting
      schedule: 20% on each of January 20, 2006, 2007, 2008, 2009 and
      2010.
 (5)
              Unvested
      portion of restricted stock award subject to the following vesting
      schedule: 20% on each of May 23, 2007, 2008, 2009, 2010 and
      2011.
 (6)
              Unvested
      portion of restricted stock award subject to the following vesting
      schedule: 20% on each of December 19, 2007, 2008 2009, 2010 and
      2011.
  Option
Exercises and Stock Vested
  
 The
following table sets forth information about stock options exercised and shares
of restricted stock that vested during the fiscal year ended September 30, 2008
with respect to each named executive officer:
 
 Option
      Awards
                Stock
      AwardName
                Number
      of
                    Shares
                    Acquired
      on
                    Exercise
      (#)
                Value
                    Realized
      on
                    Exercise
      ($)
                Number
      of
                    Shares
                    Acquired
      on
                    Vesting
      (#)
                Value
                    Realized
      on
                    Vesting
      ($)(1)Joseph
      Kliminski
                ---
                ---
                25,771
                269,896Fred
      G. Kowal
                ---
                ---
                17,022
                178,444Eric
      B. Heyer
                ---
                ---
                11,751
                123,065Catherine
      M. Bringuier
                ---
                ---
                11,035
                115,547
 ________________
 (1)
              Represents
      the value realized upon vesting of restricted stock award, based on the
      market value of the shares on the vesting
date.
  20
  Pension
Benefits
 
 The Bank
maintains a supplemental executive retirement plan in the form of executive
salary continuation agreements (“SERP agreements”) with each of the named
executive officers.  The SERP agreements provide for a lifetime annual
retirement benefit, payable monthly commencing with the first month after the
executive’s retirement date (generally the December 31st nearest the executive’s
65th birthday), equal to a specified percentage of the executive’s average base
salary based upon the average of the highest  three out of the last
five years of employment.  These percentages are 50% for Mr.
Kliminski, 45% for Mr. Kowal, 40% for Mr. Heyer and 30% for Ms.
Bringuier.
 
 If an
executive’s employment with the Bank terminates prior to retirement, either
voluntarily by the executive or by the Bank without cause (other than following
a change in control to the extent described below), then the executive will
receive as severance compensation a lump sum amount equal to the accrued balance
of the executive’s liability reserve account multiplied by the executive’s
vested percentage.  At September 30, 2008, Mr. Kowal was 70% vested in
his account; all of the other named executive officers are 100% vested in their
accounts. If an executive’s employment with the Bank terminates due to
disability, the executive will be entitled to receive 100% of his or her accrued
liability balance at the time of disability, payable at the Bank’s election
either in a lump sum or in 15 annual payments with an equivalent present
value.  If an executive’s employment with the Bank is terminated
within 12 months after a change in control, either involuntarily by the Bank
without cause or voluntarily by the executive if a specified diminution in the
executive’s duties, responsibilities or benefits occurs, then the executive will
be entitled to his or her full retirement benefits under the SERP agreement upon
attaining age 65, as if the executive had been continuously employed by the Bank
until age 65, subject to reduction to avoid the payment of an “excess parachute
payment” under the Internal Revenue Code.  As long as the SERP
agreement remains in effect, upon the death of the executive, the executive’s
beneficiary will be paid a death benefit under the terms of the Endorsement
Method Split Dollar Life Insurance Agreement between the executive the Bank. No
benefits are payable under the agreements upon termination for
cause.
 
 The
following table sets forth information regarding benefits payable to the named
executive officers under the SERP agreements:
  Name
              
              Plan
      Name
              
              Number
      of
                Years
                Credited
                Service
                (#)
              
              Present
      Value
                  of
                  Accumulated
                  Benefit
                  ($)
              
              Payments
                  During
                  Last
                  Fiscal
                  Year
                  ($)Joseph
      Kliminski
              
              Executive
      Salary Continuation Agreement
              
              n/a
              
              1,284,004
              
              ---Fred
      G. Kowal
              
              Executive
      Salary Continuation Agreement
              
              n/a
              
              603,534
              
              ---Eric
      B. Heyer
              
              Executive
      Salary Continuation Agreement
              
              n/a
              
              212,525
              
              ---Catherine
      M. Bringuier
              
              Executive
      Salary Continuation Agreement
              
              n/a
              
              156,953
              
              ---
 
 
 The amounts shown for the present value
of accumulated benefit, assume an age 65 retirement date, a discount rate of
6.00% and a post-retirement mortality for each named executive as follows: Mr.
Kliminski – 15.0 years, Mr. Kowal – 15.0 years, Mr. Heyer – 15.0 years and Ms.
Bringuier – 18.2 years.
  21
 Potential
Payments upon Termination of Employment
  The
following tables summarize the approximate value of the termination payments and
benefits that the named executive officers would have received if their
employment had been terminated on September 30, 2008 under the circumstances
shown.  The tables exclude (i) amounts accrued through September 30,
2008 that would be paid in the normal course of continued employment, such as
accrued but unpaid salary and bonus amounts, (ii) and account balances under the
Bank’s 401(k) profit sharing plan and the ESOP.
  Joseph
      KliminskiTermination
                  Scenario
              Salary
                  Continuation
                  Under
                  Employment
                  Agreement
              Continuation
                  of
      Group
                  Health,
      Life
                  and
                  Disability
                  Insurance
                  Coverage
              Supplemental
                  Executive
                  Retirement
                  Benefit
              Death
                  Benefit
              Disability
                  Benefit
              Accelerated
                  Vesting
      of
                  Stock
                  Options
              Accelerated
                  Vesting
      of
                  Restricted
                  Stock
              Payment
      of
                  299%
      of
                  “Base
                  Amount”If
      termination for cause occurs
              ---
              ---
              ---
              ---
              ---
              ---
              ---
              ---If
      voluntary termination (not following a change in control)
      occurs
              ---
              ---
              $1,284,004(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause (not following a change in control)
      occurs
              $582,188(2)
              $33,844(3)
              $1,284,004(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause, or voluntary termination for
      specified reasons, occurs following a change in control
              ---
              ---
              $1,284,004(9)
              ---
              ---
              $230,867(4)
              $693,365(5)
              $1,273,758(6)If
      termination occurs due to disability
              ---
              ---
              $1,284,004(1)
              ---
              $240,000(7)
              $230,867(4)
              $693,365(5)
              ---If
      termination occurs due to death
              ---
              ---
              $1,038,312(10)
              $776,250(8)
              ----
              $230,867(4)
              $693,365(5)
              ---
 ____________________________
 (1)
              Represents
      the benefit payable to Mr. Kliminski under the circumstances indicated
      pursuant to his SERP agreement, as described above under “Pension
      Benefits.”
 (2)
              Represents
      the aggregate amount of salary that would continue to be paid to Mr.
      Kliminski pursuant to his employment agreement from the assumed employment
      termination date (September 30, 2008) through the last day of the term of
      his employment agreement (December 31,
2010).
 (3)
              Represents
      the estimated approximate cost to the Company of Mr. Kliminski obtaining
      continued health, life and disability insurance benefits pursuant to his
      employment agreement.
 (4)
              Represents
      the value of acceleration of unvested stock options, based on the closing
      price of the Company’s common stock on September 30, 2008 ($10.30) and the
      exercise prices of the options.  All unvested options vest upon
      a change in control, regardless of Mr. Kliminski’s employment
      status.
 (5)
              Represents
      the value of acceleration of unvested restricted stock, based on the
      closing price of the Company’s common stock on September 30, 2008
      ($10.30).  All unvested shares of restricted stock vest upon a
      change in control, regardless of Mr. Kliminski’s employment
      status.
 (6)
              Mr.
      Kliminski’s employment agreement provides that if his employment is
      involuntarily terminated without just cause, or voluntarily terminated
      following a specified diminution in his duties, responsibilities or
      benefits, during the term of the agreement following a change in control
      of the Company or the Bank, or within 24 months following a change in
      control of the Company or the Bank, he will be entitled to an amount equal
      to 2.99 times his “base amount” (defined generally in the Internal Revenue
      Code as his five-year average annual taxable compensation), subject to
      reduction to avoid the payment of any “excess parachute payment” under the
      Internal Revenue Code, payable, at his election, in a lump sum or in
      monthly installments over a 36-month
period.
 (7)
              Represents
      disability benefit payments to Mr. Kliminski under the Bank’s disability
      insurance benefit plan plus any supplemental disability payments, if
      applicable, paid in accordance with his employment
    agreement.
 (8)
              Represents
      supplemental life insurance benefit under Mr. Kliminski’s Executive Life
      Insurance Agreement with the Bank.
 (9)
              Represents
      the discounted present value of the estimated post-retirement payments to
      be paid to Mr. Kliminski beginning at age 65 under the circumstances
      indicated pursuant to his SERP agreement, as described above under
      “Pension Benefits.”   As discussed under “Pension
      Benefits,” the amount payable to Mr. Kliminski under the change in control
      scenario is subject to reduction to the extent necessary to avoid the
      payment of any “excess parachute payments” under the Internal Revenue
      Code.
 (10)
              Represents
      the life insurance benefit paid under Mr. Kliminski’s Life Insurance
      Endorsement Method Split Dollar Plan Agreement with the Bank associated
      with his SERP agreement.
 
 22
  
 
 
 
 
 
 
 
 
 
 Fred
      G. KowalTermination
                    Scenario
                Salary
                    Continuation
                    Under
                    Employment
                    Agreement
                Continuation
                    of
      Group
                    Health,
      Life
                    and
                    Disability
                    Insurance
                    Coverage
                Supplemental
                    Executive
                    Retirement
                    Benefit
                Death
                    Benefit
                Disability
                    Benefit
                Accelerated
                    Vesting
      of
                    Stock
                    Options
                Accelerated
                    Vesting
      of
                    Restricted
                    Stock
                Payment
      of
                    299%
      of
                    “Base
                    Amount”If
      termination for cause occurs
                ---
                ---
                ---
                ---
                ---
                ---
                ---
                ---If
      voluntary termination (not following a change in control)
      occurs
                ---
                ---
                $80,730(1)
                ---
                ---
                ---
                ---
                ---If
      involuntary termination without cause (not following a change in control)
      occurs
                $582,188(2)
                $43,713(3)
                $80,730(1)
                ---
                ---
                ---
                ---
                ---If
      involuntary termination without cause, or voluntary termination for
      specified reasons, occurs following a change in control
                ---
                ---
                $603,534(9)
                ---
                ---
                $0(4)
                $538,906(5)
                $1,006,567(6)If
      termination occurs due to disability
                ---
                ---
                $115,328(1)
                ---
                $468,984(7)
                $0(4)
                $538,906(5)
                ---If
      termination occurs due to death
                ---
                ---
                $1,244,531(10)
                $776,250(8)
                ----
                $0(4)
                $538,906(5)
                ---
 ____________________________
 (1)
                Represents
      the benefit payable to Mr. Kowal under the circumstances indicated
      pursuant to his SERP agreement, as described above under “Pension
      Benefits.”
 (2)
                Represents
      the aggregate amount of salary that would continue to be paid to Mr. Kowal
      pursuant to his employment agreement from the assumed employment
      termination date (September 30, 2008) through the last day of the term of
      his employment agreement (December 31,
2010).
 (3)
                Represents
      the estimated approximate cost to the Company of Mr. Kowal obtaining
      continued health, life and disability insurance benefits pursuant to his
      employment agreement.
 (4)
                Because
      the exercise prices of Mr. Kowal’s options are greater than the market
      price of the Company’s common stock on September 30, 2008 ($10.30), no
      acceleration value is shown.
 (5)
                Represents
      the value of acceleration of unvested restricted stock, based on the
      closing price of the Company’s common stock on September 30, 2008
      ($10.30).  All unvested shares of restricted stock vest upon a
      change in control, regardless of Mr. Kowal’s employment
      status.
 (6)
                Mr.
      Kowal’s employment agreement provides that if his employment is
      involuntarily terminated without just cause, or voluntarily terminated
      following a specified diminution in his duties, responsibilities or
      benefits, during the term of the agreement following a change in control
      of the Company or the Bank, or within 24 months following a change in
      control of the Company or the Bank, he will be entitled to an amount equal
      to 2.99 times his “base amount” (defined generally in the Internal Revenue
      Code as his five-year average annual taxable compensation), subject to
      reduction to avoid the payment of any “excess parachute payment” under the
      Internal Revenue Code, payable, at his election, in a lump sum or in
      monthly installments over a 36-month
period.
 (7)
                Represents
      disability benefit payments to Mr. Kowal under the Bank’s disability
      insurance benefit plan plus any supplemental disability payments, if
      applicable, paid in accordance with his employment
    agreement.
 (8)
                Represents
      supplemental life insurance benefit under Mr. Kowal’s Executive Life
      Insurance Agreement with the Bank.
 (9)
                Represents
      the discounted present value of the estimated post-retirement payments to
      be paid to Mr. Kowal beginning at age 65 under the circumstances indicated
      pursuant to his SERP agreement, as described above under “Pension
      Benefits.”   As discussed under “Pension Benefits,” the
      amount payable to Mr. Kowal under the change in control scenario is
      subject to reduction to the extent necessary to avoid the payment of any
      “excess parachute payments” under the Internal Revenue
    Code.
 (10)
                Represents
      the life insurance benefit paid under Mr. Kowal’s Life Insurance
      Endorsement Method Split Dollar Plan Agreement with the Bank associated
      with his SERP agreement.
  23
  Eric
      B. HeyerTermination
                  Scenario
              Salary
                  Continuation
                  Under
                  Employment
                  Agreement
              Continuation
                  of
      Group
                  Health,
      Life
                  and
                  Disability
                  Insurance
                  Coverage
              Supplemental
                  Executive
                  Retirement
                  Benefit
              Death
                  Benefit
              Disability
                  Benefit
              Accelerated
                  Vesting
      of
                  Stock
                  Options
              Accelerated
                  Vesting
      of
                  Restricted
                  Stock
              Payment
      of
                  200%
      of
                  “Base
                  Amount”If
      termination for cause occurs
              ---
              ---
              ---
              ---
              ---
              ---
              ---
              ---If
      voluntary termination (not following a change in control)
      occurs
              ---
              ---
              $78,227(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause (not following a change in control)
      occurs
              $165,328(2)
              $19,199(3)
              $78,227(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause, or voluntary termination for
      specified reasons, occurs following a change in control
              ---
              ---
              $212,525(8)
              ---
              ---
              $104,503(4)
              $315,963(5)
              $447,051(6)If
      termination occurs due to disability
              ---
              ---
              $78,227(1)
              ---
              ---
              $104,503(4)
              $315,963(5)
              ---If
      termination occurs due to death
              ---
              ---
              $1,201,157(9)
              $495,984(7)
              ----
              $104,503(4)
              $315,963(5)
              ---
 ____________________________
 (1)
              Represents
      the benefit payable to Mr. Heyer under the circumstances indicated
      pursuant to his SERP agreement, as described above under “Pension
      Benefits.”
 (2)
              Represents
      the minimum one year of salary that would continue to be paid to Mr. Heyer
      pursuant to his employment agreement from the assumed employment
      termination date (September 30, 2008) through the last day of the term of
      his employment agreement (December 31,
2008).
 (3)
              Represents
      the estimated approximate cost to the Company of Mr. Heyer obtaining
      continued health, life and disability insurance benefits pursuant to his
      employment agreement.
 (4)
              Represents
      the value of acceleration of unvested stock options, based on the closing
      price of the Company’s common stock on September 30, 2008 ($10.30) and the
      exercise prices of the options.  All unvested options vest upon
      a change in control, regardless of Mr. Heyer employment
      status.
 (5)
              Represents
      the value of acceleration of unvested restricted stock, based on the
      closing price of the Company’s common stock on September 30, 2008
      ($10.30).  All unvested shares of restricted stock vest upon a
      change in control, regardless of Mr. Heyer’s employment
      status.
 (6)
              Mr.
      Heyer’s employment agreement provides that if his employment is
      involuntarily terminated without just cause, or voluntarily terminated
      following a specified diminution in his duties, responsibilities or
      benefits, during the term of the agreement following a change in control
      of the Company or the Bank, or within 12 months following a change in
      control of the Company or the Bank, he will be entitled to an amount equal
      to 2.00 times his “base amount” (defined generally in the Internal Revenue
      Code as his five-year average annual taxable compensation), subject to
      reduction to avoid the payment of any “excess parachute payment” under the
      Internal Revenue Code, payable, at his election, in a lump sum or in
      monthly installments over a 24-month
period.
 (7)
              Represents
      supplemental life insurance benefit under Mr. Heyer’s Executive Life
      Insurance Agreement with the Bank.
 (8)
              Represents
      the discounted present value of the estimated post-retirement payments to
      be paid to Mr. Heyer beginning at age 65 under the circumstances indicated
      pursuant to his SERP agreement, as described above under “Pension
      Benefits.”   As discussed under “Pension Benefits,” the
      amount payable to Mr. Heyer under the change in control scenario is
      subject to reduction to the extent necessary to avoid the payment of any
      “excess parachute payments” under the Internal Revenue
    Code.
 (9)
              Represents
      the life insurance benefit paid under Mr. Heyer’s Life Insurance
      Endorsement Method Split Dollar Plan Agreement with the Bank associated
      with his SERP agreement.
  24
  Catherine
      BringuierTermination
                  Scenario
              Salary
                  Continuation
                  Under
                  Employment
                  Agreement
              Continuation
                  of
      Group
                  Health,
      Life
                  and
                  Disability
                  Insurance
                  Coverage
              Supplemental
                  Executive
                  Retirement
                  Benefit
              Death
                  Benefit
              Disability
                  Benefit
              Accelerated
                  Vesting
      of
                  Stock
                  Options
              Accelerated
                  Vesting
      of
                  Restricted
                  Stock
              Payment
      of
                  200%
      of
                  “Base
                  Amount”If
      termination for cause occurs
              ---
              ---
              ---
              ---
              ---
              ---
              ---
              ---If
      voluntary termination (not following a change in control)
      occurs
              ---
              ---
              $61,600(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause (not following a change in control)
      occurs
              $151,630(2)
              $9,606(3)
              $61,600(1)
              ---
              ---
              ---
              ---
              ---If
      involuntary termination without cause, or voluntary termination for
      specified reasons, occurs following a change in control
              ---
              ---
              $156,953(8)
              ---
              ---
              $104,503(4)
              $293,808(5)
              $423,743(6)If
      termination occurs due to disability
              ---
              ---
              $61,600(1)
              ---
              ---
              $104,503(4)
              $293,808(5)
              ---If
      termination occurs due to death
              ---
              ---
              $831,293(9)
              $454,890(7)
              ----
              $104,503(4)
              $293,808(5)
              ---
 ____________________________
 (1)
              Represents
      the benefit payable to Ms. Bringuier under the circumstances indicated
      pursuant to her SERP agreement, as described above under “Pension
      Benefits
 (2)
              Represents
      the minimum one year of salary that would continue to be paid to Ms.
      Bringuier pursuant to her employment agreement from the assumed employment
      termination date (September 30, 2008) through the last day of the term of
      her employment agreement (December 31,
2008).
 (3)
              Represents
      the estimated approximate cost to the Company of Ms. Bringuier obtaining
      continued health, life and disability insurance benefits pursuant to her
      employment agreement.
 (4)
              Represents
      the value of acceleration of unvested stock options, based on the closing
      price of the Company’s common stock on September 30, 2008 ($10.30) and the
      exercise prices of the options.  All unvested options vest upon
      a change in control, regardless of Ms. Bringuier’s employment
      status.
 (5)
              Represents
      the value of acceleration of unvested restricted stock, based on the
      closing price of the Company’s common stock on September 30, 2008
      ($10.30).  All unvested shares of restricted stock vest upon a
      change in control, regardless of Ms. Bringuier’s employment
      status.
 (6)
              Ms.
      Bringuier’s employment agreement provides that if her employment is
      involuntarily terminated without just cause, or voluntarily terminated
      following a specified diminution in her duties, responsibilities or
      benefits, during the term of the agreement following a change in control
      of the Company or the Bank, or within 12 months following a change in
      control of the Company or the Bank, she will be entitled to an amount
      equal to 2.00 times her “base amount” (defined generally in the Internal
      Revenue Code as her five-year average annual taxable compensation),
      subject to reduction to avoid the payment of any “excess parachute
      payment” under the Internal Revenue Code, payable, at her election, in a
      lump sum or in monthly installments over a 36-month
  period.
 (7)
              Represents
      supplemental life insurance benefit under Ms. Bringuier’s Executive Life
      Insurance Agreement with the Bank.
 (8)
              Represents
      the discounted present value of the estimated post-retirement payments to
      be paid to Ms. Bringuier beginning at age 65 under the circumstances
      indicated pursuant to her SERP agreement, as described above under
      “Pension Benefits.”   As discussed under “Pension
      Benefits,” the amount payable to Ms. Bringuier under the change in control
      scenario is subject to reduction to the extent necessary to avoid the
      payment of any “excess parachute payments” under the Internal Revenue
      Code.
 (9)
              Represents
      the life insurance benefit paid under Ms. Bringuier’s Life Insurance
      Endorsement Method Split Dollar Plan Agreement with the Bank associated
      with her SERP agreement.
  25
  Compensation
Committee Report
 
 The
Compensation Committee has reviewed and discussed the Compensation Discussion
and Analysis contained above with management and, based on such review and
discussion, the Compensation Committee recommended to the Board of Directors
that the Compensation Discussion and Analysis be included in this annual
report.
 
 Submitted
by the Compensation Committee of the Company’s Board of Directors:
  Robert
A. Gaccione
 H.
Joseph North
 W.
George Parker
 Vincent
S. Rospond
 James
H. Ward, III
 
 Compensation
Committee Interlocks and Insider Participation
 
 The
Compensation Committee during the year ended September 30, 2008 consisted of
Directors Gaccione, North, Parker, Rospond and Ward.  During the year
ended September 30, 2008, the Company had no “interlocking” relationships in
which (i) an executive officer of the Company served as a member of the
compensation committee of another entity, one of whose executive officers served
on the compensation committee of the Company; (ii) an executive officer of the
Company served as a director of another entity, one of whose executive officers
served on the compensation committee of the Company; and (iii) an executive
officer of the Company served as a member of the compensation committee of
another entity, one of whose executive officers served as a director of the
Company.  Directors Gaccione and Rospond had certain business
relationships with the Company that are described under “Certain Relationships
and Related Transactions.”
 
 Item 12.
              Security
      Ownership of Certain Beneficial Owners and Management and
      RelatedStockholder Matters.
 
 The
following table sets forth, as of the January 2, 2009, information regarding
share ownership of:
 
 §
              those
      persons or entities (or groups of affiliated persons or entities) known by
      management to beneficially own more than five percent of American Bancorp
      of New Jersey, Inc.  common stock other than directors and
      executive officers;
 
 §
              each
      director and director nominee of American Bancorp of New Jersey,
      Inc.;
 
 §
              each
      executive officer of American Bancorp of New Jersey, Inc. named in the
      Summary Compensation Table appearing under “Executive Compensation” below;
      and
 
 §
              all
      current directors and executive officers of American Bancorp of New
      Jersey, Inc. as a group.
 
 The
address of each of the beneficial owners, except where otherwise indicated, is
the same address as American Bancorp of New Jersey, Inc.  Beneficial
ownership is determined in accordance with the rules of the Securities Exchange
Commission.  In computing the number of shares beneficially owned by a
person and the percentage ownership of that person, shares of common stock
subject to outstanding options that are currently exercisable or exercisable
within 60 days after January 2, 2009, are included in the number of shares
beneficially owned by the person and are deemed outstanding for the purpose of
calculating the person’s percentage ownership.  These shares, however,
are not deemed outstanding for the purpose of computing the percentage ownership
of any other person.
  26
 
 Number of
      Shares
                                                                
                                                                Percent ofBeneficially
                                                                
                                                                Common
StockBeneficial
      Owners
                                                                
                                                                Owned(1)
                                                                
                                                                OutstandingBeneficial Owners of More Than 5%
      Other ThanDirectors and Named Executive
      OfficersAmerican Bank of New Jersey Bank
      Employee StockOwnership Plan Trust (the
      “ESOP”)(2)
                                                                
                                                                1,120,818
                                                                
                                                                10.32%Investors of America, Limited
      Partnership135 North
      MeramecClayton,Missouri63105(3)
                                                                
                                                                679,125
                                                                
                                                                6.25%Directors and Named Executive
      OfficersRobert A.
      Gaccione
                                                                
                                                                126,535
                                                                
                                                                1.16%Joseph Kliminski(6)
                                                                
                                                                501,185
                                                                
                                                                4.53%Fred G.
    Kowal
                                                                
                                                                206,670
                                                                
                                                                1.89%H. Joseph North(7)
                                                                
                                                                81,872
                                                                
                                                                0.75%W. George
      Parker
                                                                
                                                                284,765
                                                                
                                                                2.61%Vincent S.
      Rospond
                                                                
                                                                217,320
                                                                
                                                                1.99%James W. Ward,
      III
                                                                
                                                                268,251
                                                                
                                                                2.46%Eric B.
    Heyer
                                                                
                                                                183,571
                                                                
                                                                1.68%Catherine M.
      Bringuier
                                                                
                                                                169,898
                                                                
                                                                1.55%All directors and executive
      officersas a group (9 persons)(4)(5)
                                                                
                                                                2,040,067
                                                                
                                                                17.70%
 ______________


(1)
                            Except
      as otherwise noted in these footnotes, the nature of beneficial ownership
      for shares reported in this table is sole voting and investment
      power.(2)
                            These
      shares are held in a suspense account and are allocated among participants
      annually on the basis of compensation as the ESOP debt is
      repaid.  As of January 2, 2009, 175,675 shares had been
      allocated to ESOP participants with an additional 53,247 shares to be
      allocated effective of December 31, 2008 upon completion of the allocation
      for 2008 by the plan administrator.(3)
                            As
      reported by the named beneficial owners on Schedule 13D dated December 24,
      2008.  The named beneficial owners reported shared voting and
      dispositive power over all shares.(4)
                            Includes
      shares of common stock held directly as well as by spouses or minor
      children, in trust and through other forms of indirect
      ownership.(5)
                            Includes
      an aggregate of 664,053 shares underlying options exercisable or becoming
      exercisable within 60 days after January 2, 2009.  As of January
      2, 2009, each non-employee director had 45,348 options exercisable or
      becoming exercisable within 60 days after January 2, 2009.  As
      of January 2, 2009, Officers Kliminski, Kowal, Heyer and Bringuier had
      195,510, 71,228, 88,615 and 85,725 options, respectively, exercisable or
      becoming exercisable within 60 days of January 2, 2009.(6)
                            The
      number of shares reported for Mr. Kliminski include 51,020 shares pledged
      as collateral for a margin loan.(7)
                            The
      number of shares reported for Mr. North include 16,767 shares pledged as
      collateral for a margin
loan.





Item 13.
            Certain
      Relationships and Related Transactions, and Director
      Independence





The
charter of the Audit Committee of the Company’s Board of Directors provides that
the Audit Committee is required to review all related party transactions for
potential conflict of interest situations and, as appropriate, approve such
transactions.  Other than as disclosed below, no directors, officers
or their immediate family members were engaged in transactions with American
Bancorp of New Jersey, Inc., American Bank of New Jersey or any other subsidiary
of the Company involving more than $120,000 (other than through a loan with the
Bank) during the fiscal year ended September 30, 2008.





Director
Vincent S. Rospond is the majority shareholder of the law firm of Rospond,
Rospond & Conte, P.A., which serves as general counsel to American Bank of
New Jersey and to which the Bank paid approximately $7,112 in legal fees during
the fiscal year ended September 30, 2008.  In addition, the Bank
engages this law firm in connection with residential loan closings, and fees
paid by borrowers in loan closings handled by this law firm totaled
approximately $16,450 during fiscal 2008.





27


Director
Robert A. Gaccione is a senior partner of the law firm of Gaccione, Pomaco &
Malanga, P.C. to which the Bank paid approximately $15,961 in legal fees during
the fiscal year ended September 30, 2008.  In addition, the Bank
engages this law firm in connection with commercial loan closings, and fees paid
by borrowers in loan closings handled by this law firm totaled approximately
$86,375 during fiscal 2008.





The law
firms of Rospond, Rospond & Conte, P.A. and Gaccione, Pomaco & Malanga,
P.C. were each authorized to represent the Bank on loan closings during fiscal
2008.  Management believes that the transactions described above were
on terms at least as favorable to the Bank as it would have received in
transactions with an unrelated party.





The Bank
makes loans to its officers, directors and employees in the ordinary course of
business.  The application fee is waived for mortgages to officers and
employees on single-family owner-occupied homes or second homes.  The
Bank also reduces its application fee for mortgages on two- to four-family
owner-occupied homes by the amount of the application fee for single family home
mortgages and reduces its modification fee for one- to four-family
owner-occupied home mortgages or second home mortgages by the amount of the
application fee for single family home mortgages.  Other than these
application fee waivers and reductions to officers and employees, these loans
are on substantially the same terms and conditions as those of comparable
transactions prevailing at the time with other persons.  These loans
also do not include more than the normal risk of collectibility or present other
unfavorable features.





Item 14.
            Principal
      Accounting Fees and Services.





The Audit
Committee has appointed Crowe Horwath LLP, as the independent public accounting
firm to audit the Company’s financial statements for the fiscal year ending
September 30, 2009.  In making its determination to appoint Crowe
Horwath LLP as the Company’s independent auditors for the 2009 fiscal year, the
Audit Committee considered whether the providing of services (and the aggregate
fees billed for those services) by Crowe Horwath LLP, other than audit services,
is compatible with maintaining the independence of the outside
accountants.  Our shareholders are asked to ratify this appointment at
the annual meeting.  If the appointment of Crowe Horwath LLP is not
ratified by the shareholders, the Audit Committee may appoint other independent
auditors or may decide to maintain its appointment of Crowe Horwath
LLP.





Fees
Paid to Crowe Horwath LLP





All of the services
listed below for fiscal 2008 and 2007 were approved by the Audit Committee prior
to the service being rendered. There were no services that were not recognized
to be non-audit services at the time of engagement that were approved after the
fact.





(a)
            Audit
      Fees.  The aggregate fees billed by Crowe Horwath LLP for
      professional services rendered for the audit of the Company’s annual
      consolidated financial statements and review of the quarterly consolidated
      financial statements for the fiscal years ended September 30, 2008 and
      2007 were $157,000 and $150,500,
respectively.





(b)
            Audit Related Fees. The
      aggregate fees billed by Crowe Horwath LLP for assurance and related
      services related to the Company’s Annual Report on Form 10-K for the years
      ended September 30, 2008 and 2007 were $9,000 and $8,500, respectively.
      For those same periods respectively, audit related fees billed by Crowe
      Horwath LLP also included $0 and $1,500 for Form S-8 consent
      procedures.





(c)
            Tax
      Fees.  The aggregate fees billed by Crowe Horwath LLP for
      professional services rendered for tax preparation services for the years
      ended September 30, 2008 and 2007 were $12,600 and $12,000,
      respectively.  Additional tax-related services billed by Crowe
      Horwath LLP for the years ended September 30, 2008 and 2007 were $4,480
      and $2,700, respectively.  Such additional tax-related services
      consisted of billings for the review of quarterly estimated tax payment
      calculations and income tax guidance regarding several
      compensation-related matters.





(d)
            All Other Fees. The
      aggregate fees billed by Crowe Horwath LLP for professional services
      rendered for services or products other than those listed under the
      captions “Audit Fees,” “Audit-Related Fees,” and “Tax Fees” totaled $0 for
      both years ended September 30, 2008 and
2007.




28


SIGNATURES





Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized as of January 28,
2009.




AMERICAN
      BANCORP OF NEW JERSEY, INC.By:
                  /s/ Fred
      G. KowalFred
      G. KowalPresident
      and Chief Operating Officer(Duly
      Authorized Representative)




Pursuant
to the requirement of the Securities Exchange Act of 1934, as amended, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated as of January 28, 2009.




/s/
      W.
      George Parker
                
                
                /s/
      Joseph KliminskiW.
      George Parker
                
                
                Joseph
      KliminskiChairman
                
                
                Chief
      Executive Officer and Director(Principal
      Executive Officer)




/s/
      Fred
      G. Kowal
                  
                  
                  /s/
      Eric
      B. HeyerFred
      G. Kowal
                  
                  
                  Eric
      B. HeyerPresident,
      Chief Operating Officer
                  
                  
                  Senior
      Vice President, Treasurer andand
      Director
                  
                  
                  Chief
      Financial Officer(Principal
      Financial and AccountingOfficer)




/s/
      H. Joseph North
              
              
              /s/
      James H. Ward, IIIH.
      Joseph North
              
              
              James
      H. Ward, IIIDirector
              
              
              Vice
      Chairman




/s/
      Vincent
      S. Rospond
              
              
              /s/ Robert
      GaccioneVincent
      S. Rospond
              
              
              Robert
      GaccioneDirector
              
              
              Director




29