UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
     ACT OF 1934
For the quarterly period ended.............................. SEPTEMBER 30, 2000

                                       OR

[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from __________ to ___________

Commission File No.: 000-23809


                          FIRST SENTINEL BANCORP, INC.
             (exact name of registrant as specified in its charter)

            DELAWARE                                            22-3566151
(State or other jurisdiction of                          (IRS Employer I.D. No.)
 incorporation or organization)

               1000 WOODBRIDGE CENTER DRIVE, WOODBRIDGE, NJ 07095
                    (Address of principal executive offices)

       Registrant's telephone number, including area code: (732) 726-9700

                                 NOT APPLICABLE
       Former Name, Address, and Fiscal year, if changed since last report


     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes _X_   No ___


                      APPLICABLE ONLY TO CORPORATE ISSUERS

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

                    CLASS                        OUTSTANDING AT NOVEMBER 1, 2000
       -------------------------------           -------------------------------
                Common Stock                            33,755,873 shares

<PAGE>


                          FIRST SENTINEL BANCORP, INC.

                               INDEX TO FORM 10-Q

                                                                          PAGE #
PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements (Unaudited)

           Consolidated Statements of Financial Condition as of
           September 30, 2000 and December 31, 1999                            3

           Consolidated Statements of Income for the Three and Nine Months
           Ended September 30, 2000 and 1999                                   4

           Consolidated Statements of Stockholders' Equity for the
           Nine Months Ended September 30, 2000 and 1999                       5

           Consolidated Statements of Cash Flows for the Nine Months
           Ended September 30, 2000 and 1999                                   6

           Notes to Consolidated Financial Statements                          7

Item 2.    Management's Discussion and Analysis of Financial Condition
           and Results of Operations                                          10

Item 3.    Quantitative and Qualitative Disclosure About Market Risk          15

PART II.   OTHER INFORMATION                                                  16

           SIGNATURES                                                         17

                                       2
<PAGE>


FIRST SENTINEL BANCORP, INC. AND SUBSIDIARIES
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in thousands, except share data) (Unaudited)

                                                    September 30,   December 31,
                                                         2000           1999
                                                     -----------    -----------

ASSETS
Cash and due from banks ..........................   $    14,319    $    11,532
Federal funds sold ...............................            --         19,075
                                                     -----------    -----------
     Total cash and cash equivalents .............        14,319         30,607
Federal Home Loan Bank of New York
  (FHLB-NY) stock, at cost .......................        19,643         18,100
Investment securities available for sale .........       233,367        213,590
Mortgage-backed securities available for sale ....       476,653        575,159
Loans receivable, net ............................     1,162,747      1,016,116
Interest and dividends receivable ................        13,095         12,278
Premises and equipment, net ......................        15,854         16,503
Excess of cost over fair value of net
  assets acquired ................................         6,471          7,106
Other assets .....................................        13,600         15,237
                                                     -----------    -----------
     Total assets ................................   $ 1,955,749    $ 1,904,696
                                                     ===========    ===========

--------------------------------------------------------------------------------

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Deposits .........................................   $ 1,214,078    $ 1,213,724
Borrowed funds ...................................       504,039        422,000
Advances by borrowers for taxes and insurance ....         9,817          8,385
Other liabilities ................................         8,265         16,007
                                                     -----------    -----------
  Total liabilities ..............................     1,736,199      1,660,116
                                                     -----------    -----------

STOCKHOLDERS' EQUITY
Preferred Stock; authorized 10,000,000 shares;
  none issued and outstanding ....................            --             --
Common Stock, $.01 par value,
  85,000,000 shares authorized;
  43,106,742 and 33,760,873 shares
  issued and outstanding at 9/30/00
  and 43,106,742 and 38,443,350 shares
  issued and outstanding at 12/31/99 .............           431            431
Paid-in capital ..................................       201,366        200,781
Retained earnings ................................       128,865        117,922
Accumulated other comprehensive loss .............       (16,669)       (17,302)
Less: Treasury stock (9,309,088 and 4,628,604
    shares at September 30, 2000 and
    December 31, 1999, respectively) .............       (79,968)       (41,229)
  Common stock acquired by the
  Employee Stock Ownership Plan (ESOP) ...........       (11,468)       (12,156)
  Common stock acquired by the Recognition
    and Retention Plan (RRP) .....................        (3,007)        (3,867)
                                                     -----------    -----------
  Total stockholders' equity .....................       219,550        244,580
                                                     -----------    -----------
  Total liabilities and stockholders' equity .....   $ 1,955,749    $ 1,904,696
                                                     ===========    ===========

See accompanying notes to the unaudited consolidated financial statements.

                                       3
<PAGE>


FIRST SENTINEL BANCORP, INC. AND SUBSIDIARIES
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except share data) (Unaudited)

<TABLE>
<CAPTION>
                                                                             Three Months Ended               Nine Months Ended
                                                                                September 30,                   September 30,
                                                                         ---------------------------     --------------------------
                                                                             2000            1999            2000           1999
                                                                         -----------     -----------     -----------    -----------
<S>                                                                      <C>             <C>             <C>            <C>
INTEREST INCOME:
  Loans .............................................................    $    22,033     $    17,359     $    61,709    $    50,270
  Investment and mortgage-backed
    securities available for sale ...................................         13,112          13,728          40,456         41,243
                                                                         -----------     -----------     -----------    -----------
      Total interest income .........................................         35,145          31,087         102,165         91,513
                                                                         -----------     -----------     -----------    -----------

INTEREST EXPENSE:
  Deposits:
    NOW and money market demand .....................................          2,374           2,404           7,106          7,013
    Savings .........................................................            937             981           2,820          2,970
    Certificates of deposit .........................................          8,926           8,384          25,584         25,781
                                                                         -----------     -----------     -----------    -----------
      Total interest expense - deposits .............................         12,237          11,769          35,510         35,764
  Borrowed funds ....................................................          8,611           4,363          22,910         12,190
                                                                         -----------     -----------     -----------    -----------
      Total interest expense ........................................         20,848          16,132          58,420         47,954
                                                                         -----------     -----------     -----------    -----------
      Net interest income ...........................................         14,297          14,955          43,745         43,559
Provision for loan losses ...........................................            393             300           1,179          1,200
                                                                         -----------     -----------     -----------    -----------
      Net interest income after provision for loan losses ...........         13,904          14,655          42,566         42,359
                                                                         -----------     -----------     -----------    -----------

NON-INTEREST INCOME:
  Fees and service charges ..........................................            623             626           1,753          1,859
  Net (loss) gain on sales of loans and securities
    available for sale ..............................................           (669)            273            (766)           850
  Other income ......................................................            116             (53)            522            187
                                                                         -----------     -----------     -----------    -----------
    Total non-interest income .......................................             70             846           1,509          2,896
                                                                         -----------     -----------     -----------    -----------

NON-INTEREST EXPENSE:
  Compensation and benefits .........................................          3,489           3,362          10,770         10,163
  Occupancy .........................................................            571             582           1,742          1,671
  Equipment .........................................................            392             444           1,254          1,239
  Advertising .......................................................            188             350             923            953
  Federal deposit insurance .........................................             64             186             195            574
  Amortization of intangibles .......................................            211             213             635            638
  General and administrative ........................................            880           1,048           2,860          3,312
                                                                         -----------     -----------     -----------    -----------
     Total non-interest expense .....................................          5,795           6,185          18,379         18,550
                                                                         -----------     -----------     -----------    -----------

     Income before income tax expense ...............................          8,179           9,316          25,696         26,705

Income tax expense ..................................................          2,538           3,164           8,523          9,062
                                                                         -----------     -----------     -----------    -----------

     Net income .....................................................    $     5,641     $     6,152     $    17,173    $    17,643
                                                                         ===========     ===========     ===========    ===========

Basic earnings per share ............................................    $      0.17     $      0.15     $      0.50    $      0.44
                                                                         ===========     ===========     ===========    ===========

Weighted average shares outstanding - Basic .........................     32,531,953      39,709,257      34,020,609     40,364,014
                                                                         ===========     ===========     ===========    ===========

Diluted earnings per share ..........................................    $      0.17     $      0.15     $      0.50    $      0.43
                                                                         ===========     ===========     ===========    ===========

Weighted average shares outstanding - Diluted .......................     32,845,734      40,028,012      34,317,027     40,784,389
                                                                         ===========     ===========     ===========    ===========
</TABLE>

See accompanying notes to the unaudited consolidated financial statements.

                                       4
<PAGE>


FIRST SENTINEL BANCORP, INC. AND SUBSIDIARIES
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
 (Dollars in thousands) (Unaudited)

<TABLE>
<CAPTION>
                                                                         Accumulated
                                                                            Other                  Common      Common      Total
                                                                           Compre-                  Stock       Stock      Stock-
                                           Common   Paid In    Retained    hensive     Treasury    Acquired   Acquired    holders'
                                           Stock    Capital    Earnings  Income(Loss)   Stock      by ESOP     by RRP      Equity
                                           ------  --------    --------  ------------  --------    --------   --------    ---------
<S>                                         <C>    <C>         <C>         <C>         <C>         <C>         <C>        <C>
Balance at December 31, 1998 ............   $431   $201,105    $112,601    $  2,498    $ (3,664)   $(13,073)   $   (79)   $ 299,819
Net income for the nine months ended
  September 30, 1999 ....................     --         --      17,643          --          --          --         --       17,643
Cash dividends declared ($.16) ..........     --         --      (6,857)         --          --          --         --       (6,857)
Net change in unrealized gain/(loss)
  on securities available for sale ......     --         --          --     (14,884)         --          --         --      (14,884)
Purchases of treasury stock .............     --         --          --          --     (36,511)         --         --      (36,511)
Exercise of stock options ...............     --          6      (3,283)         --       4,766          --         --        1,489
Transfer of treasury stock to RRP .......     --         --        (656)         --       5,704          --     (5,048)          --
Amortization of RRP .....................     --         --          --          --          --          --        821          821
Amortization of ESOP ....................     --        (58)         --          --          --         688         --          630
                                            ---------------------------------------------------------------------------------------

Balance at September 30, 1999 ...........   $431   $201,053    $119,448    $(12,386)   $(29,705)   $(12,385)   $(4,306)   $ 262,150
                                            =======================================================================================

Balance at December 31, 1999 ............   $431   $200,781    $117,922    $(17,302)   $(41,229)   $(12,156)   $(3,867)   $ 244,580
Net income for the nine months
  ended September 30, 2000 ..............     --         --      17,173          --          --          --         --       17,173
Cash dividends declared ($.18) ..........     --         --      (6,072)         --          --          --         --       (6,072)
Net change in unrealized gain/(loss)
  on securities available for sale ......     --         --          --         633          --          --         --          633
Purchases of treasury stock .............     --         --          --          --     (38,931)         --         --      (38,931)
Exercise of stock options ...............     --         --        (112)         --         192          --         --           80
Tax benefit on stock options ............     --        605          --          --          --          --         --          605
Purchase and retirement of
  common stock ..........................     --        (14)         --          --          --          --         --          (14)
Amortization of RRP .....................     --         (6)         --          --          --          --        860          854
Amortization of ESOP ....................     --         --         (46)         --          --         688         --          642
                                            ---------------------------------------------------------------------------------------

Balance at September 30, 2000 ............  $431   $201,366    $128,865    $(16,669)   $(79,968)   $(11,468)   $(3,007)    $219,550
                                            =======================================================================================
</TABLE>
See accompanying notes to the unaudited consolidated financial statements.


                                       5
<PAGE>


FIRST SENTINEL BANCORP, INC. AND SUBSIDIARIES
--------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands) (Unaudited)
                                                            Nine Months Ended
                                                              September 30,
                                                          ---------------------
                                                            2000         1999
                                                          --------     --------
Cash flows from operating activities:
  Net income .........................................    $ 17,173     $ 17,643
  ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH
    PROVIDED BY OPERATING ACTIVITIES:
  Depreciation of premises and equipment .............       1,043        1,040
  Amortization of excess of cost over fair value
    of assets acquired ...............................         635          638
  Amortization of ESOP ...............................         642          630
  Amortization of RRP ................................         860          821
  Net amortization of premiums and accretion
    of discounts and deferred fees ...................         273         (198)
  Provision for loan losses ..........................       1,179        1,200
  Provision for losses on real estate owned ..........          --           31
  Loans originated for sale ..........................      (2,255)      (7,099)
  Proceeds from sales of mortgage loans available
    for sale .........................................       2,248        7,075
  Net loss (gain) on sales of loans and securities
    available for sale ...............................         766         (850)
  Net loss on sales of real estate owned .............          49           23
  (Increase) decrease in interest and
    dividends receivable .............................        (817)       1,511
  Tax benefit on stock options .......................        (605)          --
  Decrease in other liabilities ......................        (761)      (2,692)
  Decrease in other assets ...........................         723        2,411
                                                          --------     --------
    Net cash provided by operating activities ........      21,153       22,184
                                                          --------     --------
Cash flows from investing activities:
  Proceeds from sales/calls/maturities of
    investment securities available for sale .........      39,490      118,126
  Purchases of investment securities available
    for sale .........................................     (56,730)    (119,133)
  Purchase of FHLB-NY stock ..........................      (1,543)      (2,880)
  Proceeds from sales of mortgage-backed
    securities available for sale ....................     154,407      159,984
  Principal payments on mortgage-backed securities ...      71,239      174,394
  Purchases of mortgage-backed securities
    available for sale ...............................    (130,078)    (313,952)
  Principal repayments on loans ......................     176,084      192,053
  Origination of loans ...............................    (254,002)    (264,832)
  Purchases of mortgage loans ........................     (69,331)     (32,678)
  Proceeds from sale of real estate owned ............         306        1,604
  Purchases of premises and equipment ................        (394)      (1,244)
                                                          --------     --------
    Net cash used in investing activities ............     (70,552)     (88,558)
                                                          --------     --------
Cash flows from financing activities:
  Purchase of treasury stock .........................     (38,931)     (36,511)
  Purchase and retirement of common stock ............         (14)          --
  Stock options exercised ............................          80        1,489
  Cash dividends paid ................................     (11,849)      (6,857)
  Net increase (decrease) in deposits ................         354      (30,491)
  Net increase in borrowed funds .....................      82,039      118,650
  Net increase in advances by borrowers
    for taxes and insurance ..........................       1,432        1,483
                                                          --------     --------
    Net cash provided by financing activities ........      33,111       47,763
                                                          --------     --------
    Net decrease in cash and cash equivalents ........     (16,288)     (18,611)
Cash and cash equivalents at beginning of period .....      30,607       37,631
                                                          --------     --------
Cash and cash equivalents at end of period ...........    $ 14,319     $ 19,020
                                                          ========     ========

Supplemental disclosures of cash flow information:
  Cash paid during the period for:
    Interest .........................................    $ 58,879     $ 47,270
    Income taxes .....................................       9,350        9,043
  Non cash investing and financing activities
    for the period:
    Transfer of loans to real estate owned ...........    $    104     $  1,399

See accompanying notes to the unaudited consolidated financial statements.

                                       6
<PAGE>


                  FIRST SENTINEL BANCORP, INC. AND SUBSIDIARIES

              Notes to Unaudited Consolidated Financial Statements

(1)  BASIS OF PRESENTATION

The accompanying  unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles ("GAAP") for interim
financial  information and in conformity with the  instructions to Form 10-Q and
Article 10 of Regulation S-X for First Sentinel Bancorp,  Inc. ("First Sentinel"
or the "Company") and its wholly-owned subsidiaries, First Savings Bank, ("First
Savings" or the "Bank") Pulse Investment,  Inc., Pulse Insurance Services,  Inc.
and Pulse Real  Estate,  Inc.,  and the Bank's  wholly-owned  subsidiaries,  FSB
Financial Corp., and 1000 Woodbridge Center Drive, Inc.

In the  opinion  of  management,  all  adjustments  (consisting  of only  normal
recurring accruals) necessary to present fairly the financial condition, results
of operations, and changes in cash flows have been made at and for the three and
nine months ended September 30, 2000 and 1999. The results of operations for the
three and nine months ended September 30, 2000, are not  necessarily  indicative
of results that may be expected for the entire  fiscal year ending  December 31,
2000. These interim financial  statements should be read in conjunction with the
December 31, 1999 Annual Report to Stockholders.

(2)  EARNINGS PER SHARE

Basic  earnings  per share is  calculated  by  dividing  net income by the daily
average  number  of common  shares  outstanding  during  the  period.  Potential
dilutive common shares are not included in the calculation.

Diluted  earnings per share is computed  similarly  to basic  earnings per share
except that the  denominator  is increased  to include the number of  additional
common shares that would have been outstanding if all potential  dilutive common
shares were issued utilizing the treasury stock method.

Calculation of Basic and Diluted Earnings Per Share
--------------------------------------------------------
(dollars in thousands, except per share data)

                                 Three Months Ended         Nine Months Ended
                                    September 30,             September 30,
                              ------------------------  ------------------------
                                  2000         1999         2000         1999
                              -----------  -----------  -----------  -----------
Net income .................. $     5,641  $     6,152  $    17,173  $    17,643
                              ===========  ===========  ===========  ===========

Basic weighted-average
  common shares
  outstanding ...............  32,531,953   39,709,257   34,020,609   40,364,014
Plus: Dilutive stock
  options and awards ........     313,781      318,755      296,418      420,375
                              -----------  -----------  -----------  -----------
Diluted weighted-average
  common shares
  outstanding ...............  32,845,734   40,028,012   34,317,027   40,784,389
                              ===========  ===========  ===========  ===========

Net income per common share:
  Basic ..................... $      0.17  $      0.15  $      0.50  $      0.44
                              ===========  ===========  ===========  ===========
  Diluted ................... $      0.17  $      0.15  $      0.50  $      0.43
                              ===========  ===========  ===========  ===========

(3)  DIVIDENDS

Based upon current  operating  results,  the Company  declared cash dividends of
$0.06  per  common  share  on  July  26,  2000,  payable  August  25,  2000,  to
stockholders of record on August 11, 2000.

                                       7
<PAGE>


(4)  COMMITMENTS AND CONTINGENCIES

At  September  30,  2000,  the Company  had the  following  commitments:  (i) to
originate  loans of  $66.9  million;  (ii) to  purchase  mortgage  loans of $7.2
million; (iii) to purchase mortgage-backed  securities of $16.6 million; (iv) to
purchase investment securities of $341,000; (v) to sell investment securities of
$462,000;  (vi) unused  equity  lines of credit of $49.2  million;  (vii) unused
commercial lines of credit of $7.6 million;  (viii) unused construction lines of
credit of $60.7 million;  and (ix) letters of credit  outstanding  totaling $2.5
million. Further, certificates of deposits, which are scheduled to mature and/or
rollover in one year or less, totaled $504.6 million at September 30, 2000.

(5)  ALLOWANCE FOR LOAN LOSSES

The following  table  presents the activity in the allowance for loan losses (in
thousands):

                                                            Nine Months Ended
                                                              September 30,
                                                          ---------------------
                                                            2000         1999
                                                          --------     --------
Balance at beginning of period .......................    $ 11,004     $  9,505
Provision charged to operations ......................       1,179        1,200
Charge offs, net of recoveries .......................        (102)         (88)
                                                          --------     --------
Balance at end of period .............................    $ 12,081     $ 10,617
                                                          ========     ========

(6)  COMPREHENSIVE INCOME

Total  comprehensive  income,  consisting  of net  income  and the net change in
unrealized  gain/(loss) on securities  available for sale, was $10.8 million and
$3.1 million for the quarter ended  September  30, 2000 and 1999,  respectively.
For the nine months  ended  September  30, 2000 and 1999,  comprehensive  income
totaled $17.8 million and $2.8 million, respectively.

(7)  RECENT ACCOUNTING PRONOUNCEMENTS

In  March  2000,  the  Financial   Accounting   Standards  Board  (FASB)  issued
Interpretation  No. 44,  "Accounting  for Certain  Transactions  Involving Stock
Compensation,  an  Interpretation  of APB Opinion  No.  25." The  interpretation
clarifies   certain  issues  with  respect  to  the  application  of  Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" (APB
Opinion  No.  25).  The  interpretation  results  in a number of  changes in the
application of APB Opinion No. 25, including the accounting for modifications to
equity awards,  as well as extending APB Opinion No. 25 accounting  treatment to
options  granted to outside  directors  for their  services  as  directors.  The
provisions  of  the  interpretation  were  effective  July  1,  2000  and  apply
prospectively,  except for  certain  modifications  to equity  awards made after
December 15, 1998. The initial adoption did not have a significant impact on the
Company's financial statements.

In June 2000, the FASB issued Statement of Financial Accounting Standards (SFAS)
No. 138,  "Accounting  for Certain  Derivative  Instruments  and Certain Hedging
Activities, an Amendment to FASB Statement No. 133." SFAS No. 138 amends certain
aspects of SFAS No. 133 to simplify the  accounting for  derivatives  and hedges
under SFAS No. 133.  SFAS No. 138 is effective  upon the  company's  adoption of
SFAS No. 133  (January 1, 2001).  The initial  adoption of SFAS No. 133 and SFAS
No. 138 is not  expected to have a material  impact on the  Company's  financial
statements.

In September  2000, the FASB issued SFAS No. 140,  "Accounting for Transfers and
Servicing of Financial Assets and  Extinguishments of Liabilities (A Replacement
of FASB  Statement  125)." SFAS No. 140  supersedes and replaces the guidance in
SFAS No.  125 and,  accordingly,  provides  guidance  on the  following  topics:
securitization  transactions  involving  financial  assets;  sales of  financial
assets such as receivables, loans, and securities;  factoring transactions; wash
sales; servicing assets and liabilities;  collateralized borrowing arrangements;
securities lending transactions; repurchase agreements; loan participations; and
extinguishment of liabilities.  While most of the provisions of SFAS No. 140 are

                                       8
<PAGE>


effective for  transactions  entered into after March 31, 2001,  companies  with
fiscal year ends that hold  beneficial  interests from previous  securitizations
will be required  to make  additional  disclosures  in their  December  31, 2000
financial  statements.  The initial  adoption of SFAS No. 140 is not expected to
have a material impact on the Company's financial statements.

                                       9
<PAGE>


FIRST SENTINEL BANCORP, INC.

Item 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

GENERAL.

Statements   contained  in  this  report  that  are  not  historical   fact  are
forward-looking  statements,  as that term is defined in the Private  Securities
Litigation  Reform  Act  of  1995.  Such  statements  may  be  characterized  as
management's  intentions,  hopes,  beliefs,  expectations  or predictions of the
future. It is important to note that such forward-looking statements are subject
to risks and uncertainties  that could cause actual results to differ materially
from those  projected  in such  forward-looking  statements.  Factors that could
cause future results to vary materially from current  expectations  include, but
are not limited to, changes in interest rates, economic conditions,  deposit and
loan growth,  real estate values,  loan loss provisions,  competition,  customer
retention,  changes  in  accounting  principles,   policies  or  guidelines  and
legislative and regulatory changes.

ASSETS.  Total assets grew to $2.0 billion at September 30, 2000,  reflecting an
increase of $51.1 million,  or 2.7% from December 31, 1999. The change in assets
consisted  primarily of increases in loans receivable and investment  securities
available for sale, partially offset by decreases in mortgage-backed  securities
("MBS") available for sale and cash and cash equivalents.

Net loans increased  $146.6  million,  or 14.4%, to $1.2 billion as of September
30, 2000, from $1.0 billion at December 31, 1999.  Total loan  originations  for
the nine months ended September 30, 2000,  were $256.3  million,  as compared to
$271.9 million for the same period in 1999. Adjustable-rate, single-family first
mortgage loans totaled $108.8 million, or 42.5% of production, while fixed-rate,
single-family  first mortgage loan originations  accounted for $18.0 million, or
7.0% of total  originations  for the first nine months of 2000.  Also during the
first nine months of 2000,  construction lending totaled $47.3 million, or 18.5%
of total originations, while commercial real estate, commercial and multi-family
loan  originations  totaled  $26.3  million,  or 10.2%.  During the same period,
consumer  loan  originations,  including  home  equity  loans and credit  lines,
totaled $55.9 million, or 21.8% of total originations.  In addition, the Company
purchased $58.5 million of adjustable-rate,  single-family first mortgage loans,
$3.2 million of fixed-rate,  single-family first mortgage loans and $7.6 million
of commercial real estate and multi-family mortgage loans through correspondents
during  the  nine  months  ended   September  30,  2000.   Purchased  loans  are
re-underwritten  by the Bank and are extended under  slightly  higher rates than
the Bank's  direct loan  originations.  Repayment of principal on loans  totaled
$176.1  million for the nine months ended  September  30,  2000,  as compared to
$192.1  million  for the same  period in 1999.  Management  has  emphasized  the
origination  of loans in an effort to increase  loans as a percentage of assets.
While  management  intends to continue to actively seek to originate  loans, the
future  levels  of  loan  originations  and  repayments  will  be  significantly
influenced by external  interest rates and other economic factors outside of the
control of the Company.

Investment  securities  available for sale increased $19.8 million,  or 9.3%, to
$233.4  million as of September  30, 2000,  from $213.6  million at December 31,
1999.  For the nine months ended  September  30, 2000,  purchases of  investment
securities  available for sale totaled  $56.7  million,  while sales,  calls and
maturities  totaled  $39.5  million.   Purchases  during  the  period  consisted
primarily   of   debt    securities    issued   by   U.S.    corporations    and
government-sponsored agencies.

MBS available for sale decreased  $98.5 million,  or 17.1%, to $476.7 million at
September 30, 2000,  from $575.2  million at December 31, 1999. The decrease was
primarily  due to sales and  principal  repayments  of $154.4  million and $71.2
million, respectively,  exceeding purchases of $130.1 million for the nine month
period ended  September 30, 2000.  Net proceeds were used primarily to fund loan
growth, repurchase the Company's common stock, and repay borrowings.

Cash and cash  equivalents  decreased  $16.3  million from  December 31, 1999 to
$14.3 million at September 30, 2000,  as liquidity  requirements  related to the
century date change were satisfied.

                                       10
<PAGE>

LIABILITIES. Borrowed funds increased $82.0 million, or 19.4%, to $504.0 million
at September 30, 2000,  from $422.0  million at December 31, 1999. The increased
borrowed  funds  were used  primarily  to fund loan  originations.  Advances  by
borrowers for taxes and insurance  increased  $1.4  million,  or 17.1%,  to $9.8
million at September 30, 2000, from $8.4 million at December 31, 1999, primarily
due to the  increase  in  the  residential  loan  portfolio.  Other  liabilities
decreased $7.7 million,  or 48.4%,  to $8.3 million at September 30, 2000,  from
$16.0  million at  December  31,  1999,  primarily  due to the payment of a $5.8
million  special cash dividend in January 2000 which was accrued at December 31,
1999.

CAPITAL.  The Company's  stockholders' equity decreased $25.0 million, or 10.2%,
to $219.6  million at September  30, 2000,  from $244.6  million at December 31,
1999.  The primary  reasons for the  decrease in equity were the  repurchase  of
$38.9 million of the Company's common stock and cash dividends  declared of $6.1
million.  These  decreases were partially  offset by net income of $17.2 million
for the nine months ended September 30, 2000.

The Federal Deposit  Insurance  Corporation  requires that the Bank meet minimum
leverage,  Tier 1 and total risk-based  capital  requirements.  At September 30,
2000, the Bank exceeded all regulatory capital requirements, as follows (dollars
in thousands):

                           Require                Actual            Excess of
                      -----------------     ------------------     Actual over
                                  % of                   % of       Regulatory
                       Amount    Assets     Amount      Assets     Requirements
                       ------    ------     ------      ------   --------------
Leverage Capital      $ 78,686    4.00%    $181,689      9.24%       $103,003

Risk-based Capital:
Tier 1                  39,899    4.00%     181,689     18.21%        141,790
Total                   79,798    8.00%     193,770     19.43%        113,972

LIQUIDITY  AND CAPITAL  RESOURCES.  The Company's  primary  sources of funds are
deposits;   proceeds  from   principal  and  interest   payments  on  loans  and
mortgage-backed  securities;  sales of  loans,  mortgage-backed  securities  and
investments available for sale; maturities or calls of investment securities and
short-term investments;  and, to an increasing extent, advances from the FHLB-NY
and other borrowed funds.  While maturities and scheduled  amortization of loans
and mortgage-backed  securities are a predictable source of funds,  deposit cash
flows and mortgage prepayments are greatly influenced by general interest rates,
competition, and economic conditions.

The most  significant  sources of funds for the first  nine  months of 2000 were
principal  repayments and prepayments of loans and  mortgage-backed  securities,
totaling  $176.1  million  and  $71.2  million,  respectively,  and sales of MBS
available for sale totaling $154.4 million.  Other significant  sources of funds
for the nine months ended  September  30, 2000,  were a net increase in borrowed
funds  totaling  $82.0  million,  and sales,  calls and maturities of investment
securities  available for sale of $39.5 million.  If necessary,  the Company has
additional  borrowing  capacity with FHLB-NY,  including an available  overnight
line of credit of up to $50.0  million.  At September 30, 2000,  the Company had
unpledged  investment  securities and MBS available for sale with a market value
of $277.0 million.

The  primary  investing  activities  of the Company for the first nine months of
2000  were the  origination  of loans  totaling  $256.3  million,  purchases  of
mortgage-backed securities available for sale totaling $130.1 million, purchases
of mortgage  loans  totaling  $69.3  million  and the  purchases  of  investment
securities available for sale totaling $56.7 million.  Other significant uses of
funds during the nine months ended  September  30, 2000,  were $38.9  million in
repurchases of common stock and $11.8 million in cash dividends paid.

                                       11
<PAGE>


COMPARISON OF OPERATING RESULTS FOR THE THREE AND NINE MONTHS ENDED
SEPTEMBER 30, 2000 AND 1999.

RESULTS OF OPERATIONS.  Net income for the three and nine months ended September
30, 2000, totaled $5.6 million and $17.2 million, respectively. This represented
decreases of $511,000 and  $470,000,  or 8.3% and 2.7%,  respectively,  over net
income of $6.2 million and $17.6 million for the  comparable  1999 periods.  For
the quarter ended September 30, 2000,  basic and diluted earnings per share were
$0.17,  representing  an 11.9% and 11.7%  increase over third quarter 1999 basic
and diluted earnings per share of $0.15. For the nine months ended September 30,
2000, basic and diluted earnings per share were $0.50,  representing a 15.5% and
15.7%  increase  over basic and diluted  earnings  per share of $0.44 and $0.43,
respectively,  for the first nine months of 1999.  Earnings per share  increased
despite  decreases in net income,  as the Company  repurchased its common stock.
The  Company  repurchased  4.7 million  shares at an average  price of $8.28 per
share through the nine months ended September 30, 2000.

Annualized  return on average equity improved to 10.23% and 10.10% for the three
and nine months ended September 30, 2000, respectively, from 8.85% and 8.14% for
the comparable 1999 periods.  Annualized  return on average assets was 1.14% and
1.17% for the three and nine months  ended  September  30,  2000,  respectively,
compared with 1.30% and 1.25% for the three and nine months ended  September 30,
1999, respectively.

Excluding  net gains and losses on sales of loans and  securities  available for
sale and related tax effect from all periods presented, net income for the three
and nine  months  ended  September  30,  2000,  totaled  $6.1  million and $17.7
million,  respectively.  This represented increases of $100,000 and $580,000, or
1.7% and 3.4%,  respectively,  over net income of $6.0 million and $17.1 million
for the  comparable  1999  periods.  Excluding  net gains and losses on sales of
loans and securities  available for sale and related tax effect from all periods
presented,  for the quarter ended September 30, 2000, basic and diluted earnings
per share  were $0.19 and $0.18,  respectively,  representing  a 24.1% and 23.9%
increase over third quarter 1999 basic and diluted  earnings per share of $0.15.
Excluding  net gains and losses on sales of loans and  securities  available for
sale and  related tax effect  from all  periods  presented,  for the nine months
ended  September 30, 2000,  basic and diluted  earnings per share were $0.52 and
$0.51,  respectively,  representing  a 22.7% and 22.9%  increase  over basic and
diluted earnings per share of $0.42 for the first nine months of 1999.

INTEREST  INCOME.  Interest income for the three and nine months ended September
30,  2000,  increased  by $4.1  million and $10.7  million,  or 13.1% and 11.6%,
respectively, from the same periods in 1999.

Interest on loans increased $4.7 million and $11.4 million,  or 26.9% and 22.8%,
respectively,  to $22.0  million and $61.7 million for the three and nine months
ended September 30, 2000, as compared to $17.4 million and $50.3 million for the
same periods in 1999.  The average  balance of the loan  portfolio  for the nine
month period  ended  September  30, 2000,  increased to $1.1 billion from $914.8
million for 1999,  while the average yield on the  portfolio  increased to 7.48%
for the nine months ended  September 30, 2000, from 7.33% for the same period in
1999.

Interest  on  securities  declined  $616,000  and  $787,000,  or 4.5% and  1.9%,
respectively,  to $13.1  million and $40.5 million for the three and nine months
ended September 30, 2000, as compared to $13.7 million and $41.2 million for the
same periods in 1999. The average balance of the investment,  FHLB stock and MBS
available for sale portfolios  totaled $843.5 million,  with an annualized yield
of 6.39% for the nine months ended September 30, 2000,  compared with an average
balance of $914.8 million with an annualized  yield of 6.01% for the nine months
ended September 30, 1999.

INTEREST  EXPENSE.  Interest expense increased $4.7 million to $20.8 million for
the three months ended  September  30, 2000,  compared to $16.1  million for the
same period in 1999.  For the nine months ended  September  30,  2000,  interest
expense increased $10.5 million to $58.4 million,  compared to $48.0 million for
the comparable 1999 period.

Interest expense on deposits increased $468,000 and decreased $254,000,  or 4.0%
and (0.7%),  respectively,  to $12.2 million and $35.5 million for the three and
nine months ended  September  30, 2000,  as compared to $11.8  million and $35.8
million  for the same  periods in 1999.  The  average  balance  of core

                                       12
<PAGE>


deposit  accounts,  consisting  of  NOW,  money  market,  savings  accounts  and
non-interest bearing deposits,  totaled $570.7 million for the nine months ended
September 30, 2000,  as compared to $561.2  million for the same period in 1999.
Within these core accounts, non-interest bearing deposits averaged $48.2 million
for the nine months  ended  September  30, 2000,  up from $44.2  million for the
comparable 1999 period. The average balance of certificates of deposit decreased
to $646.6  million for the nine months ended  September  30,  2000,  from $696.1
million for the same period in 1999.  The average  interest cost on all deposits
for the nine months ended September 30, 2000,  increased to 3.89% from 3.79% for
the comparable 1999 period.  The average interest cost on certificates  over the
nine month period ended September 30, 2000, was 5.28%, as compared to 4.94% over
the same period in 1999.

Interest on borrowed  funds for the three and nine months  ended  September  30,
2000,   increased  $4.2  million  and  $10.7   million,   or  97.4%  and  87.9%,
respectively,  to $8.6 million and $22.9  million,  compared to $4.4 million and
$12.2  million  for the same  respective  periods in 1999.  The  increase in the
average  balance of borrowed funds for the nine months ended September 30, 2000,
to  $502.6  million,  from  $302.4  million  for the same  period  in 1999,  was
attributable  to management's  continuing  strategy to fund earning asset growth
through the use of borrowed  funds,  where  accretive to  earnings.  The average
interest  rate  paid on  borrowed  funds was  6.08%  for the nine  months  ended
September 30, 2000, compared with 5.37% for the same period in 1999.

NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES. Net interest income before
provision for loan losses decreased $658,000 and increased  $186,000,  or (4.4%)
and 0.4%,  respectively,  to $14.3  million and $43.7  million for the three and
nine months  ended  September  30,  2000,  compared  to $15.0  million and $43.6
million for the same periods in 1999. The change in net interest  income was due
to the changes in interest  income and interest  expense  described  above.  The
interest  rate spread was 2.24% for the three months ended  September  30, 2000,
compared  with  2.50% for the same  period in 1999.  For the nine  months  ended
September 30, 2000,  the interest rate spread  declined 10 basis points to 2.35%
compared  with the same period in 1999.  The net  interest  margin was 2.90% and
3.00% for the three and nine months  ended  September  30,  2000,  respectively,
compared  with 3.23% and 3.17% for the same  periods in 1999.  The  declines  in
interest rate spread and net interest margin are attributable to rising interest
rates and competitive pricing pressures.  In addition,  the use of funds for the
repurchase of the Company's  common stock has further  impacted the net interest
margin.

PROVISION FOR LOAN LOSSES.  The provision for loan losses for the three and nine
months ended September 30, 2000,  increased  $93,000 and decreased  $21,000,  to
$393,000  and $1.2  million,  compared to $300,000 and $1.2 million for the same
periods in 1999.  Provisions  for loan  losses  are made  based on  management's
evaluation of risks  inherent in the loan  portfolio,  giving  consideration  to
on-going  credit  evaluations  and changes in the balance and composition of the
loan portfolio. In management's opinion, the allowance for loan losses, totaling
$12.1  million  or 1.03%  of  total  loans at  September  30,  2000,  adequately
addresses  the risks  inherent in the  portfolio.  Management  will  continue to
review the need for  additions to its  allowance  for loan losses based upon its
quarterly review of the loan portfolio, the level of delinquencies,  and general
market and economic conditions.

                                       13
<PAGE>


The following  table sets forth ratios  regarding  nonaccrual  loans,  and loans
which are 90 days or more  delinquent,  but on which  the  Company  is  accruing
interest at the dates indicated.  The Company discontinues  accruing interest on
delinquent loans when collection of interest is considered  doubtful,  generally
when 90 days or more  delinquent  and when  loan-to-value  ratios exceed 55%, at
which time all accrued but uncollected  interest is reversed.  Total  foreclosed
real estate ("REO"),  net, totaled $215,000 at September 30, 2000, and consisted
of three residential properties, two of which are under contract for sale.



                                Sept. 30, June 30,  Mar. 31,  Dec. 30, Sept. 30,
(dollars in thousands)            2000      2000      1999      1999     2000
                                --------  -------   --------  -------  --------
Non-accrual mortgage loans ....  $2,620    $2,478    $2,407    $2,311    $2,251
Non-accrual other loans .......      --        45        42        45        82
                                 ------    ------    ------    ------    ------
  Total non-accrual loans .....   2,620     2,523     2,449     2,356     2,333
Loans 90 days or more
  delinquent and
  still accruing ..............     166       263       410       326       320
                                 ------    ------    ------    ------    ------
Total non-performing loans ....   2,786     2,786     2,859     2,682     2,653
Total foreclosed real estate,
  net of related Allowance ....     215       215       344       466     1,193
                                 ------    ------    ------    ------    ------
Total non-performing assets ...  $3,001    $3,001    $3,203    $3,148    $3,846
                                 ======    ======    ======    ======    ======
Non-performing loans to loans
  receivable, net .............    0.24%     0.24%     0.27%     0.26%     0.27%
Non-performing assets to
  total assets ................    0.15%     0.15%     0.16%     0.17%     0.20%


NON-INTEREST  INCOME.  Non-interest  income  decreased  $776,000,  or 91.7%,  to
$70,000 for the three months ended September 30, 2000,  compared to $846,000 for
the same  period  in  1999.  For the  nine  months  ended  September  30,  2000,
non-interest  income totaled $1.5 million, a decrease of $1.4 million,  or 47.9%
from the same period in 1999.  The decrease was  primarily  attributable  to net
losses on sales of loans and securities  totaling  $669,000 and $766,000 for the
three and nine months ended September 30, 2000, respectively,  compared with net
gains of $273,000 and $850,000 for the comparable 1999 periods. The Company sold
$102.0 million of investment  securities and MBS available for sale in the third
quarter.  These sales were  undertaken in response to the increase in short-term
interest rates over the past year, resulting in market value declines of certain
fixed-rate  investments,  while funding costs continued to increase. The Company
will  use the  proceeds  from the sale of  lower-yielding  investments  to repay
higher-costing  borrowings  and to fund  loan  growth  and the  Company's  share
repurchase  program.  Future sales of loans and  securities and related gains or
losses are dependent on market  conditions,  as well as the Company's  liquidity
and risk management requirements.

NON-INTEREST  EXPENSE.  Non-interest expense for the three and nine months ended
September  30,  2000,  decreased  $390,000  and  $171,000,  or  6.3%  and  0.9%,
respectively,  to $5.8 million and $18.4  million,  compared to $6.2 million and
$19.0 million for the same periods in 1999.

Within this category, compensation and benefits increased $127,000 and $607,000,
or 3.8% and 6.0%, respectively,  to $3.5 million and $10.8 million for the three
and nine months ended September 30, 2000.  Included in compensation and benefits
expense for the current nine month period was a non-recurring charge of $177,000
incurred following the death of one of the Company's directors during the second
quarter of 2000.

Advertising   expense  decreased  $162,000  and  $30,000,  or  46.3%  and  3.1%,
respectively,  to $188,000  and  $923,000  for the three and nine  months  ended
September  30,  2000,  compared to $350,000 and $953,000 for the same periods in
1999, primarily due to decreased marketing activity.

Federal deposit insurance premiums decreased $122,000 and $379,000, or 65.6% and
66.0%, respectively, to $64,000 and $195,000 for the three and nine months ended
September 30, 2000, as a result of a reduction in the assessment rate.

General and administrative expenses decreased $168,000 and $452,000 or 16.0% and
13.6%, respectively,  to $880,000 and $2.9 million for the three and nine months
ended  September 30, 2000,  primarily due to a

                                       14
<PAGE>


reduction in supervisory charges realized  as a result of the Bank's conversion
to a state-chartered  savings  bank in January 2000 and data processing expenses
recognized in 1999 in connection  with the December  1998  acquisition  of Pulse
Bancorp.

As a measure  of the  Company's  non-interest  expense  control,  the  Company's
annualized non-interest expense, excluding amortization of intangibles,  divided
by  average  assets  improved  to 1.13% and 1.21% for the three and nine  months
ended  September  30,  2000,  compared to 1.26% and 1.27% for the three and nine
months ended September 30, 1999. The Company's  efficiency ratio,  calculated as
non-interest expense divided by the sum of net interest income plus non-interest
income, excluding gains and losses on the sale of loans and securities, improved
to 38.54% and 39.94% for the three and nine months  ended  September  30,  2000,
respectively, compared with 39.83% and 40.68% for the comparable 1999 periods.

Non-interest  expenses  are  expected  to  increase  as the  Company  introduces
transactional  internet  banking  in  2001  and  progresses  with a  project  to
facilitate teller/platform automation, including document preparation and online
signature verification. These upgrades are intended to enhance customer service,
streamline  the  account  opening  process,  reduce  printing  costs and provide
improved security and research capabilities. The Company anticipates the cost of
such  upgrades  will  approximate  $1.5  million,  to be  amortized  over  their
estimated useful lives.


Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK.

There  have  been  no  material  changes  to  information   required   regarding
quantitative and qualitative  disclosures  about market risk from the end of the
preceding  fiscal  year  to  the  date  of the  most  recent  interim  financial
statements (September 30, 2000).

                                       15
<PAGE>


                           PART II. OTHER INFORMATION

Item 1.   LEGAL PROCEEDINGS.
          There are  various  claims and  lawsuits  in which the  Registrant  is
          periodically involved incidental to the Registrant's  business. In the
          opinion of  management,  no material loss is expected from any of such
          pending claims and lawsuits.

Item 2.   CHANGES IN SECURITIES.
          None.

Item 3.   DEFAULTS UPON SENIOR SECURITIES.
          Not applicable.

Item 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
          None.

Item 5.   OTHER INFORMATION.
          None.

Item 6.   EXHIBITS AND REPORTS ON FORM 8-K.
          a.)    EXHIBITS

          ======================================================================
          Exhibit
          Number                    Description                       Reference
          ----------------------------------------------------------------------
            3.1  Certificate of Incorporation of
                   First Sentinel Bancorp, Inc.                           *
            3.2  Bylaws of First Sentinel Bancorp, Inc.                   *
             4   Stock certificate of First Sentinel Bancorp, Inc.        *
            11   Statement re: Computation of Ratios                    page 7
            27   Financial Data Schedule                              attached
          ======================================================================

          b.)    REPORTS ON FORM 8 - K
                 None.

* - Incorporated  herein by reference  into this document from the  Registration
Statement  on Form S-1 and  exhibits  thereto of First  Sentinel  Bancorp,  Inc.
(formerly First Source Bancorp, Inc.), and any amendments or supplements thereto
filed with the SEC on December  19,  1997 and  amended on February 9, 1998,  SEC
File No. 333-42757.

                                       16
<PAGE>


                                   SIGNATURES

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


                                 FIRST SENTINEL BANCORP, INC.




Date:  November 13, 2000              By: /s/ JOHN P. MULKERIN
                                          -----------------------
                                          John P. Mulkerin
                                          President and Chief Executive Officer


Date:  November 13, 2000              By: /s/ CHRISTOPHER MARTIN
                                          ----------------------
                                          Christopher Martin
                                          Executive Vice President and
                                          Chief Operating and
                                          Financial Officer

                                       17