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 . MARCH 31, 2001

                                       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 MAY 1, 2001
-------------------------------------      -------------------------------------
            Common Stock                             32,093,891 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
          March 31, 2001 and December 31, 2000                                 3

          Consolidated Statements of Income for the Three Months Ended
          March 31, 2001 and 2000                                              4

          Consolidated Statements of Stockholders' Equity
          for the Three Months Ended March 31, 2001 and 2000                   5

          Consolidated Statements of Cash Flows for the
          Three Months Ended March 31, 2001 and 2000                           6

          Notes to Consolidated Financial Statements                           7

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

Item 3.   Quantitative and Qualitative Disclosure About Market Risk           13

PART II.  OTHER INFORMATION                                                   14

          SIGNATURES                                                          16

                                       2
<PAGE>


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

                                                         March 31,  December 31,
                                                           2001         2000
                                                        ----------   ----------
ASSETS
Cash and due from banks .............................   $   24,664   $   14,069
Federal funds sold ..................................       68,150       21,050
                                                        ----------   ----------
     Total cash and cash equivalents ................       92,814       35,119
Federal Home Loan Bank of New York (FHLB-NY)
  stock, at cost ....................................       19,816       19,643
Investment securities available for sale ............      174,437      234,970
Mortgage-backed securities available for sale .......      461,946      447,022
Loans available for sale, net .......................          533          277
Loans receivable, net ...............................    1,182,180    1,184,525
Interest and dividends receivable ...................       12,078       13,481
Premises and equipment, net .........................       16,025       16,092
Excess of cost over fair value of net
  assets acquired ...................................        6,047        6,259
Other assets ........................................        7,495       11,321
                                                        ----------   ----------
     Total assets ...................................   $1,973,371   $1,968,709
                                                        ==========   ==========

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

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES
Deposits ............................................   $1,244,007   $1,219,336
Borrowed funds ......................................      481,321      505,955
Advances by borrowers for taxes and insurance .......        9,888        9,154
Other liabilities ...................................       11,543       12,101
                                                        ----------   ----------
     Total liabilities ..............................    1,746,759    1,746,546
                                                        ----------   ----------
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 32,093,891
  shares issued and outstanding at 3/31/01 and
  43,106,742 and 32,749,994 shares issued and
  outstanding at 12/31/00 ...........................          430          430

Paid-in capital .....................................      201,339      201,264
Retained earnings ...................................      135,797      132,537
Accumulated other comprehensive loss ................         (591)      (8,534)
Treasury stock (10,939,374 and 10,288,827
  shares at March 31, 2001 and
  December 31, 2000, respectively) ..................      (96,786)     (89,508)
Common stock acquired by the Employee
  Stock Ownership Plan (ESOP) .......................      (11,009)     (11,238)
Common stock acquired by the Recognition
  and Retention Plan (RRP) ..........................       (2,568)      (2,788)
                                                        ----------   ----------
     Total stockholders' equity .....................      226,612      222,163
                                                        ----------   ----------
     Total liabilities and stockholders' equity .....   $1,973,371   $1,968,709
                                                        ==========   ==========

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)

                                                    Three Months Ended March 31,
                                                    ----------------------------
                                                            2001         2000
                                                      ----------   ----------
INTEREST INCOME:
  Loans ...........................................   $   22,462   $   19,184
  Investment and mortgage-backed securities
    available for sale ............................       11,808       13,663
                                                      ----------   ----------
     Total interest income ........................       34,270       32,847
                                                      ----------   ----------
INTEREST EXPENSE:
  Deposits:
    NOW and money market demand ...................        2,322        2,383
    Savings .......................................          893          941
    Certificates of deposit .......................        9,165        8,071
                                                      ----------   ----------
      Total interest expense - deposits ...........       12,380       11,395
    Borrowed funds ................................        7,445        6,834
                                                      ----------   ----------
      Total interest expense ......................       19,825       18,229
                                                      ----------   ----------
      Net interest income .........................       14,445       14,618
  Provision for loan losses .......................          200          393
                                                      ----------   ----------
      Net interest income after provision
        for loan losses ...........................       14,245       14,225
                                                      ----------   ----------

NON-INTEREST INCOME:
  Fees and service charges ........................          637          577
  Net gain (loss) on sales of loans and
    securities available for sale .................          259          (19)
  Other income ....................................          107          180
                                                      ----------   ----------
     Total non-interest income ....................        1,003          738
                                                      ----------   ----------

NON-INTEREST EXPENSE:
  Compensation and benefits .......................        3,868        3,656
  Occupancy .......................................          579          611
  Equipment .......................................          440          424
  Advertising .....................................          297          330
  Federal deposit insurance .......................           60           66
  Amortization of intangibles .....................          212          212
  General and administrative ......................        1,084        1,032
                                                      ----------   ----------
    Total non-interest expense ....................        6,540        6,331
                                                      ----------   ----------
    Income before income tax expense ..............        8,708        8,632

Income tax expense ................................        2,792        2,896
                                                      ----------   ----------

     Net income ...................................   $    5,916   $    5,736
                                                      ==========   ==========

Basic earnings per share ..........................   $     0.19   $     0.16
                                                      ==========   ==========

Weighted average shares outstanding - Basic .......   31,110,677   35,660,061
                                                      ==========   ==========

Diluted earnings per share ........................   $     0.19   $     0.16
                                                      ==========   ==========

Weighted average shares outstanding - Diluted .....   31,741,706   35,928,375
                                                      ==========   ==========

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      Loss       Stock      by ESOP     By RRP       Equity
                                       --------------------------------------------------------------------------------------------
<S>                 <C> <C>                 <C>    <C>         <C>         <C>         <C>         <C>          <C>        <C>
Balance at December 31, 1999 ........       $431   $200,781    $117,922    $(17,302)   $(41,229)   $(12,156)    $(3,867)   $244,580
Net income for the three months
  ended March 31, 2000 ..............         --         --       5,736          --          --          --          --       5,736
Cash dividends declared ($.06)  .....         --         --      (2,301)         --          --          --          --      (2,301)
Net change in unrealized loss on
   securities available for sale ....         --         --          --      (2,130)         --          --          --      (2,130)
Purchases of treasury stock .........         --         --          --          --     (19,208)         --          --     (19,208)

Exercise of stock options ...........         --         --         (75)         --         122          --          --          47
Tax benefit on stock options and RRP          --        588          --          --          --          --          --         588
Purchase and retirement of common
   stock ............................         --        (14)         --          --          --          --          --         (14)
Amortization of RRP .................         --         --          --          --          --          --         232         232

Amortization of ESOP ................         --         --         (35)         --          --         229          --         194
                                       --------------------------------------------------------------------------------------------

Balance at March 31, 2000 ...........       $431   $201,355    $121,247    $(19,432)   $(60,315)   $(11,927)    $(3,635)   $227,724
                                       ============================================================================================

Balance at December 31, 2000 ........       $430   $201,264    $132,537     $(8,534)   $(89,508)   $(11,238)    $(2,788)   $222,163
Net income for the three months
   ended March 31, 2001 .............         --         --       5,916          --          --          --          --       5,916
Cash dividends declared ($.075) .....         --         --      (2,458)         --          --          --          --      (2,458)
Net change in unrealized loss on
   securities available for sale ....         --         --          --       7,943          --          --          --       7,943
Purchases of treasury stock .........         --         --          --          --      (7,621)         --          --      (7,621)
Exercise of stock options ...........         --         --        (198)         --         343          --          --         145
Tax benefit on stock options and RRP          --         80          --          --          --          --          --          80
Purchase and retirement of common
   stock ............................         --        (56)         --          --          --          --          --         (56)
Amortization of RRP .................         --         --          --          --          --          --         220         220

Amortization of ESOP ................         --         51          --          --          --         229          --         280
                                       --------------------------------------------------------------------------------------------

Balance at March 31, 2001 ...........       $430   $201,339    $135,797       $(591)   $(96,786)   $(11,009)    $(2,568)   $226,612
                                       ============================================================================================
</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)

<TABLE>
<CAPTION>
                                                                                                                Three Months Ended
                                                                                                                     March 31,
                                                                                                              ---------------------
                                                                                                                 2001        2000
                                                                                                              ---------   ---------
<S>                                                                                                                 <C>         <C>
Cash flows from operating activities:
  Net income ...............................................................................................  $   5,916   $   5,736
  ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES:
  Depreciation of premises and equipment ...................................................................        341         348
  Amortization of excess of cost over fair value of assets acquired ........................................        212         212
  Amortization of ESOP .....................................................................................        280         194
  Amortization of RRP ......................................................................................        220         232
  Net amortization of premiums and accretion of discounts and deferred fees ................................        385         420
  Provision for loan losses ................................................................................        200         393
  Loans originated for sale ................................................................................    (14,371)       (680)
  Proceeds from sales of mortgage loans available for sale .................................................     14,208         120
  Net (gain) loss on sales of loans and securities available for sale ......................................       (259)         19
  Net gain on sales of real estate owned ...................................................................         --         (17)
  Decrease (increase) in interest and dividends receivable .................................................      1,403        (207)
  Tax benefit on stock options and RRP .....................................................................         80         588
  Decrease in other liabilities ............................................................................       (558)     (3,841)
  (Increase) decrease in other assets ......................................................................       (712)        627
                                                                                                              ---------   ---------
       Net cash provided by operating activities ...........................................................      7,345       4,144
                                                                                                              ---------   ---------
Cash flows from investing activities:
  Proceeds from sales/calls of investment securities available for sale ....................................     91,811      16,835
  Purchases of investment securities available for sale ....................................................    (25,992)    (35,313)
  Purchase of FHLB-NY stock ................................................................................       (173)     (1,132)
  Proceeds from sales of mortgage-backed securities available for sale .....................................    104,516      21,901
  Principal payments on mortgage-backed securities .........................................................     17,600      25,294
  Purchases of mortgage-backed securities available for sale ...............................................   (130,059)    (53,223)
  Principal repayments on loans ............................................................................     72,252      51,034
  Origination of loans .....................................................................................    (62,961)    (83,806)
  Purchases of mortgage loans ..............................................................................     (7,585)    (10,476)
  Proceeds from sale of real estate owned ..................................................................        434         139
  Purchases of premises and equipment ......................................................................       (274)        (78)
                                                                                                              ---------   ---------
     Net cash provided by (used in) investing activities ...................................................     59,569     (68,825)
                                                                                                              ---------   ---------
Cash flows from financing activities:
  Purchase of treasury stock ...............................................................................     (7,621)    (19,208)
  Stock options exercised ..................................................................................        145          47
  Cash dividends paid ......................................................................................     (2,458)     (2,301)
  Net increase in deposits .................................................................................     24,671      12,375
  Net increase in short-term borrowed funds ................................................................     25,400       4,000
  Proceeds from borrowed funds .............................................................................    125,000     140,000
  Repayment of borrowed funds ..............................................................................   (175,034)    (80,000)
  Net increase in advances by borrowers for taxes and insurance ............................................        734         726
  Purchase and retirement of common stock ..................................................................        (56)        (14)
                                                                                                              ---------   ---------
     Net cash (used in) provided by financing activities ...................................................     (9,219)     55,625
                                                                                                              ---------   ---------
     Net increase (decrease) in cash and cash equivalents ..................................................     57,695      (9,056)
Cash and cash equivalents at beginning of period ...........................................................     35,119      30,607
                                                                                                              ---------   ---------
Cash and cash equivalents at end of period .................................................................  $  92,814   $  21,551
                                                                                                              =========   =========
Supplemental disclosures of cash flow information:
  Cash paid during the period for:
    Interest ...............................................................................................  $  20,053   $  17,646
    Income taxes ...........................................................................................        251          --
  Non cash investing and financing activities for the period:
    Transfer of loans to real estate owned .................................................................  $     177   $      --
</TABLE>

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
months ended March 31, 2001 and 2000.  The results of  operations  for the three
months ended March 31, 2001, are not necessarily  indicative of results that may
be expected for the entire fiscal year ending  December 31, 2001.  These interim
financial  statements  should be read in conjunction  with the December 31, 2000
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.  Common stock
equivalents are not included in the calculation.

Diluted  earnings per share is computed  similarly to that of 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 March 31,
                                                    ---------------------------
                                                           2001            2000
                                                    -----------     -----------
Net income                                          $     5,916     $     5,736
                                                    ===========     ===========

Basic weighted-average common shares
  Outstanding                                        31,110,677      35,660,061
Plus: Dilutive stock options and awards                 631,029         268,314
                                                    -----------     -----------
Diluted weighted-average common
  shares outstanding                                 31,741,706      35,928,375
                                                    ===========     ===========

Net income per common share:
  Basic                                             $      0.19     $      0.16
                                                    ===========     ===========
  Diluted                                           $      0.19     $      0.16
                                                    ===========     ===========

(3)  DIVIDENDS

Based upon current  operating  results,  the Company  declared cash dividends of
$0.075 per share on January 29, 2001, payable February 23, 2001, to stockholders
of record on February 9, 2001.

                                       7
<PAGE>


(4)  COMMITMENTS AND CONTINGENCIES

At March 31, 2001, the Company had the following  commitments:  (i) to originate
loans of $131.6 million; (ii) to purchase mortgage loans of $4.3 million;  (iii)
unused equity lines of credit of $52.7 million;  (iv) unused commercial lines of
credit  of $5.2  million;  (v)  unused  construction  lines of  credit  of $46.2
million; and (vi) letters of credit outstanding totaling $2.3 million.  Further,
certificates  of deposits,  which are scheduled to mature and/or rollover in one
year or less, totaled $574.0 million at March 31, 2001.

(5)  ALLOWANCE FOR LOAN LOSSES

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

                                                    Three Months Ended March 31,
                                                    ----------------------------
                                                        2001               2000
                                                    --------           --------
Balance at beginning of period                      $ 12,341           $ 11,004
Provision charged to operations                          200                393
Charge offs, net of recoveries                            (6)                (7)
                                                    --------           --------
Balance at end of period                            $ 12,535           $ 11,390
                                                    ========           ========



(6)  COMPREHENSIVE  INCOME

Total  comprehensive  income,  consisting  of net  income  and the net change in
unrealized  gain/(loss) on securities  available for sale, was $13.9 million and
$3.6 million for the three months ended March 31, 2001 and 2000, respectively.

                                       8
<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 the  accounting  principles,  policies or guidelines  and
legislative and regulatory changes.


ASSETS.  Total assets were $2.0 billion at March 31, 2001 and December 31, 2000.
Changes in asset composition during the quarter consisted primarily of increases
in cash and cash equivalents and  mortgage-backed  securities  ("MBS") available
for sale, partially offset by reductions in investment  securities available for
sale, other assets, and interest and dividends receivable.

Loans  receivable,  net, totaled $1.2 billion at March 31, 2001 and December 31,
2000.  Total loan  originations  for the three months ended March 31, 2001, were
$77.3  million,  as  compared  to $84.5  million  for the same  period  in 2000.
Fixed-rate  single-family first mortgage loan originations totaled $14.3 million
or 18.5% of production, while adjustable-rate single-family first mortgage loans
accounted for $10.7 million or 13.8% of total  originations  for the first three
months of 2001.  Also during the first quarter of 2001,  commercial real estate,
commercial and multi-family loan originations totaled $13.4 million, or 17.3% of
total  originations,  while  construction  lending,  primarily for single-family
developments,  totaled $16.2 million, or 21.0%. During the same period, consumer
loan originations,  including home equity loans and credit lines,  totaled $22.7
million or 29.4% of total  originations.  In  addition,  the  Company  purchased
$136,000 of adjustable-rate  single-family first mortgage loans and $7.4 million
of commercial real estate and multi-family mortgage loans through correspondents
during the three months ended March 31, 2001.  Purchased loans are  underwritten
internally and are extended at higher rates than those currently  offered by the
Bank. Repayment of principal on loans totaled $72.3 million for the three months
ended March 31, 2001,  as compared to $51.0 million for the same period in 2000.
Increased repayments are primarily  attributable to increased refinance activity
compared with the three months ended March 31, 2000.  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,  as well as the  Company's  interest rate
risk management practices.

Cash and cash equivalents  increased $57.7 million,  or 164.3%, to $92.8 million
at March 31, 2001,  from $35.1  million at December 31, 2000. At March 31, 2001,
the Company held cash and cash  equivalents in  anticipation  of debt repayments
scheduled  for  April  2001,  and to fund the loan  pipeline  and the  Company's
ongoing stock repurchase program.

MBS available for sale increased  $14.9  million,  or 3.3%, to $461.9 million at
March 31,  2001,  from $447.0  million at December  31,  2000.  The increase was
primarily  due to  purchases of $130.1  million  exceeding  sales and  principal
repayments  of $104.8  million and $17.6  million,  respectively,  for the three
month period ended March 31, 2001. Purchases during the quarter consisted of MBS
issued by U.S. government-sponsored agencies.

Investment  securities  available for sale decreased $60.5 million, or 25.8%, to
$174.4  million as of March 31, 2001,  from $235.0 million at December 31, 2000.
The decrease was  primarily  due to sales and calls of

                                       9
<PAGE>


$91.4  million  exceeding  purchases of $26.0 million for the three months ended
March 31,  2001.  Purchases  during  the  quarter  consisted  primarily  of debt
securities issued by U.S. corporations and government-sponsored agencies.

Other assets  decreased $3.8 million,  or 33.8%, to $7.5 million as of March 31,
2001 from $11.3  million at  December  31,  2000.  The  decrease  was  primarily
attributable  to a  reduction  in the  deferred  tax asset  associated  with the
unrealized  loss  on  the  Company's  investment  and  MBS  available  for  sale
portfolios.  During the quarter,  the unrealized  loss on the available for sale
portfolios,  net of related tax effect,  decreased  by $7.9  million as interest
rates declined and portfolio market values improved.

LIABILITIES. Deposits increased $24.7 million, or 2.0%, to $1.2 billion at March
31,  2001.  Core  deposits,  consisting  of  checking,  savings and money market
accounts,  grew by $6.2  million to $576.6  million and  accounted  for 46.4% of
total  deposits at March 31, 2001.  Certificates  of deposit  increased by $18.4
million  compared with  year-end  2000,  with most of the increase  occurring in
thirty-day, three-month and six-month maturity certificates.

Borrowed funds decreased $24.6 million,  or 4.9%, to $481.3 million at March 31,
2001,  from $506.0  million at December 31, 2000, as deposit  growth  provided a
less costly  funding  source.  Advances  by  borrowers  for taxes and  insurance
increased  $734,000,  or 8.0%,  to $9.9  million  at March 31,  2001,  from $9.2
million at December 31, 2000.

CAPITAL. The Company's  stockholders' equity increased $4.4 million, or 2.0%, to
$226.6 million at March 31, 2001,  from $222.2 million at December 31, 2000. The
primary  reasons  for the  increase  in  equity  were  the  decrease  in the net
unrealized loss on securities  available for sale of $7.9 million, net income of
$5.9  million for the three months ended March 31,  2001,  the  amortization  of
stock-based  compensation and benefit plans and related tax benefit of $580,000,
and  proceeds  from the  exercise  of stock  options  totaling  $145,000.  These
increases  were  partially  offset by the  purchase of $7.7  million of treasury
stock and cash dividends of $2.5 million.

The Federal Deposit  Insurance  Corporation  requires that the Bank meet minimum
leverage,  Tier 1 and total risk-based capital requirements.  At March 31, 2001,
the Bank exceeded all regulatory  capital  requirements,  as follows (dollars in
thousands):

                             Required              Actual           Excess of
                       ------------------    ------------------       Actual
                                    % of                  % of   Over Regulatory
                        Amount     Assets     Amount     Assets    Requirements
                       --------    ------    --------    ------  ---------------

Leverage Capital       $ 77,633     4.00%    $171,763     8.85%      $ 94,130
Risk-based Capital:
Tier 1                   40,020     4.00%     171,763    17.17%       131,743
Total                    80,040     8.00%     184,275    18.42%       104,235

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  interest  rates,
competition, and economic conditions.

The most  significant  sources of funds for the first three  months of 2001 were
proceeds from sales of MBS available for sale totaling $104.5 million, sales and
calls of investment securities available for sale of $91.8 million and principal
repayments and  prepayments  of loans and  mortgage-backed  securities  totaling
$72.3 million and $17.6 million,  respectively.  Another  significant  source of
funds for the three  months  ended March 31, 2001 was a net increase in deposits
totaling  $24.7  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  March  31,  2001,  the  Company  had  unpledged  investment
securities and MBS available for sale with a market value of $266.1 million.

                                       10
<PAGE>


The primary  investing  activities  of the Company for the first three months of
2001 were purchases of  mortgage-backed  securities  available for sale totaling
$130.1 million, the origination of loans totaling $77.3 million and purchases of
investment   securities  available  for  sale  totaling  $26.0  million.   Other
significant uses of funds during the three months ended March 31, 2001, were the
net repayment of borrowings of $24.6 million,  the repurchase of $7.7 million of
common stock and purchases of $7.6 million of mortgage loans.


COMPARISON  OF  OPERATING  RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND
2000.

RESULTS OF OPERATIONS.  For the quarter ended March 31, 2001,  basic and diluted
earnings  per share  were  $0.19,  representing  increases  of 16.7% and  18.2%,
respectively, over basic and diluted earnings per share of $0.16 for the quarter
ended March 31,  2000.  Net income for the three  months  ended March 31,  2001,
totaled $5.9 million,  versus net income of $5.7 million for the comparable 2000
period.  Annualized return on average equity increased 72 basis points to 10.42%
for 2001, from 9.70% from 2000, as the Company continued to leverage its capital
through internal loan growth,  share repurchases and cash dividends.  Annualized
return on average assets was 1.20% for the March 2001 quarter, compared to 1.19%
for the same period in 2000.

INTEREST  INCOME.  Interest  income for the three  months  ended March 31, 2001,
increased by $1.4 million, or 4.3%, to $34.3 million,  compared to $32.8 million
for the same period in 2000.

Interest on loans  increased  $3.3 million,  or 17.1%,  to $22.5 million for the
three  months ended March 31,  2001,  as compared to $19.2  million for the same
period in 2000.  The average  balance of the loan  portfolio for the three month
period ended March 31, 2001  increased to $1.2 billion from $1.0 billion for the
same period in 2000, while the average yield on the portfolio increased to 7.54%
for the three  months  ended March 31,  2001,  from 7.35% for the same period in
2000.   The  increase  in  average  yield   reflects  the  Company's   continued
diversification  of the loan portfolio,  with growth exhibited in the commercial
real estate, multi-family and construction loan segments.

Interest on  securities  declined  $1.9 million for the quarter  ended March 31,
2001  compared  with the  same  period  in  2000.  The  average  balance  of the
investment and MBS available for sale portfolios totaled $737.8 million, with an
annualized  yield of 6.40% for the three months  ended March 31, 2001,  compared
with an average balance of $868.6 million with an annualized  yield of 6.29% for
the three months ended March 31, 2000.

INTEREST  EXPENSE.  Interest expense  increased $1.6 million,  or 8.8%, to $19.8
million for the three months ended March 31, 2001, compared to $18.2 million for
the same period in 2000.

Interest expense on deposits increased  $985,000,  or 8.6%, to $12.4 million for
the three months ended March 31, 2001, as compared to $11.4 million for the same
period in 2000.  Average  deposits  remained at $1.2 billion for the three month
periods ended March 31, 2001 and 2000. The average  balance of  certificates  of
deposit  increased to $655.0  million for the three months ended March 31, 2001,
from  $642.6  million  for  the  same  period  in  2000.  The  average  cost  of
certificates  over the  three-month  period  ended  March 31,  2001,  was 5.60%,
compared to 5.02% for the same period in 2000. The average  interest cost on all
deposits for the three months ended March 31, 2001  increased 31 basis points to
4.06%,  compared  to 3.75%  for the same  period in 2000.  Non-interest  bearing
accounts  averaged  $49.2  million for the three months ended March 31, 2001, up
from $46.7 million for the comparable 2000 period.

Interest on borrowed funds for the three months ended March 31, 2001,  increased
$611,000, or 8.9%, to $7.4 million, compared to $6.8 million for the same period
in 2000.  The  increase in the average  balance of borrowed  funds for the three
months ended March 31, 2001, to $501.0 million, from $465.6 million for 2000 was
attributable to management's  continuing  strategy to leverage  capital and fund
earning  asset  growth  through the use of borrowed  funds,  where  accretive to
earnings.  The Company will continue to evaluate leveraged growth  opportunities
as market conditions allow. The average interest rate paid on

                                       11
<PAGE>


borrowed  funds was 5.94% for the three months  ended March 31,  2001,  compared
with 5.87% for the same period in 2000. Management  anticipates that the cost of
borrowings  will  decrease as the Federal  Reserve  continues  to reduce  market
interest rates.

NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES. Net interest income before
provision for loan losses decreased $173,000,  or 1.2%, to $14.4 million for the
three months ended March 31, 2001, compared to $14.6 million for the same period
in 2000.  The  decrease  was due to the changes in interest  income and interest
expense described above.

The interest rate spread decreased to 2.36% for the three months ended March 31,
2001,  from  2.41%  for the same  period  in 2000.  The  decrease  was due to an
increase in the average cost of  interest-bearing  liabilities  to 4.75% for the
quarter ended March 31, 2001, from 4.46% for the same period in 2000,  partially
offset by an increase in the average yield on  interest-earning  assets to 7.11%
from 6.87% for the same respective periods.

The net interest  margin  declined to 3.00% for the three months ended March 31,
2001, from 3.06% for the same period in 2000.  Average  interest-earning  assets
were $1.9 billion for both the three months ended March 31, 2001 and 2000.

PROVISION  FOR LOAN LOSSES.  The  provision for loan losses for the three months
ended March 31, 2001,  decreased  $193,000,  or 49.1%, to $200,000,  compared to
$393,000 for the same period in 2000.  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.  Total loans  receivable  remained stable at
$1.2 billion at March 31, 2001 and December 31, 2000, while non-performing loans
declined to $2.0  million at March 31,  2001,  from $2.4 million at December 31,
2000 and $2.9  million at March 31,  2000.  The  allowance  for loan losses as a
percentage of total loans was 1.05% at March 31, 2001, up from 1.03% at December
31, 2000. In management's opinion, the allowance for loan losses, totaling $12.5
million  at March 31,  2001,  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.

The following table sets forth ratios  regarding  non-accrual  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.  Foreclosed  real
estate  ("REO"),  net,  was $445,000 at March 31,  2001,  and  consisted of four
residential properties, two of which were under contract for sale.

<TABLE>
<CAPTION>
(dollars in thousands)                                    Mar. 31,    Dec. 31,   Sept. 30,    June 30,    Mar. 31,
                                                            2001        2000        2000        2000        2000
                                                           ------      ------      ------      ------      ------
<S>                                                        <C>         <C>         <C>         <C>         <C>
Non-accrual mortgage loans                                 $1,922      $2,334      $2,620      $2,478      $2,407
Non-accrual other loans                                        --          15          --          45          42
                                                           ------      ------      ------      ------      ------
   Total non-accrual loans                                  1,922       2,349       2,620       2,523       2,449
Loans 90 days or more delinquent and
     still accruing                                            40          40         166         263         410
                                                           ------      ------      ------      ------      ------
Total non-performing loans                                  1,962       2,389       2,786       2,786       2,859
Total foreclosed real estate, net of related allowance        445         257         215         215         344
                                                           ------      ------      ------      ------      ------
Total non-performing assets                                $2,407      $2,646      $3,001      $3,001      $3,203
                                                           ======      ======      ======      ======      ======
Non-performing loans to loans receivable                     0.16%       0.20%       0.24%       0.24%       0.27%
Non-performing assets to total assets                        0.12%       0.13%       0.15%       0.15%       0.16%
</TABLE>

NON-INTEREST INCOME.  Non-interest income increased $265,000,  or 35.9%, to $1.0
million for the three months ended March 31, 2001,  compared to $738,000 for the
same period in 2000. The increase was primarily  attributable  to gains on sales
of loans  and  securities  totaling  $259,000  for the  first  quarter  of 2001,

                                       12
<PAGE>


compared  with losses of $19,000 for the  comparable  2000  period.  The sale 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 months ended March 31,
2001, increased $209,000, or 3.3%, to $6.5 million, compared to $6.3 million for
the same  period  in 2000.  Within  this  category,  compensation  and  benefits
increased  $212,000,  or 5.8%,  to $3.9 million for the three months ended March
31, 2001, primarily as a result of increased healthcare and other benefit costs.
As a measure  of the  Company's  non-interest  expense  control,  the  Company's
annualized  non-interest expense,  excluding goodwill  amortization,  divided by
average  assets  was 1.29% for the three  months  ended  March 31,  2001 and the
efficiency ratio was 43.1% for the same period. Non-interest expense is expected
to increase,  however,  during the  remainder of 2001 as the Company  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.  In addition,  some increased
expense will be incurred in connection  with the planned  introduction  of fully
transactional Internet banking in the spring of 2001.

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 (March 31, 2001).

                                       13
<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.

          The Annual Meeting of Stockholders was held on April 25, 2001. The
following proposals were voted on by the stockholders:

<TABLE>
<CAPTION>
                                                                                Withhold/        Broker
                                                       For         Against       Abstain       Non-Votes
                                                   ----------    ----------     ---------      ---------
<S>                                                <C>           <C>            <C>            <C>
          1.  Election of directors
                    George T. Hornyak, Jr.         27,571,481            --     1,831,727             --
                    John P. Mulkerin               27,581,343            --     1,821,865             --
                    Jeffries Shein.                27,581,414            --     1,821,794             --

          2.  The  ratification  of  KPMG
              LLP  as   the   independent
              auditors of the Company for
              the year ended December 31,
              2001.                                29,018,902       270,564       113,742             --

          3.  A stockholder  proposal, as
              more fully described in the
              proxy statement dated March
              26, 2001. *                           7,145,346    15,531,503       419,734      6,306,625
</TABLE>

          * The proposal was introduced at the Company's  Annual Meeting but was
          not  seconded  by  another  stockholder,  hence the  proposal  was not
          properly presented under the Rules of Conduct adopted for the meeting.
          However,  based upon the proxies  solicited by the Board of Directors,
          had the motion been  seconded,  the proposal  would have been defeated
          having received only 21.8% of the total shares eligible to vote, which
          amounts to 30.9% of the votes that had been cast.

Item 5.   OTHER INFORMATION.

          None.

                                       14
<PAGE>


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
                               per Share Earnings                       page 7
          ----------------------------------------------------------------------


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.

                                       15
<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:  May 11, 2001                        By: JOHN P. MULKERIN
                                               ----------------

                                           John P. Mulkerin
                                           President and Chief Executive Officer



Date:  May 11, 2001                        By: CHRISTOPHER MARTIN
                                               ------------------

                                           Christopher Martin
                                           Executive Vice President and
                                           Chief Operating and Financial Officer
                                           and Corporate Secretary

                                       16