UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q

(Mark One)

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

                   For the quarterly period ended December 31, 1999

                                       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 Number 1-13793

                    NORTHEAST PENNSYLVANIA FINANCIAL CORP.
--------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)


DELAWARE                                                             06-1504091
--------------------------------------------------------------------------------
(State or other jurisdiction of incorporation or organization)  (I.R.S. Employer
                                                             Identification No.)


12 E. BROAD STREET, HAZLETON, PENNSYLVANIA                                 18201
--------------------------------------------------------------------------------
(Address of principal executive offices)                              (Zip Code)


                            (570) 459-3700
--------------------------------------------------------------------------------
            (Registrant's telephone number, including area code)


                            Not Applicable
--------------------------------------------------------------------------------
            (Former name, former address and former fiscal year,
                      if changes 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: The Registrant had
5,536,149 shares of Common Stock outstanding as of February 7, 2000.


<PAGE>




                                TABLE OF CONTENTS

Item
No.
                                                                          Page
                                                                          Number
PART I - CONSOLIDATED FINANCIAL INFORMATION

Item 1   CONSOLIDATED FINANCIAL STATEMENTS

         Consolidated Statements of Financial Condition at
         December 31, 1999 (unaudited) and September 30, 1999................. 1

         Consolidated Statements of Operations for the Three Months Ended
         December 31, 1999 and 1998 (unaudited)............................... 2

         Consolidated Statement of Comprehensive Income for the Three Months
         Ended December 31, 1999 and 1998 (unaudited)......................... 3

         Consolidated  Statements  of  Changes  in Equity  for the  Years  Ended
         September  30,  1999,  1998  and  1997   and  the  Three  Months  Ended
         December 31, 1999 (unaudited)........................................ 4

         Consolidated Statements of Cash Flows for the Three Months Ended
         December 31, 1999 and 1998(unaudited)................................ 5

         Notes to Consolidated Financial Statements (unaudited)............... 7


Item 2   Management's Discussion and Analysis of Financial Condition
         and Results of Operations............................................12

Item 3   Quantitative and Qualitative Disclosures about Market Risk...........16

Part II - OTHER INFORMATION

1        Legal Proceedings....................................................17

2        Changes in Securities and Use of Proceeds............................17

3        Defaults Upon Senior Securities......................................17

4        Submission of Matters to a Vote of Security Holders..................17

5        Other Information....................................................17

6        Exhibits and Reports on Form 8 - K................................17-18

Signatures


<PAGE>
<TABLE>

                     Northeast Pennsylvania Financial Corp.
                 Consolidated Statements of Financial Condition
              December 31, 1999 (unaudited) and September 30, 1999
                               (in thousands)

                                                                          December 31,       September 30,
                                                                              1999               1999
                                                                              ----               ----
                               Assets                                      (unaudited)
<S>                                                                             <C>              <C>
Cash and cash equivalents                                                       $ 3,283          $ 4,177
Securities available-for-sale                                                   193,937          189,835
Securities held-to-maturity (estimated fair value of $27,455 at
    December 1999 and $28,315 in September 1999)                                 30,330           30,332
Loans (less allowance for loan losses of $3,092 for December 1999
    and $2,924 for September 1999)                                              382,947          364,190
Accrued interest receivable                                                       5,219            4,769
Assets acquired through foreclosure                                                 217               98
Property and equipment, net                                                       9,661            9,868
Other assets                                                                     10,058            8,956
                                                                                 ------            -----
     Total assets                                                             $ 635,652        $ 612,225
                                                                              =========        =========

                       Liabilities and Equity

Deposits                                                                      $ 375,158        $ 375,983
Federal Home Loan Bank advances                                                 182,975          155,980
Other borrowings                                                                    524              524
Advances from borrowers for taxes and insurance                                     875            1,040
Accrued interest payable                                                          1,399            1,317
Other liabilities                                                                 1,828            1,905
                                                                                  -----            -----

     Total liabilities                                                        $ 562,759        $ 536,749
                                                                              ---------        ---------

Preferred stock ($.01 par value; 2,000,000 authorized shares;  0
    shares issued)                                                                    -                -
Common stock ($.01 par value; 16,000,000 authorized shares;
    6,427,350 shares issued)                                                         64               64
Additional paid-in capital                                                       62,191           62,119
Common stock acquired by stock benefit plans                                    (6,780)          (7,066)
Retained earnings - substantially restricted                                     31,616           30,818
Accumulated other comprehensive loss                                            (5,185)          (2,874)
Treasury stock, at cost (769,567 shares)                                        (9,013)          (7,585)
                                                                                -------          -------

     Total equity                                                              $ 72,893          $75,476
                                                                               --------          -------

            Total liabilities and equity                                       $635,652        $ 612,225
                                                                               ========        =========


</TABLE>

                                       1
<PAGE>


<TABLE>

                                     Northeast Pennsylvania Financial Corp.
                                     Consolidated Statements of Operations
                         For the Three Months Ended December 31, 1999 and 1998 (unaudited)
                                                  (in thousands)
<S>                                                                            <C>              <C>

                                                                              For the Three months ended
                                                                                      December 31,
Interest Income:                                                                1999               1998
                                                                                ----               ----
                                                                                        (unaudited)
  Loans                                                                        $7,290             $5,742
  Mortgage-related securities                                                     914              1,205
  Investment securities:
    Taxable                                                                     1,648              1,364
    Non-taxable                                                                   877                657
                                                                                  ---                ---
    Total interest income                                                      10,729              8,968

Interest Expense:
  Deposits                                                                      3,765              3,317
  Federal Home Loan Bank advances and other                                     2,239              1,319
                                                                                -----              -----
                                                                                6,004              4,636
     Total interest expense

Net interest income                                                             4,725              4,332

Provision for loan losses                                                         205                 47
                                                                                  ---                 --

Net interest income after provision for loan losses                             4,520              4,285

Non-interest Income:
  Service charges and other fees                                                  315                217
   Other income                                                                   173                 85
   Insurance premium income                                                        58                 45
   Gain (loss) on sale of:
     Real estate owned                                                           (40)               (16)
     Loans                                                                          9                 19
     Available-for-sale securities                                               (14)                 34
                                                                                 ----                 --
      Total non-interest income                                                   501                384

Non-interest Expense:
  Salaries and net employee benefits                                            1,967              1,718
  Occupancy costs                                                                 469                419
  Data processing                                                                 122                125
  Professional fees                                                               158                223
  Federal Home Loan Bank service charges                                          165                101
  Other                                                                           831                518
                                                                                  ---                ---

     Total non-interest expense                                                 3,712              3,104

Income before income taxes                                                      1,309              1,565

Income taxes                                                                      163                387
                                                                                  ---                ---

Net income                                                                    $ 1,146            $ 1,178
                                                                              =======            =======

Earnings per share - basic                                                    $ 0.22               $0.20
                                                                              ======               =====
Earnings per share - diluted                                                  $ 0.22               $0.19
                                                                              ======               =====

</TABLE>

                                        2
<PAGE>


<TABLE>

                     Northeast Pennsylvania Financial Corp.
                 Consolidated Statement of Comprehensive Income
          For the Three Months Ended December 31, 1999 and 1998 (unaudited)
                     (in thousands, except per share data)

                                                                               For the Three Months Ended
                                                                                     December 31,
                                                                                 1999               1998
                                                                                 ----               ----
                                                                                      (unaudited)
<S>                                                                        <C>                  <C>
Net Income                                                                    $ 1,146            $ 1,178
                                                                              =======            =======

Other comprehensive loss, net of tax
    Unrealized losses on securities:
    Unrealized holding losses arising during the period                    $ (2,320)             $ (326)
    Less:  Reclassification adjustment for gains included in net
      income                                                                     (9)                  22
                                                                                 ---                  --
Other comprehensive loss                                                   $ (2,311)             $ (304)
Comprehensive income (loss)                                                $ (1,165)               $ 874
                                                                           =========               =====




</TABLE>


                                        3

<PAGE>


<TABLE>

                     Northeast Pennsylvania Financial Corp.
                  Consolidated Statements of Changes in Equity
            For the Three Years Ended September 30, 1999,1998 and 1997
              and the Three Months Ended December 31, 1999 (unaudited)
                                (in thousands)


                                                                   Common Stock                 Accumulated
                                                       Additional   Acquired by                    Other
                                             Common     Paid In    stock benefit   Retained    Comprehensive     Treasury     Total
                                             Stock      Capital       plans        Earnings     income(loss)      Stock       Equity
                                             -----      -------       -----        --------     ------------      -----       ------
<S>                                          <C>        <C>         <C>            <C>         <C>               <C>          <C>


Balance September 30, 1996                   $    -     $     -      $      -      $ 25,874       $     253      $     -    $ 26,127

Net changes in gains (losses) on
  securities available for sale, net of tax                                                           1,030                    1,030
Net Income                                                                            1,381                                    1,381
                                             ------     -------      --------      --------       ---------      -------    --------
Balance September 30, 1997                   $    -     $     -      $      -      $ 27,255       $   1,283      $     -    $ 28,538

Issuance of Common Stock ($.01 par value;
     16,000,000 authorized shares;
     6,427,350 shares issued)                    64                                                                               64
Additional paid-in Capital                               61,959                                                               61,959
Unearned Employee Stock Ownership
     Plan (ESOP) shares                                               (5,142)                                                (5,142)
ESOP shares committed to be released                        124           343                                                    467
Net changes in gains (losses) on
     securities available for sale, net of tax                                                        1,595                    1,595
Net loss                                                                               (47)                                     (47)
                                             ------     -------      --------      --------       ---------      -------    --------
Balance September 30, 1998                   $   64     $62,083      $ (4,799)     $ 27,208       $   2,878      $     -    $ 87,434

Unearned stock awards                                                  (3,312)                                               (3,312)
ESOP shares committed to be released                         77            557                                                   634
Stock awards                                               (41)            488                                                   447
Net changes in gains (losses) on
securities available for sale, net of tax                                                           (5,752)                  (5,752)
Treasury stock at cost, (626,667 shares)                                                                          (7,585)    (7,585)
Cash dividend paid                                                                    (955)                                    (955)
Net income                                                                            4,565                                    4,565
                                             ------     -------      --------      --------       ---------      --------   --------
Balance September 30, 1999                   $   64     $62,119      $(7,066)      $ 30,818       $ (2,874)      $(7,585)   $ 75,476

ESOP shares committed to be released                         85           128                                                    213
Stock awards                                               (13)           158                                                    145
Net changes in gains (losses) on
securities available-for-sale, net of tax                                                           (2,311)                  (2,311)
Treasury stock at cost, (142,900 shares)                                                                          (1,428)    (1,428)
Cash dividend paid                                                                    (348)                                    (348)
Net income                                                                            1,146                                    1,146
                                             ------     -------      --------      --------       ---------      --------   --------
Balance, December 31, 1999                   $   64     $62,191      $(6,780)      $ 31,616       $ (5,185)      $(9,013)   $ 72,893
                                             ======     =======      ========      ========       =========      ========   ========

</TABLE>







                                       4



<PAGE>



                     Northeast Pennsylvania Financial Corp.
                     Consolidated Statement of Cash Flows
         For the Three Months Ended December 31, 1999 and 1998 (unaudited)
                                (in thousands)
<TABLE>
<S>                                                                                       <C>            <C>
                                                                                          For the Three Months Ended
                                                                                                 December 31,
                                                                                             1999           1998
                                                                                             ----           ----
Operating Activities:                                                                            (unaudited)
Net Income                                                                                $ 1,146          $ 1,178
Adjustments to reconcile net income to net cash provided by operating activities:
  Provision for REO loss                                                                       10                3
  Provision for loan losses                                                                   205               47
  Depreciation                                                                                275              198
  Deferred income tax provision                                                               584              142
  ESOP expense                                                                                213                -
  Stock award expense                                                                         145              203
  Amortization and accretion on:
     Held-to-maturity securities                                                                -               17
     Available-for-sale securities                                                             19               90
  Amortization of deferred loan fees                                                         (65)            (116)
(Gain) loss on sale of:
     Assets acquired through foreclosure                                                       40               16
     Loans                                                                                    (9)             (19)
     Available-for-sale securities                                                             14             (34)
  Changes in assets and liabilities:
    (Increase) decrease in accrued interest receivable                                      (450)              283
    Increase in other assets                                                                (234)            (110)
    Increase (decrease) in accrued interest payable                                            82            (202)
    Decrease in accrued income taxes payable                                                (519)            (215)
    Increase in other liabilities                                                             442              558
                                                                                              ---              ---

      Net cash provided by operating activities                                            $1,898           $2,039

Investing Activities:
Net increase in loans                                                                   $(19,732)         $(5,053)
Proceeds from sale of:
  Available-for-sale securities                                                             1,048            1,305
  Assets acquired through foreclosure                                                          22              102
  Loans                                                                                       653            3,525
Proceeds from repayments of held-to-maturity securities                                         2           15,953
Proceeds from repayments of available-for-sale securities                                   2,061           28,612
Purchase of:
  Held-to-maturity securities                                                                   -          (9,564)
  Available-for-sale securities                                                           (9,557)         (29,836)
  Office properties and equipment                                                            (68)            (332)
  Federal Home Loan Bank stock                                                            (1,450)            (275)
                                                                                          -------            -----

Net cash provided by (used in) investing activities                                     $(27,021)           $4,437

Financing Activities:
  Net decrease in deposit accounts                                                         $(825)         $(2,827)
  Net increase (decrease) in Federal Home Loan Bank short-term advances                  (13,000)            5,500
  Borrowings of Federal Home Loan Bank long-term advances                                  40,000                -
  Repayments of Federal Home Loan Bank long-term advances                                     (5)              (4)
  Net increase (decrease) in advances from borrowers for taxes and insurance                (165)              520

</TABLE>





                                        5


<PAGE>



                     Northeast Pennsylvania Financial Corp.
                      Consolidated Statement of Cash Flows
       For the Three Months Ended December 31, 1999 and 1998 (unaudited)
                                (in thousands)
<TABLE>

                                                                                           For the Three Months
                                                                                            Ended December 31,

                                                                                             1999        1998
                                                                                             ----        ----
                                                                                               (unaudited)
<S>                                                                                       <C>            <C>
     Net decrease in other borrowings                                                           -           (307)
     Purchase of common stock for stock incentive plan                                          -         (3,312)
     Purchase of treasury stock                                                           (1,428)               -
     Cash dividend on common stock                                                          (348)               -
                                                                                            -----               -

     Net cash provided by (used in) financing activities                                  $24,229          $(430)

Increase (decrease) in cash and cash equivalents                                            (894)           6,046

Cash and cash equivalents, beginning of year                                                4,177           3,053
                                                                                            -----           -----

Cash and cash equivalents, end of year                                                     $3,283          $9,099
                                                                                           ======          ======

Supplemental  disclosures of cash flow information:
 Cash paid during the period for:
     Interest                                                                              $5,922          $4,838
                                                                                           ======          ======
     Income taxes                                                                             $97            $476
                                                                                              ===            ====
Supplemental disclosure - non-cash and financing information:
  Transfer from loans to real estate owned                                                   $191             $58
                                                                                             ====             ===
  Net change in unrealized losses on securities
   available-for-sale, net of tax                                                        $(2,311)          $(304)
                                                                                         ========          ======

</TABLE>






                                        6




<PAGE>



Northeast Pennsylvania Financial Corp.
Notes to Consolidated Financial Statements (unaudited)

1.       Summary of Significant Accounting Policies

         Basis of Financial Statements Presentation

         The  accompanying  consolidated  financial  statements were prepared in
         accordance  with  instructions  to Form  10-Q,  and  therefore,  do not
         include information or footnotes necessary for a complete  presentation
         of  financial  position,  results  of  operations  and  cash  flows  in
         conformity with generally accepted accounting principles.  However, all
         normal recurring  adjustments which, in the opinion of management,  are
         necessary for a fair  presentation  of the financial  statements,  have
         been included. These financial statements should be read in conjunction
         with the audited financial statements and the notes thereto included in
         the Company's  Annual  Report for the period ended  September 30, 1999.
         The  results  for the three  months  ended  December  31,  1999 are not
         necessarily indicative of the results that may be expected for the year
         ended September 30, 2000.

         Business

         Northeast  Pennsylvania  Financial Corp. (the "Company") is the holding
         company for First Federal Bank.  The  Company's  principal  subsidiary,
         First  Federal  Bank,  serves  Northeastern  and  Central  Pennsylvania
         through  thirteen full service office  locations and a loan  production
         office.  The  Bank  provides  a  wide  range  of  banking  services  to
         individual  and  corporate  customers.  The  Company  and the  Bank are
         subject to  competition  from other  financial  institutions  and other
         companies that provide financial services. The Company and the Bank are
         subject to the  regulations  of certain  federal  agencies  and undergo
         periodic examinations by those regulatory authorities.

         Principles of Consolidation and Presentation

         The  accompanying  financial  statements  of  the  Company  include the
         accounts  of  First  Federal  Bank ,  Abstractors ,  Inc. ,   Northeast
         Pennsylvania Trust Co. and FIDACO, Inc..  First Federal Bank, Northeast
         Pennsylvania Trust Co.,  and  Abstractors,  Inc. ,  are  wholly - owned
         subsidiaries of Northeast Pennsylvania Financial Corp.Abstractors, Inc.
         is a title insurance agency.  Northeast  Pennsylvania  Trust Co. offers
         trust, estate and asset management services and products.  All material
         inter - company  balances  and  transactions  have  been  eliminated in
         consolidation.   Prior period amounts are reclassified, when necessary,
         to  conform  with  the current year's presentation.  FIDACO, Inc. is an
         inactive  subsidiary  of First Federal Bank and its only major asset is
         an investment in Hazleton Community Development Corporation.

         Earnings per Share

         Earnings  per share  (EPS),  basic and  diluted,  were $0.22 and $0.22,
         respectively,  for the three months ended December 31, 1999 compared to
         $0.20 and $0.19, respectively,  for the three months ended December 31,
         1998.


                                            7

<PAGE>



         The following table presents the  reconciliation  of the numerators and
         denominators of the basic and diluted EPS computations.

<TABLE>

                                                                      Three months ended
                                                                          December 31,
                                                                      1999           1998
                                                                      ----           ----
                                                                          (unaudited)
                                                           (Dollars in thousands, except per share data)
 <S>                                                             <C>            <C>
      Basic:

       Net Income                                                   $1,146           $1,178
                                                                    ======           ======

       Weighted average shares issued                            5,656,068(1)     5,826,532(1)
       Less:  Weighted Treasury shares                           (652,972)                -
       Plus:  ESOP shares released
          or committed to be released                               96,411           42,849
                                                                    ------           ------
                                                                 5,099,507        5,869,381

       Earnings per share  - basic                                   $0.22            $0.20
                                                                     =====            =====


                                                                      Three months ended
                                                                          December 31,
                                                                      1999             1998
                                                                      ----             ----
                                                                          (unaudited)
                                                        (Dollars in thousands, except per share data)

        Diluted:

        Net Income                                                   $1,146          $1,178
                                                                     ======          ======

        Basic weighted shares outstanding                         5,099,507       5,869,381
        Dilutive Instruments:
          Dilutive effect of outstanding stock options                    -           2,573
          Dilutive effect of stock awards                           193,466         174,821
                                                                    -------         -------
                                                                  5,292,973       6,046,775

        Earnings per share - diluted                                  $0.22           $0.19
                                                                      =====           =====

<FN>

         (1)Weighted  average shares is net of ESOP shares and average  weighted
         shares  purchased  for stock  awards of 514,188 and 257,094 at December
         31, 1999 and 514,188 and 86,630 at December 31, 1998, respectively
</FN>
</TABLE>


2.       Recent Accounting Pronouncements

         In June 1998, the FASB issued SFAS No. 133,  "Accounting for Derivative
         Instruments and Hedging  Activities," which was subsequently amended in
         July 1999 by SFAS No. 137,  "Accounting for Derivative  Instruments and
         Hedging Activities-Deferral of the Effective Date of FASB Statement No.
         133." This Statement establishes accounting and reporting standards for
         derivative   instruments,   including  certain  derivative  instruments
         embedded in other contracts,  (collectively referred to as derivatives)
         and for hedging  activities.  It requires that an entity  recognize all
         derivatives  as  either  assets  or  liabilities  in the  statement  of
         financial  position and measure those  instruments  at fair value.  The
         accounting for changes in the fair value of a derivative depends on the
         intended  use of the  derivative  and  the  resulting  designation.  If
         certain conditions are met, a derivative may be specifically designated
         as (a) a hedge  of the  exposure  to  changes  in the  fair  value of a
         recognized asset or liability or an unrecognized firm commitment, (b) a
         hedge  of  the  exposure  to  variable   cash  flows  of  a  forecasted
         transaction, or (c) a hedge of certain foreign currency exposures. This





                                          8



<PAGE>



         Statement "as amended"  becomes  effective  for fiscal years  beginning
         after  December 15, 1999.  Earlier  adoption is permitted.  The Company
         adopted  SFAS 133,  prior to the  issuance  of SFAS 137,  in its fourth
         fiscal  quarter of 1998,  including  its  provision  for the  potential
         reclassification of investments,  resulting in a $56.2 million transfer
         of  securities  from  held to  maturity  to  available  for sale and an
         increase of $597,000 of unrealized  gains,  net of taxes, on securities
         available  for sale.  The  adoption  of this  Statement  did not affect
         operating results of the Company.

         3.       Conversion to Stock Form of Ownership

         The Company is a business  corporation  formed at the  direction of the
         Bank under the laws of  Delaware  on December  16,  1997.  On March 31,
         1998,  the Company issued 6,427,350 shares,  par value $.01  per share
         (the "Common Stock"),  including 514,188  shares to the Bank's Employee
         Stock Ownership Plan and related trust  ("ESOP")  and a contribution of
         476,100  shares  of  Common  Stock  to  The  First  Federal  Charitable
         Foundation (the "Foundation").  The Conversion resulted in net proceeds
         of  $52.1 million, after expenses of $2.2 million.

         The  Bank  established  a  liquidation  account  at  the  time  of  the
         Conversion  in an amount equal to the equity of the Bank as of the date
         of its latest balance sheet date,  September 30, 1997, contained in the
         final  Prospectus  used  in  connection  with  the  Conversion.  In the
         unlikely event of a complete liquidation of the Bank, (and only in such
         an event), eligible depositors who continue to maintain accounts at the
         Bank shall be entitled to receive a distribution  from the  liquidation
         account.  The amount of the liquidation account decreases to the extent
         the balances of eligible  deposits  decrease.  The liquidation  account
         approximated $10.7 million at September 30, 1999.

         The  Company may not  declare  nor pay  dividends  on its stock if such
         declaration   and  payment  would   violate   statutory  or  regulatory
         requirements.

         In addition to the 16,000,000  authorized  shares of Common Stock,  the
         Company authorized 2,000,000 shares of preferred stock with a par value
         of $0.01 per share (the "Preferred  Stock").  The Board of Directors is
         authorized,  subject to any  limitations  by law,  to  provide  for the
         issuance of the shares of Preferred Stock in series,  to establish from
         time to time the number of shares to be included  in each such  series,
         and to fix the  designation,  powers,  preferences  and  rights  of the
         shares of each  such  series  and any  qualifications,  limitations  or
         restriction  thereof.  As of December 31, 1999, there were no shares of
         Preferred Stock issued.





                                             9

<PAGE>


<TABLE>

4.      Loans

        Loans are summarized as follows:                            December 31,          September 30,
                                                                        1999                  1999
                                                                        ----                  ----
                                                                    (unaudited)
                                                                           (Dollars in thousands)
<S>                                                                 <C>                     <C>
        Real Estate loans:
          One-to four-family                                          $209,791               $196,885
          Multiple family and commercial                                32,691                 31,497
          Construction                                                   3,632                  3,983
                                                                         -----                  -----
        Total real estate loans                                        246,114                232,365
                                                                       -------                -------

        Consumer Loans:
          Home equity loans and lines of credit                         70,981                 70,118
          Automobile                                                    37,623                 34,619
          Education                                                      3,008                  2,796
          Unsecured lines of credit                                      1,816                  1,744
          Other                                                          5,583                  5,571
                                                                         -----                  -----
        Total consumer loans                                           119,011                114,848
                                                                       -------                -------
        Commercial loans                                                22,340                 21,262
                                                                        ------                 ------
        Total loans                                                    387,465                368,475
                                                                       -------                -------
          Less:
             Allowance for loan losses                                 (3,092)               (2,924)
             Deferred loan origination fees                            (1,426)               (1,361)
                                                                       -------               -------
        Total loans, net                                              $382,947               $364,190
                                                                      ========               ========
</TABLE>
<TABLE>

         Allowance for loan losses is summarized as follows (in thousands):
<S>                                             <C>                            <C>                        <C>
                                                 For the three                                            For the three
                                                 months ended              For the year ended             months ended
                                               December 31, 1999           September 30, 1999           December 31, 1998
                                               -----------------           ------------------           -----------------
                                                  (unaudited)                                              (unaudited)
         Balance, beginning of period                $2,924                      $2,273                       $2,273
         Charge-offs                                   (38)                       (101)                         (35)
         Recoveries                                       1                           5                            1
         Provision for loan losses                      205                         747                           47
                                                        ---                         ---                           --
         Balance, end of period                      $3,092                      $2,924                       $2,286
                                                     ======                      ======                       ======

</TABLE>

<TABLE>

5.       Deposits

         Deposits consist of the following major classifications (in thousands):

                                                                      December 31, 1999           September 30, 1999
                                                                      -----------------           ------------------
                                                                         (unaudited)
                                                                                 Percent                     Percent
                                                                      Amount     of Total          Amount    of Total
                                                                ------------- ------------- -------------- ------------
                                                                ------------- ------------- -------------- ------------
<S>                                                             <C>               <C>            <C>          <C>
        Savings accounts (passbook, statement, clubs)                $67,938       18.11%         $69,667      18.53%
        Money market accounts                                         21,240        5.66%          21,132       5.62%
        Certificates of deposit less than $100,000                   183,198       48.83%         185,790      49.41%
        Certificates of deposit greater than $100,000(1)              51,021       13.60%          51,200      13.62%
        NOW Accounts                                                  37,235        9.93%          35,339       9.40%
        Non-interest bearing deposits                                 14,526        3.87%          12,855       3.42%
                                                                      ------        -----          ------       -----
        Total deposits at end of period                             $375,158      100.00%        $375,983     100.00%
                                                                    ========      =======        ========     =======

<FN>
         (1) Deposit balances in excess of $100,000 are not federally insured.
</FN>
</TABLE>

                                             10


<PAGE>




Item 2     MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
           OF OPERATIONS

In  addition  to  historical   information,   this  10-Q  may  include   certain
forward-looking  statements  based  on  current  management  expectations.   The
Company's   actual  results  could  differ   materially  from  those  management
expectations.  Factors  that could  cause  future  results to vary from  current
management  expectations  include,  but are not  limited  to,  general  economic
conditions,  legislative and regulatory changes, monetary and fiscal policies of
the  federal  government,  changes in tax  policies,  rates and  regulations  of
federal,  state and local tax  authorities,  changes in interest rates,  deposit
flows,  the cost of  funds,  demand  for loan  products,  demand  for  financial
services, competition,  changes in the quality or composition of the Bank's loan
and  investment  portfolios,  changes  in  accounting  principles,  policies  or
guidelines,  and other economic,  competitive,  governmental  and  technological
factors  affecting the Company's  operations,  markets,  products,  services and
prices.  Further  description of the risks and uncertainties to the business are
included in detail in Section B, Management Strategy; and  Section D,  Liquidity
and Capital Resources.

A.       General

The  Company is the holding  company  for First  Federal  Bank (the  "Bank"),  a
federally chartered capital stock savings bank regulated by the Office of Thrift
Supervision  ("OTS").  The Company does not transact any material business other
than through the Bank. The Bank's results of operations are dependent  primarily
on net interest income, which is the difference between the income earned on its
loan and investment portfolios and its cost of funds, consisting of the interest
paid on deposits and borrowings.  Results of operations are also affected by the
Bank's provision for loan losses,  loan and security sales,  service charges and
other fee income,  and non-interest  expense.  The Bank's  non-interest  expense
principally consists of compensation and employee benefits, office occupancy and
equipment expense,  professional fees, federal deposit insurance premiums,  data
processing,   and  advertising  and  business  promotion  expenses.  Results  of
operations are also  significantly  affected by general economic and competitive
conditions,  particularly  changes in interest  rates,  government  policies and
actions of regulatory authorities.

In June 1999, the Company received approval from the Pennsylvania  Department of
Banking to form a trust company, Northeast Pennsylvania Trust Co. (the "Trust").
The Trust began operations in the first fiscal quarter of 2000 and has been well
received  by the  markets  served by the  Bank.  The Trust  will  serve  current
customers and potentially other financial institutions'  customers,  with trust,
estate and asset management services and products.

B.       Management Strategy

The Bank's operating strategy is that of a community-based bank, offering a wide
variety of savings  products to its retail  customers,  while  concentrating  on
residential and consumer lending and, to a lesser extent,  construction  lending
and  small  business  and  municipal  commercial  lending.  In order to  promote
long-term  financial strength and  profitability,  the Bank's operating strategy
has focused on: (i)  maintaining  strong  asset  quality by  originating  one-to
four-family  loans  in  its  market  area;  (ii)  increasing   profitability  by
emphasizing  higher-yielding  consumer and commercial loans;  (iii) managing its
interest rate risk by emphasizing  consumer and commercial loans, in addition to
shorter-term,  fixed-rate,  one-to four-family loans;  limiting its retention of


                                        11

<PAGE>

newly-originated  longer-term  fixed-rate one-to four-family  loans;  soliciting
longer-term deposits;  utilizing longer-term advances from the Federal Home Loan
Bank of Pittsburgh  ("FHLB");  and investing in investment and  mortgage-related
securities having shorter estimated durations; (iv) meeting the banking needs of
its customers  through expanded products and improved delivery systems by taking
advantage of  technological  advances;  and (v) maintaining a strong  regulatory
capital position.

During the quarter the Bank  continued to diversify and expand its loan products
to better  serve its  customer  base by placing a greater  emphasis  on consumer
lending   and   commercial   lending,   primarily   to  small   businesses   and
municipalities.

C.       Non-Performing Assets


<TABLE>

The following  table presents  information  regarding the Bank's  non-performing
assets at the dates indicated (dollars in thousands):
                                                                          December 31,             September 30,
                                                                             1999                       1999
                                                                             ----                       ----
                                                                          (unaudited)
<S>                                                                        <C>                        <C>
Non-performing assets:
 Non-accrual loans                                                            $1,902                    $1,371
Real estate owned and other repossessed assets                                   217                        98
                                                                                 ---                        --
     Total non-performing assets                                              $2,119                    $1,469
                                                                              ======                    ======

         Total non-performing loans as a percentage of total loans             0.50%                     0.38%
         Total non-performing assets as a percentage of total assets           0.33%                     0.24%

</TABLE>

The increase in non-performing  loans is due to a participation  loan secured by
commercial  real  estate,   which  has  been  on  the  books  of  the  Bank  for
approximately  seven years.  The borrower is  experiencing  cash flow difficulty
arising from other facilities which they own.  Management of the Bank is working
closely  with the  borrower in order to  satisfactorily  resolve the  situation.
Currently, management does not expect the loan to result in a loss to the Bank.

D.       Liquidity and Capital Resources

The Bank's  primary  sources of funds on a long-term  and  short-term  basis are
deposits,   principal  and  interest  payments  on  loans,  mortgage-backed  and
investment  securities,  and FHLB advances. The Bank uses the funds generated to
support its lending and  investment  activities as well as any other demands for
liquidity such as deposit outflows.  While maturities and scheduled amortization
of loans are predictable sources of funds,  deposit flows,  mortgage prepayments
and the exercise of call  features are greatly  influenced  by general  interest
rates,  economic conditions and competition.  The Bank has continued to maintain
the  required  levels  of liquid  assets as  defined  by OTS  regulations.  This
requirement  of the  OTS,  which  may be  varied  at the  direction  of the  OTS
depending upon economic conditions and deposit flows, is based upon a percentage
of deposits and short-term  borrowings.  The Bank's current  required  liquidity
ratio is 4.0%. At December 31, 1999 and 1998, the Bank's  liquidity  ratios were
5.1% and 9.0%, respectively.

At  December  31,  1999,  the  Bank  exceeded  all  of  its  regulatory  capital
requirements  with a tangible  capital level of $57.7 million,  or 9.3% of total
adjusted assets,  which is above the required level of $9.3 million,  or 1.5%; a
core capital level of $57.7 million, or 9.3% of total adjusted assets,  which is
above the required level of $18.6 million,  or 3.0%; and a risk-based capital of


                                        12


<PAGE>

$61.8 million,  or 18.9% of  risk-weighted  assets,  which is above the required
level of $26.2 million, or 8.0%.

The Bank's most liquid assets are cash and cash  equivalents  and its investment
and mortgage-related securities  available-for-sale.  The levels of these assets
are  dependent  on  the  Bank's  operating,  financing,  lending  and  investing
activities  during  any  given  period.  At  December  31,  1999,  cash and cash
equivalents and investment and  mortgage-related  securities  available-for-sale
totaled $197.2 million, or 31.0% of total assets.

The Bank has other sources of liquidity if a need for  additional  funds arises,
including  FHLB  advances.  At December 31, 1999, the Bank had $183.0 million in
advances  outstanding from the FHLB, and had an overall borrowing  capacity from
the FHLB of $271.5  million.  Depending  on market  conditions,  the  pricing of
deposit  products  and FHLB  advances,  the Bank  may  continue  to rely on FHLB
borrowings to fund asset growth.

At December 31, 1999,  the Bank had  commitments to originate and purchase loans
and unused outstanding lines of credit and undisbursed  proceeds of construction
mortgages  totaling  $39.8  million.  The  Bank  anticipates  that it will  have
sufficient  funds  available to meet these  commitments.  Certificate  accounts,
including  Individual  Retirement Account ("IRA") and KEOGH accounts,  which are
scheduled to mature in less than one year from December 31, 1999, totaled $180.6
million.  The Bank expects that  substantially  all of the maturing  certificate
accounts,  with the exception of jumbo certificates of deposit, will be retained
by the Bank at maturity.  At December 31,  1999,  the Bank had $38.7  million in
jumbo  certificates,  the  majority  of which are  deposits  from  local  school
districts and municipalities.

At December 31, 1999, the Bank had total equity,  determined in accordance  with
generally accepted  accounting  principles,  of $54.7 million, or 8.8%, of total
assets,  which approximated the Bank's regulatory  tangible capital at that date
of 9.3% of assets.  An  institution  with a ratio of  tangible  capital to total
assets of greater  than or equal to 5% is  considered  to be  "well-capitalized"
pursuant to OTS regulations.

E. Comparison of Financial Condition at December 31, 1999 and September 30, 1999

Total assets  increased  $23.4 million from $612.2 million at September 30, 1999
to $635.7  million at December 31, 1999.  The growth in assets was primarily due
to increases in loans receivable,  investment securities and other assets, which
were funded by increases in FHLB advances.

Securities classified as  available-for-sale  securities increased $4.1 million,
from $189.8  million at  September  30, 1999 to $193.9  million at December  31,
1999.  The  increase  was  primarily  attributable  to the  effect  of  security
purchases, net of unrealized gain/loss on available-for-sale securities.

Loans  increased  $18.8 million to $382.9 million at December 31, 1999. This was
primarily  due to a $12.9  million  increase in one-to  four-family  real estate
loans, as a result of loan purchases from other financial institutions. Consumer
loans, other than home equity loans and lines of credit,  increased $3.2 million
due to increased indirect auto loan originations. Multiple family and commercial
real  estate  loans  increased  $1.2  million  due  to  marketing   efforts  and
competitive pricing of products.  Commercial loans increased $1.1 million due to
competitive pricing of products.


                                        13


<PAGE>

Other assets  increased $1.1 million to $10.1 million at December 31, 1999. This
change was  primarily  due to an $865,000  increase in the  deferred  income tax
benefit resulting from a decline in unrealized  gain/loss an  available-for-sale
securities.

FHLB advances  increased $27.0 million from $156.0 million at September 30, 1999
to $183.0  million  at  December  31,  1999.  This was a result of  management's
utilization of FHLB  borrowings to fund asset growth.  FHLB borrowings have been
invested at yields higher than the cost of the borrowed funds thereby increasing
net interest income.

Total equity  decreased $2.6 million to $72.9 million at December 31, 1999. This
decrease in equity resulted primarily from a $2.3 million increase in unrealized
losses  on  securities   reflected  in  accumulated  other  comprehensive  loss.
Contributing to this decline was the repurchase of 142,900 shares by the Company
during the quarter at a cost of $1.4 million.  These  decreases  were  partially
offset by retention of earnings for the period.

F.  Comparison of Operating Results for the Three Months ended December 31, 1999
    and December 31, 1998

General.  The Company had net income of $1.1  million for the three months ended
December 31,  1999,  compared to net income of $1.2 million for the three months
ended  December  31,  1998, a decrease of $32,000,  or 2.7%.  This  decrease was
primarily  attributable to a $1.4 million rise in interest expense, as well as a
$608,000  increase in  non-interest  expense,  offset by  increases  in interest
income and non-interest income of $1.8 million and $117,000, respectively.

Interest Income.  Total interest income increased $1.8 million,  or 19.6%,  from
$9.0 million for the three months ended  December 31, 1998 to $10.7  million for
the three months ended  December 31,  1999.  This was  primarily  due to a $94.0
million,  or 18.6%,  increase in the average balance of interest earning assets.
Specifically,  interest income on loans increased $1.5 million from $5.7 million
for the period  ending  December  31,  1998 to $7.3  million.  This was due to a
$710,000  increase  in  interest  income on real  estate  loans,  due to a $46.6
million  increase  in the average  balance of these  loans.  Interest  income on
consumer loans increased $651,000 due to a $32.4 million increase on the average
balance of these loans.  Interest income on commercial loans increased  $186,000
due to an $11.3 million increase in the average balance of these loans. Interest
income on investment securities increased $504,000 to $2.5 million for the three
months ended December 31, 1999 primarily due to a $27.0 million  increase in the
average balance of such securities.

Interest Expense.  Interest expense increased $1.4 million,  or 29.5%, from $4.6
million  to $6.0  million  for the three  months  ended  December  31,  1998 and
December 31, 1999,  respectively.  The  contributing  factor for the increase in
interest  expense was a $920,000  increase in borrowings which was primarily the
result of a $63.9 million  increase in the average  balance of FHLB advances and
other  borrowings,  which  increased from $100.0 million at December 31, 1998 to
$163.8  million at December 31, 1999,  as well as an 18 basis point  increase in
the average rate. The increase in FHLB advances reflects  management's  decision
to utilize FHLB advances to fund asset growth. Contributing to this change was a
$397,000 increase in interest expense on certificates of deposit,  which was the
result of a $38.4 million increase in the average balance of these accounts.


                                        14


<PAGE>

Provision  for Loan Losses.  The Bank's  provision for loan losses for the three
months ended  December  31, 1999 was $205,000  compared to $47,000 for the three
months ended  December 31, 1998.  The increase in the  provision was a result of
the $18.8 million  increase in outstanding  loan balances from September 1999 to
December 1999. From September 1998 to December 1998 outstanding  loans increased
by $1.6 million.  The provision for loan losses increases the allowance for loan
losses.  The  allowance  is  maintained  at a level  that  management  considers
adequate to provide for  estimated  losses based upon an evaluation of known and
inherent risks in the loan portfolio.  Loan losses, other than those incurred on
loans held for sale, are charged  directly  against the allowance and recoveries
on  previously  charged-off  loans  are  added  to the  allowance.  Management's
evaluation is based upon, among other things,  delinquency trends, the volume of
non-performing  loans, prior loss experience of the portfolio,  current economic
conditions, and other relevant factors. Although management believes it has used
the best information available to it in making such determinations, and that the
allowance for loan losses is adequate,  future  adjustments to the allowance may
be necessary,  and net income may be adversely affected if circumstances  differ
substantially  from  the  assumptions  used  in  determining  the  level  of the
allowance.  In addition,  various  regulatory  agencies,  as an integral part of
their examination  process,  periodically review the Bank's allowance for losses
on loans.  Such  agencies  may require the Bank to  recognize  additions  to the
allowance based on their judgements about  information  available to them at the
time of their examination.

Non-interest  Income.  Non-interest  income increased  $117,000 from $384,000 to
$501,000,  for the three  months  ended  December  31,  1999.  The  increase  in
non-interest  income was primarily due to a $98,000  increase in service charges
and  other  fees  from  December  1998  to  December  1999.   This  increase  is
attributable  to a larger  customer  base at  December  1999  due to  additional
branches from December 1998. Other income increased  $88,000 due to increases in
rental income. Contributing to these increases was a $98,000 increase in service
charges and other fees resulting from increased customer activity on the various
deposit and loan  accounts.  These  increases  were offset by a $14,000  loss on
available-for-sale  securities  for the three months ended December 31, 1999, as
compared  to a gain of $34,000 at  December  31,  1998.  The loss on real estate
owned increased  $24,000 from a loss of $16,000 to a loss of $40,000 at December
31, 1999.

Non-interest Expense. Total non-interest expense increased from $3.1 million for
the three  months  ended  December 31, 1998 to $3.7 million for the three months
ended  December 31,  1999.  This  increase  was due  primarily to an increase in
compensation  and  employee  benefits  of  $249,000,   for  additional  staffing
resulting  from the  opening  of  three  branches  since  December  1998.  Other
non-interest expense increased $313,000, or 60.4%, primarily due to amortization
of  goodwill  associated  with  branch and  subsidiary  acquisitions,  increased
marketing efforts of deposit and loan products and a general increase in various
operating expenses such as supplies and postage.  FHLB service charges increased
$64,000 mainly due to increased charges for higher ATM volume. Occupancy expense
increased $50,000 due to branch expansion.

Income Taxes.  The Company had an income tax provision of $163,000 for the three
months  ended  December  31,  1999,  compared to a provision of $387,000 for the
three months ended  December 31, 1998 resulting in effective tax rates of 12.5%,
and 24.7%,  respectively.  The change in income tax expense was  attributable to
increased tax-free security purchases.

                                        15

<PAGE>


Item 3.           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

                  As of December 31, 1999,  there have been no material  changes
                  in the quantative  and  qualitative  disclosures  about market
                  risks  presented in the  Company's  Annual Report on Form 10-K
                  for the fiscal year ended September 30, 1999.























                                        16

<PAGE>

Part II - OTHER INFORMATION

Item 1.           Legal Proceedings

                  The Company is not involved in any pending  legal  proceedings
                  other than routine legal proceedings occurring in the ordinary
                  course of business.  Such routine  legal  proceedings,  in the
                  aggregate,  are believed by management to be immaterial to the
                  Company's financial condition or results of operation.

Item 2.           Changes in Securities and Use of Proceeds

                  Not applicable.

Item 3.           Defaults Upon Senior  Securities

                  Not applicable.

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

                  None.

Item 5.           Other information

                  Not applicable.

Item 6.           Exhibits and Reports on Form 8-K

          (A) Exhibits

              3.1      Certificate of Incorporation of Northeast Pennsylvania
                       Financial Corp.*

              3.2      Bylaws of Northeast Pennsylvania Financial Corp.*

              4.0      Form of Stock Certificate of Northeast Pennsylvania
                       Financial Corp.*

              11.0     Statement regarding Computation of Per Share Earnings
                       (See Notes to Consolidated Financial Statements)

              27.0     Financial Data Schedule (submitted only with filing in
                       electronic format)

         *    Incorporated  herein  by  reference  into this  document  from the
              Exhibits to Form S-1, Registration  Statement,  and any amendments
              thereto, Registration No. 333-43281.

         (B) Reports on Form 8-K

         On October 18,  1999,  the Company  filed an 8-K to announce  the date,
         time and place of its 2000 Annual  Meeting of  Shareholders.  The press
         release  announcing  the date,  time and place of the Company's  Annual
         Meeting was filed by Exhibit.



                                        17

<PAGE>

         On  November  19,  1999,  the  Company  filed an 8-K to announce it had
         received  regulatory  clearance  to  repurchase  5% of its  outstanding
         shares.   The  press  release  announcing  the  receipt  of  regulatory
         clearance was filed by Exhibit.




                                        18

<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.




                                         NORTHEAST PENNSYLVANIA
                                         FINANCIAL CORP.


Date:    February 10, 2000               By: /s/ E. Lee Beard
                                         E. Lee Beard
                                         President and Chief Executive Officer

Date:    February 10, 2000               By: /s/ Patrick J. Owens, Jr.
                                         Patrick J. Owens, Jr.
                                         Treasurer


<PAGE>





                                  Exhibit Index

27.0 Financial Data Schedule (submitted only with filing in electronic format)