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


                                    FORM 10-Q

(Mark One)


/X/  QUARTERLY  REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934

     For the quarterly period ended March 31, 2004

         OR

/ /  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

     For the transition period from ______ to ______

                         Commission File Number: 0-24589

                               BCSB BANKCORP, INC.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)


          United States                                    52-2108333
-----------------------------------------             ---------------------
(State or Other Jurisdiction of                           (I.R.S. Employer
 Incorporation or Organization)                         Identification No.)

            4111 E. Joppa Road, Suite 300, Baltimore, Maryland 21236
            -------------------------------------------------------
                    (Address of Principal Executive Offices)

                                 (410) 256-5000
                ------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

                                       N/A
               ----------------------------------------------------
              (Former Name, Former Address and Former Fiscal Year,
                         if Changed Since Last Report)

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

Indicate by check mark |X| whether the  registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act).

Yes      No   X
    ----    -----

     As of April 30,  2004,  the issuer  had  5,899,093  shares of Common  Stock
issued and outstanding.

<PAGE>
                                    CONTENTS
<TABLE>
<CAPTION>

                                                                                                               PAGE
                                                                                                               ----

PART I.  FINANCIAL INFORMATION
         ---------------------
              <S>                                                                                                <C>
Item 1.  Financial Statements

         Consolidated Statements of Financial Condition as of
                  March 31, 2004 (unaudited) and September 30, 2003...............................................2

         Consolidated Statements of Operations for the Six Months and Three Months Ended
                  March 31, 2004 and 2003  (unaudited)............................................................3

         Consolidated Statements of Comprehensive Income for the Six Months and Three Months Ended
                  March 31, 2004 and 2003 (unaudited)............................................................ 4

         Consolidated Statements of Cash Flows for the Six Months Ended
                  March 31, 2004 and 2003 (unaudited)............................................................ 5

     Notes to Consolidated Financial Statements...................................................................8

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations...................11

Item 3.  Quantitative and Qualitative Disclosures About Market Risk..............................................24

Item 4.  Controls and Procedures.................................................................................25


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

Item 1.  Legal Proceedings.......................................................................................26

Item 2.  Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities........................26

Item 3.  Defaults Upon Senior Securities.........................................................................26

Item 4.  Submission of Matters to a Vote of Security Holders.....................................................26

Item 5.  Other Information.......................................................................................26

Item 6.  Exhibits and Reports on Form 8-K........................................................................26


SIGNATURES.......................................................................................................28

CERTIFICATIONS...................................................................................................29

</TABLE>



                                       1
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                 ----------------------------------------------

<TABLE>
<CAPTION>
                                                                             MARCH 31,         SEPTEMBER 30,
                                                                                2004                2003
                                                                           --------------   ----------------
 <S>                                                                            <C>                    <C>
                                                                             (Unaudited)
                                      Assets
                                      ------
Cash                                                                     $   12,114,215      $   11,032,415
Interest bearing deposits in other banks                                      3,757,270          11,288,223
Federal funds sold                                                              192,661             987,636
Investment securities, held to maturity                                       3,497,544           2,500,000
Investment securities, available for sale                                   156,149,724         121,289,555
Loans receivable, net                                                       360,049,166         365,054,645
Loans held for sale                                                                  --             247,600
Mortgage backed securities, held to maturity                                 19,932,116          18,394,439
Mortgage backed securities, available for sale                              142,249,246         116,204,401
Premises and equipment, net                                                   9,055,391           9,226,887
Federal Home Loan Bank of Atlanta stock                                       3,417,000           3,304,900
Accrued interest receivable                                                   2,074,671           2,114,609
Prepaid and deferred income taxes                                             1,185,740           1,752,582
Bank Owned Life Insurance                                                    11,667,530                  --
Goodwill                                                                      2,294,327           2,294,327
Core deposit intangible                                                         394,000             421,000
Other assets                                                                  2,746,762           2,084,630
                                                                         --------------      --------------
Total assets                                                             $  730,777,363      $  668,197,849
                                                                         ==============      ==============
                Liabilities and Stockholders' Equity
                ------------------------------------
Liabilities
-----------
  Deposits                                                               $  577,598,667      $  551,928,619
  Advances from the Federal Home Loan Bank of Atlanta                        48,717,841          32,267,861
  Trust Preferred Securities                                                         --          22,500,000
  Junior Subordinated Debentures                                             23,197,000                  --
  Advance payments by borrowers for taxes and insurance                       1,759,432             854,694
  Income taxes payable                                                          192,792             193,051
  Payables to disbursing agents                                                 351,194             136,352
  Accounts payable Trade Date Securities                                     30,937,277          13,998,307
  Dividends payable                                                             267,955             266,329
  Other liabilities                                                           1,931,911           1,284,720
                                                                         --------------      --------------
Total liabilities                                                           684,954,069         623,429,933
Commitments and contingencies
Stockholders' Equity
--------------------
  Common stock (Par value $.01 - 13,500,000 authorized,
   5,899,093 and 5,885,593
   shares issued and outstanding
   at March 31, 2004 and September 30, 2003)                                     58,991              58,856
  Additional paid-in capital                                                 20,843,890          20,652,137
  Obligation under Rabbi Trust                                                1,255,110           1,243,469
  Retained earnings (substantially restricted)                               25,426,747          25,556,888
  Accumulated Other Comperhensive Income/(Loss)  (net of taxes)                 119,652            (770,874)
  Employee Stock Ownership Plan                                                (684,596)           (776,060)
  Stock held by Rabbi Trust                                                  (1,196,500)         (1,196,500)
                                                                         ---------------     ---------------
  Total Stockholders' Equity                                                 45,823,294          44,767,916
                                                                         --------------      --------------
Total liabilities and Stockholders' Equity                               $  730,777,363      $  668,197,849
                                                                         ==============      ==============

The accompanying notes to the consolidated  financial statements are an integral
part of these  statements.
</TABLE>

                                       2
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                              Baltimore, Maryland
                              -------------------

                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                -------------------------------------------------
<TABLE>
<CAPTION>

                                                                  FOR SIX MONTHS ENDED              FOR THREE MONTHS ENDED
                                                                        MARCH 31,                          MARCH  31,
                                                              ------------------------------------------------------------
                                                                  2004              2003               2004         2003
                                                                --------          --------            ------       ------
<S>                                                               <C>                <C>               <C>            <C>
Interest Income
---------------
  Interest and fees on loans                                  $11,064,268      $13,916,798      $  5,411,417     $6,909,015
  Interest on mortgage backed securities                        2,470,871        2,065,369         1,270,422      1,009,590
  Interest and dividends on investment securities               1,871,421        1,177,629           928,080        650,348
  Other interest income                                            63,653          176,609            50,086         85,463
                                                             ------------      -----------      -------------    ----------
Total interest income                                          15,470,213       17,336,405         7,660,005      8,654,416

Interest Expense
----------------
  Interest on deposits                                          6,699,360        7,240,322          3,328,188     3,564,559
  Interest on borrowings - short term                              72,753          110,654             28,550        53,679
  Interest on borrowings-long term                                554,434          539,617            293,907       264,844
  Other Interest Expense                                          529,323          340,434            261,635       161,708
                                                             ------------      -----------       ------------    ----------
Total interest expense                                          7,855,870        8,231,027          3,912,280     4,044,790
                                                             ------------      -----------       ------------    ----------

  Net interest income                                           7,614,343        9,105,378          3,747,725     4,609,626
  Provision for losses on loans                                   267,467          412,365             85,694       130,367
                                                             ------------      -----------       ------------    ----------
  Net interest income after provision
   for losses on loans                                           7,346,876        8,693,013          3,662,031     4,479,259

Other Income
------------
  Gain on repossessed assets                                       79,440               --              2,052            --
  Gain on Sale of Loans                                            41,800          271,358             17,798       204,373
  Fees and charges on loans                                       120,521          112,328             65,327        61,583
  Fees on transaction accounts                                    395,887          246,207            184,703       116,917
  Rental income                                                    60,744           60,322             28,940        23,275
  Gain from sale of investments                                     7,800           25,000             20,546            --
  Gain (loss) from sale of Mortgage Backed Securities               7,548          153,610                 --        83,600
  Income from Bank Owned Life Insurance                           242,530               --            120,928
  Miscellaneous income                                             17,373           82,985              7,788        36,308
                                                             ------------      -----------       ------------    ----------
  Net other income                                                973,643          951,810            448,082       526,056
Non-Interest Expenses
---------------------
  Salaries and related expense                                  4,295,874        4,096,378          2,120,265     1,958,787
  Occupancy expense                                               967,330          785,110            480,425       390,127
  Deposit insurance premiums                                      107,936          100,815             54,949        51,197
  Data processing expense                                         756,756          804,489            370,483       392,898
  Property and equipment expense                                  600,248          632,678            299,248       322,170
  Professional fees                                               118,949          137,046             53,846        78,870
  Advertising                                                     480,614          421,383            239,347       193,619
  Telephone, postage and office supplies                          300,454          324,768            154,330       170,118
  Other expenses                                                  228,481          352,254            152,960       189,354
                                                             ------------      -----------       ------------   -----------
Total non-interest expenses                                     7,856,642        7,654,921          3,925,853     3,747,140
                                                             ------------      -----------       ------------   -----------

Income before tax provision                                       463,877        1,989,902            184,260     1,258,175
Income tax provision                                               76,403          758,810             22,695       479,592
                                                             ------------      -----------       ------------   -----------
Net income                                                   $    387,474      $ 1,231,092       $    161,565   $   778,583
                                                             ============      ===========       ============   ===========

Basic earnings per share                                     $        .07      $       .22       $        .03   $       .14
                                                             ============      ===========       ============   ===========
Diluted earnings per share                                   $        .07      $       .21       $        .03   $       .14
                                                             ============      ===========       ============   ===========
Dividends per share                                          $        .25      $       .25       $       .125   $      .125
                                                             ============      ===========       ============   ===========
</TABLE>

The accompanying notes to the consolidated  financial statements are an integral
part of these statements

                                       3


<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                 -----------------------------------------------
                                   (UNAUDITED)
                                   -----------


<TABLE>
<CAPTION>
                                                                                   FOR SIX MONTHS ENDED
                                                                                          MARCH  31,
                                                                               ----------------------------
                                                                                 2004                2003
                                                                                 ----                ----
<S>                                                                               <C>                 <C>
Net Income                                                                    $  387,474          $ 1,231,092
Other comprehensive income, net of tax:
 Unrealized net holding gains (losses) on
  available-for-sale portfolios, net of tax $566,546 and (100,951)               899,950             (161,449)
Reclassification adjustment for (gains) losses
  included in net income, net of tax $ (5,927) and (68,979)                       (9,421)            (109,631)
                                                                              ----------          -----------

Comprehensive income                                                          $1,278,003          $   960,012
                                                                              ==========          ===========
</TABLE>

<TABLE>
<CAPTION>
                                                                                   FOR THREE  MONTHS ENDED
                                                                                          MARCH  30,
                                                                               -------------------------------
                                                                                  2004                2003
                                                                                  ----                ----
<S>                                                                               <C>                  <C>
Net Income                                                                     $  161,565            $ 778,583
Other comprehensive income, net of tax:
 Unrealized net holding gains on
  available-for-sale portfolios, net of tax $960,092 and (224,834)              1,528,704             (346,522)
Reclassification adjustment for gains
  included in net income, net of tax $(7,935) and (32,286)                        (12,611)             (51,314)
                                                                               ----------            ---------

Comprehensive income                                                           $1,677,658            $ 380,747
                                                                               ==========            =========
</TABLE>

The accompanying notes to the consolidated  financial statements are an integral
part of these statements.


                                       9
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                -------------------------------------------------

<TABLE>
<CAPTION>
                                                                                 FOR SIX MONTHS ENDED
                                                                                      MARCH  31,
                                                                           ------------------------------
                                                                             2004                  2003
                                                                           ----------          ----------
<S>                                                                           <C>                  <C>
Operating Activities
--------------------
  Net Income                                                               $   387,474         $ 1,231,092
  Adjustments to Reconcile Net Income to Net
  Cash Used by Operating Activities
  ---------------------------------
    Accretion of discount on investments                                       (31,347)            (19,912)
    Dividends on Investment Securities                                        (549,289)           (440,103)
    Gain on sale of investments                                                 (7,800)            (25,000)
    Loans originated for sale                                               (3,201,800)         (8,682,343)
    Loans sold                                                               3,491,200           8,224,401
    Gain on sale of loans                                                      (41,800)           (271,358)
    Loan fees and costs deferred, net                                           16,423             135,692
    Amortization of deferred loan fees and cost, net                          (132,198)           (318,313)
    Provision for losses on loans                                              267,467             412,365
    Non-cash compensation under Stock-Based Benefit Plan                       170,290             118,401
    Amortization of premium on mortgage backed securities                      197,271             266,160
    Amortization of purchase premiums and discounts, net                       (40,254)           (413,873)
    Gain on sale of mortgaged backed securities                                 (7,548)           (153,610)
    Provision for depreciation                                                 470,083             486,220
    Gain on sale of repossessed assets                                         (79,440)                 --
    Income from bank owned life insurance                                     (242,530)                 --
    Decrease in accrued interest receivable                                     39,938             234,020
    Increase in prepaid income taxes                                             6,223             188,079
    Decrease in other assets                                                    34,868               1,439
    Decrease in accrued interest payable on deposits                           (17,652)            (24,505)
    (Decrease) increase in income taxes payable                                   (259)             85,226
    Increase in accounts payable Trade Date Securities                      16,938,970                  --
    Increase (decrease) in other liabilities and payables to
          disbursing agents                                                    862,033            (861,021)
    Increase in obligation under Rabbi-Trust                                    11,641              19,650
                                                                           -----------         -----------
        Net cash provided by operating activities                           18,541,964             192,707
</TABLE>


                                       5
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                -------------------------------------------------
<TABLE>
<CAPTION>


                                                                                   FOR SIX MONTHS ENDED
                                                                                        MARCH  31,
                                                                                2004               2003
                                                                            -----------        ------------
<S>                                                                             <C>                <C>
Cash Flows from Investing Activities
------------------------------------
    Purchase of Bank Owned Life Insurance                                  $ (11,425,000)      $          --
    Purchases of investment securities - available for sale                  (63,325,461)        (86,604,364)
    Proceeds from maturities of investment securities - available for sale    19,130,000          30,140,019
    Proceeds from sale of investment securities- available for sale           10,460,470           1,025,000
    Purchases of investment securities - held to maturity                     (2,497,875)                 --
    Proceeds from maturities of investment securities - held to maturity       1,500,000           2,500,000
    Longer term loans originated                                             (28,778,668)        (27,819,364)
    Principal collected on longer term loans                                  33,360,168          49,493,963
    Net increase (decrease) in short-term loans                                   74,789          (6,723,516)
    Principal collected on mortgage backed securities - available for sale    10,498,987          12,227,065
    Purchase of mortgage backed securities - available for sale              (37,262,973)        (44,398,220)
    Proceeds from sale of mortgaged backed securities- available for sale      1,447,365          13,962,697
    Purchase of mortgage backed securities- held to maturity                  (4,253,790)                 --
    Principal collected on mortgage backed securities - held to maturity       2,698,171          10,379,048
    Proceeds from sale of repossessed assets                                      79,440                  --
    Investment in premises and equipment                                        (298,587)           (572,588)
    (Purchase)/Redemption of Federal Home Loan Bank of Atlanta stock            (112,100)            269,400
                                                                           --------------      -------------
        Net cash used by investing activities                                (68,705,064)        (46,120,860)

Cash Flows from Financing Activities
------------------------------------
Decrease in checks written in excess of bank balance                                  --            (390,799)
Net increase in demand deposits, money market, passbook
      accounts and advances by borrowers for taxes and
      insurance                                                               10,085,878          17,744,654
    Net  increase in certificates of deposit                                  16,686,021          26,061,765
    Increase in Federal Home Loan Bank of Atlanta advances                    46,350,000                  --
    Repayment of Federal Home Loan Bank of Atlanta advances                  (29,800,000)         (1,000,000)
    Exercised Stock Options                                                      113,062                  --
    Increase in Dividends Payable                                                  1,626                  --
    Dividends paid on stock                                                     (517,615)           (518,729)
                                                                           -------------       -------------
        Net cash provided by financing activities                             42,918,972          41,896,891
                                                                           -------------       -------------

Increase in cash and cash equivalents                                         (7,244,128)         (4,031,262)
Cash and cash equivalents at beginning of period                              23,208,274          25,703,327
                                                                           -------------       -------------
Cash and cash equivalents at end of period                                 $  15,964,146       $  21,672,065
                                                                           =============       =============
</TABLE>

                                       6
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                -------------------------------------------------

<TABLE>
<CAPTION>

                                                                                        MARCH  31,
                                                                            --------------------------------
                                                                                2004                2003
                                                                            -----------         ------------
<S>                                                                             <C>                   <C>
The following is a summary of cash and cash equivalents:
    Cash                                                                   $  12,114,215       $   7,518,668
    Interest bearing deposits in other banks                                   3,757,270           2,307,003
    Federal funds sold                                                           192,661          11,946,394
                                                                           -------------       -------------
    Balance of cash items reflected on Statement of
      Financial Condition                                                     16,064,146          21,772,065
        Less - certificate of deposit with an original maturity of
          more than ninety days                                                  100,000             100,000
                                                                           -------------       -------------

Cash and cash equivalents reflected on the
    Statement of Cash Flows                                                $  15,964,146       $  21,672,065
                                                                           =============       =============

Supplemental Disclosures of Cash Flows Information:
    Cash paid during the period for:

    Interest                                                               $   3,929,735       $   8,286,557
                                                                           =============       =============

    Income taxes                                                           $     162,000       $     826,700
                                                                           =============       =============
</TABLE>


The accompanying notes to the consolidated financial statements are an integral
part of these statements.

                                       7
<PAGE>
                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
             ------------------------------------------------------


Note 1 - Principles of Consolidation
         ---------------------------

          BCSB Bankcorp, Inc. (the "Company") owns 100% Baltimore County Savings
          Bank, F.S.B. and subsidiaries (the "Bank") and also invests in federal
          funds sold,  interest-bearing  deposits in other banks and U.S. Agency
          bonds. The Bank owns 100% of Baltimore County Service  Corporation and
          Ebenezer Road, Inc. The accompanying consolidated financial statements
          include  the  accounts  and  transactions  of  these  companies  on  a
          consolidated  basis since the date of  acquisition.  All  intercompany
          transactions  have  been  eliminated  in  the  consolidated  financial
          statements.   Ebenezer  Road,  Inc.  sells  insurance  products.  It's
          operations are not material to the consolidated financial statements.

Note 2 - Basis for Financial Statement Presentation
         ------------------------------------------

          The accompanying  consolidated financial statements have been prepared
          in accordance with  accounting  principles  generally  accepted in the
          United  States  of  America  and  the   instructions   to  Form  10-Q.
          Accordingly,  they do not include all of the  disclosures  required by
          accounting  principles  generally  accepted  in the  United  States of
          America  for  complete  financial   statements.   In  the  opinion  of
          management,  all  adjustments  (none of which were  other than  normal
          recurring accruals) necessary for a fair presentation of the financial
          position and results of operations for the periods presented have been
          included.  The financial  statements of the Company are presented on a
          consolidated  basis with those of the Bank.  The results for the three
          and six months ended March 31, 2004 are not necessarily  indicative of
          the results of  operations  that may be  expected  for the year ending
          September 30, 2004. The consolidated  financial  statements  should be
          read in conjunction  with the  consolidated  financial  statements and
          related  notes which are  incorporated  by reference in the  Company's
          Annual Report on Form 10-K for the year ended September 30, 2003.

Note 3 - Cash Flow Presentation
         ----------------------

          For  purposes  of  the  statements  of  cash  flows,   cash  and  cash
          equivalents include cash and amounts due from depository institutions,
          investments  in  federal  funds,  and  certificates  of  deposit  with
          original maturities of 90 days or less.



                                       8





<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------


             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
             ------------------------------------------------------


Note 4 - Earnings Per Share
         ------------------

          Basic per share  amounts are based on the weighted  average  shares of
          common  stock  outstanding.  Diluted  earnings  per share  assume  the
          conversion,  exercise  or  issuance  of  all  potential  common  stock
          instruments such as options,  unless the effect is to reduce a loss or
          increase  earnings per share.  No adjustments  were made to net income
          (numerator) for all periods presented.  The basic and diluted weighted
          average  shares  outstanding  for the six and three months ended March
          31, 2004 and 2003 is as follows:
<TABLE>
<CAPTION>

                                                                       For the Six Months Ended March 31,
                                                ------------------------------------------------------------------------------
                                                              2004                                   2003
                                                ------------------------------------------------------------------------------
                                                  Income     Shares         Per Share      Income       Shares      Per Share
         <S>                                       <C>        <C>              <C>          <C>           <C>         <C>
         Basic EPS
         ---------
                                                $ 387,474   5,783,076       $     0.07   $ 1,231,092   5,720,840     $   0.22
         Effect of dilutive shares                     --      53,788               --            --      37,954           --
                                                ---------   ---------       ----------   -----------   ---------     --------
         Diluted EPS
         -----------                            $ 387,474   5,836,864       $     0.07   $ 1,231,092   5,758,794     $   0.21
                                                =========   =========       ==========   ===========   =========     ========

                                                                       For the Three Months Ended March 31,
                                                ------------------------------------------------------------------------------
                                                              2004                                   2003
                                                ------------------------------------------------------------------------------
                                                  Income     Shares         Per Share      Income       Shares      Per Share
         Basic EPS
         ---------
                                                $ 161,565   5,786,739       $     0.03   $   778,583   5,723,152     $    0.14
         Effect of dilutive shares                     --      60,788               --            --      42,168            --
                                                ---------   ---------       ----------   -----------   ---------     ---------

         Diluted EPS
         -----------
                                                $ 161,565   5,847,527       $     0.03   $   778,583   5,765,320     $    0.14
                                                =========   =========       ==========   ===========   =========     =========

</TABLE>

                                       9
<PAGE>

                      BCSB BANKCORP, INC. AND SUBSIDIARIES
                      ------------------------------------
                               Baltimore, Maryland
                               -------------------


             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
             ------------------------------------------------------

Note 5 - Regulatory Capital
         ------------------

     The  following  table sets forth the Bank's  capital  position at March 31,
2004.
<TABLE>
<CAPTION>

                                                                                              TO BE WELL
                                                                                           CAPITALIZED UNDER
                                                                   FOR CAPITAL             PROMPT CORRECTIVE
                                             ACTUAL              ADEQUACY PURPOSES         ACTION PROVISIONS
                                    -----------------------   ------------------------  ------------------------
                                    ACTUAL           % OF     REQUIRED          % OF    REQUIRED          % OF
                                    AMOUNT           ASSETS   AMOUNT            ASSETS  AMOUNT            ASSETS
                                    ------           ------   --------          ------  --------          ------
<S>                                   <C>              <C>     <C>              <C>       <C>              <C>
                                                                 (unaudited)

Tangible (1)                     $ 53,108,521          7.43%  $10,725,753         1.50%     N/A             N/A
Tier 1 capital (2)                 53,108,521         15.81           N/A          N/A   20,149,200        6.00%
Core (1)                           53,108,521          7.43    28,602,009         4.00   35,752,511        5.00
Total  (2)                         55,177,907         16.43    26,865,600         8.00   33,582,000       10.00
</TABLE>

------------
(1) To adjusted total assets.
(2) To risk-weighted assets.

Note 6 - Stock Option Plan
         -----------------

               Stock-Based Employee Compensation- At March 31, 2004 and 2003 the
          company has four stock-based  employee  compensation  plans, which are
          described more fully in the 2003 Annual Report.  The company  accounts
          for those plans under the recognition  and  measurement  principles of
          APB Opinion No. 25,  Accounting  for Stock  Issued to  Employees,  and
          related  Interpretations.  No compensation cost is reflected in income
          for the granted  options as all granted  options had an exercise price
          equal to the market value of the  underlying  common stock on the date
          of grant. The following table illustrates the effect on net income and
          earnings  per  share  if  the  Company  had  applied  the  fair  value
          recognition  provisions  of FASB  Statement  No. 123,  Accounting  for
          Stock-Based Compensation, to stock-based employee compensation.

<TABLE>
<CAPTION>

                                                                         For the six months ended March  31,
                                                                               2004              2003
                                                                               ----              ----
                      <S>                                                       <C>               <C>
                  Net Income, as reported                                   $ 387,474       $ 1,231,092
                  Add: Stock-based Compensation
                       Included in the determination of
                       Net income as reported, net of tax                     140,208            94,952
                  Deduct: Total stock-based compensation
                             Expense determined under fair value
                              Method for all awards, net of tax              (166,604)         (121,348)
                                                                              -------         ---------
                       Pro forma net income                                 $ 361,078       $ 1,204,696
                                                                              =======         =========
                       Earnings per share:

                       Basic-as reported                                        $ .07             $ .22
                                                                                  ===               ===
                       Basic-pro forma                                            .06               .21
                                                                                  ===               ===
                       Diluted-as reported                                        .07               .21
                                                                                  ===               ===
                       Diluted-proforma                                           .06               .21
                                                                                  ===               ===
</TABLE>


                                       10
<PAGE>

Note7- Recent Accounting Pronouncements
       --------------------------------

     In January  2003,  the  Financial  Accounting  Standards  Board issued FASB
Interpretation  No.  46,   "Consolidation  of  Variable  Interest  Entities,  an
Interpretation  of ARB  No.  51"  which  was  revised  in  December  2003.  This
Interpretation  provides  guidance for the  consolidation  of variable  interest
entities  (VIEs).  BCSB  Bankcorp  Capital  Trust I ("BCSB I"), and BCSB Capital
Trust II ("BCSB II") qualify as variable  interest entities under FIN 46. BCSB I
and BCSB II issued mandatorily  redeemable preferred securities (Trust Preferred
Securities)  to  third-party  investors  and loaned the proceeds to the Company.
BCSB I and BCSB II hold, as there sole assets, subordinated debentures issued by
the Company.

     FIN 46 required  the Company to  deconsolidate  BCSB I and BCSB II from the
consolidated  financial  statements  as of March  31,  2004.  There  has been no
restatement  of prior  periods  for the  adoption  of FIN 46. The impact of this
deconsolidation  was to increase junior  subordinated  debentures by $23,197,000
and  reduce  trust  preferred  securities  line  item by  $22,500,000  which had
represented the trust preferred  securities of the trust.  The Company's  equity
interest  in the  trust  subsidiary  of  $697,000,  which  had  previously  been
eliminated in  consolidation,  is now reported in "Other assets" as of March 31,
2004.  The  deconsolidation  had no effect on the bank's  capital for regulatory
reporting  purposes.  The  adoption  of FIN 46 did  not  have an  impact  on the
Company's results of operations or liquidity.

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

GENERAL

     The  Company  was formed by the Bank to become the  holding  company of the
Bank following the Bank's  reorganization  to the mutual holding company form of
organization (the "Reorganization").  The Reorganization was consummated on July
8, 1998.

     The Company's net income is dependent primarily on its net interest income,
which is the difference  between interest income earned on its loan,  investment
securities  and  mortgage-backed  securities  portfolio  and  interest  paid  on
interest-bearing  liabilities.  Net  interest  income is  determined  by (i) the
difference  between yields earned on  interest-earning  assets and rates paid on
interest-bearing  liabilities  ("interest  rate  spread")  and (ii) the relative
amounts  of  interest-earning  assets  and  interest-bearing   liabilities.  The
Company's  interest  rate  spread  is  affected  by  regulatory,   economic  and
competitive  factors  that  influence  interest  rates,  loan demand and deposit
flows.  To a lesser  extent,  the  Company's  net income also is affected by the
level of other income,  which primarily consists of fees and charges, and levels
of non-interest expenses such as salaries and related expenses.

     The  operations  of the Company are  significantly  affected by  prevailing
economic  conditions,  competition  and  the  monetary,  fiscal  and  regulatory
policies of  governmental  agencies.  Lending  activities  are influenced by the
demand  for and  supply of  housing,  competition  among  lenders,  the level of
interest rates and the  availability of funds.  Deposit flows and costs of funds
are  influenced by prevailing  market rates of interest,  primarily on competing
investments, account maturities and the levels of personal income and savings in
the Company's market area.

CRITICAL ACCOUNTING POLICIES

     The Company's  significant  accounting  policies are set forth in Note 1 of
the consolidated  financial  statements as of September 30, 2003 which was filed
on Form 10-K. Of these significant  accounting  policies,  the Company considers
its policy  regarding  the  allowance  for loan  losses to be its most  critical
accounting policy,  because it requires management's most subjective and complex
judgments.  In addition,  changes in economic  conditions can have a significant
impact on the  allowance  for loan losses and  therefore  the provision for loan
losses and results of operations. The Company has developed appropriate policies
and  procedures  for  assessing  the adequacy of the  allowance for loan losses,
recognizing  that this process  requires a number of  assumptions  and estimates
with respect to its loan portfolio. The Company's assessments may be impacted in
future  periods by  changes in  economic  conditions,  the impact of  regulatory
examinations, and the discovery of information with respect to borrowers that is
not  known  to  management  at the  time  of the  issuance  of the  consolidated
financial statements.  The Company adopted the disclosure only provision of

                                       11
<PAGE>

FASB 123 see note 6 to the consolidated financial statements. They do not expect
to expense the fair market value of stock options  until  required by accounting
principles generally accepted in the United States of America.

FORWARD-LOOKING STATEMENTS

     When used in this Form 10-Q,  the words or phrases  "will  likely  result,"
"are expected to," "will continue," "is anticipated,"  "estimate,"  "project" or
similar expressions are intended to identify "forward-looking statements" within
the  meaning of the  Private  Securities  Litigation  Reform  Act of 1995.  Such
statements are subject to certain risks and  uncertainties  including changes in
economic  conditions  in the  Company's  market  area,  changes in  policies  by
regulatory  agencies,  fluctuations in interest  rates,  demand for loans in the
Company's market area, and competition that could cause actual results to differ
materially  from  historical   earnings  and  those  presently   anticipated  or
projected.  The Company wishes to caution readers not to place undue reliance on
any such forward-looking  statements,  which speak only as of the date made. The
Company  wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results for
future periods to differ  materially  from any opinions or statements  expressed
with respect to future periods in any current statements.

     The Company does not undertake,  and specifically disclaims any obligation,
to  publicly  release  the  result  of any  revisions  which  may be made to any
forward-looking  statements to reflect events or circumstances after the date of
such  statements or to reflect the occurrence of  anticipated  or  unanticipated
events.


COMPARISON OF FINANCIAL CONDITION AT MARCH 31, 2004 AND SEPTEMBER 30, 2003

     During the six months ended March 31, 2004, the Company's  assets increased
by $62.6  million,  or 9.4% from $668.2  million at September 30, 2003 to $730.8
million at March 31, 2004. Loans receivable,  net decreased by $5.0 million,  or
1.4%,  from $365.0  million at September 30, 2003 to $360.0 million at March 31,
2004. The Company's  mortgage-backed  securities available for sale increased by
$26.0  million,  or 22.4%,  from $116.2  million at September 30, 2003 to $142.2
million at March 31, 2004.  The  Company's  mortgage-backed  securities  held to
maturity  increased by $1.5 million or 8.2% from $18.4  million at September 30,
2003 to $19.9  million at March 31, 2004.  The  Company's  investment  portfolio
available  for sale  increased  $34.9 million or 28.7%,  from $121.3  million at
September 30, 2003 to $156.1 million at March 31, 2004. The Company's investment
portfolio held to maturity  increased by $1.0 million or 39.9% from $2.5 million
at September  30, 2003 to $3.5 million at March 31, 2004.  During the six months
ended  March 31,  2004 the Company  purchased  $11.5  million of bank owned life
insurance.  The preceeding was accomplished in an effort to reduce interest rate
risk in the balance  sheet.  Management was reluctant to make long term low rate
loans in the low interest rate  environment  that prevailed during the six month
period ended March 31,  2004.  Emphasis has been placed on short term loans such
as automobile loans,  home equity loans and short term mortgages.  The Company's
deposits  increased by $25.7 million,  or 4.7%, from $551.9 million at September
30, 2003 to $577.6  million at March 31,  2004.  The  increase  in deposits  was
achieved through normal marketing  efforts.  Advances from the Federal Home Loan
Bank of Atlanta increased by $16.4 million, or 51.0% from $32.3 million at March
31,  2003 to $48.7  million at March 31,  2004.  The funds were used to purchase
securities. Accounts Payable Trade Date Securities increased by $16.9 million or
121.0% from $13.9  million at March 31, 2003 to $30.9 million at March 31, 2004.
Trade Date Securities are  commitments to settle security  purchases in the near
future.

COMPARISON OF OPERATING RESULTS FOR THE SIX MONTHS ENDED MARCH 31, 2004 AND 2003

     Net Income.  Net income decreased by $844,000,  or 68.5%, from $1.2 million
for the six months  ended March 31, 2003 to  $387,000  for the six months  ended
March 31,  2004.  The  decrease  in net income  was  primarily  attributable  to
decreased  net interest  income of $1.5 million.  This was  partially  offset by
decreases in the  provision  for loan losses and income taxes and an increase in
other income due to the Bank Owned Life Insurance.

     Net  Interest  Income.  Net  interest  income was $7.6  million for the six
months ended March 31,  2004,  compared to $9.1 million for the six months ended
March 31, 2003,  representing a decrease of $1.5 million, or 16.4%. The decrease
was   primarily   due  to  the   decrease  in  the  average   rate  on  interest
earning-assets.  The average rate on  interest-earning  assets  decreased by 100
basis points from 6.08% for the six months ended March 31, 2003 to 5.08% for the
six months

                                       12
<PAGE>

ended March 31,  2004.  Due to  declining  interest  rates and loans  re-pricing
faster than  deposits  the interest  rate spread  decreased 56 basis points from
3.10% for the six months  ended March 31, 2003 to 2.54% for the six months ended
March 31, 2004.

     Interest Income.  Interest income decreased by $1.9 million,  or 10.8% from
$17.3  million for the six months ended March 31, 2003 to $15.5  million for the
six months  ended March 31, 2004.  Interest and fees on loans  decreased by $2.8
million, or 20.1%, from $13.9 million for the six months ended March 31, 2003 to
$11.1 million for the six months ended March 31, 2004. This was primarily due to
a decrease in the average  yield on loans of 95 basis points from 7.12% at March
31, 2003 to 6.17% at March 31, 2004, and a $31.9 million decrease in the average
balance of loans  receivable  from  $390.7  million at March 31,  2003 to $358.8
million at March 31,  2004.  The  decrease in the  average  balance of loans was
primarily  attributable  to increased  competition  in the  refinancing  market,
current economic  conditions and  management's  reluctance to make long term low
rate  loans in the low  interest  rate  environment  that  prevailed  during the
period.  The  decrease in the average  yield was  attributed  to the  prevailing
market rates in the economy. Interest on mortgage-backed securities increased by
$406,000 or 19.7% from $2.0  million for the six months  ended March  31,2003 to
$2.5 million for the six months ended March 31,2004. This increase was primarily
due to the increase in the average  balance of  mortgage-backed  securities from
$92.2 million at March 31, 2003 to $121.4 million at March 31,2004. Interest and
dividends  on  investment  securities  increased  by $694,000 or 58.9% from $1.2
million  for the six months  ended  March 31 ,2003 to $1.9  million  for the six
months ended March 31,2004. This was primarily due to an increase in the average
balance of investments of $57.7 million, or 89.6% from $62.3 million for the six
months ended March 31, 2003 to $120.0 million for the six months ended March 31,
2004.  The  increase in the average  balance  more than offset a decrease in the
average yield on investments  from 3.78% for the six months ended March 31, 2003
to 3.12% for the six months ended March 31, 2004.

     Interest Expense. Interest expense, which consists of interest on deposits,
interest  on  borrowed  money and other  interest  expense  decreased  from $8.2
million  for the six months  ended  March 31,  2003 to $7.8  million for the six
months  ended March  31,2004 a change of $375,000 or 4.6%.  Interest on deposits
decreased  $541,000  due to a decrease  in the  average  yield on deposits of 43
basis points from 2.82% for the six months ended March 31, 2003 to 2.39% for the
six months ended March 31, 2004. This was partially offset by an increase in the
average  balance of deposits of $47.0  million,  or 9.2% from $513.4  million at
March 31,  2003 to $560.4  million at March 31,  2004.  The  Company was able to
increase its deposits through normal marketing  efforts.  Interest on short-term
borrowings  decreased  by $38,000  for the six months  ended  March 31, 2004 and
interest on  long-term  borrowings  increased  by  $15,000.  This  increase  was
primarily due to an increase of $8.3 million in the average balances of advances
from the  Federal  Home Loan Bank of Atlanta  during the six months  ended March
31,2004.  Also  contributing  to  interest  expense  was  interest  on the Trust
Preferred  Securities  which was $529,000 for the six month period  ending March
31, 2004.

                                       13
<PAGE>

     Average Balance Sheet.  The following table sets forth certain  information
relating to the Company's  average  balance sheet and reflects the average yield
on assets and cost of  liabilities  for the  periods  indicated  and the average
yields  earned and rates  paid.  Such  yields and costs are  derived by dividing
income or  expense  by the  average  daily  balance  of  assets or  liabilities,
respectively,  for the six month  periods  ended March 31,  2004,  and March 31,
2003. Total average assets are computed using month-end balances.

     The table also presents  information for the periods indicated with respect
to the differences between the average yield earned on  interest-earning  assets
and  average  rate  paid on  interest-bearing  liabilities,  or  "interest  rate
spread," which banks have  traditionally  used as an indicator of profitability.
Another  indicator of net interest income is "net interest margin," which is its
net interest income divided by the average balance of interest-earning assets.
<TABLE>
<CAPTION>

                                                                     Six Months Ended March 31
                                               -----------------------------------------------------------------------------
                                                              2004                                     2003
                                               -----------------------------------     -------------------------------------
                                                Average                   Average        Average                     Average
                                                Balance      Interest      Rate          Balance     Interest         Rate
                                               ---------    ---------    --------      ----------    --------        ------
      <S>                                        <C>            <C>        <C>              <C>        <C>             <C>
                                                                           (Dollars in thousands)
Interest-earning assets:
   Loans....................................   $ 358,834    $  11,064        6.17%     $  390,781    $ 13,917         7.12%
   Mortgage-backed securities...............     121,436        2,471        4.07          92,200       2,065         4.48
   Investment securities....................     119,998        1,871        3.12          62,302       1,178         3.78
   Other Investments........................      10,479           64        1.22          25,355         176         1.39
                                               ---------    ---------                  ----------    --------
       Total interest-earning assets........     610,747       15,470        5.07         570,638      17,336         6.08
Noninterest-earning assets..................      61,795                                   35,647
                                               ---------                               ----------
       Total assets.........................   $ 672,542                               $  606,285
                                               =========                               ==========

Interest-bearing liabilities:
   Deposits.................................   $ 560,402        6,699        2.39         513,371       7,240         2.82
   FHLB Advances............................      33,929          627        3.70          25,667         650         5.06
   Jr. Sub. Debt/Trust Preferred Securities.      22,500          529        4.70          12,500         340         5.44
   Other liabilities........................       1,198            0        0.00           1,548           1         0.13
                                               ---------    ---------                  ----------    --------
Total interest-bearing liabilities..........     618,029        7,855        2.54         553,086       8,231         2.98
                                                            ---------    --------                    --------       ------
Noninterest-bearing liabilities.............       9,769                                    8,040
                                               ---------                               ----------
       Total liabilities....................     627,798                                  561,126
Stockholders' equity .......................      44,744                                   45,159
                                               ---------                               ----------
       Total liabilities and stockholders'
            equity..........................   $ 672,542                               $  606,285
                                               =========                               ==========

Net interest income.........................                $   7,615                                $  9,105
                                                            =========                                ========
Interest rate spread........................                                 2.52%                                    3.10%
                                                                          =======
Net interest margin.........................                                 2.49%                                    3.19%
                                                                          =======                                   ======
Ratio average interest earning assets/
    interest bearing liabilities............                                98.82%                                  103.17%
                                                                          =======                                   ======
</TABLE>


                                       14
<PAGE>

     Rate/Volume  Analysis.  The table  below  sets  forth  certain  information
regarding  changes in interest  income and interest  expense of the Bank for the
periods   indicated.   For  each   category   of   interest-earning   asset  and
interest-bearing liability,  information is provided on changes attributable to:
(i) changes in volume (changes in volume  multiplied by old rate);  (ii) changes
in rates  (change  in rate  multiplied  by old  volume);  and (iii)  changes  in
rate/volume (changes in rate multiplied by the changes in volume).

<TABLE>
<CAPTION>

                                                           For Six Months  Ended March 31,
                                                ---------------------------------------------------
                                                        2004              vs.             2003
                                                ---------------------------------------------------
                                                                  Increase (Decrease)
                                                                        Due to
                                                ---------------------------------------------------
                                                                                Rate/
                                                Volume         Rate            Volume        Total
                                                ------         ----            ------        -----
   <S>                                           <C>           <C>              <C>           <C>
                                                                   (In thousands)
Interest income:
  Loans receivable..........................   $ (1,130)      $ (1,876)      $    153    $ (2,853)
  Mortgage-backed securities................        661           (194)           (61)        406
  Investment securities and
      FHLB Stock............................      1,089           (206)          (190)        693
  Other interest-earning assets.............       (104)           (20)            12        (112)
                                               --------       --------       --------    --------
    Total interest-earning assets...........        516         (2,296)           (86)      1,866

Interest expense:
  Deposits..................................        663         (1,103)          (101)       (541)
  FHLB advances.............................        210           (176)           (57)        (23)
  Trust Preferred Securities................        272            (46)           (37)        189
  Other liabilities.........................          0             (1)             0          (1)
                                               --------       --------       --------    --------
     Total interest-bearing
       liabilities..........................      1,145         (1,326)          (195)       (376)
                                               --------       --------       --------    --------

Change in net interest income...............   $   (659)      $   (957)      $    126    $ (1,490)
                                               ========       ========       ========    ========
</TABLE>

     Provision for Loan Losses.  The Company charges  provisions for loan losses
to  earnings  to  maintain  the  total  allowance  for  loan  losses  at a level
management   considers   adequate  to  provide  for  probable  loan  losses.  In
determining the provision,  management considers prior loss experience,  current
economic  conditions and the probability of these  conditions  affecting  future
loan  performance.  The Company  established  provisions  for losses on loans of
$267,000 for the six months  ended March 31,  2004,  as compared to $412,000 for
the six months ended March 31, 2003,  representing a decrease of $145,000.  This
decrease was partially  attributable  to the decrease in the average  balance of
loans of $31.9  million,  or 8.2% from $390.8  million to $358.8  million.  Loan
chargeoffs  for the six months ended March 31, 2004 were $682,000 as compared to
$616,000  for the six months  ended March 31,  2003 an increase of $66,000  Loan
charge offs increased due to adverse economic  conditions.  Loan recoveries were
$156,000  for the six months  ended March 31, 2004  compared to $157,000 for the
six months ended March 31,  2003.  Non  performing  loans at March 31, 2004 were
$1.0 million as compared to $750,000 at March 31, 2003. The total loss allowance
allocated to domestic loans is $2.4 million.  In establishing  such  provisions,
management considered an analysis of the risk inherent in the loan portfolio.

     Other Income.  Other income increased by $22,000, or 2.3% from $952,000 for
the six months  ended March 31, 2003 to $974,000  for the six months ended March
31,  2004.  The increase in other income for the six months ended March 31, 2004
was  primarily  attributable  to an  increase in income from the Bank Owned Life
Insurance  of  $243,000  from $0 for the six  months  ended  March  31,  2003 to
$243,000 for the six months ended March 31, 2004.  Fees on transaction  accounts
also  increased by $150,000  for the six months ended March 31, 2004,  due to an
increase in the volume of transaction  accounts.  These increases were partially
offset by a decrease in gains on the sale of loans of $229,000, from $42,000 for
the six months  ended  March 31, 2004  compared  to $271,000  for the six months
ended

                                       15
<PAGE>

March 31,  2003.  There was also a decrease in the gain on the sale of Mortgaged
Backed Securities of $146,000,  from $154,000 for the six months ended March 31,
2003 to $8,000  for the six months  ended  March 31,  2004.  Gain on the sale of
investments also decreased $17,000,  from $25,000 for the six months ended March
31, 2003 to $8,000 for the six months ended March 31, 2004.

     Non-interest  Expenses.  Total non-interest expenses increased by $202,000,
or 2.6%,  from $7.7  million  for the six months  ended  March 31,  2003 to $7.9
million for the six months  ended March 31, 2004.  The increase in  non-interest
expenses was due to increases in salaries and related  expenses of $200,000,  or
4.9%.  Occupancy  expense also increased by $182,000,  from $785,000 for the six
months ended March 31, 2003 to $967,000 for the six months ended March 31, 2004.
Advertising  expense also  increased by $60,000 or 14.3%,  from $421,000 for the
six months  ended March 31, 2003 to $481,000  for the six months ended March 31,
2004.  These  increases  were partially  offset by decreases in data  processing
expenses,  property  plant and equipment  expense and  professional  fees.  Data
processing expense decreased by $47,000 or 5.8% from $804,000 for the six months
ended  March 31,  2003 to  $757,000  for the six months  ended  March 31,  2004.
Property plant and equipment expense decreased by $33,000, or 5.2% from $633,000
for the six months  ended March 31, 2003 to  $600,000  for the six months  ended
March 31, 2004.  Professional  fees  decreased by $18,000 or 13.2% from $137,000
for the six months  ended March 31, 2003 to  $119,000  for the six months  ended
March 31, 2004.

     Income Taxes. The Company's income tax expense was $76,000 and $759,000 for
the six  months  ended  March 31,  2004 and 2003,  respectively.  The  Company's
effective tax rates were 16.5% and 38.1% for the six months ended March 31, 2004
and 2003,  respectively.  The decrease in the  effective  tax rate was primarily
attributable  to the Bank's earning non -taxable income from the Bank Owned Life
Insurance.

                                       16
<PAGE>

COMPARISON  OF  OPERATING  RESULTS FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND
2003

     Net Income.  Net income decreased by $617,000,  or 79.2%, from $779,000 for
the three  months  ended March 31, 2003 to $162,000  for the three  months ended
March 31,  2004.  The  decrease  in net income  was  primarily  attributable  to
decreased  net  interest  income of  $862,000.  This was  partially  offset by a
decrease in the  provision  for loan losses and income  taxes and an increase in
other income due to the Bank Owned Life Insurance.

     Net Interest  Income.  Net  interest  income was $3.7 million for the three
months ended March 31, 2004, compared to $4.6 million for the three months ended
March 31, 2003,  representing a decrease of $862,000, or 18.7%. The decrease was
primarily  due to the decrease in the average  rate on interest  earning-assets.
The average rate on interest-earning  assets decreased by 112 basis points from,
6.01% for the three  months  ended March 31, 2003 to 4.89% for the three  months
ended March 31,  2004.  Due to  declining  interest  rates and loans  re-pricing
faster than deposits,  the interest rate spread  decreased 75 basis points from,
3.13% for the three  months  ended March 31, 2004 to 2.38% for the three  months
ended March 31, 2004.

     Interest Income.  Interest income decreased by $994,000, or 11.5% from $8.7
million for the three  months ended March 31, 2003 to $7.7 million for the three
months  ended  March 31,  2004.  Interest  and fees on loans  decreased  by $1.5
million,  or 21.7%,  from $6.9 million for the three months ended March 31, 2003
to $5.4 million for the three months  ended March 31, 2004.  This was  primarily
due to a decrease in the average  yield on loans of 101 basis  points from 7.09%
for the three  months  ended March 31, 2003 to 6.08% for the three  months ended
March 31, 2004,  and a $33.7  million  decrease in the average  balance of loans
receivable  from $389.7 million at March 31, 2003 to $356.1 million at March 31,
2004. The decrease in the average balance of loans was primarily attributable to
increased competition in the refinancing market, current economic conditions and
the management's reluctance to make long term low rate loans in the low interest
rate environment  that prevailed during the period.  The decrease in the average
yield was attributed to the prevailing market rates in the economy.  Interest on
mortgage-backed  securities increased by $260,000 or 25.8% from $1.0 million for
the three months ended March 31, 2003 to $1.3 million for the three months ended
March 31, 2004.  This  increase was primarily due to the increase in the average
balance of  mortgage-backed  securities  from $91.6 million at March 31, 2003 to
$134.7  million  at  March  31,  2004.  Interest  and  dividends  on  investment
securities  increased by $278,000 or 42.8% from  $650,000  million for the three
months ended March 31, 2003 to $928,000 million for the three months ended March
31,  2004.  This was  primarily  due to an increase  in the  average  balance of
investments  of $48.2  million  from,  $68.5 million at March 31, 2003 to $116.7
million at March 31, 2004. The increase in the average  balance more than offset
a decrease of 72 basis points in the average yield on investments  from,  3.80 %
for the three  months  ended March 31, 2003 to 3.08% for the three  months ended
March 31, 2004.

     Interest Expense. Interest expense, which consists of interest on deposits,
interest  on  borrowed  money and other  interest  expense  decreased  from $4.0
million for the three  months ended March 31, 2003 to $3.9 million for the three
months  ended March 31, 2004 a change of $133,000 or 3.3%.  Interest on deposits
decreased  $237,000  due to a decrease  in the  average  yield on deposits of 38
basis points from 2.73% at March 31, 2003 to 2.35% at March 31,  2004.  This was
partially  offset by an  increase  in the  average  volume of  deposits of $43.1
million  from $522.5  million at March 31,  2003 to $565.6  million at March 31,
2004.  The Company was able to increase its deposits  through  normal  marketing
efforts.  Interest on short-term  borrowings  decreased by $25,000 for the three
months ended March 31, 2004, and interest on long-term  borrowings  increased by
$29,000 for the three months  ended March 31, 2004.  The increase in interest on
long-term  borrowings was primarily due to an increase in the average balance of
long-term  borrowings  of $8.0 million,  or 31.3%.  This decrease in interest on
short-term borrowings was primarily due to a decrease of 113 basis points in the
average yield paid on advances from the Federal Home Loan Bank of Atlanta during
the three months ended March 31, 2004. Also contributing to interest expense was
interest on the Junior Subordinated  Debenture/Trust  Preferred Securities which
was  $261,000 for the three month  period  ending  March 31,  2004,  compared to
$162,000 for the three month period ending March 31, 2003.

                                       17
<PAGE>

     Average Balance Sheet.  The following table sets forth certain  information
relating to the Company's  average  balance sheet and reflects the average yield
on assets and cost of  liabilities  for the  periods  indicated  and the average
yields  earned and rates  paid.  Such  yields and costs are  derived by dividing
income or  expense  by the  average  daily  balance  of  assets or  liabilities,
respectively,  for the three month periods ended March 31, 2004 and 2003.  Total
average assets are computed using month-end balances.

     The table also presents  information for the periods indicated with respect
to the differences between the average yield earned on  interest-earning  assets
and  average  rate  paid on  interest-bearing  liabilities,  or  "interest  rate
spread," which banks have  traditionally  used as an indicator of profitability.
Another  indicator of net interest income is "net interest margin," which is its
net interest income divided by the average balance of interest-earning assets.
<TABLE>
<CAPTION>

                                                                    THREE MONTHS ENDED MARCH  31
                                               ----------------------------------------------------------------------------
                                                             2004                                    2003
                                               ---------------------------------       -----------------------------------
                                               AVERAGE                   AVERAGE       AVERAGE                     AVERAGE
                                               BALANCE      INTEREST      RATE         BALANCE       INTEREST       RATE
                                               -------      --------     -------       -------       --------      -------
                                                                           (Dollars in thousands)
<S>                                             <C>          <C>           <C>          <C>           <C>             <C>
Interest-earning assets:
   Loans....................................   $ 356,069    $   5,411        6.08%     $  389,739    $  6,909         7.09%
   Mortgage-backed securities...............     134,722        1,271        3.77          91,604       1,010         4.41
   Investment securities....................     120,420          928        2.99          68,509         650         3.80
   Other Investments........................      17,157           50        1.17          26,374          85         1.29
                                               ---------    ---------                  ----------    --------
       Total interest-earning assets........     628,368        7,660        4.86         576,226       8,654         6.01
Noninterest-earning assets..................      54,809                                   40,798
                                               ---------                               ----------
       Total assets.........................   $ 683,177                               $  617,024
                                               =========                               ==========

Interest-bearing liabilities:
   Deposits.................................   $ 565,611        3,328        2.35         522,503       3,565         2.73
   FHLB Advances............................      33,599          322        3.83          25,583         317         4.96
   Jr. Sub. Debt/Trust Preferred Securities.      22,500          262        4.66          12,500         162         5.18
   Other liabilities........................       1,302            0        0.00           1,660           1         0.24
                                               ---------    ---------                  ----------    --------
Total interest-bearing liabilities..........     623,012        3,912        2.51         562,246       4,045         2.88
                                                            ---------    --------                    --------      -------
Noninterest-bearing liabilities.............      14,790                                    9,947
                                               ---------                               ----------
       Total liabilities....................     637,802                                  572,193
Stockholders' equity .......................      45,375                                   44,831
                                               ---------                               ----------
       Total liabilities and stockholders'
            equity..........................   $ 683,177                               $  617,024
                                               =========                               ==========

Net interest income.........................                $   3,748                                $  4,609
                                                            =========                                ========
Interest rate spread........................                                 2.35%                                    3.13%
                                                                          =======                                   ======
Net interest margin.........................                                 2.37%                                    3.20%
                                                                          =======                                   ======
Ratio average interest earning assets/
    interest bearing liabilities............                               100.86%                                  102.49%
                                                                          =======                                   ======
</TABLE>

                                       18

<PAGE>

     Rate/Volume  Analysis.  The table  below  sets  forth  certain  information
regarding  changes in interest  income and interest  expense of the Bank for the
periods   indicated.   For  each   category   of   interest-earning   asset  and
interest-bearing liability,  information is provided on changes attributable to:
(i) changes in volume (changes in volume  multiplied by old rate);  (ii) changes
in rates  (change  in rate  multiplied  by old  volume);  and (iii)  changes  in
rate/volume (changes in rate multiplied by the changes in volume).

<TABLE>
<CAPTION>

                                                           For Three Months  Ended March  31,
                                                -----------------------------------------------------
                                                        2004           vs.              2003
                                                ----------------------------------------------------
                                                              Increase (Decrease)
                                                                    Due to
                                                ----------------------------------------------------
                                                                                Rate/
                                                Volume         Rate            Volume        Total
                                                ------         ----            ------        -----
 <S>                                            <C>             <C>              <C>         <C>
                                                                   (In thousands)
Interest income:
  Loans receivable..........................   $   (621)      $   (961)      $     84    $ (1,498)
  Mortgage-backed securities................        477           (147)           (69)        261
  Investment securities and
      FHLB Stock............................        488           (135)          (104)        249
  Other interest-earning assets.............        (30)            (8)             3         (35)
                                               --------       --------       --------    --------
    Total interest-earning assets...........        314         (1,251)           (86)     (1,023)

Interest expense:
  Deposits..................................        294           (491)           (40)       (237)
  FHLB advances.............................         99            (72)           (22)          5
  Jr. Sub. Debt./ Trust Preferred Securities        132            (18)           (14)        100
  Other liabilities.........................          0             (1)             0          (1)
                                               --------       --------       --------    --------
     Total interest-bearing
       liabilities..........................        525           (582)           (76)       (133)
                                               --------       --------       --------    --------

Change in net interest income...............   $   (242)      $   (655)      $      7    $   (890)
                                               ========       ========       ========    ========
</TABLE>


     Provision for Loan Losses.  The Company charges  provisions for loan losses
to  earnings  to  maintain  the  total  allowance  for  loan  losses  at a level
management   considers   adequate  to  provide  for  probable  loan  losses.  In
determining  the  provision,  management  considers a number of factors  such as
existing loan levels, prior loss experience, current economic conditions and the
probability of these conditions  affecting future loan performance.  The Company
established provisions for losses on loans of $86,000 for the three months ended
March 31,  2004,  as compared to $130,000  for the three  months ended March 31,
2003,   representing   a  decrease  of  $44,000.   The  decrease  was  partially
attributable to the decrease in the average balance of loans of $33.7 million or
8.6% from $389.7  million at March 31, 2003 to $356.0 million at March 31, 2003.
Loan  chargeoffs  for the three  months  ended March 31,  2004 were  $353,000 as
compared to  $373,000  for the three  months  ended March 31, 2003 a decrease of
$20,000.  Loan chargeoffs decreased due to improving economic  conditions.  Loan
recoveries  were  $130,000 for the three months ended March 31, 2004 compared to
$54,000 for the three months ended March 31, 2003. Non performing loans at March
31, 2004 were $1.0 million as compared to $750,000 at March 31, 2003.  The total
loss allowance allocated to domestic loans is $2.4 million. In establishing such
provisions,  management  considered an analysis of the risk inherent in the loan
portfolio. For additional information see Asset Quality.

     Other Income. Other income decreased by $78,000, or 14.8% from $526,000 for
the three  months  ended March 31, 2003 to $448,000  for the three  months ended
March 31,  2004.  The  decrease in other income for the three months ended March
31,  2004 was  primarily  attributable  to a decrease of $187,000 in the gain on
sale of loans from $204,000 for the three months ended March 31, 2003 to $18,000
for the three  months  ended March 31,  2004.  This was  partially  offset by an
increase in the cash  surrender  value of bank owned life  insurance of $121,000
for the three months  ended March 31, 2004,  compared to $0 for the three months
ended March 31, 2003. There was also a gain on the sale of repossessed assets of
$2,000 for the three months  ended

                                       19
<PAGE>

March 31, 2004  compared to $0, for the three months ended March 31, 2003.  Fees
on  transaction  accounts  also  increased  $68,000 from  $117,000 for the three
months  ended March 31, 2003 to $185,000  for the three  months  ended March 31,
2004. Fees on transaction  accounts  increased due to the increase in the volume
of transaction  accounts.  There was also an increase in the gain on the sale of
investments  of $20,000 for the three months  ended March 31, 2004.  These gains
were  partially  offset by a  decrease  in gain on the sale of  mortgage  backed
securities of $84,000 for the three months ended March 31, 2004 from $84,000 for
the three months ended March 31, 2003 to $0 for the three months ended March 31,
2004. These securities were sold in an effort to mitigate interest rate risk.

     Non-interest  Expenses.  Total non-interest  expenses increased by $179,000
for the three  months  ended  March 31,  2004,  from $3.7  million for the three
months ended March 31, 2003 to $3.9 million for the three months ended March 31,
2004.  The Company  experienced  increases  of $161,000 in salaries  and related
expenses for the three  months  ended March 31, 2004,  from $2.0 million for the
three  months  ended March 31, 2003 to $2.1  million for the three  months ended
March 31, 2004.  Occupancy expense also increased by $90,000,  from $390,000 for
the three  months  ended March 31, 2003 to $480,000  for the three  months ended
March 31, 2004.  These  increases  were  partially  offset by a decrease in data
processing  expense of $23,000,  from  $393,000 for the three months ended March
31, 2003 to $370,000 for the three months ended March 31, 2004.  Other  expenses
also  decreased  by $36,000  for the three  months  ended March 31,  2004,  from
$189,000  for the three  months  ended March 31, 2003 to $153,000  for the three
months ended March 31, 2004.


     Income Taxes. The Company's income tax expense was $23,000 and $480,000 for
the three  months  ended March 31, 2004 and 2003,  respectively.  The  Company's
effective  tax rates were 12.3% and 38.1% for the three  months  ended March 31,
2004  and  2003,  respectively.  The  decrease  in the  effective  tax  rate was
primarily  attributable to the Bank's earning  non-taxable  income from the Bank
Owned Life Insurance.


                                       20
<PAGE>



COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET RISK

     The Company is a party to financial instruments with off-balance sheet risk
including  commitments  to extend  credit  under  existing  lines of credit  and
commitments  to sell  loans.  These  instruments  involve,  to varying  degrees,
elements of credit and interest rate risk in excess of the amount  recognized in
the consolidated balance sheets.

     Off-balance  sheet financial  instruments  whose contract amounts represent
credit and interest rate risk are summarized as follows:

<TABLE>
<CAPTION>

                                                                       March 31, 2004   September 30, 2003
                                                                       --------------   ------------------
          <S>                                                           <C>                    <C>
                                                                              (dollars in thousands)

         Commitments to originate new loans                           $    19,080                $    10,600
         Commitments to originate new loans held for sale                      --                         --
         Unfunded commitments to extend credit under existing
              equity line and commercial lines of credit                   19,918                     20,400
         Commercial letters of credit                                         419                        419
         Commitments to sell loans held for sale                               --                         --
</TABLE>

The Company does not have any  unconsolidated  special purpose entities or other
similar forms of off-balance sheet financing arrangements.

     Commitments  to originate new loans or to extend  credit are  agreements to
lend to a customer as long as there is no violation of any condition established
in the contract.  Loan  commitments  generally expire within 30 to 45 days. Most
equity line  commitments for the unfunded portion of equity lines are for a term
of 20 years, and commercial lines of credit are generally renewable on an annual
basis.  Commitments  generally have fixed expiration dates or other  termination
clauses  and may require  payment of a fee.  Since many of the  commitments  are
expected to expire without being drawn upon, the total commitment amounts do not
necessarily  represent  future cash  requirements.  The Company  evaluates  each
customer's  creditworthiness  on a case-by-case  basis. The amount of collateral
obtained,  if deemed necessary by the Company upon extension of credit, is based
on management's credit evaluation of the borrower.

     Commitments  to sell loans held for sale are  agreements to sell loans to a
third party at an agreed upon price.

CONTRACTUAL OBLIGATIONS

As of March 31, 2004
<TABLE>
<CAPTION>

                                                                   Payments due by period
                                                                   ----------------------
                                                                   (Dollars in thousands)
                                       Less than
                                         1 year               1-3 years         4-5 years        Over 5 years        Total
                                    -----------------         ---------         ---------        ------------        -----
 <S>                                    <C>                      <C>              <C>                 <C>               <C>

Time Deposits                        $    194,755              115,757            81,572              --             392,084
Long-term borrowings                       29,800                   --             6,000          12,000              47,800
Junior Subordinated Debenture                  --                   --                --          23,197              23,197
Lease obligations                             904                2,687             1,264           5,073               9,928
                                     ------------              -------            ------          ------             -------
Total contractual cash
    obligations                      $    225,459              118,444            88,836          40,270             473,009
                                     ============              =======            ======          ======             =======

</TABLE>
                                       21
<PAGE>

ASSET QUALITY

     At  March  31,  2004,  the  Company  had  approximately   $1.2  million  in
non-performing assets (nonaccrual loans,  repossessed assets and foreclosed real
estate) or .16% of total assets.  At September 30, 2003,  non-performing  assets
were $583 000 or .04% of total assets.  The Bank's net charge-offs for the three
months ended March 31, 2004 were $353,000.  The Bank's allowance for loan losses
was $2.4 million at March 31, 2004 and $2.7 million at September 30, 2003.

     The following  table  presents an analysis of the Company's  non-performing
assets:
<TABLE>
<CAPTION>

                                                           At                      At
                                                        March 31,             September 30,
                                                          2004                    2003
                                                          ----                    ----
<S>                                                       <C>                     <C>
Nonperforming loans:
Nonaccrual loans                                      $   1,045                 $   300
Loans 90 days past due and accruing                          --                      --
Restructured loans                                           --                      --
                                                      ---------                 -------
Total nonperforming loans                                 1,045                     300
Other non-performing assets                                 184                     283
                                                      ---------                 -------
Total nonperforming assets                            $   1,229                 $   583
                                                      =========                 =======
Nonperforming loans to loans receivable, net                .29%                    .08%
Nonperforming assets as a percentage
 of loans and other real estate owned                       .34%                    .08%
Nonperforming assets to total assets                        .16%                    .04%
</TABLE>






                                       22
<PAGE>

The  following  table sets forth an  analysis of the Bank's  allowance  for loan
losses for the periods indicated.

<TABLE>
<CAPTION>

                                                            For the Six Months Ended
                                                                    March  31,
                                                               2004           2003
                                                               ----           ----
<S>                                                             <C>            <C>
Balance at beginning of period...................           $   2,698       $  2,199
                                                            ---------       --------

Loans charged-off:
  Real estate mortgage:
    Single-family residential....................                  --             --
    Multi-family residential.....................                  --             --
    Commercial...................................                  --             --
   Construction..................................                  --             --
  Commercial loans...............................                  --             --
  Consumer.......................................                 682            616
                                                             --------         ------
Total charge-offs................................                 682            616

Recoveries:
  Real estate mortgage:
    Single-family residential....................                  --             --
Multi-family residential.........................                  --             --
    Commercial...................................                  --             --
    Construction.................................                  --             --
Commercial loans secured.........................                  --             --
  Consumer.......................................                 156            157
                                                             --------         ------
Total recoveries.................................                 156            157
                                                             --------         ------
Net loans charged off............................                (526)          (459)
Provision for loan  losses.......................                 267            412
                                                             --------         ------
Balance at end of period.........................            $  2,439         $2,152
                                                             ========         ======

Ratio of net charge-offs to average
  loans outstanding during the period............                 .14%           .12%
                                                             ========         ======
</TABLE>


     Regulations  require  that the  Company  classify  its  assets on a regular
basis. There are three classifications for problem assets: substandard, doubtful
and loss.  The Company  regularly  reviews its assets to  determine  whether any
assets  require  classification  or  re-classification.  At March 31, 2004,  the
Company had $1.2 million in  classified  assets,  consisting  of $1.0 million in
substandard  and loss  loans,  and $ 184,000  in other  repossessed  assets.  At
September 30, 2003, the Company had $583,000 in substandard  assets,  consisting
of $300,000 in loans, and $283,000 in other repossessed assets.

     In addition to regulatory  classifications,  the Company also classifies as
"special mention" assets that are currently  performing in accordance with their
contractual  terms but may become  classified  or  non-performing  assets in the
future. At March 31, 2004, the Company has identified approximately $1.9 million
in assets classified as special mention.


LIQUIDITY AND CAPITAL RESOURCES

     At March  31,  2004,  the Bank  exceeded  all  regulatory  minimum  capital
requirements. For information comparing the Bank's tangible, core and risk-based
capital  levels  to  the  regulatory  requirements,  see  Note  5  of  Notes  to
Consolidated Financial Statements.

     The  Company's  primary  sources of funds are deposits  and  proceeds  from
maturing investment securities and mortgage-backed  securities and principal and
interest  payments on loans.  While  maturities  and scheduled  amortization  of

                                       23
<PAGE>

mortgage-backed  securities and loans are a predictable source of funds, deposit
flows and mortgage prepayments are greatly influenced by general interest rates,
economic conditions, competition and other factors.

     The primary  investing  activities  of the Company are the  origination  of
loans and the purchase of investment securities and mortgage-backed  securities.
During the six months  ended  March 31,  2004 and 2003,  the  Company  had $28.8
million and $27.8 million,  respectively,  of loan originations.  During the six
months  ended  March  31,  2004  and  2003,  the  Company  purchased  investment
securities in the amounts of $65.8 million and $86.6 million,  respectively, and
mortgage-backed  securities in the amounts of $41.5  million and $44.4  million,
respectively. The primary financing activity of the Company is the attraction of
savings deposits.

     The Company has other  sources of  liquidity  if there is a need for funds.
The Bank has the  ability  to  obtain  advances  from  the FHLB of  Atlanta.  In
addition, the Company maintains a portion of its investments in interest-bearing
deposits at other financial institutions that will be available, if needed.

     The Bank is required to maintain minimum levels of liquid assets as defined
by OTS regulations.  This requirement,  which may be changed 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  average  daily
liquidity ratio for the month of March was approximately  44.9%,  which exceeded
the required  level for such period.  Management  seeks to maintain a relatively
high level of liquidity in order to retain  flexibility  in terms of  investment
opportunities  and deposit pricing.  Because liquid assets generally provide for
lower rates of return,  the Bank's  relatively high liquidity will, to a certain
extent, result in lower rates of return on assets.

     The  Company's  most liquid assets are cash,  interest-bearing  deposits in
other  banks and  federal  funds  sold,  which  are  short-term,  highly  liquid
investments with original  maturities of less than three months that are readily
convertible  to known amounts of cash.  The levels of these assets are dependent
on the Company's operating,  financing and investing activities during any given
period.  At March 31, 2004, cash,  interest-bearing  deposits in other banks and
federal funds sold were $12.1 million, $3.8.million and $193,000, respectively.

     The Company  anticipates  that it will have  sufficient  funds available to
meet its current  commitments.  Certificates  of deposit  which are scheduled to
mature in less than one year at March 31, 2004 totaled $194.7 million.  Based on
past experience, management believes that a significant portion of such deposits
will remain with the Bank.  The Bank is a party to  financial  instruments  with
off-balance-sheet  risk  made in the  normal  course  of  business  to meet  the
financing  needs of its  customers.  These  financial  instruments  are  standby
letters of credit,  lines of credit and  commitments  to fund mortgage loans and
involve  to  varying  degrees  elements  of credit  risk in excess of the amount
recognized in the statement of financial position. The contract amounts of those
instruments  express the extent of involvement  the Company has in this class of
financial  instruments and represents the Company's exposure to credit loss from
nonperformance by the other party.

     The Company  generally  requires  collateral  or other  security to support
financial instruments with off-balance-sheet credit risk. At March 31, 2004, the
Company had commitments  under standby letters of credit and lines of credit and
commitments  to originate  mortgage  loans of $419,000,  $19.9 million and $19.1
million respectively.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Market  risk is the  possible  chance of loss from  unfavorable  changes in
market prices and rates.  These changes may result in a reduction of current and
future period net interest income, which is the favorable spread earned from the
excess of interest income on  interest-earning  assets over interest  expense on
interest-bearing liabilities.

     The Company considers  interest rate risk to be its most significant market
risk, which could  potentially  have the greatest impact on operating  earnings.
The  structure  of the  Company's  loan and  deposit  portfolios  is such that a
significant  change in interest rates may adversely impact net market values and
net interest income.

     The Company  monitors whether material changes in market risk have occurred
since September 30, 2003. The Company does not believe that any material adverse
changes in market risk exposures occurred since September 30, 2003.


                                       24
<PAGE>

ITEM 4.    CONTROLS AND PROCEDURES

     As of the end of the  period  covered  by this  report,  management  of the
Company  carried  out  an  evaluation,   under  the  supervision  and  with  the
participation  of  the  Company's  principal  executive  officer  and  principal
financial officer, of the effectiveness of the Company's disclosure controls and
procedures.  Based on this evaluation, the Company's principal executive officer
and principal financial officer concluded that the Company's disclosure controls
and  procedures  are  effective  in  ensuring  that  information  required to be
disclosed  by the  Company  in  reports  that it  files  or  submits  under  the
Securities Exchange Act of 1934, as amended, is recorded, processed,  summarized
and reported,  within the time periods  specified in the Securities and Exchange
Commission's  rules  and  forms.  It  should  be noted  that the  design  of the
Company's  disclosure  controls  and  procedures  is based in part upon  certain
reasonable  assumptions about the likelihood of future events,  and there can be
no reasonable  assurance  that any design of disclosure  controls and procedures
will  succeed  in  achieving  its  stated  goals  under  all  potential   future
conditions,  regardless of how remote, but the Company's principal executive and
financial  officers have  concluded that the Company's  disclosure  controls and
procedures are, in fact, effective at a reasonable assurance level.

     In addition,  there have been no changes in the Company's  internal control
over financial  reporting (to the extent that elements of internal  control over
financial  reporting are subsumed  within  disclosure  controls and  procedures)
identified in connection  with the evaluation  described in the above  paragraph
that occurred  during the Company's  last fiscal  quarter,  that has  materially
affected,  or is reasonably likely to materially  affect, the Company's internal
control over financial reporting.













                                       25



<PAGE>

PART II.  OTHER INFORMATION

     ITEM 1. LEGAL PROCEEDINGS

     None.

     ITEM 2.  CHANGES IN  SECURITIES,  USE OF PROCEEDS  AND ISSUER  PURCHASES OF
     EQUITY SECURITIES

     None.

     ITEM 3. DEFAULTS UPON SENIOR SECURITIES

     None.

     ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS

          The Company's  Annual Meeting of Stockholders was held on February 11,
     2004 5,606,837 shares representing 95.2% of the total outstanding shares of
     the Company's common stock were represented at the Annual Meeting in person
     or by proxy.

     Stockholders voted in favor of the election of three nominees for director.
     The voting results for each nominee were as follows:
<TABLE>
<CAPTION>

                                                     Votes in Favor
         Nominee                                     of Election                Votes Withheld
         -------                                     --------------             --------------
         <S>                                            <C>                          <C>
         H. Adrian Cox                               5,582,911                          23,926
         William M. Loughran.                        5,553,387                          53,450
         John J. Panzer Jr.                          5,582,961                          23,876
</TABLE>

     There were 0 broker nonvotes on the matter.

          In addition,  stockholders  voted in favor of the  ratification of the
     appointment  of Beard  Miller  Company LLP as  independent  auditors of the
     Company for the fiscal year ending September 30, 2004. 5,582,596 votes were
     cast in favor of the proposal to ratify the appointment of auditors,  9,183
     votes were cast against the  proposal,  and 15,057 votes  abstained.  There
     were 0 broker non-votes on the matter.

     ITEM 5. OTHER INFORMATION

     None.

     ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  List of Exhibits

     The following exhibits are filed herewith:

        Exhibit
        Number          Title
        ------          -----

         3.2        Bylaws of BCSB Bankcorp Inc.

                                       26
<PAGE>

        31.1        Rule 13a-14(a) Certification of Chief Executive Officer

        31.2        Rule 13a-14(a) Certification of Chief Financial Officer

        32          Certification  Pursuant to 18 U.S.C.  Section 1350, as
                    Adopted Pursuant to Section 906 of the  Sarbanes-Oxley
                    Act of 2003.

     The  following  current  reports on Form 8-K were filed  during the quarter
ended March 31, 2004:

       (b)     Form 8-K

               On January 6, 2004 the Company filed a Current Report on Form 8-K
               reporting  under  Item  4. A  change  in  registrant's  certified
               accountant,  Beard Miller Company LLP, who acquired the Company's
               former certified accountant Anderson Associates, LLP.

               On February 12, 2004 the Company  filed a Current  Report on Form
               8-K reporting under Item 7 and Item 12.




                                       27
<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.


                                        BCSB BANKCORP, INC.



Date: May 12, 2004                     /s/ Gary C. Loraditch
                                       -----------------------------------
                                       Gary C. Loraditch
                                       President
                                       (Principal Executive Officer)


Date: May 12, 2004                     /s/ Bonnie M. Klein
                                       -----------------------------------
                                       Bonnie M. Klein
                                       Vice President and Treasurer
                                       (Principal Financial and Accounting
                                        Officer)



                                       28