SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

(Mark One)
[X]  Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934

     For the quarterly period ended:     September 30, 2005
                                         ------------------

[ ]  Transition  report  pursuant  to Section  13 or 15(d) of the  Securities
     Exchange Act of 1934

     For the transition period from ________ to ________

                           SEC File Number: 000-50467
                                            ---------


                          SYNERGY FINANCIAL GROUP, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                       New Jersey                                52-2413926
         --------------------------------------                  ----------
         (State or other jurisdiction of                     (I.R.S. Employer
          incorporation or organization)                     Identification No.)

         310 North Avenue East, Cranford, New Jersey                 07016
         --------------------------------------------------------------------
           (Address of principal executive offices)               (Zip Code)

                                 (908) 272-3838
             ------------------------------------------------------
              (Registrant's telephone number, including area code)


         Check whether the registrant:  (1) has filed all reports required to be
filed by Sections 13 or 15(d) of the Securities  Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports),  and (2) has been subject to such filing requirements for
the past 90 days. Yes  X    No
                      ---      ---

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes  X    No
                                                ---      ---

Indicate by check mark whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).  Yes      No  X
                                      ---     ---

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Number of shares outstanding of common stock as of October 31, 2005:

$0.10 Par Value Common Stock                       11,453,266
----------------------------               ----------------------------
           Class                                Shares Outstanding

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>

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

              Consolidated Balance Sheets as of September 30, 2005 (unaudited) and
                  December 31, 2004 (audited).....................................................................1

              Consolidated Statements of Income for the three and nine months ended
                  September 30, 2005 and 2004 (unaudited).........................................................2

              Consolidated Statement of Changes in Stockholders' Equity for the
                  nine months ended September 30, 2005 (unaudited)................................................3

              Consolidated Statements of Cash Flows for the nine months ended
                  September 30, 2005 and 2004 (unaudited).........................................................4

              Notes to Consolidated Financial Statements (unaudited)..............................................5

Item 2.       Management's Discussion and Analysis of Financial Condition
                  and Results of Operations......................................................................13

Item 3.       Quantitative and Qualitative Disclosures about Market Risk.........................................23

Item 4.       Controls and Procedures............................................................................24


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

Item 1.       Legal Proceedings..................................................................................25

Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds........................................25

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...........................................................................................26

Signatures.......................................................................................................27

</TABLE>

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                           Consolidated Balance Sheets
                        (In thousands, except share data)

<TABLE>
<CAPTION>
                                                                              September 30,    December 31,
                                                                                  2005             2004
                                                                               (unaudited)       (audited)
                                                                               -----------       ---------
<S>                                                                        <C>               <C>
Assets:
Cash and amounts due from banks                                              $     4,386       $     4,687
Interest-bearing deposits with banks                                               3,554             1,759
                                                                             -----------       -----------
Cash and cash equivalents                                                          7,940             6,446
Investment securities available-for-sale,
   at fair value                                                                  93,485           134,360
Investment securities held-to-maturity (fair
   value of $100,203 and $111,154, respectively)                                 101,155           110,584
Federal Home Loan Bank of New York
   stock, at cost                                                                 13,123            10,771
Loans receivable, net                                                            690,808           561,687
Accrued interest receivable                                                        3,118             2,751
Property and equipment, net                                                       17,752            16,814
Cash surrender value of bank-owned life insurance                                 13,010            12,637
Other assets                                                                       5,172             4,627
                                                                             -----------       -----------
     Total assets                                                            $   945,563       $   860,677
                                                                             ===========       ===========

Liabilities:
Deposits                                                                     $   581,140       $   538,916
Federal Home Loan Bank advances                                                  262,450           212,414
Advance payments by borrowers
   for taxes and insurance                                                         2,140             1,702
Accrued interest payable on advances                                                 780               385
Dividend payable                                                                     623               498
Other liabilities                                                                    599             2,720
                                                                             -----------       -----------
     Total liabilities                                                           847,732           756,635
                                                                             -----------       -----------

Stockholders' equity:
Preferred stock; $0.10 par value, 5,000,000 shares
   authorized; issued and outstanding - none                                           -                 -
Common stock; $0.10 par value, 20,000,000 shares authorized;
   Issued - 12,466,903 in 2005 and 12,452,011 in 2004
   Outstanding  - 11,453,266 in 2005 and 12,064,968 in 2004                        1,247             1,245
Additional paid-in-capital                                                        85,601            86,177
Retained earnings                                                                 32,211            30,603
Unearned ESOP shares                                                              (5,452)           (5,962)
Unearned RSP compensation                                                         (2,784)           (3,391)
Treasury stock held for the RSP, at cost; 363,037 and
   387,043 shares at September 30, 2005 and
   December 31, 2004, respectively                                                (4,042)           (4,343)
Treasury stock, at cost; 650,600 and -0- shares at
   September 30, 2005 and December 31, 2004, respectively                         (7,916)                -
Accumulated other comprehensive loss, net of taxes                                (1,034)             (287)
                                                                             -----------       -----------
     Total stockholders' equity                                                   97,831           104,042
                                                                             -----------       -----------
     Total liabilities and stockholders' equity                              $   945,563       $   860,677
                                                                             ===========       ===========
</TABLE>

        The accompanying notes are an integral part of these statements.

                                      -1-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                        Consolidated Statements of Income
                      (In thousands, except per share data)

<TABLE>
<CAPTION>
                                                                     For the Three Months          For the Nine Months
                                                                     ended September 30,           ended September 30,
                                                                  ------------------------      -------------------------
                                                                     2005         2004             2005          2004
                                                                  (unaudited)  (unaudited)      (unaudited)   (unaudited)
                                                                  -----------  -----------      -----------   -----------
<S>                                                             <C>           <C>              <C>          <C>
Interest income:
   Loans, including fees                                          $   9,819     $  7,278         $  27,074    $  20,647
   Investment securities                                              1,934        2,463             6,448        5,626
   Other                                                                156           42               391           88
                                                                  ---------     --------         ---------    ---------
     Total interest income                                           11,909        9,783            33,913       26,361
                                                                  ---------     --------         ---------    ---------
Interest expense:
   Deposits                                                           3,292        2,329             9,025        6,615
   Borrowed funds                                                     2,517        1,432             6,347        2,538
                                                                  ---------     --------         ---------    ---------
     Total interest expense                                           5,809        3,761            15,372        9,153
                                                                  ---------     --------         ---------    ---------
     Net interest income before provision for loan losses             6,100        6,022            18,541       17,208
Provision for loan losses                                               392          429             1,314        1,133
                                                                  ---------     --------         ---------    ---------
     Net interest income after provision for loan losses              5,708        5,593            17,227       16,075
                                                                  ---------     --------         ---------    ---------
Other income:
   Service charges and other fees on deposit accounts                   550          556             1,562        1,604
   Net gain (loss) on sale of investments                                 8           38               (26)          38
   Commissions                                                          211          153               660          186
   Other                                                                255          205               665          336
                                                                  ---------     --------         ---------    ---------
     Total other income                                               1,024          952             2,861        2,164
                                                                  ---------     --------         ---------    ---------
Other expenses:
   Salaries and employee benefits                                     2,784        2,687             8,261        7,180
   Premises and equipment                                               962          939             2,789        2,854
   Occupancy                                                            604          490             1,655        1,436
   Professional services                                                165          156               560          403
   Advertising                                                          269          241               723          603
   Other operating                                                      272          384               828          974
                                                                  ---------     --------         ---------    ---------
     Total other expenses                                             5,056        4,897            14,816       13,450
                                                                  ---------     --------         ---------    ---------
     Income before income tax expense                                 1,676        1,648             5,272        4,789
Income tax expense                                                      568          554             1,939        1,780
                                                                  ---------     --------         ---------    ---------
     Net income                                                   $   1,108     $  1,094         $   3,333    $   3,009
                                                                  =========     ========         =========    =========

Per share of common stock:
   Basic earnings per share                                       $    0.10     $   0.10         $    0.30    $    0.28
                                                                  =========     ========         =========    =========
   Diluted earnings per share                                     $    0.10     $   0.09         $    0.29    $    0.27
                                                                  =========     ========         =========    =========

Basic weighted average shares outstanding                            10,711       11,496            10,993       10,886
                                                                     ======       ======            ======       ======
Diluted weighted average shares outstanding                          11,102       11,743            11,390       11,113
                                                                     ======       ======            ======       ======
</TABLE>

        The accompanying notes are an integral part of these statements.

                                      -2-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
            Consolidated Statement of Changes in Stockholders' Equity
                  For the Nine Months Ended September 30, 2005
                                   (Unaudited)
                  (Dollars in thousands, except share amounts)

<TABLE>
<CAPTION>
                                                                                           Treasury               Other
                            Common stock                                                     stock             accumulated
                          ------------------ Additional            Unearned    Unearned    acquired           comprehensive
                              Shares    Par   paid-in-  Retained     ESOP         RSP      for the  Treasury  income (loss),
                              issued   value   capital  earnings    shares   compensation    RSP      stock        net        TOTAL
                              ------   -----   -------  --------    ------   ------------    ---    --------       ---        -----
<S>                      <C>         <C>      <C>       <C>       <C>            <C>      <C>       <C>  <C>    <C>       <C>
BALANCE AT
JANUARY 1, 2005           12,452,011  $1,245   $86,177   $30,603   $(5,962)     $(3,391)   $(4,343)  $   -0-     $  (287)  $104,042
  Net income                       -       -         -     3,333         -            -          -         -           -      3,333
  Other comprehensive
    income, net of
    reclassification
    adjustment and
    taxes                          -       -         -         -         -            -          -         -        (747)      (747)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive
  income                                                                                                                      2,586
-----------------------------------------------------------------------------------------------------------------------------------
  Dividends declared               -       -         -    (1,725)        -            -          -         -           -     (1,725)
  Common stock issued for
    options exercised
    (14,892 shares)           14,892       2        81                                                                           83
  Common stock held by
    ESOP committed
    to be released
    (74,718 shares)                -       -       410         -       510            -          -         -           -        920
  Compensation
    recognized under
    RSP Plan                       -       -         -         -         -          607          -         -           -        607
  Common stock
    repurchased for RSP
    (63,851 shares)                -       -         -         -         -            -       (766)        -           -       (766)
  Common stock issued by
    RSP (87,857 shares)                         (1,067)                                      1,067                                -
  Purchase of treasury
    stock (650,600 shares)         -       -         -         -         -            -          -    (7,916)          -     (7,916)
                          ----------  ------   -------   -------   -------      -------    -------   -------     -------    -------
BALANCE AT
SEPTEMBER 30, 2005        12,466,903  $1,247   $85,601   $32,211   $(5,452)     $(2,784)   $(4,042)  $(7,916)    $(1,034)   $97,831
                          ==========  ======   =======   =======   =======      =======    =======   =======     =======    =======
</TABLE>

        The accompanying notes are an integral part of these statements.

                                      -3-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                                 (In thousands)

<TABLE>
<CAPTION>
                                                                           For the Nine Months
                                                                           Ended September 30,
                                                                        ------------------------
                                                                            2005         2004
                                                                        (unaudited)  (unaudited)
                                                                        -----------  -----------
<S>                                                                  <C>           <C>
Operating activities:
     Net income                                                         $   3,333    $   3,009
   Adjustments to reconcile net income to net cash
     provided by operating activities
   Depreciation and amortization                                            1,139        1,086
   Provision for loan losses                                                1,314        1,133
   Deferred income taxes                                                     (405)         (83)
   Amortization of deferred loan fees and costs                               (81)          (9)
   Amortization of premiums on investment securities                          679        1,099
   Net loss (gain) on sale of investment securities                            26          (38)
   Release of ESOP shares                                                     920          763
   Compensation under RSP plan                                                607          274
   Increase in accrued interest receivable                                   (367)        (753)
   Increase in other assets                                                  (141)        (707)
   (Decrease) increase in other liabilities                                (2,121)         391
   Increase in cash surrender value of bank-owned life insurance             (373)         (50)
   Increase in accrued interest payable on advances                           395          276
                                                                          ---------    ---------
         Net cash provided by operating activities                          4,925        6,391
                                                                        ---------    ---------

Investing activities:
   Purchase of investment securities held-to-maturity                     (12,536)     (93,010)
   Purchase of investment securities available-for-sale                    (2,084)     (63,482)
   Maturity and principal repayments of investment
     securities held-to-maturity                                           21,819        9,650
   Maturity and principal repayments of investment
     securities available-for-sale                                         28,846       39,721
   Purchase of property and equipment                                      (2,077)        (549)
   Purchase of FHLB Stock                                                  (2,352)      (6,862)
   Purchase of bank owned life insurance                                        -      (10,000)
   Proceeds from the sale of investment securities available for sale      12,808          885
   Loan originations, net of principal repayments                        (120,186)     (59,462)
   Purchase of loans                                                      (10,168)     (26,653)
                                                                        ---------    ---------
         Net cash used in investing activities                            (85,930)    (209,762)
                                                                        ---------    ---------
Financing activities:
   Net increase in deposits                                                42,224       48,823
   Increase in short-term FHLB advances                                    61,475       17,321
   (Decrease) increase in long-term FHLB advances                         (11,439)     115,480
   Increase (decrease) in advance payments by borrowers
     for taxes and insurance                                                  438          (86)
   Dividends paid                                                          (1,600)        (462)
   Decrease in stock subscriptions payable                                      -      (38,322)
   Net proceeds from issuance of common stock                                   -       69,261
   Net purchase of common stock for ESOP                                        -       (5,628)
   Purchase of treasury stock for the RSP Plan                               (766)      (1,808)
   Purchase of treasury stock                                              (7,916)           -
   Common stock issued for options exercised                                   83            -
                                                                        ---------    ---------
   Net cash provided by financing activities                               82,499      204,579
                                                                        ---------    ---------
         Net increase in cash and cash equivalents                          1,494        1,208

Cash and cash equivalents at beginning of year                              6,446        7,292
                                                                        ---------    ---------
Cash and cash equivalents at end of period                              $   7,940    $   8,500
                                                                        =========    =========

Supplemental disclosure of cash flow information:
   Cash paid during the period for income taxes                         $   2,849    $   1,866
                                                                        =========    =========
   Interest paid on deposits and borrowed funds                         $  15,767    $   8,876
                                                                        =========    =========
</TABLE>

        The accompanying notes are an integral part of these statements.

                                      -4-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)


1. BASIS OF FINANCIAL STATEMENT PRESENTATION

The  accounting   policies  followed  by  Synergy  Financial  Group,  Inc.  (the
"Company")  conform to accounting  principles  generally  accepted in the United
States of America and to predominant practice within the banking industry.

The consolidated  financial  statements  include the accounts of the Company and
its  wholly-owned  subsidiaries,  Synergy Bank (the "Bank"),  and its subsidiary
Synergy Capital  Investments,  Inc., and Synergy  Financial  Services,  Inc. All
significant  inter-company  accounts and  transactions  have been  eliminated in
consolidation.

The accompanying  unaudited  condensed  consolidated  financial  statements were
prepared in accordance with  instructions to Form 10-Q, and,  therefore,  do not
include  information  or  footnotes  necessary  for a complete  presentation  of
financial position,  results of operations,  changes in equity and cash flows in
conformity with accounting principles generally accepted in the United States of
America.  However,  all normal  recurring  adjustments  that,  in the opinion of
management,  are necessary for a fair presentation of the consolidated financial
statements  have been included.  These  financial  statements  should be read in
conjunction  with  the  audited   consolidated   financial  statements  and  the
accompanying  notes thereto included in the Company's Annual Report on Form 10-K
for the period ended  December  31, 2004.  The results for the nine months ended
September  30, 2005 are not  necessarily  indicative  of the results that may be
expected for the fiscal year ending December 31, 2005 or any other period.

In preparing the financial statements,  management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities,  the
disclosure  of  contingent  assets and  liabilities  at the date of the  balance
sheets,  and the reported  amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

The principal  estimates that are susceptible to significant  change in the near
term relate to the allowance for loan losses.  The evaluation of the adequacy of
the allowance for loan losses  includes an analysis of the individual  loans and
overall risk  characteristics  and size of the different  loan  portfolios,  and
takes into consideration current economic and market conditions,  the capability
of specific borrowers to pay specific loan obligations,  as well as current loan
collateral  values.  However,  actual losses on specific  loans,  which also are
encompassed in the analysis, may vary from estimated losses.

Statement of Financial  Accounting Standards ("SFAS") No. 131, Disclosures About
Segments of an Enterprise and Related Information, establishes standards for the
way business  enterprises  report information about operating segments in annual
financial statements.  The Bank has one operating segment and, accordingly,  has
one reportable  segment,  "Community  Banking." All of the Bank's activities are
interrelated,  and each activity is dependent and assessed  based on how each of
the activities of the Bank supports the others. For example,  commercial lending
is  dependent  upon the ability of the Bank to fund itself with retail  deposits
and other borrowings and to manage interest rate and credit risk. This situation
is also similar for  consumer,  residential,  multi-family  and  non-residential
mortgage lending.  Accordingly,  all significant  operating  decisions are based
upon analysis of the Bank as one operating segment.

                                      -5-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)


2. EARNINGS PER SHARE

Basic  earnings  per share is computed by dividing  income  available  to common
stockholders by the weighted average number of common shares outstanding for the
period.  Diluted  earnings per share reflects the potential  dilution that could
occur if  securities  or other  contracts  to issue  common stock (such as stock
options)  were  exercised  or resulted in the  issuance of common  stock.  These
potentially  dilutive  shares would then be included in the  weighted  number of
shares outstanding for the period using the treasury stock method. Shares issued
and shares  re-acquired  during any period are  weighted  for the portion of the
period that they were outstanding.

The  computation  of both basic and  diluted  earnings  per share  includes  the
Employee  Stock   Ownership  Plan  ("ESOP")  shares   previously   allocated  to
participants  and shares committed to be released for allocation to participants
and restricted stock plan ("RSP") shares that have vested or have been allocated
to participants.  ESOP and RSP shares that have been purchased but not committed
to be released have not been considered in computing basic and diluted  earnings
per share.

The following is a  reconciliation  of the  numerators and  denominators  of the
basic and diluted earnings per share computation (in thousands, except per share
data):

<TABLE>
<CAPTION>
                                                                 For the Three Months Ended September 30, 2005
                                                                 ---------------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                           ---------------      -----------------      ---------------
<S>                                                        <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   1,108                 10,711            $    0.10
       Effect of dilutive common stock equivalents                    0                    391                 0.00
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   1,108                 11,102            $    0.10
                                                              =========                 ======            =========
</TABLE>

<TABLE>
<CAPTION>
                                                                 For the Three Months Ended September 30, 2004
                                                                 ---------------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                           ---------------      -----------------      ---------------
<S>                                                        <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   1,094                 11,496            $    0.10
       Effect of dilutive common stock equivalents                    0                    247                (0.01)
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   1,094                 11,743            $    0.09
                                                              =========                 ======            =========
</TABLE>

                                      -6-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                 For the Nine Months Ended September 30, 2005
                                                                 --------------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                           ---------------      -----------------      ---------------
<S>                                                        <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   3,333                 10,993            $    0.30
       Effect of dilutive common stock equivalents                    0                    397                (0.01)
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   3,333                 11,390            $    0.29
                                                              =========                 ======            =========
</TABLE>

<TABLE>
<CAPTION>
                                                                 For the Nine Months Ended September 30, 2004
                                                                 --------------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                           ---------------      -----------------      ---------------
<S>                                                        <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   3,009                 10,886            $    0.28
       Effect of dilutive common stock equivalents                    0                    227                (0.01)
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   3,009                 11,113            $    0.27
                                                              =========                 ======            =========
</TABLE>


3. STOCK-BASED COMPENSATION

The Company's  stock option plans and the  restricted  stock plans are accounted
for in accordance  with the  provisions of Accounting  Principles  Board ("APB")
Opinion  No.  25,  Accounting  for  Stock  Issued  to  Employees,  and  released
Interpretations.  Accordingly,  no compensation  expense has been recognized for
the stock option plans.  Expense for the restricted stock plans in the amount of
the fair value of the common  stock at the date of grant is  recognized  ratably
over the vesting period.

Had an expense for the Company's stock option plans been determined based on the
fair value at the grant date for the Company's stock options consistent with the
method outlined in SFAS No. 123,  Accounting for Stock-Based  Compensation,  the
Company's  net income and earnings  per share for all expenses  related to stock
options and stock granted in its restricted  stock plans would have been reduced
to the pro forma amounts that follow (in thousands, except per share data):

                                      -7-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                  For the Three Months       For the Nine Months
                                                                  ended September 30,        ended September 30,
                                                                  -------------------        -------------------
                                                                   2005          2004        2005         2004
                                                                (unaudited)   (unaudited) (unaudited)  (unaudited)
                                                                -----------   -----------------------  -----------
<S>                                                           <C>          <C>           <C>          <C>
    Net income, as reported                                     $   1,108    $   1,094     $  3,333     $   3,009
    Add expense recognized for the restricted stock plans,
       net of related tax effect                                      130           99          389           176
    Less total stock option plan and restricted stock plan
       expense, determined under the fair value method,
       net of related tax effect                                     (227)        (226)        (683)         (405)
                                                                ---------    ---------     --------     ---------
    Net income, pro forma                                       $   1,011    $     967     $  3,039     $   2,780
                                                                =========    =========     ========     =========
    Basic earnings per share:
       As reported                                              $    0.10    $    0.10     $   0.30     $   0.28
       Pro forma                                                $    0.09    $    0.08     $   0.28     $   0.26
    Diluted earnings per share:
       As reported                                              $    0.10    $    0.09     $   0.29     $   0.27
       Pro forma                                                $    0.09    $    0.08     $   0.27     $   0.25
</TABLE>

The fair value of each option  grant is estimated on the date of grant using the
Black-Scholes  options price model. The following  weighted average  assumptions
were utilized for grants in 2003:  dividend yield of 0.00%;  expected volatility
of 29.44 %; risk-free  interest rate of 3.01%; and, expected life of five years.
The following  weighted  average  assumptions  were utilized for grants in 2004:
dividend yield of 1.60%; expected volatility of 32.85%;  risk-free interest rate
of 3.33%;  and,  expected  life of five years.  The following  weighted  average
assumptions were utilized for grants in 2005: dividend yield of 2.00%;  expected
volatility of 14.97%;  risk-free  interest rate of 3.83%;  and, expected life of
five years.

The Company has established an ESOP covering eligible employees with one year of
service, as defined by the ESOP. The Company accounts for the ESOP in accordance
with the  American  Institute  of  Certified  Public  Accountants'  Statement of
Position  ("SOP") No. 93-6,  Employers'  Accounting for Employee Stock Ownership
Plans.  SOP No. 93-6  addresses  the  accounting  for shares of stock  issued to
employees  by  an  ESOP.  SOP  No.  93-6  requires  that  the  employer   record
compensation  expense in the amount equal to the fair value of shares  committed
to be released from the ESOP to employees.

Compensation  expense for the ESOP is recorded at an amount  equal to the shares
allocated by the ESOP  multiplied by the average fair market value of the shares
during the year. The Company  recognizes  compensation  expense ratably over the
year for the ESOP  shares  to be  allocated  based  upon the  Company's  current
estimate  of the number of shares  expected to be  allocated  by the ESOP during
each calendar year. The difference between the average fair market value and the
cost of the  shares  allocated  by the  ESOP is  recorded  as an  adjustment  to
additional paid-in-capital.

                                      -8-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)


4. RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the Financial  Accounting  Standards Board (the "FASB") issued
SFAS No.  123(R),  Share-Based  Payment an Amendment of SFAS No. 123 and APB No.
25, that addresses the accounting for share-based payment  transactions in which
an enterprise  receives employee services in exchange for (a) equity instruments
of the  enterprise  or (b)  liabilities  that are based on the fair value of the
enterprise's  equity  instruments or that may be settled by the issuance of such
equity instruments.  Under SFAS No. 123(R), all forms of share-based payments to
employees,  including employee stock options, would be treated the same as other
forms of compensation  by recognizing the related cost in the income  statement.
The expense of the award would  generally be measured at fair value at the grant
date.  Current  accounting  guidance  requires  that  the  expense  relating  to
so-called  fixed plan employee  stock options only be disclosed in the footnotes
to the  financial  statements.  The  Statement  would  eliminate  the ability to
account  for  share-based  compensation  transactions  using APB Opinion No. 25,
Accounting for Stock Issued to Employees. This statement is effective for public
entities that do not file as small  business  issuers as of the beginning of the
first interim or annual  reporting  period that begins after  December 15, 2005.
The  Company is  currently  evaluating  this  statement  and its  effects on the
Company's results of operations.

On March 29, 2005, the Securities and Exchange Commission ("SEC") released Staff
Accounting  Bulletin ("SAB") 107, Share Based Payments.  The  interpretations in
SAB 107 express  views of the SEC staff  regarding the  application  of SFAS No.
123(R).  Among other things, SAB 107 provides  interpretive  guidance related to
the interaction  between SFAS No. 123(R) and certain SEC rules and  regulations,
as well as provides the staff's views  regarding  the  valuation of  share-based
payment arrangements for public companies.  The Company is evaluating the impact
that the  implementation  of SAB 107 and SFAS No.  123(R)  will  have on  future
option grants.

On April 14, 2005, the SEC voted unanimously to adopt a staff  recommendation to
delay  the  effective  date  of SFAS  No.  123(R)  for  many  public  companies.
Specifically,  the new rule states that public  companies  do not have to comply
with  Statement  No.  123(R)  until the first  quarter of the first  fiscal year
beginning after June 15, 2005,  rather than the first quarterly or annual period
beginning after that date, as originally prescribed by SFAS No. 123(R). As such,
calendar year public  companies  must begin  complying  with SFAS No. 123(R) for
their first quarterly  period beginning in 2006, and not in the third quarter of
2005.

On June 29, 2005, the FASB issued FASB Staff  Position  ("FSP") SFAS No. ("FAS")
115-1,  The Meaning of Other than Temporary  Impairment  and Its  Application to
Certain  Investments.  This  reflects  the latest  changes to the FASB  Emerging
Issues Task Force ("EITF") 03-1,  which the Bank adopted in December 2003.  EITF
03-1  included  certain  disclosures  regarding   quantitative  and  qualitative
disclosures  for  investment  securities  accounted  for  under  SFAS  No.  115,
Accounting  for  Certain  Investments  in Debt and Equity  Securities,  that are
impaired at the balance sheet date, but an  other-than-temporary  impairment has
not been  recognized.  FSP SFAS No.  115-1 will codify the guidance set forth in
EITF Topic D-44 and clarify that an investor  should  recognize an impairment no
later than when the  impairment is considered  other than  temporary,  even if a
decision to sell has not been made.  FSP SFAS No.  115-1 will be  effective  for
other-than-temporary  impairment  analysis  conducted in periods beginning after
September 15, 2005. The Company is in the process of determining the impact that
EITF 03-1 will have on its financial statements.

                                      -9-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)


5. INVESTMENT SECURITIES

The amortized cost,  gross  unrealized  gains and losses,  and fair value of the
Company's investment securities  available-for-sale  and held-to-maturity are as
follows (in thousands):

<TABLE>
<CAPTION>
                                                                        September 30, 2005 (unaudited)
                                                          ---------------------------------------------------------
                                                                              Gross          Gross
                                                          Amortized        unrealized     unrealized        Fair
                                                              cost            gains         losses          value
                                                          ---------------------------------------------------------
<S>                                                     <C>              <C>            <C>           <C>
   Available-for-sale
   ------------------
     U.S. government obligations                          $     1,999      $       -      $     (78)    $     1,921
     Mortgage-backed securities:
       FHLMC                                                   60,823             12           (970)         59,865
       FNMA                                                    31,263             16           (525)         30,754
     Equity securities                                          1,000                           (55)            945
                                                          -----------      ---------      ---------     -----------

         Total                                            $    95,085      $      28      $  (1,628)    $    93,485
                                                          ===========      =========      =========     ===========
</TABLE>

<TABLE>
<CAPTION>
                                                                        September 30, 2005 (unaudited)
                                                          ---------------------------------------------------------
                                                                              Gross          Gross
                                                            Amortized      unrealized     unrealized        Fair
                                                              cost            gains         losses          value
                                                          ---------------------------------------------------------
<S>                                                     <C>              <C>            <C>           <C>
   Held-to-maturity
   ----------------
     Mortgage-backed securities:
       FHLMC                                              $    41,212      $      62       $   (597)    $    40,677
       FNMA                                                    56,771             88           (509)         56,350
       GNMA                                                     3,162             14            (10)          3,166
     Other debt securities                                         10              -              -              10
                                                          -----------      ---------      ---------     -----------
       Total                                              $   101,155      $     164      $  (1,116)    $   100,203
                                                          ===========      =========      =========     ===========
</TABLE>

<TABLE>
<CAPTION>
                                                                               December 31, 2004
                                                          ---------------------------------------------------------
                                                                              Gross          Gross
                                                            Amortized      unrealized     unrealized        Fair
                                                              cost            gains         losses          value
                                                          ---------------------------------------------------------
<S>                                                     <C>              <C>            <C>           <C>
   Available-for-sale
   ------------------
     U.S. government obligations                          $     2,500      $       -       $    (57)    $     2,443
     Mortgage-backed securities:
       FHLMC                                                   82,597            208           (475)         82,330
       FNMA                                                    48,684            123           (213)         48,594
     Equity securities                                          1,029              9            (45)            993
                                                          -----------      ---------      ---------     -----------
         Total                                            $   134,810      $     340       $   (790)    $   134,360
                                                          ===========      =========       ========     ===========
</TABLE>

                                      -10-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                              December 31, 2004
                                                          ---------------------------------------------------------
                                                                              Gross          Gross
                                                            Amortized      unrealized     unrealized        Fair
                                                              cost            gains         losses          value
                                                          ---------------------------------------------------------
<S>                                                     <C>              <C>             <C>          <C>
   Held-to-maturity
   ----------------
     Mortgage-backed securities:
       FHLMC                                              $    47,360      $     229       $   (256)    $    47,333
       FNMA                                                    59,121            668           (124)         59,665
       GNMA                                                     4,093             53              -           4,146
     Other debt securities                                         10              -              -              10
                                                          -----------      ---------       --------     -----------
         Total                                            $   110,584      $     950       $   (380)    $   111,154
                                                          ===========      =========       ========     ===========
</TABLE>


6. LOANS RECEIVABLE

Major groupings of loans are as follows (in thousands):

<TABLE>
<CAPTION>
                                                                          September 30,             December 31,
                                                                              2005                      2004
                                                                       --------------------------------------------
<S>                                                                    <C>                       <C>
   Mortgages:
     Residential, 1-4 family                                             $   242,823               $   243,772
     Non-residential and multi-family                                        232,065                   154,226
   Construction                                                                8,183                     5,792
   Automobile                                                                187,412                   146,148
   Commercial                                                                 21,985                    12,208
   Other                                                                       3,501                     3,720
                                                                         -----------               -----------

   Loans receivable                                                          695,969                   565,866
   Deferred loan fees and costs                                                  235                       248
   Allowance for loan losses                                                  (5,396)                   (4,427)
                                                                         -----------               -----------
   Loans receivable, net                                                 $   690,808               $   561,687
                                                                         ===========               ===========
</TABLE>

A summary of the  activity  in the  allowance  for loan losses is as follows (in
thousands):

<TABLE>
<CAPTION>
                                                                                 For the Nine Months Ended
                                                                       --------------------------------------------
                                                                         September 30,            September 30,
                                                                            2005                     2004
                                                                       --------------------------------------------

<S>                                                                    <C>                       <C>
   Balance, beginning of period                                          $     4,427               $     3,274
   Provision for loan losses                                                   1,314                     1,133
   Recoveries                                                                    240                       321
   Loans charged-off                                                            (585)                     (598)
                                                                         -----------               -----------
   Balance, end of period                                                $     5,396               $     4,130
                                                                         ===========               ===========
</TABLE>

                                      -11-

<PAGE>

                 SYNERGY FINANCIAL GROUP, INC. AND SUBSIDIARIES
                   Notes to Consolidated Financial Statements
                                   (unaudited)

7. DEPOSITS

Deposits are summarized as follows (in thousands):

<TABLE>
<CAPTION>
                                                                          September 30,             December 31,
                                                                              2005                      2004
                                                                       --------------------------------------------
<S>                                                                    <C>                       <C>
     Non-interest-bearing checking accounts                              $    56,825               $    52,019
     Interest-bearing checking accounts                                        4,106                     3,946
     Savings and club accounts                                                62,269                    67,115
     Money market accounts                                                   134,155                   163,091
     Certificate of deposit accounts                                         323,785                   252,745
                                                                         -----------               -----------
                                                                         $   581,140               $   538,916
                                                                         ===========               ===========
</TABLE>


8. FEDERAL HOME LOAN BANK ("FHLB") OF NEW YORK ADVANCES

1. Short-Term FHLB Advances
   ------------------------

Short-term  FHLB advances  generally have  maturities of less than one year. The
details  of  these   advances  are  presented   below  (in   thousands,   except
percentages):

<TABLE>
<CAPTION>
                                                                                       At or For The
                                                                       --------------------------------------------
                                                                           Nine Months              Twelve Months
                                                                              Ended                     Ended
                                                                          September 30,             December 31,
                                                                              2005                      2004
                                                                       --------------------------------------------

<S>                                                                     <C>                       <C>
Average balance outstanding                                              $    56,291               $    33,618
Maximum amount outstanding at any month end during the period                 92,500                    48,975
Balance outstanding at period end                                             92,500                    31,025
Weighted average interest rate during the period                                3.35%                     1.61%
Weighted average interest rate at period end                                    3.76%                     2.42%
</TABLE>

2. Long-Term FHLB Advances
   -----------------------

At September 30, 2005,  long-term advances from the FHLB totaled $169.9 million.
Advances  consist of  fixed-rate  advances  that will mature  within one to nine
years. The advances are  collateralized by FHLB stock and certain first mortgage
loans,  first-lien  home  equity  loans and  mortgage-backed  securities.  These
advances had a weighted average interest rate of 3.68%.

As of  September  30,  2005,  long-term  FHLB  advances  mature as  follows  (in
thousands):

   2005                                                $    16,000
   2006                                                     59,150
   2007                                                     58,000
   2008                                                     26,100
   2009                                                      8,000
   Thereafter                                                2,700
                                                       -----------
                                                       $   169,950
                                                       ===========

                                      -12-

<PAGE>

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


General

         Management's discussion and analysis of financial condition and results
of  operations  is  intended  to  provide   assistance  in   understanding   our
consolidated  financial condition and results of operations.  The information in
this section should be read with the consolidated  interim financial  statements
and the notes thereto included in this Form 10-Q.

         Our results of operations  are primarily  dependent on our net interest
income.  Net interest  income is a function of the balances of  interest-earning
assets  outstanding in any one period, the yields earned on those assets and the
interest paid on deposits and borrowed funds that were  outstanding in that same
period.  To a lesser extent,  the relative  levels of our other income and other
expenses  also  affect our  results of  operations.  Our other  income  consists
primarily of fees and service  charges,  commissions and gains and losses on the
sale of loans and investments.  The other expenses consist primarily of employee
compensation  and benefits,  occupancy and equipment  expenses,  data processing
costs,  marketing  costs,  professional  fees,  office  supplies,  telephone and
postage costs. Our results of operations are also significantly  impacted by the
amount of provisions for loan losses which, in turn, are dependent  upon,  among
other things,  the size and makeup of the loan portfolio,  loan quality and loan
trends.


Forward-Looking Statements

         This report  contains  certain  forward-looking  statements  within the
meaning  of  Section  27A of  the  Securities  Act  of  1933,  as  amended  (the
"Securities  Act"), and Section 21 E of the Securities  Exchange Act of 1934, as
amended  (the  "Exchange  Act").   The  Company  intends  such   forward-looking
statements  to be  covered by the safe  harbor  provisions  for  forward-looking
statements  contained  in the  Private  Securities  Reform  Act of 1995,  and is
including  this  statement  for the  purpose  of these safe  harbor  provisions.
Forward-looking statements,  which are based on certain assumptions and describe
future  plans,  strategies  and  expectations  of  the  Company,  are  generally
identified  by use of the words  "believe,"  "expect,"  "intend,"  "anticipate,"
"estimate," "project," or similar expressions.  The Company's ability to predict
results  or the  actual  effect  of future  plans or  strategies  is  inherently
uncertain.  Factors which could have a material adverse effect on the operations
of the Company and its subsidiaries  include, but are not limited to, changes in
interest rates,  general economic  conditions,  legislative/regulatory  changes,
monetary and fiscal policies of the U.S.  Government,  including policies of the
U.S.  Treasury and the Federal Reserve Board,  the quality or composition of the
loan  or  investment  portfolios,  demand  for  loan  products,  deposit  flows,
competition,  demand for  financial  services in the  Company's  market area and
accounting  principles and guidelines.  These risks and uncertainties  should be
considered in evaluating  forward-looking  statements and undue reliance  should
not be placed on such statements. Further information concerning the Company and
its business,  including  additional  factors that could  materially  effect the
Company's financial results, is included in the Company's filings with the SEC.

         The  Company  does  not  undertake  - and  specifically  disclaims  any
obligation - to release  publicly the results 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.

                                      -13-

<PAGE>

Critical Accounting Policies, Judgments and Estimates

       The  accounting  and reporting  policies of the Company  conform with the
accounting  principles  generally  accepted in the United  States of America and
general practices within the financial services industry. The preparation of the
financial statements in conformity with accounting principles generally accepted
in the United  States of  America  requires  management  to make  estimates  and
assumptions that affect the amounts reported in the financial statements and the
accompanying notes. Actual results could differ from those estimates.

       Allowance for Loan Losses.  The Company recognizes that the determination
of the  allowance  for loan  losses  involves a higher  degree of  judgment  and
complexity than its other significant  accounting  policies.  The balance in the
allowance  for loan  losses  is  determined  based on  management's  review  and
evaluation of the loan portfolio in relation to past loss  experience,  the size
and composition of the portfolio,  current  economic events and conditions,  and
other  pertinent  factors,  including  management's  assumptions  as  to  future
delinquencies, recoveries and losses. All of these factors may be susceptible to
significant  change.  To the extent  actual  outcomes  differ from  management's
estimates,  additional  provisions  for loan losses may be  required  that would
adversely impact earnings in future periods.

       Intangible  Assets.  Intangible  assets,  such as  goodwill  and the core
deposit intangible associated with the January 2003 acquisition of First Bank of
Central Jersey,  are subject to annual  impairment tests and, in the case of the
core deposit intangible,  amortization of the asset through a charge to expense.
To the extent the  outcome of the  impairment  tests  differ  from the  carrying
value,  additional  charges to expense  could be required to reduce the carrying
value, which would adversely impact earnings in future periods.

       Income  Taxes.  Under the  liability  method,  deferred  tax  assets  and
liabilities  are  determined  based  on the  difference  between  the  financial
statement  and tax basis of assets  and  liabilities.  Deferred  tax  assets are
subject to  management's  judgment  based upon  available  evidence  that future
realization is more likely than not. If management  determines  that the Company
may be unable  to  realize  all or part of the net  deferred  tax  assets in the
future,  a direct  charge to income tax  expense  may be  required to reduce the
recorded value of the net deferred tax assets to the expected realizable amount,
thereby impacting earnings.

Comparison of Financial Condition at September 30, 2005 and December 31, 2004

       Assets.  Total assets  reached  $945.6  million on September 30, 2005, an
increase of 9.9%, or $84.9  million,  from $860.7  million on December 31, 2004.
This growth was primarily  attributable  to increases in the loan  portfolio and
FHLB stock, partially offset by a decrease in investment securities.

       Between December 31, 2004 and September 30, 2005,  investment  securities
decreased $50.3 million,  or 20.5%, from $244.9 million to $194.6 million.  This
decrease  was  primarily  due to  $50.6  million  in  maturities  and  principal
repayments  coupled with the sale of approximately  $12.8 million in securities,
which resulted in a net loss of $26,000.  These decreases were partially  offset
by $14.7 million in purchases.  Additionally,  there was a $1.2 million decrease
in the unrealized market value associated with investment  securities designated
available-for-sale.  FHLB stock holdings  increased  21.6%, or $2.3 million,  to
$13.1 million at September 30, 2005, from $10.8 million at December 31, 2004.

       Net loans  increased  23.0%,  or $129.1  million,  to $690.8  million  at
September  30,  2005,  from $561.7  million at December  31,  2004.  This growth
includes $120.2 million in originations,  net of principal repayments, and $10.2
million in purchases,  offset by  amortization of the premium on purchased loans
and

                                      -14-

<PAGE>

deferred loan fees,  along with a provision of $1.3 million to the allowance for
loan losses. The most significant changes during the nine months ended September
30, 2005 were in  non-residential  and  multi-family  mortgage,  automobile  and
commercial loans.  Non-residential and multi-family mortgages increased by $77.8
million,  or 50.5%,  to $232.1  million.  Automobile  loans  increased  by $41.3
million,  or 28.2%,  to  $187.4  million.  Commercial  loans  increased  by $9.8
million, or 80.1%, to $22.0 million.

       On September 30, 2005,  total loans of $696.2  million were  comprised of
33.3% in  non-residential  and  multi-family  mortgage loans,  27.4% in consumer
loans,  comprised  mostly  of  direct  automobile  loans  for  both new and used
vehicles,  18.4% in one-to-four  family real estate loans,  16.5% in home equity
loans, 3.2% in commercial loans and 1.2% in construction loans.

       The allowance for loan losses was $5.4  million at  September  30,  2005,
compared to $4.4  million at December 31, 2004.  This  reflects a provision  for
loan losses of $1.3 million for the nine-month period, offset by net charge-offs
of  $345,000.  The  ratio of the  allowance  to total  loans  was  0.78% at both
September 30, 2005 and December 31, 2004. The ratio of non-performing  assets to
total assets was 0.06% at September 30, 2005,  compared to 0.03% at December 31,
2004.

       Liabilities.  Total  liabilities  increased  $91.1 million,  or 12.0%, to
$847.7 million at September 30, 2005,  from $756.6 million at December 31, 2004.
The increase in total liabilities  resulted  primarily from an increase of $50.0
million,  or 23.6%, in FHLB advances and a $42.2 million,  or 7.8%,  increase in
deposits.  The  balance  of the  change is  attributable  to a decline  in other
liabilities of $1.1 million.

       Deposits  reached  $581.1  million at September  30, 2005, an increase of
$42.2 million,  or 7.8%, from the $538.9 million  reported at December 31, 2004.
This growth  resulted  from an increase in  certificate  of deposit  accounts of
$71.0  million,  or 28.1%,  for the nine months ended  September 30, 2005.  This
increase was  primarily the result of  initiatives  directed  toward  attracting
funds  with  extended  maturities  in  response  to the  current  interest  rate
environment.  Total core deposits, which consist of checking,  savings and money
market accounts, decreased $28.8 million, or 10.1 percent, and represented 44.3%
of total deposits at September 30, 2005, compared to 53.1% at December 31, 2004.
Even though total core deposits  declined during this period,  checking accounts
increased by $5.0 million, or 8.9%.

       The $50.0 million increase in FHLB advances between December 31, 2004 and
September  30, 2005 has  primarily  funded the  origination  of loans during the
nine-month period.

       Equity.  Stockholders'  equity  totaled  $97.8 million  at  September 30,
2005, a decrease of 6.0%, or $6.2 million,  from $104.0  million at December 31,
2004.  The decline was  attributable  to the  repurchase of common stock in open
market transactions  associated with the Company's two stock repurchase programs
that were  announced on January 26 and August 24, 2005, as well as the effect of
the net unrealized  investment portfolio market value adjustment,  offset by the
net  income for the  period.  Additionally,  the  Company's  Board of  Directors
declared quarterly cash dividends totaling $0.14 per common share.

       The repurchase of shares associated with the Company's  stock  repurchase
programs  resulted in a  cumulative  reduction  in equity of $7.9  million.  The
decrease in accumulated other comprehensive  income, net of tax effect,  totaled
$747,000.

                                      -15-

<PAGE>

Average Balance Sheet.  The following  table sets forth certain  information for
the three months ended September 30, 2005 and 2004. The average yields and costs
are  derived by dividing  income or expense by the average  balance of assets or
liabilities,  respectively,  for the periods  presented.  Average  balances  are
derived from daily  average  balances.  The table does not include the allowance
for loan losses in the average balances of loans receivable. Management does not
believe that this causes any material differences in the information presented.

<TABLE>
<CAPTION>
                                                                  For the Three Months Ended September 30,
                                                    -------------------------------------------------------------------
                                                                 2005                               2004
                                                    --------------------------------    -------------------------------
                                                     Average               Average       Average              Average
                                                     Balance   Interest   Yield/Cost     Balance  Interest   Yield/Cost
                                                     -------   --------   ----------     -------  --------   ----------
<S>                                               <C>         <C>           <C>       <C>         <C>         <C>
Interest-earning assets:
  Loans receivable, net(1)                          $669,363   $ 9,819        5.87%     $501,801    $7,278      5.80%
  Securities(2)                                      206,863     1,934        3.74       274,567     2,463      3.59
  Other interest-earning assets(3)                    13,510       156        4.62         9,992        42      1.68
                                                    --------   -------        ----      --------    ------      ----
     Total interest-earning assets                   889,736    11,909        5.35       786,360     9,783      4.98
Non-interest-earning assets                           40,013                              37,725
                                                    --------                            --------

     Total assets                                   $929,749                            $824,085
                                                    ========                            ========
Interest-bearing liabilities:
  Checking accounts(4)                               $57,298       $18        0.13       $51,422       $10      0.08
  Savings and club accounts                           64,423        81        0.50        70,759        87      0.49
  Money market accounts                              141,421       771        2.18       167,494       719      1.72
  Certificates of deposit                            295,656     2,422        3.28       227,993     1,513      2.65
  FHLB advances                                      270,193     2,517        3.73       198,409     1,432      2.89
                                                    --------   -------        ----      --------    ------      ----
     Total interest-bearing liabilities              828,991     5,809        2.80       716,077     3,761      2.10
                                                               -------                              ------
Non-interest-bearing liabilities                       2,409                               2,814
                                                    --------                            --------
     Total liabilities                               831,400                             718,891
Stockholders' equity                                  98,349                             105,194
                                                    --------                            --------
     Total liabilities and stockholders' equity     $929,749                            $824,085
                                                    ========                            ========
Net interest income                                             $6,100                              $6,023
                                                                ======                              ======
Interest rate spread(5)                                                       2.55%                             2.88%
Net yield on interest-earning assets(6)                                       2.74%                             3.06%
Ratio of average interest-earning assets to
   average interest-bearing liabilities                                     107.33%                           109.82%
</TABLE>

-------------------------------
(1)  Non-accruing  loans have been included in loans receivable,  and the effect
     of such inclusion was not material.
(2)  Includes  U.S.  government  obligations,   mortgage-backed  securities  and
     interest-bearing deposits in banks.
(3)  Includes FHLB stock at cost.
(4)  Includes both interest-bearing and non-interest bearing checking accounts.
(5)  Interest rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities (including non-interest bearing checking accounts).
(6)  Net yield on  interest-earning  assets  represents net interest income as a
     percentage of average interest-earning assets.

                                      -16-
<PAGE>

Average Balance Sheet.  The following  table sets forth certain  information for
the nine months ended  September 30, 2005 and 2004. The average yields and costs
are  derived by dividing  income or expense by the average  balance of assets or
liabilities,  respectively,  for the periods  presented.  Average  balances  are
derived from daily  average  balances.  The table does not include the allowance
for loan losses in the average balances of loans receivable. Management does not
believe that this causes any material differences in the information presented.

<TABLE>
<CAPTION>
                                                                For the Nine Months Ended September 30,
                                                  -------------------------------------------------------------------
                                                               2005                               2004
                                                  --------------------------------    -------------------------------
                                                   Average               Average       Average              Average
                                                   Balance   Interest   Yield/Cost     Balance  Interest   Yield/Cost
                                                   -------   --------   ----------     -------  --------   ----------
<S>                                               <C>         <C>           <C>       <C>         <C>         <C>
Interest-earning assets:
  Loans receivable, net(1)                        $624,189   $27,074      5.78%       $467,935   $20,647      5.88%
  Securities(2)                                    228,497     6,448      3.76         222,006     5,626      3.38
  Other interest-earning assets(3)                  12,460       391      4.18           6,263        88      1.87
                                                  --------   -------      ----        --------   -------      ----
     Total interest-earning assets                 865,146    33,913      5.23         696,204    26,361      5.05
Non-interest-earning assets                         40,444                              34,509
                                                  --------                            --------

     Total assets                                 $905,590                            $730,713
                                                  ========                            ========
Interest-bearing liabilities:
 Checking accounts(4)                              $56,074       $46      0.11         $49,105       $14      0.04
 Savings and club accounts                          66,460       248      0.50          71,054       265      0.50
 Money market accounts                             151,932     2,374      2.08         156,924     1,996      1.70
 Certificates of deposit                           278,504     6,357      3.04         222,666     4,340      2.60
 FHLB advances                                     247,794     6,347      3.42         122,407     2,515      2.74
 Stock subscriptions payable                             -         -           -         7,569        23      0.41
                                                  --------   -------      ----        --------   -------      ----
     Total interest-bearing liabilities            800,764    15,372      2.56         629,725     9,153      1.94
                                                             -------                             -------
Non-interest-bearing liabilities                     3,187                               2,735
                                                  --------                            --------
     Total liabilities                             803,951                             632,460
Stockholders' equity                               101,639                              98,253
                                                  --------                            --------
     Total liabilities and stockholders' equity   $905,590                            $730,713
                                                  ========                            ========
Net interest income                                          $18,541                             $17,208
                                                             =======                             =======
Interest rate spread(5)                                                   2.67%                               3.11%
Net yield on interest-earning assets(6)                                   2.86%                               3.30%
Ratio of average interest-earning assets to
   average interest-bearing liabilities                                 108.04%                             110.56%
</TABLE>

-------------------------------
(1)  Non-accruing  loans have been included in loans receivable,  and the effect
     of such inclusion was not material.
(2)  Includes  U.S.  government  obligations,   mortgage-backed  securities  and
     interest-bearing deposits in banks.
(3)  Includes FHLB stock at cost.
(4)  Includes both interest-bearing and non-interest bearing checking accounts.
(5)  Interest rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities (including non-interest bearing checking accounts).
(6)  Net yield on  interest-earning  assets  represents net interest income as a
     percentage of average interest-earning assets.

                                      -17-

<PAGE>

Comparison  of Operating  Results for Three Months Ended  September 30, 2005 and
2004

         Net Income. Net income increased by $14,000, to $1.108 million, for the
three months ended  September 30, 2005,  compared to $1.094 million for the same
period in 2004, a 1.3% increase.  Diluted net income per common share  increased
11.1%,  to $0.10,  from the $0.09  reported  for the same period last year.  The
increase  was  primarily  attributable  to a $78,000  increase  in net  interest
income,  a  $72,000  increase  in other  income  and a $37,000  decrease  in the
provision  for loan  losses,  partially  offset by a $159,000  increase in other
expenses  and a $14,000  increase  in income  tax  expense as a result of higher
pre-tax earnings.

         Net Interest Income. Net interest income grew $78,000, or 0.2%, to $6.1
million for the three months ended September 30, 2005,  compared to $6.0 million
for the same period in 2004. Total interest income increased by $2.1 million, to
$11.9  million,  for the three months  ended  September  30,  2005,  while total
interest expense increased by $2.0 million, to $5.8 million,  for the same three
month period.  The net interest margin for the third quarter of 2005 declined to
2.74%,  from 3.24% in the third quarter of 2004, due primarily to the flattening
of the yield curve over the past year.

         The 21.7%  increase in total  interest  income was  primarily  due to a
$103.4  million,  or 13.1%,  increase  in the average  interest-earning  assets,
combined  with a 46 basis point  increase in the average  yield  earned on these
assets when  compared to the same  quarter of the prior  year.  The  increase in
interest-earning  assets  was a result of the  Company's  growth  strategy.  The
increase  in the  average  yield was  primarily  attributable  to higher  market
interest rates on originated loans, a higher yield on investment  securities and
increased  other  interest  income  resulting  from  higher  average  FHLB stock
balances.

         The 106.0% increase in total interest expense primarily resulted from a
$112.9  million,  or 15.8%,  increase  in average  interest-bearing  liabilities
coupled  with a 93 basis  point  increase  in the  average  cost of  funds  when
compared to the same quarter of the prior year. The increase in the average cost
of  interest-bearing  liabilities  was primarily  attributable  to higher market
interest rates, as well as a significant increase in higher cost certificates of
deposits  and  FHLB  borrowings.   The  majority  of  the  increase  in  average
interest-bearing  liabilities  for the  quarter  ended  September  30,  2005 was
comprised of a $71.8 million, or 36.2%,  increase in the average balance of FHLB
advances along with a $67.7 million,  or 34.1%,  increase in the average balance
of certificate of deposit accounts over the same quarter of the prior year.

         Provision  for loan losses.  We maintain an  allowance  for loan losses
through  provisions for loan losses that are charged to earnings.  The provision
is made to  adjust  the  total  allowance  for loan  losses  to an  amount  that
represents  management's  best estimate of losses known and inherent in the loan
portfolio at the balance  sheet date that are both  probable and  reasonable  to
estimate. In estimating the known and inherent losses in the loan portfolio that
are both probable and reasonable to estimate,  management considers factors such
as an internal analysis of credit quality, general levels of loan delinquencies,
collateral values,  the Bank's historical loan loss experience,  changes in loan
concentrations by loan category,  peer group information and economic and market
trends affecting our market area. The provision established for loan losses each
month reflects management's assessment of these factors in relation to the level
of the  allowance at such time.  Management  allocates  the allowance to various
categories based on its classified  assets,  historical loan loss experience and
its  assessment  of the  risk  characteristics  of each  loan  category  and the
relative  balances at month end of each loan category.  Management's  assessment
did not change either in estimation method or assumptions during either period.

         The provision for loan losses declined by $37,000, to $392,000, for the
three months ended  September  30, 2005,  from  $429,000 for the same quarter in
2004. Total charge-offs amounted to $190,000 and recoveries amounted to $85,000,
resulting  in a net  charge-off  amount of $105,000  for the three  months ended
September 30, 2005. This  represents a $5,000  increase in net charge-offs  over
the same quarter in 2004.

                                      -18-

<PAGE>

         Other Income.  Other income increased  $72,000,  or 7.6%, to $1,024,000
for the three months ended September 30, 2005, compared to $952,000 for the same
quarter  in 2004.  This is  primarily  the result of an  increase  of $58,000 in
commission income generated by sales from Synergy Financial Services, Inc. and a
$50,000  increase in other income.  These  increases were partially  offset by a
$30,000 decrease in gains on the sale of investment  securities and a decline of
$6,000 in service charges and fees on deposit accounts.

         Other Expenses.  Other expenses  increased  $159,000,  or 3.2%, to $5.1
million for the three months ended September 30, 2005,  compared to $4.9 million
for the same  quarter  in 2004.  The  increase  was  primarily  attributable  to
salaries and benefits  associated  with the  Company's  growth  strategy,  which
includes equity-based employee compensation plans, coupled with higher operating
expenses associated with a larger branch network.

         Income Tax Expense.  Income tax expense increased by $14,000,  or 2.5%,
during the three  months  ended  September  30,  2005 when  compared to the same
quarter in 2004, reflecting higher taxable income for the 2005 period.

Comparison  of Operating  Results for Nine Months Ended  September  30, 2005 and
2004

         Net Income. Net income increased by $324,000,  to $3.3 million, for the
nine months  ended  September  30,  2005,  compared to $3.0 million for the same
period in 2004, a 10.8% increase.  The increase was primarily  attributable to a
$1.3 million  increase in net interest  income and a $697,000  increase in other
income,  offset by a $181,000  increase in the provision for loan losses, a $1.4
million increase in other expenses and a $159,000 increase in income tax expense
as a result of higher  pre-tax  earnings.  The net interest  margin for the nine
months ended  September 30, 2005  declined to 2.86% from the 3.30%  reported for
the same period last year,  due  primarily to the  flattening of the yield curve
over the past year.

         Net Interest Income. Net interest income grew $1.3 million, or 7.7%, to
$18.5 million for the nine months ended  September  30, 2005,  compared to $17.2
million for the same period in 2004.  Total  interest  income  increased by $7.6
million,  to $33.9 million,  for the nine months ended September 30, 2005, while
total interest expense increased by $6.2 million, to $15.4 million, for the same
nine month period.

         The 28.6%  increase in total  interest  income was  primarily  due to a
$168.9 million, or 24.3, increase in average  interest-earning  assets, combined
with an 18 basis point increase in the average yield earned on these assets when
compared to the same period of the prior year. The increase in  interest-earning
assets  was a result of the  Company's  growth  strategy.  The  increase  in the
average yield was primarily  attributable  to higher  market  interest  rates on
loans  originated,  a higher yield on a larger  portfolio of average  investment
securities and increased other interest income  resulting from higher FHLB stock
balances.

         The 67.9% increase in total interest expense resulted  primarily from a
$171.0 million,  or 27.2%,  increase in the average balance of  interest-bearing
liabilities  coupled with a 62 basis point increase in the average cost of funds
when compared to the same period last year.  The increase in the average cost of
interest-bearing   liabilities  was  primarily  attributable  to  higher  market
interest rates, as well as a significant increase in higher cost certificates of
deposits  and  FHLB  borrowings.   The  majority  of  the  increase  in  average
interest-bearing  liabilities  for the first  nine  months in 2005 was due to an
increase of a $125.4 million, or 102.4%, in the average balance of FHLB advances
and a $55.8 million, or 25.1%, increase in the average balance of certificate of
deposit accounts over the same period of the prior year.

                                      -19-

<PAGE>

         Provision  for loan losses.  We maintain an  allowance  for loan losses
through  provisions for loan losses that are charged to earnings.  The provision
is made to  adjust  the  total  allowance  for loan  losses  to an  amount  that
represents  management's  best estimate of losses known and inherent in the loan
portfolio at the balance  sheet date that are both  probable and  reasonable  to
estimate. In estimating the known and inherent losses in the loan portfolio that
are both probable and reasonable to estimate,  management considers factors such
as an internal analysis of credit quality, general levels of loan delinquencies,
collateral values,  the Bank's historical loan loss experience,  changes in loan
concentrations by loan category,  peer group information and economic and market
trends affecting our market area. The provision established for loan losses each
month reflects management's assessment of these factors in relation to the level
of the  allowance at such time.  Management  allocates  the allowance to various
categories based on its classified  assets,  historical loan loss experience and
its  assessment  of the  risk  characteristics  of each  loan  category  and the
relative  balances at month end of each loan category.  Management's  assessment
did not change either in estimation method or assumptions during either period.

         The provision for loan losses increased by $181,000,  or 16.0%, to $1.3
million for the nine months ended  September 30, 2005, from $1.1 million for the
same period in 2004.  Total  charge-offs  amounted to  $585,000  and  recoveries
amounted to $240,000,  resulting in a net charge-off  amount of $345,000 for the
nine months ended September 30, 2005. This represents a $68,000  increase in net
charge-offs over the same period in 2004.

         Other  Income.  Other  income  increased  $697,000,  or 32.2%,  to $2.9
million for the nine months ended  September 30, 2005,  compared to $2.2 million
for the same period in 2004. The growth in other income was primarily the result
of higher commission income generated by sales from Synergy Financial  Services,
Inc. of $474,000 and an increase of $322,000 in tax-advantaged  income resulting
from a larger  investment in bank-owned  life  insurance.  These  increases were
partially  offset by a $42,000  decrease in service  charges and fees on deposit
accounts   and  a  decrease  of  $64,000   related  to   investment   securities
transactions.

         Other  Expenses.  Other expenses  increased $1.4 million,  or 10.2%, to
$14.8 million for the nine months ended  September  30, 2005,  compared to $13.4
million for the same period in 2004. The increase was primarily  attributable to
salaries and benefits  associated  with the  Company's  growth  strategy,  which
includes equity-based employee compensation plans, and higher operating expenses
associated with a larger branch network.

         Income Tax Expense.  Income tax expense increased by $159,000, or 8.9%,
during the nine months ended September 30, 2005 when compared to the same period
in 2004, reflecting higher taxable income for the 2005 period.

                                      -20-

<PAGE>

Liquidity

       The Bank maintains liquid assets at levels it considers  adequate to meet
liquidity needs. The liquidity of the Bank reflects its ability to provide funds
to meet loan requests,  accommodate possible outflows in deposits,  fund current
and  planned   expenditures   and  take   advantage  of  interest   rate  market
opportunities  in  connection  with asset and liability  management  objectives.
Funding loan  requests,  providing  for  liability  outflows and  management  of
interest rate  fluctuations  require  continuous  analysis in order to match the
maturities  of earning  assets with specific  types of deposits and  borrowings.
Bank  liquidity  is  normally  considered  in terms of the nature and mix of the
Bank's sources and uses of funds.

       The  Bank's  primary   sources  of  liquidity  are  deposits,   scheduled
amortization  and  prepayment  of  loans  and  mortgage-backed   securities.  In
addition,  the  Bank  invests  any  excess  funds  in  overnight  federal  funds
investments, which provide liquidity. Its cash and cash equivalents,  defined as
cash and deposits in other financial  institutions  with original  maturities of
three months or less,  totaled $7.9 million at September  30, 2005.  To a lesser
extent,  the earnings and funds provided from operating  activities are a source
of liquidity.

       Liquidity  management is both a daily and long-term  function of business
management.  While scheduled  principal  repayments on loans and mortgage-backed
securities are a relatively  predictable source of funds, deposit flows and loan
and securities  prepayments  are greatly  influenced by general  interest rates,
economic  conditions  and  competition.  If the Bank  requires  funds beyond its
ability to generate them internally,  it has the ability to obtain advances from
the FHLB,  which provides an additional  source of funds. At September 30, 2005,
the  Bank's  borrowing  limit  with  the  FHLB  was  $255.7  million,  excluding
repurchase agreement advances, subject to collateral requirements.  At September
30, 2005,  the Bank had $154.5 million of FHLB advances  outstanding  and $108.0
million in repurchase agreement advances.

       Management is not aware of any trends,  events or uncertainties that will
have  or are  reasonably  likely  to have a  material  effect  on the  Company's
liquidity,  capital or operations nor is it aware of any current  recommendation
by regulatory authorities,  which, if implemented,  would have a material effect
on liquidity,  capital or operations. The total amount of the Bank's commitments
to extend  credit for mortgage and consumer  loans as of September  30, 2005 was
$66.4 million,  excluding  commitments on unused lines of credit,  which totaled
$29.4 million.

       Management  intends to expand the Bank's branch  network  either  through
opening or acquiring branch offices. During April 2005, the Bank opened a branch
in Elizabeth,  New Jersey.  The Bank currently plans to open four additional new
branch  locations  and relocate two branches  over the next two years.  The Bank
also will  continue to actively  consider  the  acquisition  of local  financial
institutions as part of expanding its banking operations.  It does not, however,
have any current understandings, agreements or arrangements for the expansion of
its business, other than opening new branch office locations.

                                      -21-

<PAGE>

The following table discloses the Bank's contractual obligations as of September
30, 2005 (in thousands):

<TABLE>
<CAPTION>
                                              Total           Less Than       1-3 Years        4-5 Years       After
                                                                1 Year                                        5 Years
                                             --------          --------         -------          -------      -------
<S>                                        <C>               <C>              <C>              <C>          <C>
FHLB advances (1)                            $262,450          $133,650         $93,100          $13,000      $22,700
Rental under operating leases                  12,841               614           2,819            1,593        7,815
                                             --------          --------         -------          -------      -------
Total                                        $275,291          $134,264         $95,919          $14,593      $30,515
                                             ========          ========         =======          =======      =======
</TABLE>

----------------
(1)  At  September  30,  2005,  the Bank had $262.5  million of FHLB  borrowings
     outstanding,   which  included  $108.0  million  in  repurchase   agreement
     advances.  At September 30, 2005, the Bank's  borrowing limit with the FHLB
     was $255.7 million,  excluding  repurchase  agreement advances,  subject to
     collateral requirements.

The following table discloses the Bank's commercial  commitments as of September
30, 2005 (in thousands):

<TABLE>
<CAPTION>
                                              Total           Less Than       1-3 Years        4-5 Years       After
                                                                1 Year                                        5 Years
                                             -------           -------            -----        ------         -------
<S>                                        <C>               <C>              <C>              <C>          <C>
Lines of Credit (1)                          $29,396           $ 1,208            $ 686        $1,178         $26,324
Other commitments to extend credit            66,439            66,439                -             -               -
                                             -------           -------            -----        ------         -------
Total                                        $95,835           $67,647            $ 686        $1,178         $26,324
                                             =======           =======            =====        ======         =======
</TABLE>

----------------
(1) Represents amounts committed to customers.

Regulatory Capital Requirements

         The Bank is subject to federal  regulations that impose certain minimum
capital requirements. Quantitative measures, established by regulation to ensure
capital  adequacy,  require the Bank to maintain  amounts and ratios of tangible
and core  capital to adjusted  total assets and of total  risk-based  capital to
risk-weighted assets. On September 30, 2005, the Bank was in compliance with all
of its  regulatory  capital  requirements.  The  following  table sets forth the
Bank's  capital  position  and  relativity  to  regulatory  requirements  as  of
September 30, 2005:

<TABLE>
<CAPTION>
                                                                  OTS Requirements
                                     ---------------------------------------------------------------------------
                                                                                             Regulatory
                                                                      Minimum           for classification as
                                            Bank actual           capital adequacy        well-capitalized
                                            -----------           ----------------        ----------------
                                        Amount       Ratio       Amount      Ratio       Amount       Ratio
                                        ------       -----       ------      -----       ------       -----
<S>                                  <C>          <C>         <C>          <C>        <C>          <C>
Total risk-based capital
   (to risk-weighted assets)           $91,084      13.34%      $54,612      8.00%      $68,265      10.00%
Tier 1 capital
   (to risk-weighted assets)            85,689      12.55%          N/A        N/A       40,959       6.00%
Tier 1 capital
   (to adjusted total assets)           85,689       9.11%       37,619      4.00%       47,023       5.00%
Tangible capital
   (to adjusted total assets)           85,689       9.11%       14,107      1.50%          N/A         N/A
</TABLE>

                                      -22-


<PAGE>

Impact of Inflation and Changes Prices

         The consolidated financial statements of the Company and notes thereto,
presented  elsewhere  herein,  have been prepared in accordance  with accounting
principles generally accepted in the United States of America, which require the
measurement of financial  position and operating  results in terms of historical
dollars without considering the change in the relative purchasing power of money
over time and due to  inflation.  The impact of  inflation  is  reflected in the
increased cost of the Company's operations,  primarily those at the Bank. Unlike
most industrial companies,  nearly all of the assets and liabilities of the Bank
are financial.  As a result,  interest rates have a greater impact on the Bank's
performance  than do the effects of general levels of inflation.  Interest rates
do not  necessarily  move in the same  direction  or to the same  extent  as the
prices of goods and services.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Management of Interest Rate Risk and Market Risk

         Quantitative  Analysis.  Management actively monitors its interest rate
risk  exposure.  The  Bank's  objective  is to  maintain a  consistent  level of
profitability  within  acceptable  risk  tolerances  across  a  broad  range  of
potential  interest  rate  environments.  The Bank  uses the  Office  of  Thrift
Supervision  Net Portfolio Value (NPV) Model to monitor its exposure to interest
rate risk, which calculates  changes in net portfolio value.  Reports  generated
from  assumptions  provided and modified by management are reviewed by the Asset
and  Liability  Management  Committee  and  reported  to the Board of  Directors
quarterly. The Interest Rate Sensitivity of Net Portfolio Value Report shows the
degree  to which  balance  sheet  line  items  and the net  portfolio  value are
potentially affected by a 100 to 300 basis point (1/100th of a percentage point)
upward and downward shift (shock) in the Treasury yield curve.

         Management  believes that there has not been a material  adverse change
in market risk during the three month period ended September 30, 2005.

         Qualitative   Analysis.    Because   the   majority   of   the   Bank's
interest-earning  assets  and  interest-bearing  liabilities  are  sensitive  to
changes in interest  rates,  a  significant  form of market risk for the Bank is
interest rate risk, or changes in interest  rates.  The Bank is vulnerable to an
increase  in  interest  rates to the extent  that  interest-bearing  liabilities
mature or re-price more rapidly than interest-earning assets. Our assets include
long-term,  fixed-rate loans and investments, while our primary sources of funds
are deposits and borrowings  with  substantially  shorter  maturities.  Although
having   interest-bearing   liabilities   that  re-price  more  frequently  than
interest-earning  assets is generally beneficial to net interest income during a
period of declining  interest rates,  this type of  asset/liability  mismatch is
generally detrimental during periods of rising interest rates.

         The  Board  of  Directors  has   established  an  Asset  and  Liability
Management and Budget Committee that consists of Directors Scott (Chairman),  De
Perez,  Fiore,  Gibbons  and  Putvinski.  The  Committee  meets  quarterly  with
management  to  review  current  investments:   average  lives,   durations  and
re-pricing  frequencies of loans and  securities;  loan and deposit  pricing and
production volumes and alternative funding sources; interest rate risk analysis;
liquidity  and  borrowing  needs;  and a variety of other  assets and  liability
management  topics. The management session of the Committee is held monthly with
President  Fiore presiding and senior  management in attendance.  The results of
the  quarterly  and monthly  meetings of the  Committee are reported to the full
Board at its regular meetings. In addition, the Committee generally meets during
October and November each year with the goal of  developing  an annual  business
and operating plan for presentation to the full Board.

                                      -23-

<PAGE>

         To reduce the effect of interest  rate changes on net interest  income,
the Bank has adopted various  strategies to enable it to improve the matching of
interest-earning asset maturities to interest-bearing  liability maturities. The
main elements of these strategies include seeking to:

          o    originate loans with adjustable-rate features or fixed-rate loans
               with short  maturities,  such as home equity and consumer  loans,
               comprised mostly of direct automobile loans for both new and used
               vehicles;
          o    expand commercial and industrial loans, which  predominantly have
               variable rates of interest;
          o    increase  production in higher  yielding  commercial  real estate
               loans;
          o    lengthen the maturities of time deposits and  borrowings  when it
               would  be cost  effective  through  the  aggressive  pricing  and
               promotion of  certificates  of deposits and  utilization  of FHLB
               advances;
          o    increase core deposits (i.e., checking,  savings and money market
               accounts), which tend to be less interest rate sensitive; and
          o    purchase  intermediate and adjustable-rate  investment securities
               that  provide a stable cash flow,  thereby  providing  investable
               funds in varying interest rate cycles.


Item 4. Controls and Procedures

         Evaluation  of  disclosure  controls  and  procedures.  Based  on their
evaluation of the Company's  disclosure  controls and  procedures (as defined in
Rule 13a-15(e) under the Securities  Exchange Act of 1934 (the "Exchange Act")),
the Company's  principal  executive officer and principal financial officer have
concluded that as of the end of the period  covered by this Quarterly  Report on
Form 10-Q such disclosure controls and procedures are effective.

         Changes in internal  controls.  During the quarter under report,  there
was no change in the Company's  internal  control over financial  reporting that
has  materially  affected,  or is reasonable  likely to materially  affect,  the
Company's internal control over financial reporting.

                                      -24-

<PAGE>

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.
        -----------------

         The Company and its subsidiaries,  from time to time, may be a party to
routine  litigation,  which  arises in the normal  course of  business,  such as
claims to enforce  liens,  condemnation  proceedings  on properties in which the
Bank, the  wholly-owned  subsidiary of the Company,  holds  security  interests,
claims  involving  the making and  servicing  of real  property  loans and other
issues incident to its business.  There were no lawsuits  pending or known to be
contemplated  at  September  30,  2005 that would be expected to have a material
effect on the Company's operations or income.

Item 2. Unregistered Sales of Equity Securities and  Use of Proceeds.
        ------------------------------------------------------------

                      ISSUER PURCHASES OF EQUITY SECURITIES

The following table reports information  regarding  repurchases of the Company's
common stock  during the third  quarter of 2005 and the stock  repurchase  plans
approved by the Company's Board of Directors.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------
                                                                Total Number of Shares    Maximum Number of Shares
                               Total Number                      Purchased as Part of     that May Yet Be Purchased
                                of Shares      Average Price      Publicly Announced         Under the Plans or
        Period                  Purchased     Paid per Share    Plans or Programs (1)           Programs (1)
--------------------------------------------------------------------------------------------------------------------
<S>                            <C>               <C>                 <C>                        <C>
July 1-31, 2005                     -                -                    -                         121,751
--------------------------------------------------------------------------------------------------------------------
August 1-31, 2005                121,751           12.45               121,751                      577,628
--------------------------------------------------------------------------------------------------------------------
September 1-30, 2005              28,000           12.25                28,000                      549,628
--------------------------------------------------------------------------------------------------------------------
Total                            149,751           12.41               149,751
--------------------------------------------------------------------------------------------------------------------
</TABLE>

------------------
(1)  On August  24,  2005,  the  Company  announced  that it had  completed  its
     purchase of 5.0 percent of the Company's outstanding shares of common stock
     (approximately 622,600 shares) as previously announced on January 26, 2005.
     The Company also  announced that it intends to purchase up to an additional
     5.0  percent  of  the   Company's   outstanding   shares  of  common  stock
     (approximately 577,628 shares) in open market transactions.  Such purchases
     are to be made  from  time  to time in the  open  market,  based  on  stock
     availability,  price and the Company's financial performance.  This program
     has no expiration date and has 549,628 shares yet to be purchased.

                                      -25-

<PAGE>

Item 3. Defaults Upon Senior Securities.
        -------------------------------

         None.


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

         None.


Item 5. Other Information.
        -----------------

         None.


Item 6. Exhibits.
        --------

        a) Exhibits:

           31 Certification pursuant to ss.302 of the Sarbanes-Oxley Act of 2002
           32 Certification pursuant to ss.906 of the Sarbanes-Oxley Act of 2002

                                      -26-

<PAGE>

                                   SIGNATURES



          Pursuant to the requirements of Sections 13 or 15(d) 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.

                          SYNERGY FINANCIAL GROUP, INC.



Date: November 9, 2005
                                       By: /s/John S. Fiore
                                           -------------------------------------
                                           John S. Fiore
                                           President and Chief Executive Officer
                                           (Duly Authorized Representative)

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

<TABLE>
<CAPTION>
<S>                                         <C>
/s/John S. Fiore                               /s/A. Richard Abrahamian
-------------------------------------          -------------------------------------------------
John S. Fiore                                  A. Richard Abrahamian
President and Chief Executive Officer          Senior Vice President and Chief Financial Officer
(Principal Executive Officer)                  (Principal Financial and Accounting Officer)

Date: November 9, 2005                         Date: November 9, 2005

</TABLE>

                                      -27-