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:     June 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
                                                ---     ---

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Number of shares outstanding of common stock as of June 30, 2005:

$0.10 Par Value Common Stock                          11,552,566
----------------------------                          ----------
          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 June 30, 2005 (unaudited) and
                  December 31, 2004 (audited)............................................1

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

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

              Consolidated Statements of Cash Flows for the six months ended
                  June 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...........................................25

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>
                                                                                June 30,       December 31,
                                                                                  2005             2004
                                                                               (unaudited)       (audited)
                                                                               -----------       ---------
<S>                                                                        <C>               <C>
Assets:
Cash and amounts due from banks                                              $     4,083       $     4,687
Interest-bearing deposits with banks                                                  57             1,759
                                                                             -----------       -----------
Cash and cash equivalents                                                          4,140             6,446
Investment securities available-for-sale,
   at fair value                                                                 102,743           134,360
Investment securities held-to-maturity (fair
   value of $110,267 and $111,154, respectively)                                 110,538           110,584
Federal Home Loan Bank of New York
   stock, at cost                                                                 13,101            10,771
Loans receivable, net                                                            654,068           561,687
Accrued interest receivable                                                        3,014             2,751
Property and equipment, net                                                       17,610            16,814
Cash surrender value of bank-owned life insurance                                 12,884            12,637
Other assets                                                                       4,918             4,627
                                                                             -----------       -----------
     Total assets                                                            $   923,016       $   860,677
                                                                             ===========       ===========

Liabilities:
Deposits                                                                     $   558,003       $   538,916
Federal Home Loan Bank advances                                                  262,022           212,414
Advance payments by borrowers
   for taxes and insurance                                                         2,159             1,702
Accrued interest payable on advances                                                 593               385
Dividend payable                                                                     623               498
Other liabilities                                                                    711             2,720
                                                                             -----------       -----------
     Total liabilities                                                           824,111           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  - 11,552,566 in 2005 and 12,064,968 in 2004                        1,246             1,245
Additional paid-in-capital                                                        86,085            86,177
Retained earnings                                                                 31,694            30,603
Unearned ESOP shares                                                              (5,622)           (5,962)
Unearned RSP compensation                                                         (2,986)           (3,391)
Treasury stock held for the RSP, at cost; 413,488 and
   387,043 shares at June 30, 2005 and December 31, 2004,
   respectively                                                                   (4,662)           (4,343)
Treasury stock, at cost; 500,849 and -0- shares at
     June 30, 2005 and December 31, 2004, respectively                            (6,050)                -
Accumulated other comprehensive loss, net of taxes                                  (800)             (287)
                                                                             -----------       -----------
     Total stockholders' equity                                                   98,905           104,042
                                                                             -----------       -----------
     Total liabilities and stockholders' equity                              $   923,016       $   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 Six Months
                                                                      ended June 30,                  ended June 30,
                                                                      --------------                  --------------
                                                                     2005         2004             2005          2004
                                                                  (unaudited)  (unaudited)      (unaudited)   (unaudited)
                                                                  -----------  -----------      -----------   -----------
<S>                                                              <C>           <C>              <C>          <C>
Interest income:
   Loans, including fees                                          $   9,081     $  6,669         $  17,255    $  13,369
   Investment securities                                              2,244        1,653             4,514        3,163
   Other                                                                143           23               234           45
                                                                  ---------     --------         ---------    ---------
     Total interest income                                           11,468        8,345            22,003       16,577
                                                                  ---------     --------         ---------    ---------
Interest expense:
   Deposits                                                           3,013        2,190             5,733        4,285
   Borrowed funds                                                     2,037          630             3,830        1,106
                                                                  ---------     --------         ---------    ---------
     Total interest expense                                           5,050        2,820             9,563        5,391
                                                                  ---------     --------         ---------    ---------
     Net interest income before provision for loan losses             6,418        5,525            12,440       11,186

Provision for loan losses                                               477          336               922          704
                                                                  ---------     --------         ---------    ---------
     Net interest income after provision for loan losses              5,941        5,189            11,518       10,482
                                                                  ---------     --------         ---------    ---------
Other income:
   Service charges and other fees on deposit accounts                   503          564             1,012        1,048
   Net (loss) gain on sale of investments                               (34)           1               (34)           1
   Commissions                                                          201           18               449           33
   Other                                                                202          (59)              410          130
                                                                  ---------     --------         ---------    ---------
     Total other income                                                 872          524             1,837        1,212
                                                                  ---------     --------         ---------    ---------
Other expenses:
   Salaries and employee benefits                                     2,834        2,238             5,477        4,493
   Premises and equipment                                               956          934             1,828        1,915
   Occupancy                                                            527          474             1,051          947
   Professional services                                                199          118               394          246
   Advertising                                                          246          186               453          362
   Other operating                                                      274          291               556          590
                                                                  ---------     --------         ---------    ---------
     Total other expenses                                             5,036        4,241             9,759        8,553
                                                                  ---------     --------         ---------    ---------
     Income before income tax expense                                 1,777        1,472             3,596        3,141
Income tax expense                                                      672          562             1,371        1,226
                                                                  ---------     --------         ---------    ---------
     Net income                                                   $   1,105     $    910         $   2,225    $   1,915
                                                                  =========     ========         =========    =========

Per share of common stock:
   Basic earnings per share                                       $    0.10     $   0.08         $    0.20    $    0.18
                                                                  =========     ========         =========    =========
   Diluted earnings per share                                     $    0.10     $   0.08         $    0.19    $    0.18
                                                                  =========     ========         =========    =========

Basic weighted average shares outstanding                            11,043       11,495            11,136       10,575
                                                                     ======       ======            ======       ======
Diluted weighted average shares outstanding                          11,395       11,713            11,536       10,787
                                                                     ======       ======            ======       ======
</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 Six Months Ended June 30, 2005
                                   (Unaudited)
                  (Dollars in thousands, except share amounts)
<TABLE>
<CAPTION>
                                                                                                                   Other
                                                                                                                   accumu-
                                                                                                                   lated
                                                                                               Treasury            compre-
                                      Common stock                                   Unearned   stock              hensive
                                    ---------------  Additional           Unearned     RSP     acquired   Treasury income
                                  Shares      Par     paid-in-  Retained    ESOP     compen-   for the     stock   (loss),
                                  issued     value    capital   earnings   shares    sation      RSP      acquired   net     TOTAL
----------------------------------------------------------------------------------------------------------------------------------

<S>                            <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                             -        -         -     2,225         -          -        -         -        -     2,225

  Other comprehensive
    income, net of
    reclassification
    adjustment and taxes                 -        -         -         -         -          -        -         -     (513)     (513)
----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive income                                                                                                   1,712
----------------------------------------------------------------------------------------------------------------------------------

  Dividends declared                     -        -         -    (1,134)        -          -        -         -        -    (1,134)

  Common stock issued
    for options exercised
    (14,892 shares)                 14,892        1        82                                                                   83

  Common stock held by
    ESOP committed
    to be released
    (49,812 shares)                      -        -       273         -       340          -        -         -        -       613

  Compensation recognized
    under RSP Plan                       -        -         -         -         -        405        -         -        -       405

  Common stock repurchased
    for RSP (63,851 shares)              -        -         -         -         -          -     (766)        -        -      (766)

  Common stock issued by RSP
    (37,406 shares)                                      (447)                                    447                            -

  Purchase of treasury stock
    (500,849 shares)                     -        -         -         -         -          -        -    (6,050)       -    (6,050)
                               ---------------------------------------------------------------------------------------------------
BALANCE AT JUNE 30, 2005        12,466,903   $1,246   $86,085   $31,694   $(5,622)   $(2,986) $(4,662)  $(6,050)   $(800)  $98,905
                               ===================================================================================================
</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 Six Months
                                                                                   Ended June 30,
                                                                                   --------------
                                                                               2005          2004
                                                                            (unaudited)   (unaudited)
                                                                            -----------   -----------

<S>                                                                        <C>          <C>
Operating activities:
     Net income                                                              $   2,225    $   1,915
  Adjustments to reconcile net income to net cash
     provided by operating activities:
  Depreciation and amortization                                                    750          730
  Provision for loan losses                                                        922          704
  Deferred income taxes                                                           (294)        (836)
  Amortization of deferred loan fees and costs                                     (49)           4
  Amortization of premiums on investment securities                                462          772
  Net loss on sale of investment securities                                         34            -
  Release of ESOP shares                                                           612          508
  Compensation under RSP plan                                                      405          119
  Increase in accrued interest receivable                                         (263)        (632)
  Decrease (increase) in other assets                                                3         (591)
 (Decrease) increase in other liabilities                                       (1,884)         124
 (Increase) decrease in cash surrender value of bank-owned life insurance         (247)          61
  Increase in accrued interest payable on advances                                 208          156
                                                                             ---------    ---------
    Net cash provided by operating activities                                    2,884        3,034
                                                                             ---------    ---------

Investing activities:
  Purchase of investment securities held-to-maturity                           (12,536)     (86,110)
  Purchase of investment securities available-for-sale                          (2,199)     (58,664)
  Maturity and principal repayments of investment
    securities held-to-maturity                                                 12,473        4,778
  Maturity and principal repayments of investment
    securities available-for-sale                                               20,137       27,065
  Purchase of property and equipment                                            (1,546)        (456)
  Purchase of FHLB Stock                                                        (2,330)      (5,230)
  Proceeds from the sale of investment securities available for sale            12,779            -
  Loan originations, net of principal repayments                               (86,555)     (32,970)
  Purchase of loans                                                             (6,699)     (20,115)
                                                                             ---------    ---------
    Net cash used in investing activities                                      (66,476)    (171,702)
                                                                             ---------    ---------
Financing activities:
  Net increase in deposits                                                      19,087       46,667
  Decrease in short-term FHLB advances                                         (15,339)     (11,028)
  Increase in long-term FHLB advances                                           64,947      109,859
  Increase in advance payments by borrowers
    for taxes and insurance                                                        457          186
  Dividends paid                                                                (1,134)           -
  Decrease in stock subscriptions payable                                            -      (38,322)
  Net proceeds from issuance of common stock                                         -       69,260
  Net purchase of common stock for ESOP                                              -       (5,628)
  Purchase of treasury stock for the RSP Plan                                     (765)        (759)
  Purchase of treasury stock                                                    (6,050)           -
  Common stock issued for options exercised                                         83            -
                                                                             ---------    ---------
    Net cash provided by financing activities                                   61,286      170,235
                                                                             ---------    ---------
    Net (decrease) increase in cash and cash equivalents                        (2,306)       1,567
Cash and cash equivalents at beginning of year                                   6,446        7,292
                                                                             ---------    ---------
Cash and cash equivalents at end of period                                   $   4,140    $   8,859
                                                                             =========    =========

Supplemental disclosure of cash flow information:
   Cash paid during the period for income taxes                              $   2,174    $   1,095
                                                                             =========    =========
   Interest paid on deposits and borrowed funds                              $   9,771    $   6,654
                                                                             =========    =========
</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 six months ended
June 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 June 30, 2005
                                                                 ----------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                             -----------          -------------         ------------
<S>                                                        <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   1,105                 11,043            $    0.10
       Effect of dilutive common stock equivalents                    0                    352                 0.00
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   1,105                 11,395            $    0.10
                                                              =========                 ======            =========
</TABLE>

<TABLE>
<CAPTION>

                                                                  For the Three Months Ended June 30, 2004
                                                                  ----------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                             -----------          -------------         ------------
<S>                                                         <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $     910                 11,495            $    0.08
       Effect of dilutive common stock equivalents                    0                    218                 0.00
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $     910                 11,713            $    0.08
                                                              =========                 ======            =========
</TABLE>

                                      -6-

<PAGE>

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

<TABLE>
<CAPTION>
                                                                    For the Six Months Ended June 30, 2005
                                                                    --------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                             -----------          -------------         ------------
<S>                                                         <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   2,225                 11,136            $    0.20
       Effect of dilutive common stock equivalents                    0                    400                (0.01)
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   2,225                 11,536            $    0.19
                                                              =========                 ======            =========
</TABLE>

<TABLE>
<CAPTION>

                                                                    For the Six Months Ended June 30, 2004
                                                                    --------------------------------------
                                                                                    Weighted
                                                               Income            average shares              Per
                                                             (numerator)          (denominator)         share amount
                                                             -----------          -------------         ------------
<S>                                                         <C>                       <C>               <C>
    Basic earnings per share:
       Income available to common stockholders                $   1,915                 10,575            $    0.18
       Effect of dilutive common stock equivalents                    0                    212                 0.00
                                                              ---------                 ------            ---------
    Diluted earnings per share:
       Income available to common stockholders                $   1,915                 10,787            $    0.18
                                                              =========                 ======            =========
</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 Six Months
                                                                     ended June 30,            ended June 30,
                                                                 --------------------       ------------------
                                                                    2005         2004         2005        2004
                                                                (unaudited)  (unaudited)  (unaudited)  (unaudited)
                                                                -----------  -----------  -----------  -----------

<S>                                                           <C>          <C>           <C>          <C>
    Net income, as reported                                     $   1,105    $     910     $  2,225     $   1,915
    Add expense recognized for the restricted stock plans,
       net of related tax effect                                      130           36          259            71
    Less total stock option plan and restricted stock plan
       expense, determined under the fair value method,
       net of related tax effect                                     (294)         (84)        (424)         (167)
                                                                ---------    ---------     --------     ---------
    Net income, pro forma                                       $     941    $     862     $  2,060     $   1,819
                                                                =========    =========     ========     =========

    Basic earnings per share:
       As reported                                              $    0.10    $    0.08     $   0.20     $   0.18
       Pro forma                                                $    0.09    $    0.08     $   0.18     $   0.17
    Diluted earnings per share:
       As reported                                              $    0.10    $    0.08     $   0.19     $   0.18
       Pro forma                                                $    0.08    $    0.07     $   0.18     $   0.17
</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 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.

4. RECENT ACCOUNTING PRONOUNCEMENTS

In December 2004, the Financial Accounting Standards Board (the "FASB") issued a
Statement No. 123(R),  Share-Based  Payment an Amendment of FASB  Statements 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 FASB Statement

                                      -8-

<PAGE>

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


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 of the first fiscal year  beginning on or after June 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 Statement
No. 123(R). Among other things, SAB 107 provides  interpretive  guidance related
to  the  interaction   between  Statement  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 Statement 123(R) will have on
future option grants.

On June 29, 2005, the FASB issued FASB Staff Position ("FSP") FASB Statement 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 FAS 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 FAS 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  FAS   115-1   will  be   effective   for
other-than-temporary  impairment  analysis  conducted in periods beginning after
September 15, 2005. The Company does not expect FSP FAS 115-1 to have a material
impact on the Company's financial position or results of operations.

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>
                                                                            June 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      $       -      $     (71)    $     1,928
     Mortgage-backed securities:
       FHLMC                                                   65,886             18           (775)         65,129
       FNMA                                                    35,086             17           (416)         34,687
     Equity securities                                          1,029              7            (37)            999
                                                          -----------      ---------      ---------     -----------
         Total                                            $   104,000      $      42      $  (1,299)    $   102,743
                                                          ===========      =========      =========     ===========

</TABLE>

                                      -9-

<PAGE>

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

<TABLE>
<CAPTION>
                                                                            June 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                                              $    45,964      $     116       $   (431)    $    45,649
       FNMA                                                    61,099            270           (245)         61,124
       GNMA                                                     3,465             20             (1)          3,484
     Other debt securities                                         10              -              -              10
                                                          -----------      ---------       --------     -----------
         Total                                            $   110,538      $     406       $   (677)    $   110,267
                                                          ===========      =========       ========     ===========
</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>


<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>

                                      -10-

<PAGE>

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



6. LOANS RECEIVABLE

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

                                                June 30,        December 31,
                                                 2005               2004
                                            -----------------------------------
   Mortgages:
     Residential, 1-4 family                $   247,396        $   243,772
     Non-residential and multi-family           194,478            154,226
     Construction loans                          10,217              5,792
   Automobile                                   188,122            146,148
   Commercial                                    15,224             12,208
   Other loans                                    3,484              3,720
                                            -----------        -----------

   Loans receivable                             658,921            565,866
   Deferred loan fees and costs                     256                248
   Allowance for loan losses                     (5,109)            (4,427)
                                            -----------        -----------

   Loans receivable, net                    $   654,068        $   561,687
                                            ===========        ===========


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

                                                   For the Six Months Ended
                                            -----------------------------------
                                                  June 30,            June 30,
                                                   2005                 2004
                                            -----------------------------------

   Balance, beginning of period             $     4,427          $     3,274
   Provision for loan losses                        922                  704
   Recoveries                                       154                  208
   Loans charged-off                               (394)                (385)
                                            -----------          -----------
   Balance, end of period                   $     5,109          $     3,801
                                            ===========          ===========


7. DEPOSITS

Deposits are summarized as follows (in thousands:

                                               June 30,           December 31,
                                                 2005                 2004
                                            -----------------------------------

     Non-interest bearing checking accounts $    56,588          $    52,019
     Interest-bearing checking                    4,153                3,946
     Savings and club accounts                   67,590               67,115
     Money market accounts                      149,700              163,091
     Certificate of deposit accounts            279,972              252,745
                                            -----------          -----------
                                            $   558,003          $   538,916
                                            ===========          ===========

                                      -11-

<PAGE>

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


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
                                                                         ---------------------------------
                                                                          Three Months     Twelve Months
                                                                              Ended            Ended
                                                                            June 30,       December 31,
                                                                              2005             2004
                                                                         ---------------------------------
<S>                                                                    <C>              <C>
Average balance outstanding                                              $    50,074      $    33,618
Maximum amount outstanding at any month end during the period                 95,972           48,975
Balance outstanding at period end                                             95,972           31,025
Weighted average interest rate during the period                                3.13%            1.61%
Weighted average interest rate at period end                                    3.46%            2.42%
</TABLE>

2. Long-term FHLB Advances
   -----------------------

At June 30,  2005,  long-term  advances  from the FHLB totaled  $166.0  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 3.51%.

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

   2005                                                 $    30,100
   2006                                                      54,150
   2007                                                      48,000
   2008                                                      23,100
   2009                                                       8,000
   Thereafter                                                 2,700
                                                        -----------
                                                        $   166,050
                                                        ===========

                                      -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
Securities and Exchange Commission (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 June 30, 2005 and December 31, 2004

       Assets. Total assets reached $923.0 million on June 30, 2005, an increase
of 7.2%, or $62.3 million, from $860.7 million on December 31, 2004. This growth
was primarily  attributable  to increases in the loan  portfolio and FHLB stock,
offset by a decrease in investment securities.

       Between  December  31,  2004  and June 30,  2005,  investment  securities
decreased $31.7 million,  or 12.9%, from $244.9 million to $213.3 million.  This
decrease  was  primarily  due to  $32.6  million  in  maturities  and  principal
repayments coupled with the sale of $12.8 million in securities,  which resulted
in a net loss of $34,000. These decreases were partially offset by $14.7 million
in  purchases.  Additionally,  there was a $807,000  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 June 30, 2005, from $10.8 million at December 31, 2004.

       Net loans increased  16.4%,  or $92.4 million,  to $654.1 million at June
30, 2005,  from $561.7 million at December 31, 2004.  This growth includes $86.6
million  in  originations,  net of  principal  repayments,  and $6.7  million in
purchases, offset by amortization of the premium on purchased loans and deferred
loan fees,  along with a provision of $922,000 to the allowance for loan losses.
The most  significant  change  during the

                                      -14-

<PAGE>

six months  ended June 30, 2005 was in  automobile  loans and  multi-family  and
non-residential  mortgage loans. Automobile loans increased by $42.0 million, or
28.7%,  to  $188.1  million  and  multi-family  and  non-residential   mortgages
increased by $40.3 million, or 26.1%, to $194.5 million.

       On June 30, 2005,  total loans of $658.9  million were comprised of 29.5%
in multi-family  and  non-residential  mortgage loans,  29.1% in consumer loans,
comprised  mostly of  direct  automobile  loans for both new and used  vehicles,
20.0% in one-to-four  family real estate loans, 17.5% in home equity loans, 2.3%
in commercial loans and 1.6% in construction loans.

       The allowance for loan losses was $5.1 million at June 30, 2005, compared
to $4.4 million at December 31, 2004.  This reflects a provision for loan losses
of $922,000 for the six-month period, offset by net charge-offs of $240,000. The
ratio of  allowance  to total loans was 0.78% on both June 30, 2005 and December
31,  2004.  Non-performing  assets to total  assets was 0.04% at June 30,  2005,
compared to 0.03% at December 31, 2004.

       Liabilities.  Total  liabilities  increased  $67.5  million,  or 8.9%, to
$824.1  million at June 30, 2005,  from $756.6 million at December 31, 2004. The
increase  in total  liabilities  resulted  primarily  from an  increase of $49.6
million,  or 23.4%, in FHLB advances and a $19.1 million,  or 3.5%,  increase in
deposits.  The  balance  of the  change is  attributable  to a decline  in other
liabilities of $1.2 million.

       Deposits  reached  $558.0  million at June 30, 2005, an increase of $19.1
million,  or 3.5%,  from the $538.9 million  reported at December 31, 2004. This
growth  resulted from an increase in  certificate  of deposit  accounts of $27.2
million,  or 10.8%,  for the six months ended June 30, 2005.  This  increase was
primarily the result of  competitive  pricing  initiatives to attract funds with
extended  maturities in response to the current interest rate trend.  Total core
deposits,  which  consist  of  checking,  savings  and  money  market  accounts,
decreased $8.1 million, or 2.8 percent,  and represented 49.8% of total deposits
at June 30, 2005,  compared to 53.1% at December 31, 2004.  Despite a decline in
total core  deposits  during this period,  checking  accounts  increased by $4.8
million or 8.5%.

       The $49.6 million increase in FHLB advances between December 31, 2004 and
June 30,  2005 has funded  both the  origination  of loans and the  purchase  of
investment securities during the six month period.

         Equity.  Stockholders' equity totaled $98.9 million at June 30, 2005, a
decrease of 4.9%, or $5.1 million, from $104.0 million at December 31, 2004. The
decline  was  attributable  to the  repurchase  of common  stock in open  market
transactions  to  satisfy  the  Company's  2004 RSP and the 5% stock  repurchase
program that was announced on January 26, 2005, as well as the effect of the net
unrealized  investment  portfolio  market  value  adjustment,  offset by the net
income for the period.  Additionally,  on June 29, 2005, the Company's  Board of
Directors  declared a quarterly  cash dividend of $0.05 per common share,  which
represented  an  increase  of $0.01,  or 25.0%,  over the prior  quarterly  cash
dividend. The dividend was payable on July 29, 2005 to stockholders of record on
July 15, 2005.

    The  repurchase of shares  associated  with the  Company's  2004 RSP and the
stock repurchase program resulted in cumulative reductions in equity of $319,000
and $6.1  million,  respectively.  The  decrease  in the  unrealized  investment
portfolio market value adjustment, net of tax effect, totaled $513,000.

                                      -15-

<PAGE>

Average Balance Sheet.  The following  table sets forth certain  information for
the three months ended June 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 June 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)                         $623,790      $ 9,081        5.82%      $459,960      $6,669     5.80%
  Securities(2)                                     236,324        2,244        3.80        211,795       1,653     3.12
  Other interest-earning assets(3)                   12,363          143        4.63         10,809          23     0.85
                                                   --------       ------                   --------      ------
     Total interest-earning assets                  872,477       11,468        5.26        682,564       8,345     4.89
Non-interest-earning assets                          40,580                                  29,114
                                                   --------                                --------
     Total assets                                  $913,057                                $711,678
                                                   ========                                ========
Interest-bearing liabilities:
  Checking accounts(4)                             $ 58,655           15        0.10       $ 51,018           2     0.02
  Savings and club accounts                          68,769           86        0.50         72,373          90     0.50
  Money market accounts                             157,293          834        2.12        158,159         672     1.70
  Certificates of deposit                           276,832        2,078        3.00        222,589       1,426     2.56
  FHLB advances                                     246,300        2,037        3.31        100,655         630     2.50
  Stock subscriptions payable                             -            -        0.00              -           -     0.00
                                                   --------      -------                   --------      ------
     Total interest-bearing liabilities             807,849        5,050        2.50        604,794       2,820     1.87
Non-interest-bearing liabilities                      2,873                                   1,696
                                                   --------                                --------
     Total liabilities                              810,722                                 606,490
Stockholders' equity                                102,335                                 105,188
                                                   --------                                --------
     Total liabilities and stockholders' equity    $913,057                                $711,678
                                                   ========                                ========
Net interest income                                              $ 6,418                                 $5,525
                                                                 =======                                 ======
Interest rate spread(5)                                                         2.76%                               3.02%
Net yield on interest-earning assets(6)                                         2.94%                               3.24%
Ratio of average interest-earning assets to
   average interest-bearing liabilities                                       108.00%                             112.86%
</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 six months  ended June 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 Six Months Ended June 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)                          $601,603    $17,255        5.74%       $451,002    $13,369       5.93%
  Securities(2)                                      238,851      4,514        3.78         193,283      3,163       3.27
  Other interest-earning assets(3)                    12,398        234        3.77          10,500         45       0.86
                                                    --------    -------                    --------    -------
     Total interest-earning assets                   852,852     22,003        5.16         654,785     16,577       5.06
Non-interest-earning assets                           40,659                                 29,242
                                                    --------                               --------
     Total assets                                   $893,511                               $684,027
                                                    ========                               ========
Interest-bearing liabilities:
 Checking accounts(4)                               $ 55,463         28        0.10        $ 47,946          4       0.02
 Savings and club accounts                            67,480        168        0.50          71,202        176       0.49
 Money market accounts                               157,187      1,604        2.04         151,639      1,277       1.68
 Certificates of deposit                             269,929      3,933        2.91         220,003      2,828       2.57
 FHLB advances                                       236,594      3,830        3.24          84,407      1,083       2.57
 Stock subscriptions payable                               -          -        0.00          11,603         23       0.40
                                                    --------    -------                    --------    -------
     Total interest-bearing liabilities              786,653      9,563        2.43         586,800      5,391       1.84
Non-interest-bearing liabilities                       3,575                                  2,445
                                                    --------                               --------
     Total liabilities                               790,228                                589,245
Stockholders' equity                                 103,283                                 94,782
                                                    --------                               --------
     Total liabilities and stockholders' equity     $893,511                               $684,027
                                                    ========                               ========
Net interest income                                             $12,440                                $11,186
                                                                =======                                =======
Interest rate spread(5)                                                        2.73%                                3.22%
Net yield on interest-earning assets(6)                                        2.92%                                3.42%
Ratio of average interest-earning assets to
   average interest-bearing liabilities                                      108.42%                              111.59%
</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 June 30, 2005 and 2004

         Net Income. Net income increased by $195,000,  to $1.1 million, for the
three months  ended June 30,  2005,  compared to $910,000 for the same period in
2004, a 21.4% increase.  The increase was primarily  attributable to an $893,000
increase  in net  interest  income  and a  $348,000  increase  in other  income,
partially  offset by a $141,000  increase in the  provision  for loan losses,  a
$795,000  increase  in other  expenses  and a  $110,000  increase  in income tax
expense as a result of higher pre-tax earnings.

         Net Interest  Income.  Net interest income grew $893,000,  or 16.2%, to
$6.4 million for the three months ended June 30, 2005,  compared to $5.5 million
for the same period in 2004. Total interest income increased by $3.1 million, to
$11.5  million,  for the three months ended June 30, 2005,  while total interest
expense  increased by $2.2 million,  to $5.1  million,  for the same three month
period.

         The 37.4%  increase in total  interest  income was  primarily  due to a
$189.9  million,  or 27.8%,  increase  in the average  interest-earning  assets,
combined  with a 37 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 a larger  portfolio of
average investment securities and increased other interest income resulting from
higher average FHLB stock balances.

         The 79.1% increase in total interest expense primarily  resulted from a
$203.1 million, or 33.6%, increase in average interest-bearing  liabilities with
a 63 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  borrowings.  The  majority  of the
increase in average interest-bearing  liabilities for the quarter ended June 30,
2005 was  comprised  of a $145.6  million,  or 144.7%,  increase  in the average
balance of FHLB advances along with a $54.2 million,  or 24.4%,  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  increased  by $141,000,  or 42.0%,  to
$477,000 for the three months  ended June 30, 2005,  from  $336,000 for the same
quarter in 2004. Total charge-offs  amounted to $157,000 and recoveries amounted
to $84,000, resulting in a net charge-off amount of $73,000 for the three months
ended June 30, 2005. This represents a $65,000  increase in net charge-offs over
the same quarter in 2004.

                                      -18-

<PAGE>

         Other Income.  Other income increased  $348,000,  or 66.4%, to $872,000
for the three  months  ended June 30,  2005,  compared to $524,000  for the same
quarter in 2004.  This is  primarily  the result of an  increase  of $183,000 in
commission income generated by sales from Synergy Financial Services, Inc. and a
$275,000  increase in tax advantaged  income from the Company's  bank-owned life
insurance  investment.  This increase was partially offset by a $61,000 decrease
in service  charges and fees on deposit  accounts and a loss of $34,000 from the
sale of $12.8 million of investment securities during the quarter ended June 30,
2005.

         Other Expenses.  Other expenses increased  $795,000,  or 18.7%, to $5.0
million for the three months  ended June 30, 2005,  compared to $4.2 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.  During the quarter  ended June 30,
2005, the Company opened its 19th branch office in Elizabeth, New Jersey.

         Income Tax Expense. Income tax expense increased by $110,000, or 19.6%,
during the three months ended June 30, 2005 when compared to the same quarter in
2004, reflecting higher taxable income for the 2005 period.

Comparison of Operating Results for Six Months Ended June 30, 2005 and 2004

         Net Income. Net income increased by $310,000,  to $2.2 million, for the
six months ended June 30, 2005,  compared to $1.9 million for the same period in
2004,  a 16.2%  increase.  The  increase was  primarily  attributable  to a $1.3
million increase in net interest income and a $625,000 increase in other income,
offset by a $218,000  increase in the provision for loan losses,  a $1.2 million
increase in other  expenses  and a $145,000  increase in income tax expense as a
result of higher pre-tax earnings.

         Net Interest Income.  Net interest income grew $1.3 million,  or 11.2%,
to $12.4  million  for the six months  ended June 30,  2005,  compared  to $11.2
million for the same period in 2004.  Total  interest  income  increased by $5.4
million,  to $22.0 million,  for the six months ended June 30, 2005, while total
interest expense  increased by $4.2 million,  to $9.6 million,  for the same six
month period.

         The 32.7%  increase in total  interest  income was  primarily  due to a
$198.1 million, or 30.2%, increase in average  interest-earning assets, combined
with a 10 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 77.4% increase in total interest expense resulted  primarily from a
$199.9 million,  or 34.1%,  increase in the average balance of  interest-bearing
liabilities  coupled with a 59 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 borrowings. The
majority of the increase in average  interest-bearing  liabilities for the first
six months in 2005 was due to an increase of a $152.2 million, or 180.3%, in the
average balance of FHLB advances and a $49.9 million, or 22.7%,  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 $218,000,  or 31.0%,  to
$922,000  for the six months  ended June 30,  2005,  from  $704,000 for the same
period in 2004. Total charge-offs  amounted to $394,000 and recoveries  amounted
to $154,000, resulting in a net charge-off amount of $240,000 for the six months
ended June 30, 2005. This represents a $63,000  increase in net charge-offs over
the same period in 2004.

         Other  Income.  Other  income  increased  $625,000,  or 51.6%,  to $1.8
million for the six months ended June 30, 2005, compared to $1.2 million for the
same period in 2004.  This is primarily the result of an increase of $416,000 in
commission income generated by sales from Synergy Financial Services, Inc. and a
$308,000  increase  in  tax  advantaged  income  from  a  larger  investment  in
bank-owned  life  insurance.  The  increase  was  partially  offset by a $36,000
decrease in service  charges and fees on deposit  accounts and a loss of $34,000
from the sale of $12.8  million of  investment  securities  during the six month
period ended June 30, 2005.

         Other  Expenses.  Other expenses  increased $1.2 million,  or 14.1%, to
$9.8 million for the six months  ended June 30,  2005,  compared to $8.6 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.  During the quarter  ended June 30,
2005, the Company opened its 19th branch office in Elizabeth, New Jersey.

         Income Tax Expense. Income tax expense increased by $145,000, or 11.8%,
during the six months  ended June 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 $4.1 million at June 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 June 30, 2005, the
Bank's  borrowing limit with the FHLB was $203.8 million,  excluding  repurchase
agreement  advances, subject to collateral  requirements.  At June 30, 2005, the
Bank had $262.0 million of borrowings outstanding, which included $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 June 30, 2005 was $99.1
million,  excluding  commitments on unused lines of credit,  which totaled $27.6
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 June 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)                            $262,022       $155,722         $69,800          $13,800      $22,700
Rental under operating leases                  12,636            409           2,819            1,593        7,815
                                             --------       --------         -------          -------      -------
Total                                        $274,658       $156,131         $72,619          $15,393      $30,515
                                             ========       ========         =======          =======      =======
</TABLE>

-----------------
(1)  At  June  30,  2005,  the  Bank  had  $262.0  million  of  FHLB  borrowings
     outstanding,   which  included  $108.0  million  in  repurchase   agreement
     advances.  At June 30, 2005, the Bank's  borrowing  limit with the FHLB was
     $203.8  million,   excluding   repurchase  agreement  advances, subject  to
     collateral requirements.

The following table discloses the Bank's  commercial  commitments as of June 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)                          $ 27,601     $  1,041       $ 1,555      $2,362     $22,643
Other commitments to extend credit             99,113       99,113             -           -           -
                                             --------     --------       -------      ------     -------
Total                                        $126,714     $100,154       $ 1,555      $2,362     $22,643
                                             ========     ========       =======      ======     =======
</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 June 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 June 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)           $96,246      14.79%      $52,070      8.00%      $65,087      10.00%
Tier 1 capital
   (to risk-weighted assets)            91,137      14.00%          N/A        N/A       39,052       6.00%
Tier 1 capital (to adjusted total
   (to adjusted total assets)           91,137       9.90%       36,834      4.00%       46,042       5.00%
Tangible capital
   (to adjusted total assets)           91,137       9.90%       13,813      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 June 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  his
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 and financial officer has 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 to ensure that  information
required  to be  disclosed  by the  Company in reports  that it files or submits
under the Exchange Act is recorded,  processed,  summarized and reported  within
the time periods  specified in  Securities  and  Exchange  Commission  rules and
forms.

         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 June 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 second  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>
April 1-30, 2005                    -                -                    -                         555,851
----------------------------- --------------- ---------------- ------------------------- ----------------------------
May 1-31, 2005                   143,600           12.13               143,600                      412,251
----------------------------- --------------- ---------------- ------------------------- ----------------------------
June 1-30, 2005                  290,500           11.99               290,500                      121,751
----------------------------- --------------- ---------------- ------------------------- ----------------------------
Total                            434,100           12.03               434,100
----------------------------- --------------- ---------------- ------------------------- ----------------------------
</TABLE>

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

None.

--------------
(1)  On January 26, 2005, the Company announced a share repurchase program.  The
     program  specified  the  purchase  of up to 5.0  percent  of the  Company's
     outstanding shares of common stock  (approximately  622,600 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 121,751 shares yet
     to be purchased.

                                      -25-

<PAGE>

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

      The Annual Meeting of Stockholders (the "Meeting") of the Company was held
      on April 26,  2005.  There were  outstanding  and  entitled to vote at the
      Meeting  12,452,011  shares of Common  Stock of the  Company.  There  were
      present at the  meeting or by proxy the  holders of  11,349,625  shares of
      Common Stock  representing  91.2% of the total  eligible votes to be cast.
      Proposal 1 was to elect three directors of the Company.  Proposal 2 was to
      ratify the  appointment  of the  independent  auditor for the December 31,
      2005  fiscal  year.  The result of the voting at the Meeting is as follows
      (percentages in terms of votes cast):

        Proposal 1
<TABLE>
<CAPTION>
                                                    VOTES FOR                          VOTES WITHHELD
                                       -----------------------------------    ---------------------------------
                                            Number           Percentage           Number          Percentage
                                           of Votes         of Votes Cast        of Votes        of Votes Cast
                                       ---------------    ----------------    -------------    ----------------

<S>                                     <C>                   <C>               <C>                <C>
  Magdalena M. De Perez                   11,293,852            99.5%             55,773             0.5%

  Kenneth S. Kasper                       11,303,752            99.6%             45,873             0.4%

  George Putvinski                        11,301,619            99.6%             48,006             0.4%
</TABLE>


         Proposal 2

         Ratification  of the  appointment  of Grant Thornton LLP as independent
         auditor for the Company for the December 31, 2005 fiscal year.


                               Number of      Percentage of
                                 Votes         Votes Cast
                           --------------- -------------------

FOR                          11,309,463          99.7%

AGAINST                          36,066           0.3%

ABSTAIN                           4,096           0.0%


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: August 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  person on behalf of the
Registrant and in the capacities and on the date indicated.


/s/John S. Fiore
--------------------------------------------------------------
John S. Fiore
President, Chief Executive Officer and Chief Financial Officer
(Principal Executive and Financial Officer)

Date:  August 9, 2005

                                      -27-