SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

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

                  For the quarterly period ended March 31, 2001

                         Commission file number: 0-31847

                        Lawrence Financial Holdings, Inc.
                        ---------------------------------
             (Exact name of registrant as specified in its charter)

        Maryland                                                  31-1724442
--------------------------------------------------------------------------------
(State or other jurisdiction of                                (IRS Employer
 incorporation or organization)                              Identification No.)


                   311 South Fifth Street, Ironton, Ohio 45638
                   -------------------------------------------
                    (Address of principal executive offices)

                                 (740) 532-0263
                                 --------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 the number of shares  outstanding  of each of the  issuer's  classes of
common equity, as of the latest practicable date.


                Class:                      Outstanding at April 30 , 2001
     Common Stock, $.01 par value                775,827 Common Shares

<PAGE>

                        Lawrence Financial Holdings, Inc.

                                   FORM 10-QSB

                          Quarter Ended March 31, 2001


                         Part I - Financial Information


                                                                         Page
                                                                         ----

ITEM 1 - Financial Statements

         Consolidated Balance Sheets ...................................  3

         Consolidated Statements of Income..............................  4

         Consolidated Statements of Comprehensive Income................  5

         Condensed Consolidated Statements of Changes in
          Shareholders' Equity..........................................  6

         Consolidated Statements of Cash Flows..........................  7

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


ITEM 2 - Management's Discussion and Analysis of
         Financial Condition and Results of Operations.................. 10



                           Part II - Other Information

Other Information....................................................... 20

Signatures.............................................................. 20


                                       2

<PAGE>

                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

                                                       March 31,    December 31,
                                                         2001           2000
                                                    ----------------------------
ASSETS

Cash and due from banks                             $  9,197,539    $  2,206,856
Money market fund                                        117,932       2,678,223
                                                    ----------------------------
    Total cash and cash equivalents                    9,315,471       4,885,079
Securities available for sale, at fair value           6,051,086       6,430,911
Loans receivable, net                                106,993,290     105,385,397
Federal Home Loan Bank stock                             558,900         549,100
Premises and equipment, net                            3,409,773       3,453,094
Accrued interest receivable                              780,920         815,816
Cash surrender value of life insurance                 1,883,970       1,870,231
Other assets                                             230,197         455,590
                                                    ----------------------------

                                                    $129,223,607    $123,845,218
                                                    ============================

<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY

<S>                                                           <C>              <C>
Liabilities
    Noninterest-bearing deposits                              $   1,529,089    $   1,409,413
    Interest-bearing deposits                                   109,186,586      101,697,172
                                                              ------------------------------
         Total deposits                                         110,715,675      103,106,585
    Federal Home Loan Bank borrowings                             2,000,000        5,000,000
    Other liabilities                                             1,281,962          798,688
                                                              ------------------------------
         Total liabilities                                      113,997,637      108,905,273

Shareholders' Equity
    Preferred stock; par value $0.01 per share; shares
      authorized:  1,000,000; shares issued: none                        --               --
    Common stock; par value $0.01 per share; shares
      authorized:  4,000,000; shares issued: 775,827                  7,696            7,696
    Additional paid-in capital                                    6,996,306        6,994,305
    Retained earnings                                             8,735,058        8,555,006
    Unearned ESOP shares - 54,301 at YTD 2001                      (542,661)        (558,660)
    Accumulated other comprehensive gain (loss), net of tax
      of $15,234 at 2001 and $(30,086) at 2000                       29,571          (58,402)
                                                              ------------------------------
         Total shareholders' equity                              15,225,970       14,939,945
                                                              ------------------------------

             Total liabilities and shareholders' equity       $ 129,223,607    $ 123,845,218
                                                              ==============================
</TABLE>

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

                                       3
<PAGE>


                        CONSOLIDATED STATEMENTS OF INCOME
                   Three Months Ended March 31, 2001 and 2000
                                   (Unaudited)


                                                         Three Months Ended
                                                               March 31,
                                                      -------------------------
                                                           2001         2000
                                                      -------------------------
Interest income
     Loans, including fees                            $ 2,230,096   $ 1,564,457
     Taxable securities                                    96,321       198,051
     Overnight deposits                                    49,270         8,708
                                                      -------------------------
                                                        2,375,687     1,771,216
                                                      -------------------------
Interest expense
     Deposits                                           1,341,844       986,807
     Federal Home Loan Bank borrowings                     33,943        33,441
                                                      -------------------------
                                                        1,375,787     1,020,248
                                                      -------------------------
Net interest income                                       999,900       750,968

Provision for loan losses                                  48,000        30,000
                                                      -------------------------
Net interest income after provision for loan losses       951,900       720,968

Noninterest income
     Net securities (losses)                                   --       (13,739)
     Service charges                                       87,770        78,852
     Other                                                 38,954        34,913
                                                      -------------------------
                                                          126,724       100,026

Noninterest expense
     Salaries and benefits                                367,675       268,448
     Deposit insurance premiums                             4,830         4,807
     Occupancy and equipment                               83,816        88,525
     Data processing                                      119,272       106,237
     Franchise tax                                         26,250        26,250
     Advertising expense                                   16,048        36,443
     Other                                                199,173       110,553
                                                      -------------------------
                                                          817,064       641,263
                                                      -------------------------
Income before income tax                                  261,560       179,731

Provision for income tax                                   81,508        55,577
                                                      -------------------------

Net income                                            $   180,052   $   124,154
                                                      =========================

Basic and diluted earnings per common share           $      0.25           N/A
                                                      ===========

                                       4

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

<PAGE>

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
                   Three Months Ended March 31, 2001 and 2000
                                   (Unaudited)

                                                            Three Months Ended
                                                                March 31,
                                                          ---------------------
                                                            2001         2000
                                                          ---------------------
Net income                                                $180,052     $124,154
Other comprehensive income:
     Unrealized gains arising during period                133,292       41,879
     Reclassification adjustment for losses
       included in net income                                   --       13,739
                                                          ---------------------
                                                           133,292       55,618
     Income tax (expense)                                  (45,319)     (18,910)
                                                          ---------------------
         Other comprehensive income,  net of tax            87,973       36,708
                                                          ---------------------
Comprehensive income                                      $268,025     $160,862
                                                          =====================



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


                                       5

<PAGE>

           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
     Year Ended December 31, 2000 and the three months ended March 31, 2001
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                         Additional                 Unearned    Accum Other
                                                Common     Paid-In     Retained       ESOP     Comprehensive
                                                 Stock     Capital     Earnings      Shares        Income       Total
                                                ------------------------------------------------------------------------
<S>                                             <C>      <C>          <C>          <C>           <C>         <C>
Balance - January 1, 2000                       $   --   $       --   $8,132,702   $      --     $(341,189)  $ 7,791,513

Net income                                          --           --      422,304          --            --       422,304

Net unrealized appreciation on securities
  available for sale, net of tax of $145,678        --           --           --          --       282,787       282,787

Proceeds from the sale of 775,827 shares of
  common stock, net of conversion costs          7,758    7,056,243           --          --            --     7,064,001

Purchase of 62,066 shares of common stock
  for ESOP                                          --           --           --    (620,660)           --     (620,660)

6,200 shares committed to be released under
  the ESOP                                         (62)     (61,938)          --      62,000            --            --
                                                ------------------------------------------------------------------------
Balance - December 31, 2000                     $7,696   $6,994,305   $8,555,006   $(558,660)    $ (58,402)  $14,939,945
                                                ------------------------------------------------------------------------
Net income                                          --           --      180,052          --            --       180,052

1,565 shares committed to be released under
  the ESOP                                          --        2,001           --      15,999            --        18,000

Net unrealized appreciation on securities
  available for sale, net of tax of $(45,319)       --           --           --          --        87,973        87,973
                                                ------------------------------------------------------------------------
Balance - March 31, 2001                        $7,696   $6,996,306   $8,735,058   $(542,661)    $  29,571   $15,225,970
                                                ========================================================================
</TABLE>


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


                                       6

<PAGE>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   Three Months Ended March 31, 2001 and 2000
                                   (Unaudited)


                                                          Three Months Ended
                                                               March 31,
                                                       ------------------------
                                                          2001          2000
                                                       ----------    ----------
Cash flows from operating activities
  Net income                                           $  180,052    $  124,154
  Adjustments to reconcile net income to net cash
    from operating activities
      Depreciation                                         43,488        49,471
      Provision for loan losses                            48,000        30,000
      Stock dividend on Federal Home Loan Bank stock       (9,800)       (8,890)
      Net premium amortization                              4,112       (51,817)
        Net securities (gains) losses                          --        13,739
      ESOP expense                                         18,000            --
      Change in other assets and liabilities              684,505       (69,532)
                                                       ------------------------
          Net cash from operating activities              968,357        87,125
                                                       ------------------------
Cash flows from investing activities
  Purchase of:
    Securities available for sale                      (1,540,995)   (2,050,000)
      Premises and equipment                                 (167)         (847)
  Proceeds from:
    Sale of securities available for sale                      --     2,103,966
    Calls, maturities and principal repayments of
      securities available for sale                     2,050,000            --
  Net change in loans                                  (1,655,893)   (2,335,126)
                                                       ------------------------
          Net cash from investing activities           (1,147,055)   (2,282,007)
                                                       ------------------------
Cash flows from financing activities
  Net change in:
    Deposits                                            7,609,090     2,948,859
    Federal Home Loan Bank short-term borrowings       (3,000,000)   (2,500,000)
                                                       ------------------------
          Net cash from financing activities            4,609,090       448,859
                                                       ------------------------
Net change in cash and cash equivalents                 4,430,392    (1,746,023)

Cash and cash equivalents at beginning of quarter       4,885,079     4,667,632
                                                       ------------------------
Cash and cash equivalents at end of quarter            $9,315,471    $2,921,609
                                                       ========================
Supplemental disclosures:
  Cash paid during the quarter for:
    Interest                                           $1,386,428    $1,042,961
    Income taxes                                          135,000             0


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


                                       7

<PAGE>

NOTE 1 - SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

Principles of  Consolidation:  The  consolidated  financial  statements  include
-----------------------------
Lawrence  Financial  Holdings,  Inc. and its wholly-owned  subsidiary,  Lawrence
Federal  Savings  Bank (the  "Bank")  and the  Bank's  wholly-owned  subsidiary,
Lawrence Financial Services Corporation (together, the "Company").  Intercompany
transactions and balances are eliminated in consolidation.

Nature of  Operations:  The  Company  provides  financial  services  through its
----------------------
offices in Lawrence  and Scioto  Counties.  Its  primary  deposit  products  are
checking,  savings,  and term  certificate  accounts,  and its  primary  lending
products are real estate mortgage and installment loans. Substantially all loans
are secured by specific items of collateral  including  consumer assets and real
estate.   Lawrence  Financial  Services  Corporation  holds  real  property  for
investment purposes. Management considers the Company to operate in one segment,
banking.

Earnings Per Common Share: Basic earnings per common share is net income divided
--------------------------
by 775,827 weighted  average number of common shares  outstanding less 55,866 of
unearned  ESOP  shares.   A  total  of  719,961  weighted  average  shares  were
outstanding  for the period.  Diluted  earnings  per common  share  includes the
dilutive effect of additional  potential  common shares  issuable.  Earnings and
dividends per share are restated for all stock splits and dividends  through the
date of issue of the financial  statements.  As of March 31, 2001, 2000 and 1999
there were no  potentially  dilutive  items.  The following  table  reflects the
Company's basic and diluted earnings per share of common stock.

                                         03/31/01     03/31/00     03/31/99
Basic earnings per common share           $ 0.25         N/A         N/A
Diluted earnings per common share           0.25         N/A         N/A

Management's Opinion: In the opinion of management,  the unaudited  Consolidated
---------------------
Financial  Statements include all adjustments (which consist of normal recurring
accruals) necessary to present fairly the consolidated  financial position as of
March 31, 2001,  the results of operations  for the three months ended March 31,
2001 and 2000 and the  statements of cash flows for the three months ended March
31, 2001 and 2000. In accordance with generally accepted  accounting  principles
for interim  financial  information,  these  statements  do not include  certain
information and footnote  disclosures  required by generally accepted accounting
principles for complete annual financial statements. Financial information as of
December  31,  2000 has been  derived  from the audited  Consolidated  Financial
Statements of Lawrence Financial Holdings, Inc. (the "Company").  The results of
operations  and  statements  of cash flows for the three  months ended March 31,
2001 are not  necessarily  indicative of the results to be expected for the full
year. For further  information,  refer to the Consolidated  Financial Statements
and  footnotes  thereto for the year ended  December 31,  2000,  included in the
Company's  Annual Report on Form 10-KSB.  (Certain  reclassifications  have been
made to prior periods'  consolidated  financial  statements and related notes to
conform with the current period presentation.)

NOTE 2 - EMPLOYEE  BENEFITS

Retirement  Plan: The Company sponsors a 401(k) profit sharing plan for eligible
-----------------
employees.  Under the plan,  employees  who are at least 21 1/2 years of age and
have  completed six months of service are eligible to  participate.  The Company
matches  each   employee's   contribution  at  a  rate  of  100%  of  employees'
contributions up to 5% of gross compensation. Participants become 100% vested as
to the Company's contributions after three years of service.

Employee  Stock Option Plan:  Employees  participate in an Employee Stock Option
----------------------------
Plan (ESOP).  On December 29, 2000, the ESOP borrowed  $620,660 from the Company
to purchase  62,066  shares of common stock at $10 per share.  The Company makes
discretionary  contributions to the ESOP, and the ESOP uses funds it receives to
repay the loan.  ESOP shares are  allocated  to  participants  based on relative
compensation and expense is recorded.

                                       8
<PAGE>

NOTE 3 - REGULATORY  CAPITAL  REQUIREMENTS

     Lawrence Federal Savings Bank (the "Bank") is subject to various regulatory
capital  requirements  administered by federal regulatory  agencies.  Failure to
meet minimum capital  requirements can initiate certain  mandatory actions that,
if  undertaken,  could have a direct  material  effect on the  Bank's  financial
statements.  Under capital  adequacy  guidelines  and  regulatory  framework for
prompt-corrective  action,  the  Bank  must  meet  specific  capital  guidelines
involving  quantitative  measures of the Bank's assets,  liabilities and certain
off-balance-sheet items as calculated under regulatory accounting practices. The
Bank's  capital  amounts and  classifications  are also  subject to  qualitative
judgments by regulators about the Bank's  components,  risk weightings and other
factors.  At March 31, 2001 and December 31, 2000,  management believes the Bank
complied with all regulatory capital requirements.  Based on the Bank's computed
regulatory  capital  ratios,  the Bank was  considered  well  capitalized  under
Section 38 of the Federal Deposit  Insurance Act as of its last regulatory exam.
Management  is  unaware  of any events or  circumstances  that would  change the
Bank's classification since that time.

     The Bank's  actual  capital  levels and  minimum  required  levels  were as
follows:

                                                                    Minimum
                                                                 Required to be
                                                                Well Capitalized
                                              Minimum Required    Under Prompt
                                                for Capital    Corrective Action
                                 Actual      Adequacy Purposes    Regulations
                            ----------------------------------------------------
(dollars in thousands)       Amount  Ratio    Amount   Ratio    Amount   Ratio
                            ----------------------------------------------------
March 31,2001:
--------------
Total capital (to risk-
  weighted assets)          $14,014  15.26%   $7,345    8.0%    $9,181   10.0%
Tier 1 (core) capital (to
  risk-weighted assets)     $13,208  14.39%   $3,672    4.0%    $5,509    6.0%
Tier 1 (core) capital (to
  adjusted total assets)    $13,208  10.22%   $5,202    4.0%    $6,502    5.0%

December 31,2000:
-----------------
Total capital (to risk-
  weighted assets)          $13,771  15.32%   $7,190    8.0%    $8,988   10.0%
Tier 1 (core) capital (to
  risk-weighted assets)     $12,996  14.46%   $3,595    4.0%    $5,393    6.0%
Tier 1 (core) capital (to
  adjusted total assets)    $12,996  10.44%   $5,012    4.0%    $6,265    5.0%


     Regulations of the Office of Thrift  Supervision  (OTS) limit the amount of
cash dividends,  repurchase of common stock and other capital distributions that
may be  paid  by a bank  without  prior  approval  of the  OTS.  The  regulatory
restriction  provides  that the Bank may  make a  capital  distribution  without
notifying  the OTS or applying  to the OTS for  approval  provided  that (1) the
total amount of all capital at the institution  (including the proposed  capital
distribution) for the applicable calendar year does not exceed the institution's
net income for that year to date plus the institution's  retained net income for
the preceding two years; (2) the institution will be well capitalized  following
the proposed capital distributions; and, (3) certain other conditions are met.

     In addition to the restriction described above, the Bank may not declare or
pay cash dividends or repurchase any of its shares of common stock if the effect
thereof  would  reduce the Bank's  capital  level  below the  aggregate  balance
required for the liquidation account.


                                       9

<PAGE>

ITEM  2
           Management's Discussion and Analysis of Financial Condition
                            And Results of Operations

                             Selected Financial Data


                                                     Three Months Ended
                                                          March 31,
                                                     ------------------
                                                      2001        2000
                                                     ------      ------
Significant Ratios

Net income to:
  Average total assets                                0.58%       0.49%
  Average stockholders' equity                        4.78        6.32
Net Interest Margin                                   3.43        3.21
Average net loans to average deposits                99.39       86.57
Average stockholders' equity to
  average total assets                               12.20        7.72
Capital ratios:
  Tier I capital                                     10.22        7.79
  Risk-based capital                                 15.26       11.78

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

Per Share Data:

Earnings
  Basic                                            $  0.25        N/A
  Diluted                                             0.25        N/A
Cash dividends per share                                --        N/A
Weighted average shares outstanding
  Basic                                            719,961        N/A
  Diluted                                          719,961        N/A
Book value at end of period                        $ 21.15        N/A
Market price at end of period                        11.50        N/A


                                       10

<PAGE>

Introduction

     This  report  contains  certain  "forward-looking  statements"  within  the
meaning of the federal  securities  laws.  These  statements  are not historical
facts, rather they are statements based on Lawrence Financial  Holdings,  Inc.'s
("Lawrence  Financial") current expectations  regarding its business strategies,
intended results and future performance. Forward-looking statements are preceded
by terms such as  "expects,"  "believes,"  "anticipates,"  "intends" and similar
expressions.

     Management's  ability to predict  results or the effect of future  plans or
strategies is inherently  uncertain.  Factors which could affect actual  results
include interest rate trends, the general economic climate in the market area in
which Lawrence Financial operates,  as well as nationwide,  Lawrence Financial's
ability to control costs and expenses,  competitive  products and pricing,  loan
delinquency  rates and changes in federal and state  legislation and regulation.
These factors should be considered in evaluating the forward-looking  statements
and undue reliance should not be placed on such statements.  Lawrence  Financial
assumes no obligation to update any forward-looking statements.

Operating Strategy

     Lawrence  Financial,  through its wholly owned subsidiary  Lawrence Federal
Savings Bank ("Lawrence  Federal"),  operates as a community-oriented  financial
institution  focused on meeting the financial  service needs of consumers in its
market area. To accomplish this objective,  Lawrence Federal offers a variety of
mortgage and consumer loans and retail deposit  products.  Lawrence  Federal has
extended its lending  activities outside of its market area through programs for
originating mobile home and automobile loans through a network of dealers. These
indirect  lending  programs help Lawrence  Federal  originate a larger amount of
consumer  loans,  which  typically  have  shorter  terms and higher  yields than
mortgage loans,  than Lawrence Federal would otherwise be able to originate.  In
addition,  the  origination  of shorter term  consumer  loans will help Lawrence
Federal in managing its interest rate risk. Lawrence Federal intends to continue
to focus on further expansion of its non-mortgage lending.

General

     Lawrence  Federal's  results of operations depend primarily on net interest
income,  which is the difference  between the interest income earned on Lawrence
Federal's  interest-earning  assets,  such  as  loans  and  securities,  and the
interest  expense on its  interest-bearing  liabilities,  such as  deposits  and
borrowings.  Lawrence Federal also generates  noninterest  income primarily from
loan fees and service charges. Lawrence Federal's noninterest expenses primarily
consist  of  employee   compensation  and  benefits,   occupancy  expense,  data
processing costs, and other operating  expenses.  Lawrence  Federal's results of
operations  are also affected by general  economic and  competitive  conditions,
notably changes in market interest rates, government policies and regulations.

Comparison of Financial Condition at March 31, 2001 and December 31, 2000

     During the first three months of 2001,  total assets  increased $5 million,
or 4%, to $129  million  at March 31,  2001 when  compared  to the  balances  at
December 31, 2000. At the quarter ended March 31, 2001, net loans receivable had
grown $2 million,  or 2%, when compared to the end of the prior quarter.  Direct
and indirect consumer loans grew $1 million,  or 5%, real estate loans decreased
by $1  million,  or 2%, and  indirect  mobile home loans grew  $790,000,  or 4%.
commercial loans were at $1 million on March 31, 2001 with no comparable balance
at December 31, 2000. The growth in the  commercial  loan portfolio was due to a
reclassification  of real estate based,  commercial  purpose loans from the real
estate loan  portfolio.  The majority of the growth in consumer loans is tied to
the indirect automobile lending program,  while real estate loans decreased as a
result of  reclassifications  and  reduced  market  demand.  Mobile  home  loans
increased  as a result of  increased  origination  efforts  by the  third  party
through  which  Lawrence  Federal  originates  most of its  mobile  home  loans.
Lawrence  Federal's  long  term  investments,  held in the  form of  securities,
decreased by $380,000, or 6%, when comparing March 31, 2001 balances to December
31,  2000.  During the third and fourth  quarters  of 2000,  Lawrence  Financial
deployed most of the liquidity  provided by the sale of these assets as a source
of funds to generate  higher  yielding  loans.  During the first quarter of 2001
Lawrence  Financial's  available cash and cash equivalents grew to $9 million an
increase of $4 million, or 91%, when compared to the quarter ending December 31,
2000. This growth was primarily due to increases in interest bearing deposits.

                                       11

<PAGE>

     Compared to December 31, 2000,  total deposits and borrowings  increased $5
million,  or 4%, to $113 million at March 31, 2001.  Within the first quarter of
2001,  deposits increased $8 million, or 7%, and the volume of Federal Home Loan
Bank  advances  decreased  by $3 million to a balance of $2 million at March 31,
2001.  Deposits  grew during this  period as a result of  marketing  efforts and
aggressively priced products.

     Equity  increased  $286,000,  or 2%, to $15  million at March 31, 2001 when
compared to the same period in December 31, 2000. On December 28, 2000, Lawrence
Financial   completed  its  initial  public  offering  in  connection  with  the
conversion  of Lawrence  Federal to a stock  company.  The first quarter of 2001
marks  the end of the first  three  months  of  operating  with the new level of
capital.  During the quarter ended March 31, 2001,  retained earnings  increased
$180,000  as a result of net  income  for the  period  while  changes to the net
unrealized  appreciation  on  securities  available-for-sale  improved  from  an
unrealized loss of $58,000 to an unrealized gain of $30,000.


Comparison of Operating Results for the Quarters Ending March 31, 2001 and 2000

     General.  For the quarter ended March 31,  Lawrence  Financial's net income
increased  45% to $180,000 for 2001 from  $124,000  for 2000.  Return on average
assets was 0.58% for the first  quarter of 2001 and 0.49% for the same period in
2000,  and  return on average  equity  was 4.78% in 2001 and 6.32% in 2000.  Net
interest income increased  $249,000,  or 33%, while noninterest income increased
$27,000,  or 27%, as a result of a $14,000  losses taken in the first quarter of
2000 on the sale of securities  and an increase in service charge related income
in the first quarter of 2001. The increase in net interest  income was primarily
the result of the increase in the size of the loan portfolio  and,  secondarily,
the result of an increased yield on interest-earning assets, which was partially
offset by an increased  cost of funds.  Offsetting  the increase in net interest
and noninterest income was a $176,000,  or 27%, increase in noninterest expense.
Employee salaries and benefits increased  $99,000,  or 37%, when compared to the
first quarter of 2000,  accounting  for the majority of the increase.  There are
several  causes for the  increase  in salary and wage  expense  between  the two
periods.  First, the Company has employed  additional  personnel in the indirect
lending and  finance  areas and  existing  personnel  received  an annual  merit
increase.  Another  cause for the  increase is the  monthly  accrual for expense
related to the ESOP which was  implemented at the date of  conversion,  December
28, 2000. And finally, the Company is accruing monthly for the potential rewards
which may be earned by employees as part of the new, results oriented, incentive
processes  implemented  by the Company in the first quarter of 2001. The Company
also  experienced  an  increase in supply  costs,  professional  services,  data
processing and other  noninterest  expenses related to the additional  financial
reporting processes required of a public company and the growth of the Company's
customer base.

     Interest  Income.  Net interest income increased  $249,000,  or 33%, in the
quarter compared to the same quarter in 2000. Interest income on loans increased
$666,000,  or 43%, primarily as a result of growth in the loan portfolio and, to
a lesser  extent,  as a result of the  increase  in the yield on the  portfolio.
Interest income on short-term  investments increased $40,000, or 466%, primarily
as a result of a larger average  balance being carried by the Company during the
first quarter of 2001. The average yield on interest-earning  assets improved to
8.23% for the quarter  ending March 31, 2001,  from 7.62% for the same period in
2000,  as loans became a higher  percentage of  interest-earning  assets and the
yield on the portfolio increased.

     Interest Expense.  Interest expense increased $356,000,  or 35%, in for the
quarter  ending March 31, 2001 compared to the first  quarter of 2000.  Interest
paid on deposits  increased  $355,000,  or 36%, as a result of growth in deposit
accounts and the increase in rates paid on  deposits.  Interest  paid on Federal
Home Loan Bank  advances  was $34,000  through  the first  three  months of 2001
compared  to  $33,000  for  the  same  period  in  2000.  The  average  cost  of
interest-bearing  liabilities  rose to 5.11% in the first  quarter  of 2001 from
4.37% in 2000,  primarily as a result of higher market rates on  certificates of
deposits and the addition of higher costing Federal Home Loan Bank advances.


                                       12

<PAGE>

     Provision  for Loan  Losses.  Activity  in the  allowance  for loan  losses
consists of increases  due to monthly  provisions  for loan losses and decreases
for periodic charge offs, net of recoveries. Management analyzes the adequacy of
the allowance  balance  quarterly by determining its estimate of probable losses
in  the  portfolio  and  comparing  that  estimate  to  the  allowance  balance.
Management  calculates  its  estimate of probable  losses  primarily by applying
expected loss percentages to classified loans and major loan categories.  In the
first  quarter of 2001,  management  reevaluated  the loss  percentage  used for
determining the required  allowance for each loan category.  The impact of these
events are  described in more detail below as part of the  discussion  comparing
the first quarter 2001 and 2000 provisions for loan losses.

     The  provision  for loan losses was  $48,000 for the first  quarter of 2001
compared  to $30,000 for the same period in 2000.  The  provision  for the first
quarter of 2001 and 2000 reflected  management's  assessment of probable losses,
which is  impacted by loan  growth and  changes in the  composition  of the loan
portfolio, particularly the growth of indirect automobile, indirect mobile home,
and direct  consumer  loans.  Management's  assessment of probable losses in the
loan portfolio increased for the first three months of 2001 when compared to the
same period in 2000, primarily due to the changes in both the volume and the mix
of the loan  portfolio.  During  the  first  quarter  of 2001,  management  also
reevaluated  Lawrence  Federal's historic loss percentage and incorporated other
factors  such as peer  comparisons,  underwriting  quality  and  local  economic
conditions  in its analysis of allowance  levels.  While the economy in Lawrence
County has generally  been good the past few years,  recent plant  closings have
resulted in job losses.  Over the past several years,  unemployment  in Lawrence
County has been greater than the state and national rate.  Management  considers
these  factors  when  calculating  its  estimate  of the  required  level of the
allowance for loan losses.

     Management  believes  that the  average  balance  of  outstanding  indirect
automobile loans will not grow significantly  beyond its ending balance at March
31, 2001.  Management  anticipates  that its  estimate of the required  level of
allowance associated with Lawrence Federal's indirect automobile lending program
will  decrease  when  compared to the year 2000,  but will  increase if the bank
experiences  growth  in its  loan  volume  or an  unexpected  increase  in  loan
delinquency.

     While  management  believes  the  existing  level of reserves is  adequate,
future adjustments to the allowance may be necessary due to economic, operating,
regulatory, and other conditions that may be beyond Lawrence Federal's control.

Noninterest  Income.  The following  table shows the  components of  noninterest
income and the dollar and  percentage  change from the first  quarter of 2001 to
the first quarter of 2000.

                                                             Dollar   Percentage
                                       03/31/01   03/31/00   Change     Change
                                       --------   --------   ------   ----------
    (Dollars in Thousands)
Net securities gains (losses)             --         -14       14        N/A
Service charges                           88          79        9         11
Other                                     39          35        4         11
                                         ---         ---      ---
    Total                                127         100       27         27
                                         ===         ===      ===        ===

     Net  securities  losses  incurred  in the  first  quarter  of 2000 were not
duplicated  in the same period of 2001.  Service  charges  increased  during the
quarter as a result of growth in the number of deposit  accounts.  Other  income
consists of increases in the cash surrender value of life insurance policies and
$2,500 of fees paid to the Company for the  origination of fixed rate mortgages.
The  origination of long-term,  fixed rate  mortgages  through a third party was
started  in the  first  quarter  of 2001  and is part of the  Company's  overall
interest rate risk management strategy.


                                       13

<PAGE>

Noninterest  Expense.  The following  table shows the  components of noninterest
expense and the dollar and percentage  change from the three months ending March
31, 2001 to the same period in 2000.

                                                             Dollar   Percentage
                                       03/31/01   03/31/00   Change     Change
                                       --------   --------   ------   ----------
  (Dollars in Thousands)
Salaries and benefits                    368         268      100         37
Deposit insurance premiums                 5           5       --         --
Occupancy and equipment                   84          89       -5         -6
Data processing                          119         106       13         12
Franchise tax                             26          26       --         --
Advertising expense                       16          36      -20        -55
Other                                    199         111       88         79
                                         ---         ---      ---
    Total                                817         641      176         27
                                         ===         ===      ===        ===

     Employee salaries and benefits increased $100,000, or 37%, when compared to
the first  quarter of 2000,  accounting  for the  majority  of the  increase  in
noninterest  expenses.  There are several  causes for the increase in salary and
wage expense between the two periods. First, the Company has employed additional
personnel  in the  indirect  lending and finance  areas and  existing  personnel
received an annual merit increase. Another cause for the increase is the monthly
accrual for  expense  related to the ESOP which was  implemented  at the date of
conversion,  December 28, 2000. And finally, the Company is accruing monthly for
the  potential  rewards  which may be earned  by  employees  as part of the new,
results oriented,  incentive  processes  implemented by the Company in the first
quarter of 2001.  The Company  also  experienced  an  increase in supply  costs,
professional services, data processing and other noninterest expenses related to
the additional  financial  reporting  processes required of a public company and
the growth of the Company's customer base.

     Income Tax  Expense.  The  provision  for income tax was $81,500 in for the
quarter  ended March 31, 2001,  compared to $55,600 in the same period for 2000.
The provision  increased as a result of higher taxable income. The effective tax
rate for the first  quarter of 2001 was 31.2%  compared  with 30.9% for the same
period in 2000.


                                       14

<PAGE>

Average Balances, Interest and Average Yields/Cost

     The following table presents certain information regarding average balances
of assets and  liabilities,  as well as the total  dollar  amounts  of  interest
income from  average  interest-earning  assets and  interest  expense on average
interest-bearing  liabilities  and the resulting  average yields and costs.  The
yields and costs for the periods  indicated  are  derived by dividing  income or
expense by the average balances of assets or liabilities,  respectively, for the
periods presented. Average balances were derived from daily balances.

<TABLE>
<CAPTION>
                                    -----------------------------------------------------------
                                                      Quarter ended March 31,
                                    -----------------------------------------------------------
                                                2001                           2000
                                    ----------------------------   ----------------------------
    (Dollars in Thousands)          Average   Interest   Average   Average   Interest   Average
                                    Balance               Yield/   Balance               Yield/
                                                           Rate                           Rate
                                    -------   --------   -------   -------   --------   -------
<S>                                 <C>         <C>       <C>       <C>        <C>       <C>
Interest-earning assets:
  Loans (1)                         106,371     2,230     8.44%     79,414     1,565     7.89%
  Securities (2)                      6,474        97     5.96%     12,548       198     6.32%
  Interest-bearing short term inv     3,307        49     6.05%      1,138         9     3.07%
                                    -------     -----              -------     -----
    Total interest-earning assets   116,152     2,376     8.23%     93,100     1,771     7.62%
Non-interest-earning assets           9,202                          9,180
                                    -------                        -------
    Total assets                    125,354                        102,280
                                    =======                        =======
Interest-bearing liabilities:
  Deposits:
    Passbook accounts                20,123       128     2.58%     18,115       125     2.77%
    Money market accounts               784         5     2.54%        910         6     2.65%
    NOW accounts                     11,624        72     2.51%     12,011        81     2.71%
    Certificates of deposit          74,495     1,137     6.19%     60,700       775     5.14%
                                    -------     -----              -------     -----
      Total deposits                107,026     1,342     5.08%     91,736       987     4.33%
  FHLB advances                       2,258        34     6.09%      2,194        33     6.12%
                                    -------     -----              -------     -----
      Total interest-bearing
        liabilities                 109,284     1,376     5.11%     93,930     1,020     4.37%
                                                -----                          -----
Non-interest-bearing liabilities        775                            451
                                    -------                        -------
      Total liabilities             110,059                         94,381
Total retained earnings              15,295                          7,899
                                    -------                        -------
      Total liabilities and
        retained earnings           125,354                        102,280
                                    =======                        =======

Net interest-earning assets           6,868                           (830)
                                    =======                        =======
Net interest income/interest
  rate spread (3)                               1,000     3.12%                  751     3.25%
                                                =====     ====                 =====     ====
Net interest margin (4)                          3.43%                          3.21%
                                                =====                          =====
Ratio of interest-earning assets
  to interest-bearing liabilities    106.28%                         99.12%
                                    =======                        =======
</TABLE>
----------
(1)  Balances are net of deferred  loan  origination  costs,  allowance for loan
     losses,  undisbursed proceeds of construction loans in process, and include
     non-accrual loans.
(2)  Includes  investment  securities  available-for-sale,  stock in the Federal
     Home Loan Bank of Cincinnati and mutual funds.
(3)  Net interest rate spread  represents  the  difference  between the weighted
     average yield on  interest-earning  assets and the weighted average cost of
     interest-bearing liabilities.
(4)  Net  interest  margin  represents  net interest  income as a percentage  of
     average interest-earning assets.

                                       15

<PAGE>

Management of Interest Rate Risk and Market Risk Analysis

     Qualitative  Aspects of Market Risk.  Lawrence  Federal's most  significant
form of market risk is interest rate risk. The principal  objectives of Lawrence
Federal's  interest rate risk  management are to evaluate the interest rate risk
inherent  in  certain  balance  sheet  accounts,  determine  the  level  of risk
appropriate given Lawrence Federal's business strategy,  operating  environment,
capital and liquidity  requirements and performance  objectives,  and manage the
risk  consistent  with the Board of  Director's  approved  guidelines.  Lawrence
Federal has an Asset/Liability  Committee (ALCO),  responsible for reviewing its
asset/liability  policies and interest rate risk  position,  which meets monthly
and reports  trends and  interest  rate risk  position to the Board of Directors
quarterly.  The ALCO is  actively  involved  in  reviewing  the mix,  volume and
pricing  strategies  associated  with  managing  the  Bank's  balance  sheet and
interest  rate risk.  During  the first  quarter  of 2001  management  developed
several  additional  internal  reports to better  analyze the current  financial
position of the Bank, and the Company,  and to identify  historic  trends in the
both entities performance. However, the extent of the movement of interest rates
is an uncertainty  that could have a negative impact on the earnings of Lawrence
Federal.

     At this time,  Lawrence Federal is liability sensitive which makes the Bank
subject to increased  interest  expense during periods of rising interest rates.
During  the first  quarter  of 2001,  the  Federal  Reserve  lowered  short-term
interest  rates by 150 basis points which should result in improved net interest
margins for the Bank. In recent years,  Lawrence  Federal has used the following
strategies to manage interest rate risk: (1)  emphasizing  shorter term consumer
loans; (2) maintaining a high quality  portfolio of short- to  intermediate-term
securities;  and (3) managing the rates and terms of  certificates of deposit to
better structure the repricing  opportunities of its rate sensitive liabilities.
Lawrence Federal intends to increase its emphasis on  adjustable-rate  loans and
to originate  some  fixed-rate  mortgage  loans through a third party which will
reduce the  interest  rate risk  contained  in the  balance  sheet and  generate
additional  noninterest income.  Lawrence Federal currently does not participate
in hedging programs,  interest rate swaps or other activities  involving the use
of off-balance sheet derivative financial instruments.

     Quantitative Aspects of Market Risk. Lawrence Federal primarily utilizes an
interest  sensitivity  analysis prepared by the Office of Thrift  Supervision to
review the level of interest  rate risk.  This analysis  measures  interest rate
risk by computing changes in the net portfolio value of Lawrence  Federal's cash
flows from assets,  liabilities  and  off-balance  sheet items in the event of a
range  of  assumed  changes  in  market  interest  rates.  Net  portfolio  value
represents the market value of portfolio equity and is equal to the market value
of assets  minus the market  value of  liabilities,  with  adjustments  made for
off-balance  sheet items. This analysis assesses the risk of loss in market risk
sensitive  instruments  in the event of a sudden and  sustained 100 to 300 basis
point increase or decrease in market  interest rates with no effect given to any
steps that  management  might take to counter the effect of that  interest  rate
movement.  The  following  table,  which  is based on  information  provided  to
Lawrence  Federal by the Office of Thrift  Supervision,  presents  the change in
Lawrence  Federal's net portfolio  value at December 31, 2000,  that would occur
upon an immediate change in interest rates based on Office of Thrift Supervision
assumptions,  but without giving effect to any steps that management  might take
to counteract that change.

   Change in            Net Portfolio Value         NPV as % of Portfolio
 Interest Rates                                        Value of Assets
In Basis Points
  (Rate Shock)
---------------   -------------------------------   ---------------------
                  (Dollars in thousands)
                                                      NPV
                   $ Amount   $ Change   % Change    Ratio     Change (1)
---------------    --------   --------   --------    -----     ----------
       300           6,142     -5,019      -45%       5.28%       -380
       200           7,865     -3,296      -30%       6.63%       -245
       100           9,579     -1,582      -14%       7.92%       -115
     Static         11,161         --       --        9.07%         --
      -100          12,386      1,224       11%       9.93%         85
      -200          13,911      2,750       25%      10.97%        189
      -300          16,046      4,885       44%      12.39%        332

(1)  Expressed in basis points.

     The  preceding  table  shows  that in the event of a sudden  and  sustained
increase in market  interest  rates of 2% or more,  the net  portfolio  value of
Lawrence Federal would decrease moderately.

                                       16

<PAGE>

     The Office of Thrift Supervision uses certain  assumptions in assessing the
interest rate risk of savings associations. These assumptions relate to interest
rates,  loan  prepayment  rates,  deposit decay rates,  and the market values of
certain assets under differing interest rate scenarios, among others.

     As with any method of measuring  interest rate risk,  certain  shortcomings
are inherent in the method of analysis  presented in the  foregoing  table.  For
example,  although certain assets and liabilities may have similar maturities or
periods to repricing,  they may react in different  degrees to changes in market
interest  rates.  Also,  the  interest  rates on  certain  types of  assets  and
liabilities may fluctuate in advance of changes in market interest rates,  while
interest  rates  on  other  types  may  lag  behind  changes  in  market  rates.
Additionally,  certain  assets,  such as adjustable  rate mortgage  loans,  have
features which restrict changes in interest rates on a short-term basis and over
the life of the asset.  Further,  if interest  rates change,  expected  rates of
prepayments on loans and early  withdrawals  from  certificates of deposit could
deviate significantly from those assumed in calculating the table.

Liquidity and Capital Resources

     Liquidity is the ability to meet current and future  financial  obligations
of a  short-term  nature.  Lawrence  Federal  further  defines  liquidity as the
ability  to  respond  to the  needs  of  depositors  and  borrowers  as  well as
maintaining  the  flexibility  to take  advantage of  investment  opportunities.
Lawrence  Federal's  primary sources of funds consist of deposit  inflows,  loan
repayments,  maturities and sales of investment  securities and borrowings  from
the Federal Home Loan Bank. While maturities and scheduled amortization of loans
and  securities  are  predictable  sources of funds,  deposit flows and mortgage
prepayments  are  greatly   influenced  by  general  interest  rates,   economic
conditions and competition.

     Liquidity  management  is  both a daily  and  long-term  responsibility  of
management. Lawrence Federal adjusts its investments in liquid assets based upon
management's assessment of (1) expected loan demand, (2) expected deposit flows,
(3) yields available on  interest-earning  deposits and securities,  and (4) the
objectives of its asset/liability  management program.  Excess liquid assets are
invested  generally  in  interest-earning  overnight  deposits  and  short-  and
intermediate-term U.S. Government and agency obligations.

     Lawrence  Federal's most liquid assets are cash and short-term  investments
(securities  maturing  in one year or  less).  The  levels of these  assets  are
dependent on Lawrence  Federal's  operating,  financing,  lending and  investing
activities  during any given  period.  At March 31,  2001,  cash and  short-term
investments  totaled $9 million.  Securities  classified  as  available-for-sale
totaled $6 million at March 31, 2001. In addition,  at March 31, 2001,  Lawrence
Federal had the ability to borrow a total of approximately  $10 million from the
Federal  Home  Loan Bank of  Cincinnati.  On that  date,  Lawrence  Federal  had
advances outstanding of $2 million.

     The primary investing activities of Lawrence Federal are the origination of
loans and the purchase of  securities.  In the first  quarter of 2001,  Lawrence
Federal  originated $9 million of loans and purchased $1 million of  securities.
During the same period in 2000,  Lawrence Federal originated $6 million of loans
and purchased $2 million of securities.

     Funding is obtained  primarily from activity involving deposit accounts and
Federal Home Loan Bank advances.  In the first quarter of 2001 Lawrence  Federal
experienced  a net  increase  in total  deposits  of $8 million  compared  to an
increase of $3 million for the first quarter of 2000. Deposit flows are affected
by the overall level of interest rates,  the interest rates and products offered
by  Lawrence  Federal  and its local  competitors  and other  factors.  Lawrence
Federal  generally  manages the pricing of its deposits to be competitive and to
increase  core deposit  relationships.  Occasionally,  Lawrence  Federal  offers
promotional rates on certain deposit products in order to attract  deposits.  At
March 31, 2001,  Federal Home Loan Bank  advances  were $2 million.  On the same
date in 2000, Federal Home Loan Bank advances were at $2 million. The difference
between the two balances is that the 2001  borrowing has a 24 month maturity and
the borrowing at March 31, 2000 was a short-term, overnight, borrowing.

     At  March  31,  2001,  Lawrence  Federal  had  outstanding  commitments  to
originate loans of $5 million.  Lawrence  Federal  anticipates that it will have
sufficient  funds  available  to  meet  its  current  loan   commitments.   Loan
commitments  have, in recent periods,  been funded through  liquidity or through
Federal Home Loan Bank borrowings. Certificates of deposit that are scheduled to
mature in one year or less from March 31, 2001 totaled $53  million.  Management
believes, based on past experience, that a significant portion of those deposits
will remain with Lawrence  Federal.  Based on the  foregoing,  Lawrence  Federal
considers its liquidity and capital resources sufficient to meet its outstanding
short-term and long-term needs.

                                       17

<PAGE>

     Lawrence  Federal is subject to  various  regulatory  capital  requirements
administered by the Office of Thrift Supervision  including a risk-based capital
measure.  The risk-based capital guidelines include both a definition of capital
and a framework for calculating  risk-weighted assets by assigning balance sheet
assets and off-balance sheet items to broad risk categories.  At March 31, 2001,
Lawrence Federal exceeded all of its regulatory capital  requirements.  Lawrence
Federal is considered "well capitalized" under regulatory guidelines.

Impact of Accounting Pronouncements

     Accounting for Derivative Instruments and Hedging Activities.  Statement of
Financial Accounting  Standards No. 133, "Accounting for Derivative  Instruments
and  Hedging  Activities,"  issued in June 1998 (as  amended  by SFAS No.  137),
standardizes  the  accounting  for  derivative  instruments,  including  certain
derivative  instruments  embedded in other  contracts.  The  statement  requires
entities to carry all  derivative  instruments  in the  statement  of  financial
position at fair value. The accounting for changes in the fair value,  gains and
losses, of a derivative instrument depends on whether it has been designated and
qualifies  as part of a hedging  relationship  and,  if so, on the  reasons  for
holding it. If certain  conditions  are met,  entities  may elect to designate a
derivative  instrument  as a hedge of exposures  to changes in fair value,  cash
flows or foreign currencies. Lawrence Federal adopted FASB No. 133 on January 1,
2001. The statement did not affect  Lawrence  Federal because  Lawrence  Federal
does  not  currently  purchase  derivative  instruments  or enter  into  hedging
activities.

Effect of Inflation and Changing Prices

     The consolidated  financial statements and related financial data presented
in this prospectus have been prepared following  generally  accepted  accounting
principles,  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 due to  inflation.  The  primary
impact of inflation is reflected  in the  increased  cost of Lawrence  Federal's
operations.  Unlike  most  industrial  companies,  virtually  all the assets and
liabilities  of a financial  institution  are  monetary in nature.  As a result,
interest  rates  generally  have  a  more  significant  impact  on  a  financial
institution's performance than do 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.

Looking Forward......

     The close of business,  March 31, 2001,  marked the completion of our first
three  months  as a  stock  company.  The  results  posted  by the  Company  are
consistent with the mission,  goal and strategic objectives of the organization.
Our corporate  "Mission" is to provided the  communities  within our market with
competitively  priced  financial  services,  delivered  by a  knowledgeable  and
professional  staff, in a convenient and timely manner.  Our corporate "Goal" is
to achieve an annual increase in net income of at least 8.00% while  maintaining
a balance of asset quality and growth. The long-term result of this goal will be
to provide enhanced value to our shareholders.

     Both the mission and the goal of the Company  will be achieved  through the
continued education of our associates and improved teamwork.  The combination of
these two elements creates a positive banking environment in which the staff can
grow  professionally  and  personally.  As a result,  our customers will receive
value added services,  our communities  will receive the financial  support they
need and our shareholders will receive a reasonable return on their investment.

     During the first quarter of 2001 the Company  implemented a set of tailored
incentive  programs  to  reward  associates  for  producing  results  which  are
consistent  with the Company's  stated mission,  goal and strategic  objectives.
There are three  separate  incentive  programs.  Each program is  structured  to
strike a balance  between five  fundamental  elements  necessary  for  long-term
corporate success: growth; profit; quality; efficiency; and enhanced shareholder
value.

                                       18

<PAGE>

     The  Company is focused  on  expanding  our  customer  base.  One method of
accomplishing  this  objective  is through  the  introduction  of new  financial
products and  services.  Another  method for  improving  the customer base is to
focus on enhancing the number of banking  relationships with existing customers.
A third  alternative is by expanding our current  delivery  network.  Management
believes  that the Company is now in a position to pursue  appropriate  business
opportunities  and to focus part of its energies on evaluating  possible banking
center expansion via denovo construction and/or by purchasing existing locations
as a means of acquiring new sales centers and enhancing  revenue  opportunities.
Future acquisitions,  if they occur, may not be limited to a specific geographic
location or proximity to current  branch  operations.  Lawrence  Financial  will
consider only those business  opportunities  that are  consistent  with both the
mission and the  strategic  goals of the Company and which  management  believes
have the potential to generate additional shareholder value.

     The Company's  management  team is evaluating  various  methods to leverage
existing and new  technologies to improve  operating  efficiencies,  product and
service delivery  channels,  and the  measurement/analysis  of internal data. By
performing these "ground-up"  reviews  management  believes it can significantly
improve several core processes generating both short-term and long-term benefits
to customers and shareholders.

     The Board of  Directors,  the  management  team and each  associate  of the
Company are focused on producing positive results. Generating a short-term spike
in income  or  growth is not the  objective.  To be  consistent  with  corporate
objectives  positive  results must enhance  franchise  value over the long-term,
deliver  value  added  services to the  customer  and the  community,  and build
sustained shareholder value.

     The first quarter of 2001 produced several positive results for the Company
and it marked a good beginning but it is only that, "... a good beginning".


                                       19

<PAGE>

                        Lawrence Financial Holdings, Inc.
                                    Form 10-Q

                          Quarter ended March 31, 2001

PART II - Other Information

Item 1-   Legal Proceedings:
          There are no matters required to be reported under this item.

Item 2-   Changes in Securities:
          There are no matters required to be reported under this item.

Item 3-   Defaults Upon Senior Securities:
          There are no matters required to be reported under this item.

Item 4-   Submission of Matters to a Vote of Security Holders:
          There are no matters required to be reported under this item.

Item 5-   Other Information:
          There are no matters required to be reported under this item.

Item 6-   Exhibits and Reports on Form 8-K:

          (a)  Exhibits - Not applicable.
          (b)  Reports on Form 8-K.

     A report on Form 8-K was  filed on March  19,  2001.  Under  Item 5,  Other
Matters,  Lawrence  Financial  Holdings,  Inc.  reported  that it issued a press
release to announce the date of its annual meeting of shareholders.


                                   Signatures

     In accordance with to the  requirements  of the Securities  Exchange Act of
1934,  the  registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.


                               Lawrence Financial Holdings, Inc.



Date:  May 14, 2001            /s/Jack L. Blair

                               Jack L. Blair
                               President and Chief Executive Officer


Date:  May 14, 2001            /s/RobRoy Walters

                               RobRoy Walters
                               Senior Vice President and Chief Financial Officer


                                       20