----

----

|                                                                                          |   | March      31,2008                                           |    |   | December      31, 2007 |   |
|-----------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------|---------|--------|-----------------------------|--------|
|                                                                                          |   | (Unaudited)(Dollar      in thousands, except per share data) |    |
| Cash      and due from banks                                                                  |   | $                                                            | 6,244   |   |                        | $      | 6,646 |   |
| Short-term      investments                                                                   |   |                                                         | 9,919   |   |                        |   | 59 |   |
| Cash      and cash equivalents                                                                |   |                                                         | 16,163  |   |                        |   | 6,705 |   |
|                                                                                          |   |                                                         |    |   |                        |   |   |   |
| Securities      available for sale, at fair value                                             |   |                                                         | 7,038   |   |                        |   | 6,966 |   |
| Securities      held to maturity, at amortized cost                                           |   |                                                         | 30,144  |   |                        |   | 30,886 |   |
| Federal      Home Loan Bank stock, at cost                                                    |   |                                                         | 4,944   |   |                        |   | 4,163 |   |
|  Loans                                                                                   |   |                                                         | 305,848 |   |                        |   | 295,483 |   |
| Allowance      for loan losses                                                                |   |                                                         | (2,503  | )      |                        |   | (2,399 | ) |
| Loans, net                                                                                    |   |                                                         | 303,345 |   |                        |   | 293,084 |   |
|  Premises      and equipment, net                                                        |   |                                                         | 8,114   |   |                        |   | 5,849 |   |
| Accrued      interest receivable                                                              |   |                                                         | 1,241   |   |                        |   | 1,269 |   |
| Net      deferred tax asset                                                                   |   |                                                         | 2,454   |   |                        |   | 2,313 |   |
| Bank-owned      life insurance                                                                |   |                                                         | 9,610   |   |                        |   | 9,274 |   |
| Other      assets                                                                             |   |                                                         | 588     |   |                        |   | 750 |   |
| Total      assets                                                                             |   | $                                                            | 383,641 |   |                        | $      | 361,259 |   |
|                                                                                          |   |
| LIABILITIES      AND STOCKHOLDERS’ EQUITY                                               |   |
| Deposits                                                                                      |   | $                                                            | 206,989 |   |                        | $      | 193,285 |   |
| Short-term      borrowings                                                                    |   |                                                         | -       |   |                        |   | 5,809 |   |
| Long-term      borrowings                                                                     |   |                                                         | 115,397 |   |                        |   | 99,547 |   |
| Accrued      expenses and other liabilities                                                   |   |                                                         | 2,935   |   |                        |   | 3,666 |   |
| Total      liabilities                                                                        |   |                                                         | 325,321 |   |                        |   | 302,307 |   |
|                                                                                          |   |                                                         |    |   |                        |   |   |   |
| Preferred      stock, $.01 par value; 1,000,000 shares authorized; none      issued           |   |                                                         | -       |   |                        |   | - |   |
| Common      stock, $.01 par value; 19,000,000 shares authorized; 4,878,349 shares      issued |   |                                                         | 49      |   |                        |   | 49 |   |
| Additional      paid in capital                                                               |   |                                                         | 50,278  |   |                        |   | 50,023 |   |
| Retained      earnings                                                                        |   |                                                         | 17,246  |   |                        |   | 17,234 |   |
| Unearned      compensation (526,861 and 533,365 shares at                                     |   |                                                         |    |   |                        |   |   |   |
|     March      31, 2008 and December 31, 2007, respectively)              |   |                                                         | (5,204  | )      |                        |   | (5,548 | ) |
| Treasury      stock, at cost (314,617 and 213,660 shares at                                   |   |                                                         |    |   |                        |   |   |   |
|     March      31, 2008 and December 31, 2007, respectively)              |   |                                                         | (3,889  | )      |                        |   | (2,655 | ) |
| Accumulated      other comprehensive loss                                                     |   |                                                         | (160    | )      |                        |   | (151 | ) |
| Total stockholders’      equity                                                         |   |                                                         | 58,320  |   |                        |   | 58,952 |   |
| Total liabilities and      stockholders’ equity                                         |   | $                                                            | 383,641 |   |                        | $      | 361,259 |   |

----

|                                                                     |   | Three      Months EndedMarch      31,                         |   |
|--------------------------------------------------------------------------|--------|---------------------------------------------------------------|--------|
|                                                                     |   | 2008                                                          |   |   | 2007 |   |
|                                                                     |   | (Unaudited)(Dollars      in thousands, except per share data) |   |
| Interest      and dividend income:                                       |   |                                                          |   |   |   |   |
| Loans                                                                    |   | $                                                             | 4,632  |   |   | $ | 4,064 |   |
| Securities                                                               |   |                                                          | 491    |   |   |   | 104 |   |
| Federal Home Loan Bank      stock                                        |   |                                                          | 58     |   |   |   | 41 |   |
| Other interest-earning      assets                                       |   |                                                          | 40     |   |   |   | 12 |   |
| Total interest and dividend      income                                  |   |                                                          | 5,221  |   |   |   | 4,221 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Interest      expense:                                                   |   |                                                          |   |   |   |   |   |   |
| Deposits                                                                 |   |                                                          | 1,189  |   |   |   | 1,144 |   |
| Short-term      borrowings                                               |   |                                                          | 28     |   |   |   | 123 |   |
| Long-term      borrowings                                                |   |                                                          | 1,152  |   |   |   | 398 |   |
| Total interest      expense                                              |   |                                                          | 2,369  |   |   |   | 1,665 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Net      interest income                                                 |   |                                                          | 2,852  |   |   |   | 2,556 |   |
| Provision      for loan losses                                           |   |                                                          | 111    |   |   |   | 113 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Net interest income, after      provision for loan losses                |   |                                                          | 2,741  |   |   |   | 2,443 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Non-interest      income:                                                |   |                                                          |   |   |   |   |   |   |
| Customer service      fees                                               |   |                                                          | 433    |   |   |   | 437 |   |
|        Bank-owned      life insurance |   |                                                          | 101    |   |   |   | 95 |   |
| Miscellaneous                                                            |   |                                                          | 25     |   |   |   | 23 |   |
| Total non-interest      income                                           |   |                                                          | 559    |   |   |   | 555 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Non-interest      expenses:                                              |   |                                                          |   |   |   |   |   |   |
| Salaries and employee      benefits                                      |   |                                                          | 2,005  |   |   |   | 1,438 |   |
| Occupancy and equipment,      net                                        |   |                                                          | 332    |   |   |   | 313 |   |
| Data processing                                                          |   |                                                          | 262    |   |   |   | 268 |   |
| Professional    fees                                                     |   |                                                          | 113    |   |   |   | 121 |   |
| Marketing                                                                |   |                                                          | 225    |   |   |   | 270 |   |
| Other general and      administrative                                    |   |                                                          | 183    |   |   |   | 177 |   |
| Total non-interest      expenses                                         |   |                                                          | 3,120  |   |   |   | 2,587 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Income      before income taxes                                          |   |                                                          | 180    |   |   |   | 411 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Provision      for income taxes                                          |   |                                                          | 106    |   |   |   | 152 |   |
|                                                                     |   |                                                          |   |   |   |   |   |   |
| Net      income                                                          |   | $                                                             | 74     |   |   | $ | 259 |   |

| Weighted-average      shares outstanding: |   |   |      |   |   |   |
|-------------------------------------------|--------|--------|-----------|--------|--------|--------|
| Basic                                     |   |   | 4,282,128 |   |   |   | 4,516,339 |   |
| Diluted                                   |   |   | 4,282,128 |   |   |   | 4,516,339 |   |
|                                      |   |   |      |   |   |   |   |   |
| Earnings      per share:                  |   |   |      |   |   |   |   |   |
| Basic                                     |   | $      | .02       |   |   | $      | .06 |   |
| Diluted                                   |   | $      | .02       |   |   | $      | .06 |   |