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

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
|---|----------------------------------------------------------------------------------------------|

|                            UNITED STATES                            |                      65-1233977                      |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (State or other jurisdiction of incorporation or                                                                                                                                                                                                                                                                                                  | (I.R.S. Employer Identification No.)                                                                                                                                                                                                                                   |
| organization)                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                   |
|                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                   |
| 333 CHURCH STREET, NAUGATUCK, CONNECTICUT                                                                                                                                                                                                                                                                                          |              06770                                                                                                                   |
| (Address of principal executive offices)                                                                                                                                                                                                                                                                                                          | (Zip Code)                                                                                                                                                                                                                                                             |

|   | Large Accelerated Filer  o          | Accelerated Filer  o         |
|--------|-----------------------------------------------|----------------------------------------|
|   | Non-accelerated Filer  o            | Smaller Reporting Company  x |
|   | (Do not check if a smaller reporting company) |                                   |

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l

| Part I.  Financial Information |     | Page No.                                                                                          |
|------------------------------------------|----------|---------------------------------------------------------------------------------------------------|
|                                     |     |                                                                                              |   |   |
|                                     | Item 1.  | Financial Statements (Unaudited)                                                                  |   |   |
|                                     |     |                                                                                              |   |   |
|                                     |     | Consolidated Statements of Financial Condition at September 30, 2010 and December 31, 2009        |   | 3 |
|                                     |     |                                                                                              |   |   |
|                                     |     | Consolidated Statements of Income for the three and nine months ended September 30, 2010 and 2009 |   | 4 |
|                                     |     |                                                                                              |   |   |
|                                     |     | Consolidated Statements of Cash Flows for the nine months ended September 30, 2010 and 2009       |   | 5 |
|                                     |     |                                                                                              |   |   |
|                                     |     | Notes to Unaudited Consolidated Financial Statements                                              |   | 6 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations       |   | 16 |
|                                     |     |                                                                                              |   |   |
|                                     |     | Liquidity and Capital Resources                                                                   |   | 22 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                                        |   | 24 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 4.  | Controls and Procedures                                                                           |   | 25 |
|                                     |     |                                                                                              |   |   |
|                                     |     |                                                                                              |   |   |
| Part II.  Other Information    |     |                                                                                              |
|                                     |     |                                                                                              |   |   |
|                                     | Item 1.  | Legal Proceedings                                                                                 |   | 26 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 1A. | Risk Factors                                                                                      |   | 26 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                                       |   | 26 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 3.  | Defaults Upon Senior Securities                                                                   |   | 27 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 4.  | (Removed and Reserved)                                                                            |   | 27 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 5.  | Other Information                                                                                 |   | 27 |
|                                     |     |                                                                                              |   |   |
|                                     | Item 6.  | Exhibits                                                                                          |   | 27 |
|                                     |     |                                                                                              |   |   |
| Signatures                               |     |                                                                                              |
|                                     |     |                                                                                              |   |   |
| Exhibits                                 |     |                                                                                              |

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t

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S

|                                                               |   | September 30, |    |   | December 31, |   |
|--------------------------------------------------------------------|--------|---------------|---------|--------|--------------|--------|
|                                                               | 2010   |          |    | 2009   |         |
|                                                               |   | (Unaudited)   |    |
| ASSETS                                                             |   |          |    |   |         |   |
| Cash and due from depository institutions                          |   | $             | 23,849  |   |         | $      | 9,003 |   |
| Investment in federal funds                                        |   |          | 582     |   |         |   | 3,143 |   |
| Investment securities available-for-sale, at fair value            |   |          | 33,925  |   |         |   | 37,623 |   |
| Investment securities held-to-maturity, at amortized cost          |   |          | 10,269  |   |         |   | 1,451 |   |
| Loans held for sale, at fair value                                 |   |          | 856     |   |         |   | - |   |
| Loans receivable, net                                              |   |          | 478,738 |   |         |   | 473,304 |   |
| Accrued income receivable                                          |   |          | 2,033   |   |         |   | 2,074 |   |
| Foreclosed real estate and repossessed assets, net                 |   |          | 506     |   |         |   | 140 |   |
| Premises and equipment, net                                        |   |          | 9,690   |   |         |   | 9,948 |   |
| Bank owned life insurance                                          |   |          | 9,168   |   |         |   | 8,920 |   |
| Federal Home Loan Bank stock, at cost                              |   |          | 6,252   |   |         |   | 6,252 |   |
| Other assets                                                       |   |          | 5,263   |   |         |   | 5,097 |   |
|                                                               |   |          |    |   |         |   |   |   |
| Total assets                                                       |   | $             | 581,131 |   |         | $      | 556,955 |   |
|                                                               |   |          |    |   |         |   |   |   |
|                                                               |   |          |    |   |         |   |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY                               |   |          |    |   |         |   |   |   |
| Liabilities                                                        |   |          |    |   |         |   |   |   |
| Deposits                                                           |   | $             | 404,750 |   |         | $      | 380,931 |   |
| Borrowed funds                                                     |   |          | 119,870 |   |         |   | 118,984 |   |
| Mortgagors' escrow accounts                                        |   |          | 2,373   |   |         |   | 4,888 |   |
| Other liabilities                                                  |   |          | 2,036   |   |         |   | 1,844 |   |
|                                                               |   |          |    |   |         |   |   |   |
| Total liabilities                                                  |   |          | 529,029 |   |         |   | 506,647 |   |
|                                                               |   |          |    |   |         |   |   |   |
| Commitments and contingencies                                      |   |          |    |   |         |   |   |   |
|                                                               |   |          |    |   |         |   |   |   |
| Stockholders' equity                                               |   |          |    |   |         |   |   |   |
| Preferred stock, $.01 par value; 1,000,000 shares authorized;      |   |          |    |   |         |   |   |   |
| no shares issued or outstanding                                    |   |          | -       |   |         |   | - |   |
| Common stock, $.01 par value; 25,000,000 shares authorized;        |   |          |    |   |         |   |   |   |
| 7,604,375 shares issued, 7,018,823 shares outstanding at September |   |          |    |   |         |   |   |   |
| 30, 2010 and 7,022,866 shares outstanding at December 31, 2009     |   |          | 76      |   |         |   | 76 |   |
| Paid-in capital                                                    |   |          | 33,860  |   |         |   | 33,756 |   |
| Retained earnings                                                  |   |          | 25,811  |   |         |   | 24,849 |   |
| Unearned ESOP shares (193,735 shares at September 30, 2010         |   |          |    |   |         |   |   |   |
| and December 31, 2009)                                             |   |          | (1,937  | )      |         |   | (1,937 | ) |
| Unearned stock awards (3,500 shares at September 30, 2010          |   |          |    |   |         |   |   |   |
| and 32,340 shares at December 31, 2009)                            |   |          | (35     | )      |         |   | (355 | ) |
| Treasury stock, at cost 588,875 shares at September 30, 2010       |   |          |    |   |         |   |   |   |
| and 583,342 shares at December 31, 2009)                           |   |          | (6,176  | )      |         |   | (6,132 | ) |
| Accumulated other comprehensive gain                               |   |          | 503     |   |         |   | 51 |   |
|                                                               |   |          |    |   |         |   |   |   |
| Total stockholders' equity                                         |   |          | 52,102  |   |         |   | 50,308 |   |
|                                                               |   |          |    |   |         |   |   |   |
| Total liabilities and stockholders' equity                         |   | $             | 581,131 |   |         | $      | 556,955 |   |

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n

|                                                |   | Three Months Ended |   |   | Nine Months Ended |   |
|-----------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                                |   | September 30,      |   |   | September 30,     |   |
|                                                |   | 2010               |   |   | 2009              |   |   | 2010 |   |   | 2009 |   |
|                                                |   | (Unaudited)        |   |
| Interest income                                     |   |               |   |   |              |   |   |   |   |   |   |   |
| Interest on loans                                   |   | $                  | 6,784  |   |              | $      | 6,514 |   |   | $ | 20,251 |   |   | $ | 19,279 |   |
| Interest and dividends on investments and deposits  |   |               | 427    |   |              |   | 541 |   |   |   | 1,289 |   |   |   | 1,871 |   |
| Total interest income                               |   |               | 7,211  |   |              |   | 7,055 |   |   |   | 21,540 |   |   |   | 21,150 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                    |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Interest on deposits                                |   |               | 1,853  |   |              |   | 2,049 |   |   |   | 5,479 |   |   |   | 6,513 |   |
| Interest on borrowed funds                          |   |               | 731    |   |              |   | 1,019 |   |   |   | 2,291 |   |   |   | 3,236 |   |
| Total interest expense                              |   |               | 2,584  |   |              |   | 3,068 |   |   |   | 7,770 |   |   |   | 9,749 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                 |   |               | 4,627  |   |              |   | 3,987 |   |   |   | 13,770 |   |   |   | 11,401 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Provision for loan losses                           |   |               | 993    |   |              |   | 302 |   |   |   | 2,164 |   |   |   | 859 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income after provision for loan losses |   |               | 3,634  |   |              |   | 3,685 |   |   |   | 11,606 |   |   |   | 10,542 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest income                                  |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Fees for other services                             |   |               | 381    |   |              |   | 155 |   |   |   | 766 |   |   |   | 455 |   |
| Fees for services related to deposit accounts       |   |               | 238    |   |              |   | 273 |   |   |   | 728 |   |   |   | 765 |   |
| Income from bank owned life insurance               |   |               | 80     |   |              |   | 87 |   |   |   | 248 |   |   |   | 258 |   |
| Income from investment advisory services, net       |   |               | 51     |   |              |   | 67 |   |   |   | 146 |   |   |   | 225 |   |
| Gain on investments                                 |   |               | -      |   |              |   | 203 |   |   |   | 11 |   |   |   | 379 |   |
| Other income                                        |   |               | 19     |   |              |   | 27 |   |   |   | 100 |   |   |   | 83 |   |
| Total noninterest income                            |   |               | 769    |   |              |   | 812 |   |   |   | 1,999 |   |   |   | 2,165 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Noninterest expense                                 |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Compensation, taxes and benefits                    |   |               | 2,136  |   |              |   | 1,858 |   |   |   | 6,332 |   |   |   | 5,685 |   |
| Office occupancy                                    |   |               | 554    |   |              |   | 542 |   |   |   | 1,733 |   |   |   | 1,635 |   |
| Computer processing                                 |   |               | 231    |   |              |   | 221 |   |   |   | 693 |   |   |   | 691 |   |
| FDIC insurance premiums                             |   |               | 172    |   |              |   | 151 |   |   |   | 504 |   |   |   | 776 |   |
| Directors compensation                              |   |               | 79     |   |              |   | 119 |   |   |   | 467 |   |   |   | 437 |   |
| Advertising                                         |   |               | 69     |   |              |   | 96 |   |   |   | 235 |   |   |   | 281 |   |
| Loss on foreclosed real estate, net                 |   |               | 16     |   |              |   | 7 |   |   |   | 47 |   |   |   | 15 |   |
| Other expenses                                      |   |               | 519    |   |              |   | 489 |   |   |   | 1,538 |   |   |   | 1,359 |   |
| Total noninterest expense                           |   |               | 3,776  |   |              |   | 3,483 |   |   |   | 11,549 |   |   |   | 10,879 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Income before provision                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| for income taxes                                    |   |               | 627    |   |              |   | 1,014 |   |   |   | 2,056 |   |   |   | 1,828 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Provision for income taxes                          |   |               | 423    |   |              |   | 311 |   |   |   | 859 |   |   |   | 517 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                          |   | $                  | 204    |   |              | $      | 703 |   |   | $ | 1,197 |   |   | $ | 1,311 |   |
|                                                |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Earnings per common share - Basic and Diluted       |   | $                  | 0.03   |   |              | $      | 0.10 |   |   | $ | 0.18 |   |   | $ | 0.19 |   |

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|                                                                          |   | Nine Months Ended |    |
|-------------------------------------------------------------------------------|--------|-------------------|---------|
|                                                                          |   | September 30,     |    |
|                                                                          |   | 2010              |    | 2009 |   |
| Cash flows from operating activities                                          |   | (Unaudited)       |    |
| Net income                                                                    |   | $                 | 1,197   |   |   | $ | 1,311 |   |
| Adjustments to reconcile net income to cash provided by operating activities: |   |              |    |   |   |   |   |   |
| Provision for loan losses                                                     |   |              | 2,164   |   |   |   | 859 |   |
| Depreciation and amortization expense                                         |   |              | 600     |   |   |   | 627 |   |
| Loss on sale of assets                                                        |   |              | 2       |   |   |   | - |   |
| Gain on sale of loans                                                         |   |              | (267    | ) |   |   | - |   |
| Loans originated for sale                                                     |   |              | (23,677 | ) |   |   | - |   |
| Proceeds from sale of loans                                                   |   |              | 22,893  |   |   |   | - |   |
| Net amortization from investments                                             |   |              | 46      |   |   |   | 51 |   |
| Amortization of intangible assets                                             |   |              | 25      |   |   |   | 25 |   |
| Benefit from deferred tax                                                     |   |              | (226    | ) |   |   | - |   |
| Stock-based compensation                                                      |   |              | 391     |   |   |   | 490 |   |
| Gain on sale of investments                                                   |   |              | (11     | ) |   |   | (379 | ) |
| Net change in:                                                                |   |              |    |   |   |   |   |   |
| Accrued income receivable                                                     |   |              | 41      |   |   |   | 124 |   |
| Deferred loan fees                                                            |   |              | 18      |   |   |   | (9 | ) |
| Cash surrender value of life insurance                                        |   |              | (248    | ) |   |   | (257 | ) |
| Other assets                                                                  |   |              | (113    | ) |   |   | (4 | ) |
| Other liabilities                                                             |   |              | 226     |   |   |   | 320 |   |
| Net cash provided by operating activities                                     |   |              | 3,061   |   |   |   | 3,158 |   |
| Cash flows from investing activities                                          |   |              |    |   |   |   |   |   |
| Proceeds from maturities and repayments of available-for-sale securities      |   |              | 5,020   |   |   |   | 8,290 |   |
| Proceeds from sale of available-for-sale securities                           |   |              | 8,275   |   |   |   | 18,181 |   |
| Proceeds from maturities of held-to-maturity securities                       |   |              | 438     |   |   |   | 49 |   |
| Purchase of available-for-sale securities                                     |   |              | (8,995  | ) |   |   | - |   |
| Purchase of held-to-maturity securities                                       |   |              | (9,276  | ) |   |   | (1,566 | ) |
| Loan originations net of principal payments                                   |   |              | (7,927  | ) |   |   | (28,538 | ) |
| Purchase of property and equipment                                            |   |              | (360    | ) |   |   | (109 | ) |
| Proceeds from the sale of other real estate owned                             |   |              | 140     |   |   |   | - |   |
| Net cash used by investing activities                                         |   |              | (12,685 | ) |   |   | (3,693 | ) |
| Cash flows from financing activities                                          |   |              |    |   |   |   |   |   |
| Net change in time deposits                                                   |   |              | 12,406  |   |   |   | (750 | ) |
| Net change in other deposit accounts                                          |   |              | 11,413  |   |   |   | 13,403 |   |
| Net change in mortgagors' escrow deposits                                     |   |              | (2,516  | ) |   |   | (2,047 | ) |
| Advances from Federal Home Loan Bank                                          |   |              | 19,900  |   |   |   | 17,150 |   |
| Repayment of advances from Federal Home Loan Bank                             |   |              | (26,674 | ) |   |   | (37,935 | ) |
| Change in short term borrowings                                               |   |              | -       |   |   |   | (1,340 | ) |
| Net change in repurchase agreements                                           |   |              | 7,659   |   |   |   | 14,362 |   |
| Treasury stock acquired                                                       |   |              | (44     | ) |   |   | (25 | ) |
| Dividends paid to stockholders                                                |   |              | (235    | ) |   |   | (368 | ) |
| Net cash provided (used) by financing activities                              |   |              | 21,909  |   |   |   | 2,450 |   |
| Net change in cash and cash equivalents                                       |   |              | 12,285  |   |   |   | 1,915 |   |
| Cash and cash equivalents at beginning of period                              |   |              | 12,146  |   |   |   | 8,247 |   |
| Cash and cash equivalents at end of period                                    |   | $                 | 24,431  |   |   | $ | 10,162 |   |
| Cash paid during the period for:                                              |   |              |    |   |   |   |   |   |
| Interest                                                                      |   | $                 | 7,771   |   |   | $ | 9,498 |   |
| Income taxes                                                                  |   |              | 1,076   |   |   |   | 286 |   |
| Non-cash transactions:                                                        |   |              |    |   |   |   |   |   |
| Transfer of loans to foreclosed assets                                        |   | $                 | 652     |   |   | $ | 223 |   |
|                                                                          |   |              |    |   |   |   |   |   |

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|                                    |   | Amortized  |   |   | Gross Unrealized |   |   | Fair   |   |
|-----------------------------------------|--------|------------|--------|--------|------------------|--------|--------|--------|--------|
| (In thousands)                          |   | Cost Basis |   |   | Gains            |   |   | Losses |   |   | Value |   |
| Available-for-sale securities:          |   |       |   |   |             |   |   |   |   |   |   |   |
| U.S. government and agency obligations  |   | $          | 1,023  |   |             | $      | 80     |   |   | $ | - |   |   | $ | 1,103 |   |
| Mortgage-backed securities              |   |       | 20,940 |   |             |   | 1,011  |   |   |   | - |   |   |   | 21,951 |   |
| Collateralized mortgage obligations     |   |       | 2,903  |   |             |   | 20     |   |   |   | (65 | ) |   |   | 2,858 |   |
| Total debt securities                   |   |       | 24,866 |   |             |   | 1,111  |   |   |   | (65 | ) |   |   | 25,912 |   |
| Auction-rate trust preferred securities |   |       | 8,200  |   |             |   | -      |   |   |   | (187 | ) |   |   | 8,013 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total available-for-sale securities     |   | $          | 33,066 |   |             | $      | 1,111  |   |   | $ | (252 | ) |   | $ | 33,925 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   | Amortized  |   |   | Gross Unrealized |   |   | Fair   |   |
| (In thousands)                          |   | Cost Basis |   |   | Gains            |   |   | Losses |   |   | Value |   |
| Held-to-maturity securities:            |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Mortgage-backed securities              |   | $          | 10,269 |   |             | $      | 76     |   |   | $ | (5 | ) |   | $ | 10,340 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total held-to-maturity securities       |   | $          | 10,269 |   |             | $      | 76     |   |   | $ | (5 | ) |   | $ | 10,340 |   |

|                                    |   | Amortized  |   |   | Gross Unrealized |   |   | Fair   |   |
|-----------------------------------------|--------|------------|--------|--------|------------------|--------|--------|--------|--------|
| (In thousands)                          |   | Cost Basis |   |   | Gains            |   |   | Losses |   |   | Value |   |
| Available-for-sale securities:          |   |       |   |   |             |   |   |   |   |   |   |   |
| U.S. government and agency obligations  |   | $          | 1,529  |   |             | $      | 54     |   |   | $ | - |   |   | $ | 1,583 |   |
| Corporate bonds                         |   |       | 1,000  |   |             |   | -      |   |   |   | (340 | ) |   |   | 660 |   |
| Mortgage-backed securities              |   |       | 23,561 |   |             |   | 939    |   |   |   | - |   |   |   | 24,500 |   |
| Collateralized mortgage obligations     |   |       | 3,091  |   |             |   | 13     |   |   |   | (104 | ) |   |   | 3,000 |   |
| Total debt securities                   |   |       | 29,181 |   |             |   | 1,006  |   |   |   | (444 | ) |   |   | 29,743 |   |
| Auction-rate trust preferred securities |   |       | 8,200  |   |             |   | -      |   |   |   | (320 | ) |   |   | 7,880 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total available-for-sale securities     |   | $          | 37,381 |   |             | $      | 1,006  |   |   | $ | (764 | ) |   | $ | 37,623 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   | Amortized  |   |   | Gross Unrealized |   |   | Fair   |   |
| (In thousands)                          |   | Cost Basis |   |   | Gains            |   |   | Losses |   |   | Value |   |
| Held-to-maturity securities:            |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| U.S. government and agency obligations  |   | $          | 1,451  |   |             | $      | 24     |   |   | $ | - |   |   | $ | 1,475 |   |
|                                    |   |       |   |   |             |   |   |   |   |   |   |   |   |   |   |   |
| Total held-to-maturity securities       |   | $          | 1,451  |   |             | $      | 24     |   |   | $ | - |   |   | $ | 1,475 |   |

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|                                                                        |   | September 30, |    |   | December 31, |   |
|-----------------------------------------------------------------------------|--------|---------------|---------|--------|--------------|--------|
| (In thousands)                                                              |   | 2010          |    | 2009   |         |
|                                                                        |   |          |    |   |         |   |
| Real estate loans:                                                          |   |          |    |   |         |   |
| One-to-four family                                                          |   | $             | 219,250 |   |         | $      | 229,693 |   |
| Construction                                                                |   |          | 32,441  |   |         |   | 46,298 |   |
| Multi-family and commercial real estate                                     |   |          | 161,284 |   |         |   | 134,931 |   |
| Total real estate loans                                                     |   |          | 412,975 |   |         |   | 410,922 |   |
|                                                                        |   |          |    |   |         |   |   |   |
| Commercial business loans                                                   |   |          | 35,090  |   |         |   | 31,325 |   |
| Consumer loans:                                                             |   |          |    |   |         |   |   |   |
| Savings accounts                                                            |   |          | 983     |   |         |   | 1,113 |   |
| Personal                                                                    |   |          | 294     |   |         |   | 256 |   |
| Automobile                                                                  |   |          | 169     |   |         |   | 230 |   |
| Home equity                                                                 |   |          | 36,716  |   |         |   | 37,276 |   |
| Total consumer loans                                                        |   |          | 38,162  |   |         |   | 38,875 |   |
|         Totals loans                |   |          | 486,227 |   |         |   | 481,122 |   |
|                                                                        |   |          |    |   |         |   |   |   |
| Less:                                                                       |   |          |    |   |         |   |   |   |
| Allowance for loan losses                                                   |   |          | 5,294   |   |         |   | 3,996 |   |
| Undisbursed construction loans                                              |   |          | 1,692   |   |         |   | 3,336 |   |
| Deferred loan origination fees                                              |   |          | 503     |   |         |   | 486 |   |
|          Loans receivable, net |   | $             | 478,738 |   |         | $      | 473,304 |   |

|                         |   | Nine months ended |   |   | For the year ended |   |
|------------------------------|--------|-------------------|--------|--------|--------------------|--------|
|                         |   | September 30,     |   |   | December 31,       |   |
| (In thousands)               | 2010   |              |   | 2009   |               |
|                         |   |              |   |   |               |   |
| Balance at beginning of year |   | $                 | 3,996  |   |               | $      | 2,869 |   |
| Provision for loan losses    |   |              | 2,164  |   |               |   | 1,144 |   |
| Charge-offs                  |   |              | (882   | )      |               |   | (18 | ) |
| Recoveries                   |   |              | 16     |   |               |   | 1 |   |
|                         |   |              |   |   |               |   |   |   |
| Balance at end of period     |   | $                 | 5,294  |   |               | $      | 3,996 |   |

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|                                        |   | Three Months Ended |      |   | Nine Months Ended |   |
|---------------------------------------------|--------|--------------------|-----------|--------|-------------------|--------|
|                                        |   | September 30,      |      |   | September 30,     |   |
|                                        |   | 2010               |      |   | 2009              |   |   | 2010 |   |   | 2009 |   |
|                                        |   |               |      |   |              |   |   |   |   |   |   |   |
| Net income                                  |   | $                  | 204,000   |   |              | $      | 703,000 |   |   | $ | 1,197,000 |   |   | $ | 1,311,000 |   |
|                                        |   |               |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-average common shares outstanding: |   |               |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                       |   |               | 6,826,255 |   |              |   | 6,810,357 |   |   |   | 6,828,085 |   |   |   | 6,812,259 |   |
| Effect of dilutive stock options            |   |               |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| and restrictive stock awards                |   |               | -         |   |              |   | - |   |   |   | - |   |   |   | - |   |
| Diluted                                     |   |               | 6,826,255 |   |              |   | 6,810,357 |   |   |   | 6,828,085 |   |   |   | 6,812,259 |   |
|                                        |   |               |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Net income per common share:                |   |               |      |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                       |   | $                  | 0.03      |   |              | $      | 0.10 |   |   | $ | 0.18 |   |   | $ | 0.19 |   |
| Diluted                                     |   | $                  | 0.03      |   |              | $      | 0.10 |   |   | $ | 0.18 |   |   | $ | 0.19 |   |

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|                                             |   | Three Months Ended |   |   | Nine Months Ended |   |
|--------------------------------------------------|--------|--------------------|--------|--------|-------------------|--------|
|                                             |   | September 30,      |   |   | September 30,     |   |
|                                             |   | 2010               |   |   | 2009              |   |   | 2010 |   |   | 2009 |   |
|                                             |   | (In thousands)     |   |   |              |   |   |   |   |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |
| Net income                                       |   | $                  | 204    |   |              | $      | 703 |   |   | $ | 1,197 |   |   | $ | 1,311 |   |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income:                      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized gain on securities available-for-sale |   |               | 484    |   |              |   | 878 |   |   |   | 628 |   |   |   | 2,957 |   |
| Reclassification adjustment for gains            |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| realized in net income                           |   |               | -      |   |              |   | (203 | ) |   |   | (11 | ) |   |   | (379 | ) |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income before tax effect     |   |               | 484    |   |              |   | 675 |   |   |   | 617 |   |   |   | 2,578 |   |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Income tax effect related to items of other      |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| comprehensive income                             |   |               | (14    | )      |              |   | 112 |   |   |   | 165 |   |   |   | 146 |   |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income net of tax effect     |   |               | 498    |   |              |   | 563 |   |   |   | 452 |   |   |   | 2,432 |   |
|                                             |   |               |   |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Total comprehensive income                       |   | $                  | 702    |   |              | $      | 1,266 |   |   | $ | 1,649 |   |   | $ | 3,743 |   |

|                    |   |       |   |   |         |   |   |      |   |   |      |   |   |     |   |
|-------------------------|--------|------------|--------|--------|--------------|--------|--------|-----------|--------|--------|-----------|--------|--------|----------|--------|
|                    |   | Grant date |   |
|                    |   | July 26,   |   |   | December 18, |   |   | March 20, |   |   | March 21, |   |   | July 26, |   |
|                    |   | 2008       |   |   | 2007         |   |   | 2007      |   |   | 2006      |   |   | 2005     |   |
|                    |   |       |   |   |         |   |   |      |   |   |      |   |   |     |   |
| Option awards           |   |       |   |   |         |   |   |      |   |   |      |   |   |     |   |
| Awarded                 |   |       | 1,000  |   |         |   | 2,000  |      |   |   | 7,500     |   |   |     | 6,500  |   |   |   | 354,580 |   |
| Exercise price          |   | $          | 11.10  |   |         | $      | 11.10  |      |   | $      | 12.49     |   |   | $        | 11.10  |   |   | $ | 11.10 |   |
| Maximum term in years   |   |       | 10     |   |         |   | 10     |      |   |   | 10        |   |   |     | 10     |   |   |   | 10 |   |
| Restricted stock awards |   |       |   |   |         |   |   |      |   |   |      |   |   |     |   |   |   |   |   |   |
| Awarded                 |   |       | 1,000  |   |         |   | 3,000  |      |   |   | 2,000     |   |   |     | 1,500  |   |   |   | 139,712 |   |

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|                        |   |     |   |   |         |   |   |      |   |   |      |   |   |     |   |
|-----------------------------|--------|----------|--------|--------|--------------|--------|--------|-----------|--------|--------|-----------|--------|--------|----------|--------|
|                        |   | July 26, |   |   | December 18, |   |   | March 20, |   |   | March 21, |   |   | July 26, |   |
| Grant date                  |   | 2008     |   |   | 2007         |   |   | 2007      |   |   | 2006      |   |   | 2005     |   |
|                        |   |     |   |   |         |   |   |      |   |   |      |   |   |     |   |
| Dividend yield              |   |     | 2.74   | %      |         |   | 2.20   | %         |   |   | 1.60      | %      |   |     | 1.89   | % |   |   | 1.44 | % |
| Expected volatility         |   |     | 13.40  | %      |         |   | 11.00  | %         |   |   | 10.49     | %      |   |     | 11.20  | % |   |   | 11.47 | % |
| Risk-free rate              |   |     | 3.56   | %      |         |   | 3.63   | %         |   |   | 4.48      | %      |   |     | 4.61   | % |   |   | 4.18 | % |
| Expected life in years      |   |     | 6.5    |   |         |   | 6.5    |      |   |   | 6.5       |   |   |     | 6.5    |   |   |   | 6.5 |   |
|                        |   |     |   |   |         |   |   |      |   |   |      |   |   |     |   |   |   |   |   |   |
| Weighted average fair value |   |     |   |   |         |   |   |      |   |   |      |   |   |     |   |   |   |   |   |   |
| of options at grant date    |   | $        | 1.51   |   |         | $      | 1.18   |      |   | $      | 2.55      |   |   | $        | 2.25   |   |   | $ | 2.47 |   |
|                        |   |     |   |   |         |   |   |      |   |   |      |   |   |     |   |   |   |   |   |   |

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|                                     |   |               |    |   |              |   |    |     |   |   |       |   |
|------------------------------------------|--------|--------------------|---------|--------|-------------------|--------|---------|----------|--------|--------|------------|--------|
|                                     |   | September 30, 2010 |    |   | December 31, 2009 |   |
|                                     |   | Carrying           |    |   | Estimated         |   |    | Carrying |   |   | Estimated  |   |
| (In thousands)                           |   | Amount             |    |   | Fair Value        |   |    | Amount   |   |   | Fair Value |   |
|                                     |   |               |    |   |              |   |    |     |   |   |       |   |
| Financial Assets                         |   |               |    |   |              |   |    |     |   |   |       |   |
| Cash and cash equivalents                |   | $                  | 24,431  |   |              | $      | 24,431  |     |   | $      | 12,146     |   |   | $ | 12,146 |   |
| Investment securities available for sale |   |               | 33,925  |   |              |   | 33,925  |     |   |   | 37,623     |   |   |   | 37,623 |   |
| Investment securities held-to-maturity   |   |               | 10,269  |   |              |   | 10,340  |     |   |   | 1,451      |   |   |   | 1,475 |   |
| Loans held for sale                      |   |               | 856     |   |              |   | 856     |     |   |   | -          |   |   |   | - |   |
| Loans receivable, net                    |   |               | 478,738 |   |              |   | 491,181 |     |   |   | 473,304    |   |   |   | 476,665 |   |
| Accrued income receivable                |   |               | 2,033   |   |              |   | 2,033   |     |   |   | 2,074      |   |   |   | 2,074 |   |
|                                     |   |               |    |   |              |   |    |     |   |   |       |   |   |   |   |   |
| Financial Liabilities                    |   |               |    |   |              |   |    |     |   |   |       |   |   |   |   |   |
| Deposits                                 |   | $                  | 404,750 |   |              | $      | 405,248 |     |   | $      | 380,931    |   |   | $ | 379,176 |   |
| Borrowed funds                           |   |               | 119,870 |   |              |   | 123,161 |     |   |   | 118,984    |   |   |   | 120,719 |   |
| Mortgagors' escrow accounts              |   |               | 2,373   |   |              |   | 2,373   |     |   |   | 4,888      |   |   |   | 4,888 |   |

|   | • |   | Level 1: Valuation is based upon unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. |
|--------|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | Level 2: Fair value is calculated using inputs other than quoted market prices that are directly or indirectly observable for the asset or liability. The valuation may rely on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit ratings, etc.) or inputs that are derived principally or corroborated by market data by correlation or other means. |
|--------|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • |   | Level 3: Inputs for determining the fair value of the respective assets or liabilities are not observable. Level 3 valuations are reliant upon pricing models and techniques that require significant management judgment or estimation.  |
|--------|---------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                    |   |               |   |   |    |   |   |    |   |   |   |   |
|---------------------------------------------------------|--------|--------------------|--------|--------|---------|--------|--------|---------|--------|--------|--------|--------|
|                                                    |   | September 30, 2010 |   |
|                                                    |   | Carrying Value     |   |
| (In thousands)                                          |   | Level 1            |   |   | Level 2 |   |   | Level 3 |   |   | Total  |   |
|                                                    |   |               |   |   |    |   |   |    |   |   |   |   |
| Assets measured at fair value on a recurring basis:     |   |               |   |   |    |   |   |    |   |   |   |   |
| Available-for-sale investment securities                |   | $                  | -      |   |    | $      | 25,912 |    |   | $      | 8,013  |   |   | $ | 33,925 |   |
| Residential loans held for sale                         |   |               | -      |   |    |   | 856    |    |   |   | -      |   |   |   | 856 |   |
|                                                    |   |               |   |   |    |   |   |    |   |   |   |   |   |   |   |   |
| Assets measured at fair value on a non-recurring basis: |   |               |   |   |    |   |   |    |   |   |   |   |   |
| Impaired loans                                          |   |               | -      |   |    |   | 7,411  |    |   |   | 16     |   |   |   | 7,427 |   |
| Real estate owned and other repossessed assets          |   |               | -      |   |    |   | -      |    |   |   | 506    |   |   |   | 506 |   |

|                                            |   |          |   |   |         |   |
|-------------------------------------------------|--------|---------------|--------|--------|--------------|--------|
|                                            |   | For the Nine  |   |   | For the Year |   |
|                                            |   | Months Ended  |   |   | Ended        |   |
|                                            |   | September 30, |   |   | December 31, |   |
| (In thousands)                                  |   | 2010          |   |   | 2009         |   |
|                                            |   |          |   |   |         |   |
| Balance at beginning of period                  |   | $             | 7,880  |   |         | $      | 6,744 |   |
| New purchases                                   |   |          | -      |   |         |   | - |   |
| Transfer to (from) level 3                      |   |          | -      |   |         |   | - |   |
| Increase (decrease) in fair value of securities |   |          |   |   |         |   | - |   |
| included in accumulated other                   |   |          |   |   |         |   |   |   |
| comprehensive income                            |   |          | 133    |   |         |   | 2,219 |   |
| Impairment charges included in net income       |   |          |   |   |         |   | - |   |
| Proceeds from sale of level 3 securities        |   |          | -      |   |         |   | (83 | ) |
| Redemptions at par                              |   |          | -      |   |         |   | (1,000 | ) |
| Balance at end of period                        |   | $             | 8,013  |   |         | $      | 7,880 |   |
|                                            |   |          |   |   |         |   |   |   |

i

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|                            |   | Three Months           |   |   |   |   |   | Nine Months         |   |   |   |     |
|---------------------------------|--------|------------------------|--------|--------|--------|--------|--------|---------------------|--------|--------|--------|----------|
|                            |   | Ended September 30,    |   |   |   |   |   | Ended September 30, |   |   |   |     |
|                            |   | 2010                   |   |   | 2009   |   |   | % Change            |   | 2010   |   |     | 2009 |   |   | % Change |
|                            |   | (Dollars in thousands) |   |
| Interest income:                |   |                   |   |   |   |   |   |                |   |   |   |     |   |   |   |   |   |   |
| Loans                           |   | $                      | 6,784  |   |   | $      | 6,514  |                |   |   | 4.14   |   % |   | $ | 20,251 |   |   | $ | 19,279 |   |   |   | 5.04 |   % |
| Fed Funds sold                  |   |                   | 1      |   |   |   | -      |                |   |   | N/A    |     |   |   | 2 |   |   |   | 4 |   |   |   | (50.00 | ) % |
| Investment securities           |   |                   | 426    |   |   |   | 541    |                |   |   | (21.26 | ) %      |   |   | 1,287 |   |   |   | 1,867 |   |   |   | (31.07 | ) % |
| Total interest income           |   |                   | 7,211  |   |   |   | 7,055  |                |   |   | 2.21   |   % |   |   | 21,540 |   |   |   | 21,150 |   |   |   | 1.84 |   % |
| Interest expense:               |   |                   |   |   |   |   |   |                |   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |   |
| Certificate accounts            |   |                   | 1,669  |   |   |   | 1,874  |                |   |   | (10.94 | ) %      |   |   | 4,961 |   |   |   | 5,949 |   |   |   | (16.61 | ) % |
| Regular savings accounts        |   |                   | 117    |   |   |   | 96     |                |   |   | 21.88  |   % |   |   | 310 |   |   |   | 292 |   |   |   | 6.16 |   % |
| Checking and NOW accounts       |   |                   | 12     |   |   |   | 12     |                |   |   | -      |   % |   |   | 36 |   |   |   | 35 |   |   |   | 2.86 |   % |
| Money market savings accounts   |   |                   | 55     |   |   |   | 67     |                |   |   | (17.91 | ) %      |   |   | 172 |   |   |   | 237 |   |   |   | (27.43 | ) % |
| Total interest-bearing deposits |   |                   | 1,853  |   |   |   | 2,049  |                |   |   | (9.57  | ) %      |   |   | 5,479 |   |   |   | 6,513 |   |   |   | (15.88 | ) % |
| FHLB advances                   |   |                   | 698    |   |   |   | 967    |                |   |   | (27.82 | ) %      |   |   | 2,201 |   |   |   | 3,133 |   |   |   | (29.75 | ) % |
| Other borrowings                |   |                   | 33     |   |   |   | 52     |                |   |   | (36.54 | ) %      |   |   | 90 |   |   |   | 103 |   |   |   | (12.62 | ) % |
| Total interest expense          |   |                   | 2,584  |   |   |   | 3,068  |                |   |   | (15.78 | ) %      |   |   | 7,770 |   |   |   | 9,749 |   |   |   | (20.30 | ) % |
| Net interest income             |   | $                      | 4,627  |   |   | $      | 3,987  |                |   |   | 16.05  |   % |   | $ | 13,770 |   |   | $ | 11,401 |   |   |   | 20.78 |   % |
|                            |   |                   |   |   |   |   |   |                |   |   |   |     |   |   |   |   |   |   |   |   |   |   |   |   |

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|                                  |   | Three Months Ended September 30, |    |   | Nine Months Ended September 30, |   |   |    |   |
|---------------------------------------|--------|----------------------------------|---------|--------|---------------------------------|--------|--------|---------|--------|
|                                  |   | 2010                             |    |   | 2009                            |   |   | 2010    |   |   | 2009 |   |
|                                  |   | Average                          |    |   | Yield/                          |   |   | Average |   |   | Yield/ |   |   | Average |   |   | Yield/ |   |   | Average |   |   | Yield/ |   |
|                                  |   | Balance                          |    |   | Cost                            |   |   | Balance |   |   | Cost |   |   | Balance |   |   | Cost |   |   | Balance |   |   | Cost |   |
|                                  |   | (Dollars in thousands)           |
|                                  |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-earning assets               |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                 |   | $                                | 483,110 |   |                            |   | 5.62   | %       |   | $ | 450,825 |   |   |   | 5.78 | % |   | $ | 480,524 |   |   |   | 5.62 | % |   | $ | 442,714 |   |   |   | 5.81 | % |
| Fed Funds sold                        |   |                             | 3,267   |   |                            |   | 0.12   | %       |   |   | 2,452 |   |   |   | 0.00 | % |   |   | 3,596 |   |   |   | 0.07 | % |   |   | 6,636 |   |   |   | 0.08 | % |
| Investment securities                 |   |                             | 41,687  |   |                            |   | 4.09   | %       |   |   | 46,591 |   |   |   | 4.64 | % |   |   | 39,823 |   |   |   | 4.31 | % |   |   | 53,180 |   |   |   | 4.68 | % |
| Federal Home Loan Bank stock          |   |                             | 6,252   |   |                            |   | 0.00   | %       |   |   | 6,252 |   |   |   | 0.00 | % |   |   | 6,252 |   |   |   | 0.00 | % |   |   | 6,252 |   |   |   | 0.00 | % |
|                                  |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total interest-earning assets         |   | $                                | 534,316 |   |                            |   | 5.40   | %       |   | $ | 506,120 |   |   |   | 5.58 | % |   | $ | 530,195 |   |   |   | 5.42 | % |   | $ | 508,782 |   |   |   | 5.54 | % |
|                                  |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities          |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Certificate accounts                  |   | $                                | 242,271 |   |                            |   | 2.76   | %       |   | $ | 237,254 |   |   |   | 3.16 | % |   | $ | 237,290 |   |   |   | 2.79 | % |   | $ | 239,424 |   |   |   | 3.31 | % |
| Regular savings accounts & escrow |   |                             | 77,903  |   |                            |   | 0.60   | %       |   |   | 62,341 |   |   |   | 0.62 | % |   |   | 73,535 |   |   |   | 0.56 | % |   |   | 58,679 |   |   |   | 0.66 | % |
| Checking and NOW accounts             |   |                             | 56,532  |   |                            |   | 0.08   | %       |   |   | 51,004 |   |   |   | 0.09 | % |   |   | 56,785 |   |   |   | 0.08 | % |   |   | 52,710 |   |   |   | 0.09 | % |
| Money market savings accounts         |   |                             | 26,247  |   |                            |   | 0.84   | %       |   |   | 25,831 |   |   |   | 1.04 | % |   |   | 26,275 |   |   |   | 0.87 | % |   |   | 25,590 |   |   |   | 1.23 | % |
|                                  |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing deposits       |   |                             | 402,953 |   |                            |   | 1.84   | %       |   |   | 376,430 |   |   |   | 2.18 | % |   |   | 393,885 |   |   |   | 1.85 | % |   |   | 376,403 |   |   |   | 2.31 | % |
| FHLB advances                         |   |                             | 107,142 |   |                            |   | 2.61   | %       |   |   | 96,532 |   |   |   | 4.01 | % |   |   | 108,177 |   |   |   | 2.71 | % |   |   | 104,997 |   |   |   | 3.98 | % |
| Other borrowings                      |   |                             | 14,483  |   |                            |   | 0.91   | %       |   |   | 15,609 |   |   |   | 1.33 | % |   |   | 12,647 |   |   |   | 0.95 | % |   |   | 9,193 |   |   |   | 1.49 | % |
|                                  |   |                             |    |   |                            |   |   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total interest-bearing liabilities    |   | $                                | 524,578 |   |                            |   | 1.97   | %       |   | $ | 488,571 |   |   |   | 2.51 | % |   | $ | 514,709 |   |   |   | 2.01 | % |   | $ | 490,593 |   |   |   | 2.65 | % |

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|                             |   | Three Months        |   |   | Nine Months         |   |
|----------------------------------|--------|---------------------|--------|--------|---------------------|--------|
|                             |   | Ended September 30, |   |   | Ended September 30, |   |
|                             |   | 2010                |   |   | 2009                |   |   | 2010 |   |   | 2009 |   |
|                             |   | (In thousands)      |   |
| Allowance at beginning of period |   | $                   | 5,119  |   |                | $      | 3,416 |   |   | $ | 3,996 |   |   | $ | 2,869 |   |
| Provision for loan losses        |   |                | 993    |   |                |   | 302 |   |   |   | 2,164 |   |   |   | 859 |   |
|                             |   |                |   |   |                |   |   |   |   |   |   |   |   |   |   |   |
| Charge-offs                      |   |                | (834   | )      |                |   | (6 | ) |   |   | (882 | ) |   |   | (17 | ) |
| Recoveries                       |   |                | 16     |   |                |   | - |   |   |   | 16 |   |   |   | 1 |   |
| Net recoveries (charge-offs)     |   |                | (818   | )      |                |   | (6 | ) |   |   | (866 | ) |   |   | (16 | ) |
| Allowance at end of period       |   | $                   | 5,294  |   |                | $      | 3,712 |   |   | $ | 5,294 |   |   | $ | 3,712 |   |

|                                                                                   |   | At September 30,       |   |   | At December 31, |   |   |     |   |
|----------------------------------------------------------------------------------------|--------|------------------------|--------|--------|-----------------|--------|--------|----------|--------|
|                                                                                   |   | 2010                   |   |   | 2009            |   |   | % Change |
|                                                                                   |   | (Dollars in thousands) |   |   |            |   |
|  Nonaccrual loans                                                                 |   | $                      | 11,356 |   |            | $      | 6,000  |     |   |   | 89.27 | % |
|  Troubled debt restructurings                                                     |   |                   | 2,396  |   |            |   | -      |     |   |   | N/A |   |
|  Real estate owned                                                                |   |                   | 416    |   |            |   | 140    |     |   |   | 197.14 |   |
|  Other repossessed assets                                                         |   |                   | 90     |   |            |   | -      |     |   |   | N/A |   |
|           Total nonperforming assets |   | $                      | 14,258 |   |            | $      | 6,140  |     |   |   | 132.21 | % |
|                                                                                   |   |                   |   |   |            |   |   |     |   |   |   |   |
|  Total nonperforming loans to total loans                                         |   |                   | 2.84   | %      |            |   | 1.26   | %        |   |   | 125.40 | % |
|                                                                                   |   |                   |   |   |            |   |   |     |   |   |   |   |
|  Total nonperforming loans to total assets                                        |   |                   | 2.37   | %      |            |   | 1.08   | %        |   |   | 119.44 | % |
|                                                                                   |   |                   |   |   |            |   |   |     |   |   |   |   |
|  Total nonperforming assets to total assets                                       |   |                   | 2.45   | %      |            |   | 1.10   | %        |   |   | 122.73 | % |

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|                                                                                |   | At September 30, |   |   | At December 31, |   |
|-------------------------------------------------------------------------------------|--------|------------------|--------|--------|-----------------|--------|
|                                                                                |   | 2010             |   |   | 2009            |   |
|                                                                                |   | (In thousands)   |   |
|                                                                                |   |             |   |   |            |   |
|  Special mention assets                                                        |   | $                | 29,639 |   |            | $      | 43,539 |   |
|  Substandard assets                                                            |   |             | 31,046 |   |            |   | 16,890 |   |
|  Doubtful assets                                                               |   |             | 198    |   |            |   | 37 |   |
|  Loss assets                                                                   |   |             | -      |   |            |   | - |   |
|           Total classified assets |   | $                | 60,883 |   |            | $      | 60,466 |   |

|                                          |   | Three Months           |   |   |   |   |   | Nine Months         |   |   |    |   |
|-----------------------------------------------|--------|------------------------|--------|--------|--------|--------|--------|---------------------|--------|--------|---------|--------|
|                                          |   | Ended September 30,    |   |   |   |   |   | Ended September 30, |   |   |    |   |
|                                          |   | 2010                   |   |   | 2009   |   |   | % Change            |   | 2010   |    |   | 2009 |   |   | % Change |
|                                          |   | (Dollars in thousands) |
| Fees for other services                       |   | $                      | 381    |   |   | $      | 155    |                |   |   | 145.81  | %      |   | $ | 766 |   |   | $ | 455 |   |   |   | 68.35 | % |
| Fees for services related to deposit accounts |   |                   | 238    |   |   |   | 273    |                |   |   | (12.82  | ) %    |   |   | 728 |   |   |   | 765 |   |   |   | (4.84 | ) % |
| Income from bank owned life insurance         |   |                   | 80     |   |   |   | 87     |                |   |   | (8.05   | ) %    |   |   | 248 |   |   |   | 258 |   |   |   | (3.88 | ) % |
| Income from investment advisory services, net |   |                   | 51     |   |   |   | 67     |                |   |   | (23.88  | ) %    |   |   | 146 |   |   |   | 225 |   |   |   | (35.11 | ) % |
| Gain on investments                           |   |                   | -      |   |   |   | 203    |                |   |   | (100.00 | ) %    |   |   | 11 |   |   |   | 379 |   |   |   | (97.10 | ) % |
| Other income                                  |   |                   | 19     |   |   |   | 27     |                |   |   | (29.63  | ) %    |   |   | 100 |   |   |   | 83 |   |   |   | 20.48 | % |
| Total                                         |   | $                      | 769    |   |   | $      | 812    |                |   |   | (5.30   | ) %    |   | $ | 1,999 |   |   | $ | 2,165 |   |   |   | (7.67 | ) % |

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|                                |   | Three Months           |   |   |   |   |   | Nine Months         |   |   |   |     |
|-------------------------------------|--------|------------------------|--------|--------|--------|--------|--------|---------------------|--------|--------|--------|----------|
|                                |   | Ended September 30,    |   |   |   |   |   | Ended September 30, |   |   |   |     |
|                                |   | 2010                   |   |   | 2009   |   |   | % Change            |   | 2010   |   |     | 2009 |   |   | % Change |
|                                |   | (Dollars in thousands) |   |   |   |   |   |                |   |   |   |     |   |   |   |
| Compensation, taxes and benefits    |   | $                      | 2,136  |   |   | $      | 1,858  |                |   |   | 14.96  |   % |   | $ | 6,332 |   |   | $ | 5,685 |   |   |   | 11.38 |   % |
| Office occupancy                    |   |                   | 554    |   |   |   | 542    |                |   |   | 2.21   |   % |   |   | 1,733 |   |   |   | 1,635 |   |   |   | 5.99 |   % |
| Computer processing                 |   |                   | 231    |   |   |   | 221    |                |   |   | 4.52   |   % |   |   | 693 |   |   |   | 691 |   |   |   | 0.29 |   % |
| FDIC insurance premiums             |   |                   | 172    |   |   |   | 151    |                |   |   | 13.91  |   % |   |   | 504 |   |   |   | 776 |   |   |   | (35.05 | ) % |
| Directors compensation              |   |                   | 79     |   |   |   | 119    |                |   |   | (33.61 | ) %      |   |   | 467 |   |   |   | 437 |   |   |   | 6.86 |   % |
| Advertising                         |   |                   | 69     |   |   |   | 96     |                |   |   | (28.13 | ) %      |   |   | 235 |   |   |   | 281 |   |   |   | (16.37 | ) % |
| Loss on foreclosed real estate, net |   |                   | 16     |   |   |   | 7      |                |   |   | 128.57 |   % |   |   | 47 |   |   |   | 15 |   |   |   | 213.33 |   % |
| Other expenses                      |   |                   | 519    |   |   |   | 489    |                |   |   | 6.13   |   % |   |   | 1,538 |   |   |   | 1,359 |   |   |   | 13.17 |   % |
| Total                               |   | $                      | 3,776  |   |   | $      | 3,483  |                |   |   | 8.41   |   % |   | $ | 11,549 |   |   | $ | 10,879 |   |   |   | 6.16 |   % |

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|                                         |   |
|----------------------------------------------|--------|
|                                         |   | September 30, |   |   | December 31, |   |
| (In thousands)                               |   | 2010 |   |   | 2009 |   |
| Commitments to extend credit:                |   |   |   |   |   |   |
| Loan commitments                             |   | $ | 10,631 |   |   | $ | 10,611 |   |
| Unused lines of credit                       |   |   | 19,448 |   |   |   | 21,142 |   |
| Amounts due mortgagors on construction loans |   |   | 21,795 |   |   |   | 28,843 |   |
| Amounts due on commercial  loans   |   |   | 18,017 |   |   |   | 17,899 |   |
| Commercial letters of credit                 |   |   | 4,191 |   |   |   | 4,332 |   |

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|                                                 |   |           |   |   |             |   |   | Naugatuck Valley |   |
|------------------------------------------------------|--------|----------------|--------|--------|------------------|--------|--------|------------------|--------|
|                                                 |   | OTS Regulation |   |   | Savings and Loan |   |
|                                                 |   | Adequately     |   |   | Well             |   |   |             |   |   |   |   |
| (Dollars in thousands)                               |   | Capitalized    |   |   | Capitalized      |   |   | Amount           |   |   | Ratio |   |
|                                                 |   |           |   |   |             |   |   |             |   |   |   |   |
| Total Risk-Based Capital (to Risk-Weighted Assets)   |   |           | 8.00   | %      |             |   | 10.00  | %                |   | $ | 49,435 |   |   |   | 11.45 | % |
|                                                 |   |           |   |   |             |   |   |             |   |   |   |   |   |   |   |   |
| Tier I Risk-Based Capital (to Risk-Weighted Assets)  |   |           | 4.00   | %      |             |   | 6.00   | %                |   |   | 44,860 |   |   |   | 10.38 | % |
|                                                 |   |           |   |   |             |   |   |             |   |   |   |   |   |   |   |   |
| Tier I  Capital (to Adjusted Total Assets) |   |           | 4.00   | %      |             |   | 5.00   | %                |   |   | 44,860 |   |   |   | 7.76 | % |
|                                                 |   |           |   |   |             |   |   |             |   |   |   |   |   |   |   |   |
| Tangible Equity Capital (to Tangible Assets)         |   |           | 1.50   | %      |             |   | 2.00   | %                |   |   | 44,860 |   |   |   | 7.76 | % |

n

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|               |   |                   |   |                    |     |   |    |     |   |   | Net Portfolio Value as % of |
|--------------------|--------|------------------------|--------|-------------------------|----------|--------|---------|----------|--------|--------|-----------------------------|
| Basis Point ("bp") |   | Net Portfolio Value    |   | Present Value of Assets |
| Change in Rates    |   | $ Amount               |   |                    | $ Change |   |    | % Change |   |   | NPV Ratio                   |   |   | Change |   |
|               |   | (Dollars in thousands) |   |                    |     |   |    |     |   |   |                        |   |
|               |   |                   |   |                    |     |   |    |     |   |   |                        |   |   |   |   |
| 300 bp             |   | $                      | 45,374 |                    |     | $      | (16,320 | )        |   |   | (26                         | ) % |   |   | 8.10 | % |   |   | (2.33 | ) % |
| 200                |   |                   | 53,212 |                    |     |   | (8,482  | )        |   |   | (14                         | ) % |   |   | 9.29 | % |   |   | (1.14 | ) % |
| 100                |   |                   | 59,541 |                    |     |   | (2,153  | )        |   |   | (3                          | ) % |   |   | 10.19 | % |   |   | (0.24 | ) % |
| 50                 |   |                   | 61,307 |                    |     |   | (387    | )        |   |   | (1                          | ) % |   |   | 10.42 | % |   |   | (0.01 | ) % |
| 0                  |   |                   | 61,694 |                    |     |   | -       |     |   |   | -                           |   |   |   | 10.43 | % |   |   | - |   |
| (50)               |   |                   | 60,956 |                    |     |   | (738    | )        |   |   | (1                          | ) % |   |   | 10.27 | % |   |   | (0.16 | ) % |
| (100)              |   |                   | 59,461 |                    |     |   | (2,233  | )        |   |   | (4                          | ) % |   |   | 10.01 | % |   |   | (0.42 | ) % |

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I

o

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|      |   |          |   |   |          |   |   | Total Number of     |   |   | Maximum Number     |   |
|-----------|--------|---------------|--------|--------|---------------|--------|--------|---------------------|--------|--------|--------------------|--------|
|      |   |          |   |   |          |   |   | Shares Purchased as |   |   | of Shares that May |   |
|      |   | Total Number  |   |   | Average Price |   |   | Part of Publicly    |   |   | Yet Be Purchased   |   |
|      |   | of Shares     |   |   | Paid          |   |   | Announced Plans     |   |   | Under the Plans    |   |
| Period    |   | Purchased (1) |   |   | per Share     |   |   | or Programs         |   |   | or Programs        |   |
|      |   |          |   |   |          |   |   |                |   |   |               |   |
| July      |   |          | 3,836  |   |          | $      | 6.00   |                |   |   | -                  |   |   |   | 159,676 |   |
| August    |   |          | -      |   |          | $      | -      |                |   |   | -                  |   |   |   | 159,676 |   |
| September |   |          | -      |   |          | $      | -      |                |   |   | -                  |   |   |   | 159,676 |   |
|      |   |          |   |   |          |   |   |                |   |   |               |   |   |   |   |   |
| Total     |   |          | 3,836  |   |          | $      | 6.00   |                |   |   | -                  |   |   |   | 159,676 |   |
|      |   |          |   |   |          |   |   |                |   |   |               |   |   |   |   |   |

s

e

f

s

|   | Exhibits – |                                                                                                                                                                                                                                                                                                   |
|--------|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 2.1              | First Amendment to Agreement and Plan of Merger (1)                                                                                                                                                                                                                                                    |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 2.2              | Mutual Termination Agreement by and among Naugatuck Valley Financial Corporation, a federal chartered subsidiary holding company, Naugatuck Valley Financial Corporation, a Maryland corporation, and Southern Connecticut Bancorp, Inc., a Connecticut corporation, dated November 12, 2010 (2)  |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 3.1              | Charter of Naugatuck Valley Financial Corporation (3)                                                                                                                                                                                                                                                  |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 3.2              | Bylaws of Naugatuck Valley Financial Corporation (4)                                                                                                                                                                                                                                                   |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 4.1              | Specimen Stock Certificate of Naugatuck Valley Financial Corporation (5)                                                                                                                                                                                                                               |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 31.1             | Rule 13a-14(a)/15d-14(a) Certification.                                                                                                                                                                                                                                                                |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 31.2             | Rule 13a-14(a)/15d-14(a) Certification.                                                                                                                                                                                                                                                                |
|   |             |                                                                                                                                                                                                                                                                                                   |
|   | 32               | Section 1350 Certifications.                                                                                                                                                                                                                                                                           |

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G

| Date: November 15, 2010 | by:    | /s/ John C. Roman                                 |
|-------------------------|--------|---------------------------------------------------|
|                    |   | John C. Roman                                     |
|                    |   | President and Chief Executive Officer             |
|                    |   | (principal executive officer)                     |
|                    |   |                                              |
|                    |   |                                              |
| Date: November 15, 2010 | by:    | /s/ Lee R. Schlesinger                            |
|                    |   | Lee R. Schlesinger                                |
|                    |   | Senior Vice President and Chief Financial Officer |
|                    |   | (principal financial officer)                     |
|                    |   |                                              |