UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

[ X ]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF 1934 (NO FEE  REQUIRED)

        For the fiscal year ended: June 30, 1997
                                          
                                       OR

[   ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
        EXCHANGE ACT OF 1934  (NO  FEE REQUIRED)
                                      
        For  the  transition  period  from  __________ to __________
                                  
                          Commission File No.: 0-22444

                               WVS Financial Corp.
             (Exact name of registrant as specified in its charter)

           Pennsylvania                                       25-1710500
   (State or other jurisdiction                            (I.R.S. Employer
 of incorporation or organization)                      Identification Number)
        9001 Perry Highway
     Pittsburgh, Pennsylvania                                   15237
       (Address of Principal                                  (Zip Code)
        Executive Offices)

       Registrant's telephone number, including area code: (412) 364-1911

           Securities registered pursuant to Section 12(b) of the Act:
                                 Not Applicable

           Securities registered pursuant to Section 12(g) of the Act:
                     Common Stock (par value $.01 per share)
                                (Title of Class)

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  Registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes [ X ]   No  [   ]

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of Registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.   [ X ]

As of September 16, 1997, the aggregate value of the 1,448,594  shares of Common
Stock of the  Registrant  issued and  outstanding  on such date,  which excludes
299,326  shares held by all directors and officers of the Registrant as a group,
was  approximately  $39.9 million.  This figure is based on the last known trade
price of $27.50 per share of the  Registrant's  Common  Stock on  September  11,
1997.

Number of shares of Common Stock outstanding as of September 16, 1997: 1,747,920
<PAGE>


                       DOCUMENTS INCORPORATED BY REFERENCE 

List hereunder the following documents incorporated by reference and the Part of
the Form 10-K into which the document is incorporated:

(1) Portions of the Annual Report to Stockholders for the fiscal year ended June
30,  1997  are  incorporated  into  Parts  I, II and  IV.  (2)  Portions  of the
definitive  proxy  statement  for the 1997 Annual  Meeting of  Stockholders  are
incorporated into Part III.
<PAGE>
PART I.

Item 1.       Business.


     WVS Financial Corp.  ("WVS" or the "Company") is the parent holding company
of West View Savings Bank ("West View" or the "Savings  Bank").  The Company was
organized in July 1993 as a Pennsylvania-chartered  unitary bank holding company
and acquired 100% of the common stock of the Savings Bank in November 1993.

     West View  Savings  Bank is a  Pennsylvania-chartered,  SAIF-insured  stock
savings bank conducting  business from six offices in the North Hills suburbs of
Pittsburgh.  Originally  organized under  Pennsylvania  law in 1908 as West View
Building Loan  Association,  West View changed its name to West View Savings and
Loan   Association   in  1954.  In  June  1992,   West  View  converted  from  a
Pennsylvania-chartered    mutual    savings   and   loan    association   to   a
Pennsylvania-chartered  mutual  savings bank.  The Savings Bank converted to the
stock form of ownership in November 1993.  The Savings Bank had no  subsidiaries
at June 30, 1997.

Lending Activities

     General.  At June 30, 1997, the Company's net portfolio of loans receivable
totaled  $158.1  million,  as compared to $149.0  million at June 30, 1996.  Net
loans  receivable  comprised  53.6% of Company  total  assets and 92.5% of total
deposits at June 30, 1997, as compared to 57.4% and 87.2%, respectively, at June
30, 1996.  The  principal  categories  of loans in the  Company's  portfolio are
single-family  and multi-family  residential real estate loans,  commercial real
estate loans,  construction  loans,  land acquisition and development  loans and
consumer  loans.  Substantially  all of the Company's  mortgage  loan  portfolio
consists  of  conventional  mortgage  loans,  which are loans  that are  neither
insured by the Federal Housing  Administration  ("FHA") nor partially guaranteed
by the Department of Veterans Affairs ("VA").

     Historically,  the Company's  lending  activities have been concentrated in
single-family  residential  loans secured by  properties  located in its primary
market area of northern  Allegheny  County,  southern  Butler County and eastern
Beaver County,  Pennsylvania.  During fiscal 1997,  the Company's  single-family
real estate  loans  increased by $6.9  million or 6.3%  primarily  due to weaker
consumer  demand for home  purchase and  refinancing  activity and the Company's
decision not to directly match aggressive local market pricing.  Commercial real
estate loans increased $1.6 million or 12.2% during fiscal 1997  principally due
to the  Company's  renewed  focus on this market  segment.  The  Company's  land
acquisition and development  lending, and construction  lending,  decreased $3.9
million or 13.8% during  fiscal 1997.  The decrease was  principally  due to the
repayment of later stage  construction  development and the Company's  desire to
reduce its  exposure to such loans in light of a slow-down in the final sales of
such  projects.  Land  acquisition  and  development  lending,  and  speculative
construction  lending to builders is  generally  considered  to involve a higher
level of risk as  compared to  single-family  residential  lending.  The Company
believes that its  underwriting  standards are prudent and consistent  with safe
and sound banking practices.

     On  occasion,   the  Company  has  also  purchased  whole  loans  and  loan
participations  secured by properties located outside of its primary market area
but predominantly in Pennsylvania. The Company believes that all of its mortgage
loans are secured by properties located in Pennsylvania. Moreover, substantially
all of the  Company's  non-mortgage  loan  portfolio  consists  of loans made to
residents and businesses located in the Company's primary market area.
<PAGE>
     The Financial  Institutions  Reform,  Recovery and  Enforcement Act of 1989
("FIRREA")  imposed  limitations on the aggregate amount of loans that a savings
institution could make to any one borrower,  including  related entities.  Under
FIRREA,  the permissible  amount of loans-to-one  borrower  follows the national
bank standard for all loans made by savings  institutions,  which generally does
not  permit  loans-to-one  borrower  to exceed  15% of  unimpaired  capital  and
surplus. Loans in an amount equal to an additional 10% of unimpaired capital and
surplus also may be made to a borrower if the loans are fully secured by readily
marketable   securities.   At  June  30,  1997,  the  Savings  Bank's  limit  on
loans-to-one borrower under FIRREA was approximately $3.9 million. The Company's
general  policy  has  been to limit  loans-to-one  borrower,  including  related
entities,  to $2.0 million  although this general limit may be exceeded based on
the merit of a particular  credit.  At June 30, 1997, the Company's five largest
loans or groups of loans-to-one  borrower,  including related  entities,  ranged
from an aggregate of $1.8 million to $3.2 million,  and are secured primarily by
real estate located in the Company's primary market area.
<PAGE>
     Loan Portfolio Composition.  The following table sets forth the composition
of the  Company's  net loans  receivable  portfolio by type of loan at the dates
indicated.
<TABLE>
<CAPTION>
                                                                         At June 30,
                         ---------------------------------------------------------------------------------------------------------
                                 1997                  1996                  1995                  1994                 1993
                         ------------------    ------------------    -----------------     -----------------     -----------------  
                          Amount       %        Amount       %        Amount      %         Amount      %         Amount      %
                                                                  (Dollars in Thousands)
<S>                      <C>        <C>        <C>        <C>        <C>       <C>         <C>       <C>         <C>       <C>
Real estate loans:
  Single-family          $116,663    67.25%    $109,776    65.16%    $ 92,710   63.17%     $ 85,661   60.06%     $ 83,572   63.33% 
  Multi-family              3,499     2.02        3,235     1.92        2,303    1.57         2,931    2.05         3,245    2.46
  Commercial               14,669     8.46       13,088     7.77       12,138    8.27         9,087    6.37         9,083    6.88
  Construction             16,969     9.78       19,269    11.44       21,106   14.38        27,341   19.17        17,949   13.60
  Land acquisition
     & development          7,412     4.27        9,004     5.35        4,671    3.18         4,601    3.23         4,435    3.37
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
                          159,212    91.78      154,372    91.64      132,928   90.57       129,621   90.88       118,284   89.64
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
Consumer loans:
  Home equity              12,258     7.06       11,963     7.10       12,477    8.50        11,601    8.13        11,925    9.04
  Education                   516     0.30          590     0.35          394    0.27           353    0.25           746    0.57
  Other                     1,403     0.81        1,484     0.88          905    0.61           863    0.61           663    0.50
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
  Total consumer
     loans                 14,177     8.17       14,037     8.33       13,776    9.38        12,817    8.99        13,334   10.11
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
Commercial loans               91     0.05           40     0.02          ---     ---           ---     ---           ---     ---
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
Commercial lease
   financings                   2     0.00           14     0.01           68    0.05           184    0.13           317    0.25
                         --------   ------     --------   ------     --------  ------      --------  ------      --------  ------  
                          173,482   100.00%     168,463   100.00%     146,772  100.00%      142,622  100.00%      131,935  100.00%
                         --------   ======     --------   ======     --------  ======      --------  ======      --------  ======  
Less:
  Undisbursed loan
     proceeds             (12,505)              (16,651)              (10,794)              (16,508)              (10,136)
  Net deferred loan
     origination fees        (834)                 (837)                 (799)                 (881)               (1,004)
  Allowance for
     loan losses           (2,009)               (1,964)               (1,836)               (1,633)               (1,447)
                         --------              --------              --------              --------              -------- 
Net loans receivable     $158,134              $149,011              $133,343              $123,600              $119,348
                         ========              ========              ========              ========              ========

</TABLE>
<PAGE>
         Contractual  Maturities.  The following  table sets forth the scheduled
contractual maturities of the Company's loans and mortgage-backed  securities at
June 30, 1997.  The amounts  shown for each period do not take into account loan
prepayments and normal amortization of the Company's loan portfolio.
<TABLE>
<CAPTION>
                                     Real Estate Loans 

                                                                                                    Land       
                                                                                                acquisition    
                                                                                                    and        
                              Single-family    Multi-family  Non-residential  Construction      development        
                              -------------    ------------  ---------------  ------------      -----------        
                                                  (Dollars in Thousands)                                       
<S>                             <C>             <C>             <C>             <C>               <C>          
Amounts due in:                                                                                                
        One year or less        $  1,433        $  1,542        $    828        $ 11,931         $  3,395      
  After one year through                                                                                       
              five years           4,237              49           1,558            --              3,983      
        After five years         110,993           1,908          12,283           5,038               34      
                                --------        --------        --------        --------         --------      
                Total(1)        $116,663        $  3,499        $ 14,669        $ 16,969         $  7,412      
                                ========        ========        ========        ========         ========      
                                                                                               

<CAPTION>
                                Consumer                  
                               loans and        Mortgage- 
                               commercial       backed    
                             loans & leases    securities       Total
                             --------------    ----------       -----
                                 (Dollars in Thousands)
<S>                             <C>             <C>             <C>
Amounts due in:            
        One year or less       $    878        $    103        $ 20,110   
  After one year through                                                  
              five years          9,900           1,882          21,609   
        After five years          3,492          35,505         169,253   
                               --------        --------        --------   
                Total(1)       $ 14,270        $ 37,490        $210,972   
                               ========        ========        ========   


(1) Does not include adjustments relating to loans in process, the allowance for
loan losses, accrued interest, deferred fee income and unearned discounts.
</TABLE>
<PAGE>
Interest rate terms on  amounts due after one year:

<TABLE>
<CAPTION>

                                     Real Estate Loans 

                                                                                        Land           
                                                                                     acquisition       
                                                                                         and           
                 Single-family    Multi-family    Non-residential    Construction    development     
                 -------------    ------------    ---------------    ------------    -----------     
                                      (Dollars in Thousands)                                 
<S>               <C>                <C>             <C>             <C>               <C>         
Fixed             $ 92,689           $  1,341        $  7,861        $  4,405          $  1,978 
Adjustable          22,541                616           5,980             633             2,039 
                  --------           --------        --------        --------          -------- 
                                                                                                
     Total        $115,230           $  1,957        $ 13,841        $  5,038          $  4,017 
                  ========           ========        ========        ========          ======== 
                                                                                     

<CAPTION>
                         Consumer                  
                        loans and         Mortgage- 
                        commercial         backed    
                      loans & leases     securities         Total
                      --------------     ----------         -----
                                    (Dollars in Thousands)
<S>                       <C>             <C>             <C>
Fixed                     $  7,835        $ 18,405        $134,514  
Adjustable                   5,557          18,982          56,348  
                          --------        --------        --------  
                                                                 
     Total                $ 13,392        $ 37,387        $190,862  
                          ========        ========        ========  
</TABLE>

         Scheduled  contractual  principal  repayments do not reflect the actual
maturities of loans. The average  maturity of loans is  substantially  less than
their  average  contractual  terms  because of  prepayments  and, in the case of
conventional  mortgage  loans,  due-on-sale  clauses,  which  generally give the
Company  the right to declare a loan  immediately  due and payable in the event,
among other things,  that the borrower  sells the real  property  subject to the
mortgage and the loan is not repaid. The average life of mortgage loans tends to
increase when current mortgage loan rates are substantially higher than rates on
existing  mortgage  loans  and,  conversely,  decrease  when  rates on  existing
mortgages  are  substantially  higher than current  mortgage  loan rates (due to
refinancings of adjustable-rate and fixed-rate loans at lower rates).
<PAGE>
         As further  discussed  below, the Company has from time to time renewed
commercial real estate loans and speculative construction  (single-family) loans
due to slower than expected sales of the underlying collateral.  Commercial real
estate loans are generally renewed at a contract rate that is the greater of the
market  rate at the time of the renewal or the  original  contract  rate.  Loans
secured  by  speculative  single-family   construction  or  developed  lots  are
generally  renewed for an  additional  six month term with  monthly  payments of
interest.  Subsequent  renewals,  if  necessary,  are  generally  granted for an
additional six month term;  principal  amortization  may also be required.  Land
acquisition and development loans are generally renewed for an additional twelve
month term with monthly payments of interest.

         At June 30, 1997, the Company had approximately $4.9 million of renewed
commercial real estate and construction loans, all of which were performing. The
$4.9 million in aggregate disbursed principal that has been renewed is comprised
of:  single-family  speculative  construction  loans - $943 thousand,  developed
residential  lots - $721  thousand,  acquisition  and  development  loans - $2.8
million,  and  a  participation  in  a  land  development  project  for  upscale
residential  housing  totaling  $407  thousand.  Management  believes  that  the
previously discussed whole loans will self-liquidate during the normal course of
business,  though some additional  rollovers may be necessary.  All of the loans
that have been rolled over, as discussed  above, are in compliance with all loan
terms,  including  the  receipt of all  required  payments,  and are  considered
performing  loans.  The Company had no loans scheduled to mature in the one year
period  ending  June 30,  1997 which  were  non-performing.  See  "-Multi-Family
Residential, Commercial Real Estate and Construction Loans" and "-Non-Performing
Assets".

         Origination,  Purchase and Sale of Loans.  Applications for residential
real  estate  loans and  consumer  loans are  obtained  at all of the  Company's
offices.  Applications  for  commercial  real estate loans are taken only at the
Company's  Franklin Park office.  Residential  loan  applications  are primarily
attributable to existing  customers,  builders,  walk-in customers and referrals
from both real estate  brokers and existing  customers.  Commercial  real estate
loan  applications are obtained  primarily by referrals from former and existing
borrowers.  Consumer loans are primarily  obtained  through existing and walk-in
customers.

         All processing and underwriting of real estate and commercial  business
is performed  solely at the Company's loan division at the Franklin Park office.
The  Company  believes  this   centralized   approach  to  approving  such  loan
applications  allows it to process and approve such applications faster and with
greater  efficiency.  The Company also believes that this approach increases its
ability to service the loans. All loan  applications are required to be approved
by the  Company's  Loan  Committee,  comprised  of both  outside  directors  and
management, which meets weekly.

         Historically, the Company has originated substantially all of the loans
retained in its  portfolio.  Substantially  all of the  residential  real estate
loans  originated  by  the  Company  have  been  under  terms,   conditions  and
documentation   which  permit  their  sale  to  the  Federal  National  Mortgage
Association  ("FNMA") and other investors in the secondary market.  Although the
Company has not been a seller of loans in the secondary  market,  the Company is
on the FNMA approved list of  sellers/servicers.  The Company has held the loans
it originates in its own portfolio until maturity,  due, in part, to competitive
pricing  conditions in the marketplace for origination by nationwide lenders and
portfolio lenders.
<PAGE>
         The Company has not been an aggressive purchaser of loans. However, the
Company may purchase whole loans or loan participations in those instances where
demand for new loan originations in the Company's market area is insufficient or
to increase the yield  earned on the loan  portfolio.  Such loans are  generally
presented  to  the  Company   from   contacts   primarily  at  other   financial
institutions,  particularly  those which have  previously done business with the
Company.  At June 30, 1997,  $6.3 million or 3.6% of the  Company's  total loans
receivable  consisted  of  whole  loans  and  participation  interests  in loans
purchased  from  other  financial  institutions,  of which  $2.1  million or 33%
consisted  of loans  secured by  commercial  real  estate,  $2.2  million or 35%
consisted  of pools of low to moderate  income  single-family  residences,  $1.6
million or 25% consisted of a  multi-family  apartment  complex  loan,  and $407
thousand  or 7%  consisted  of a land  development  loan.  During  fiscal  1997,
purchases  of whole loans and  participations  decreased by $1.6  million,  to a
total of $1.1 million, as compared to fiscal 1996. The $1.1 million purchase was
comprised primarily of low to moderate income single-family residential loans.

         The  Company  requires  that all  purchased  loans be  underwritten  in
accordance with its underwriting  guidelines and standards.  The Company reviews
loans, particularly scrutinizing the borrower's ability to repay the obligation,
the  appraisal  and  the  loan-to-value  ratio.   Servicing  of  loans  or  loan
participations  purchased  by the Company  generally is performed by the seller,
with a portion of the interest being paid by the borrower retained by the seller
to cover servicing costs. At June 30, 1997,  approximately  $3.8 million or 2.2%
of the Company's  total loans  receivable were being serviced for the Company by
others.
<PAGE>
         The following  table shows  origination,  purchase and sale activity of
the Company  with  respect to loans on a  consolidated  basis during the periods
indicated.
<TABLE>
<CAPTION>
                                                      At or For the Year Ended June 30,
                                                  --------------------------------------
                                                      1997           1996          1995
                                                  ---------      ---------     ---------
                                                            (Dollars in Thousands)
<S>                                               <C>            <C>           <C>
Net loans receivable beginning balance ......     $ 149,011      $ 133,343     $ 123,600
Real estate loan originations:
   Single-family(1) .........................        15,643         25,181        18,481
   Multi-family(2) ..........................           575          1,984            85
   Commercial ...............................         2,000          1,731         4,388
   Construction .............................         9,044         10,792        10,776
   Land acquisition and development .........         1,384          4,219         1,921
                                                  ---------      ---------     ---------
      Total real estate loan originations ...        28,646         43,907        35,651
                                                  ---------      ---------     ---------

Home equity .................................         3,160          2,589         4,122
Education ...................................           323           --            --
Commercial ..................................           533             40          --
Other .......................................           207            287           616
                                                  ---------      ---------     ---------
      Total loan originations ...............        32,869         46,823        40,389
                                                  ---------      ---------     ---------

Disbursements against available credit lines:
   Home equity ..............................         4,608          4,693         3,998
   Other ....................................            28             28            47
Purchase of whole loans and participations ..         1,145          2,653           250
                                                  ---------      ---------     ---------
      Total originations and purchases ......        38,650         54,197        44,684
                                                  ---------      ---------     ---------

Less:
   Loan principal repayments ................        33,569         32,460        40,542
   Sales of whole loans and participations ..          --             --            --
   Transferred to real estate owned .........            73             51          --
   Change in loans in process ...............        (4,147)         5,857        (5,714)
   Other, net(3) ............................            32            161           113
                                                  ---------      ---------     ---------
      Net increase ..........................     $   9,123      $  15,668     $   9,743
                                                  =========      =========     =========

Net loans receivable ending balance .........     $ 158,134      $ 149,011     $ 133,343
                                                  =========      =========     =========
------------   
(1) Consists of loans secured by 1-4 family properties.
(2) Consists of loans secured by five or more family properties.
(3) Includes reductions for net deferred loan origination fees and the allowance 
    for losses.
</TABLE>
<PAGE>
         Real Estate Lending Standards.  All financial institutions are required
to adopt and maintain  comprehensive  written real estate lending  policies that
are consistent  with safe and sound banking  practices.  These lending  policies
must reflect consideration of the Interagency Guidelines for Real Estate Lending
Policies   adopted  by  the  federal   banking   agencies   in   December   1992
("Guidelines").   The  Guidelines  set  forth  uniform  regulations  prescribing
standards for real estate  lending.  Real estate lending is defined as extension
of credit  secured by liens on  interests in real estate or made for the purpose
of  financing  the  construction  of a building  or other  improvements  to real
estate, regardless of whether a lien has been taken on the property.

         The policies must address certain lending  considerations  set forth in
the Guidelines,  including  loan-to-value  ("LTV") limits,  loan  administration
procedures,  underwriting standards,  portfolio  diversification  standards, and
documentation,  approval and reporting requirements. These policies must also be
appropriate  to the size of the  institution  and the  nature  and  scope of its
operations,  and must be reviewed  and  approved by the  institution's  board of
directors at least annually. The LTV ratio framework, with a LTV ratio being the
total  amount of credit to be  extended  divided by the  appraised  value of the
property  at the time the credit is  originated,  must be  established  for each
category of real estate loans.  If not a first lien, the lender must combine all
senior liens when calculating  this ratio.  The Guidelines,  among other things,
establish the following supervisory LTV limits: raw land (65%); land development
(75%);  construction  (commercial,   multi-family  and  non-residential)  (80%);
improved property (85%); and one-to-four family residential (owner occupied) (no
maximum ratio; however any LTV ratio in excess of 90% should require appropriate
insurance or readily  marketable  collateral).  Consistent with its conservative
lending philosophy, the Company's LTV limits are generally more restrictive than
those in the Guidelines:  raw land (60%); land development  (70%);  construction
(commercial - 70%;  multi-family  - 75%;  speculative  residential  - 80%);  and
residential  properties  (95% in the case of one-to-four  family  owner-occupied
residences and 75% on larger family non owner-occupied residences).

         Single-Family  Residential  Real Estate  Loans.  Historically,  savings
institutions such as the Company have concentrated  their lending  activities on
the  origination of loans secured  primarily by first mortgage liens on existing
single-family  residences.  At June 30,  1997,  $116.7  million  or 67.3% of the
Company's  total loan  portfolio  consisted of  single-family  residential  real
estate loans,  substantially all of which are conventional loans.  Single-family
loan  originations  totaled $15.6  million and  decreased  $9.6 million or 38.1%
during the fiscal year ended June 30,  1997 when  compared to the same period in
1996.  The decrease in  single-family  originations  is due  primarily to weaker
consumer  demand for home  purchase and  refinance  activity  and the  Company's
decision not to directly match aggressive local market pricing.

         The Company historically has and continues to emphasize the origination
of  fixed-rate  loans  with  terms of up to 30 years.  Although  such  loans are
originated with the expectation that they will be maintained in portfolio, these
loans are originated  generally under terms,  conditions and documentation which
permit their sale in the  secondary  market.  The Company  also makes  available
single-family  residential  adjustable-rate mortgages ("ARMs") which provide for
periodic  adjustments  to the interest  rate,  but such loans have never been as
widely  accepted in the Company's  market area as the  fixed-rate  mortgage loan
products. The ARMs currently offered by the Company have up to 30-year terms and
an  interest  rate which  adjusts  in  accordance  with one of several  indices.
Consumer  response  to  adjustable  rate  loans  has  been  limited  due  to the
appreciable  decline in long-term  interest rates  experienced  during the first
half of fiscal 1996.
<PAGE>
         At  June  30,  1997,  approximately  $94.1  million  or  80.6%  of  the
single-family  residential  loans in the Company's loan  portfolio  consisted of
loans which provide for fixed rates of interest.  Although these loans generally
provide for repayments of principal over a fixed period of 15 to 30 years, it is
the Company's  experience that because of prepayments  and due-on-sale  clauses,
such loans generally  remain  outstanding for a substantially  shorter period of
time.

         The Company is  permitted to lend up to 95% of the  appraised  value of
real  property  securing  a  residential  loan;  however,  if  the  amount  of a
residential  loan originated or refinanced  exceeds 95% of the appraised  value,
the Company is required by state banking  regulations to obtain private mortgage
insurance  on the  portion  of the  principal  amount  that  exceeds  75% of the
appraised value of the security  property.  Pursuant to underwriting  guidelines
adopted by the Board of  Directors,  private  mortgage  insurance  is  generally
obtained on residential loans for which loan-to-value ratios exceed 80%.

         Property  appraisals on the real estate and  improvements  securing the
Company's  single-family  residential  loans are made by independent  appraisers
approved by the Board of Directors.  Appraisals are performed in accordance with
federal  regulations and policies.  The Company obtains title insurance policies
on most first mortgage real estate loans originated by it. If title insurance is
not  obtained or is  unavailable,  the Company  obtains an abstract of title and
title opinion. Borrowers also must obtain hazard insurance prior to closing and,
when required by the United States Department of Housing and Urban  Development,
flood insurance.  Borrowers may be required to advance funds,  with each monthly
payment of  principal  and  interest,  to a loan escrow  account  from which the
Company  makes  disbursements  for items such as real estate  taxes and mortgage
insurance premiums as they become due.

         Multi-Family  Residential,  Commercial  Real  Estate  and  Construction
Loans. The Company originates mortgage loans for the acquisition and refinancing
of existing multi-family  residential and commercial real estate properties.  At
June 30,  1997,  $3.5  million or 2.0% of the  Company's  total  loan  portfolio
consisted  of loans  secured by existing  multi-family  residential  real estate
properties and $14.7 million or 8.5% of such loan  portfolio  consisted of loans
secured by existing commercial real estate properties.

         The  majority  of the  Company's  multi-family  residential  loans  are
secured  primarily by 5 to 20 unit apartment  buildings,  while  commercial real
estate   loans  are  secured  by  office   buildings,   hotels,   small   retail
establishments and churches.  These types of properties  constitute the majority
of  the  Company's   commercial  real  estate  loan  portfolio.   The  Company's
multi-family  residential  and commercial  real estate loan  portfolio  consists
primarily of loans secured by properties located in its primary market area.

         Although  terms vary,  multi-family  residential  and  commercial  real
estate loans  generally are amortized over a period of up to 15 years  (although
some loans  amortize  over a twenty  year  period) and mature in five to fifteen
years.  The Company will originate  these loans either with fixed interest rates
or with interest rates which adjust in accordance with a designated index, which
generally is negotiated at the time of origination.  Loan-to-value ratios on the
Company's commercial real estate loans are currently limited to 75% or lower. As
part of the criteria for  underwriting  multi-family  residential and commercial
real estate loans,  the Company  generally  imposes a debt  coverage  ratio (the
ratio of net cash from  operations  before  payment of the debt  service to debt
<PAGE>
service)  of at least  100%.  It is also the Savings  Bank's  general  policy to
obtain personal  guarantees on its multi-family  residential and commercial real
estate  loans from the  principals  of the  borrower  and,  when this  cannot be
obtained,  to  impose  more  stringent  loan-to-value,  debt  service  and other
underwriting requirements.

         At June 30, 1997, the Company's multi-family residential and commercial
real estate loan portfolio  consisted of  approximately 87 loans with an average
principal  balance of $209  thousand.  At June 30,  1997,  the  Company  had one
commercial real estate loan that was not accruing interest.

         In  recent  years,  the  Company  has  been   increasingly   active  in
originating loans to construct  primarily  single-family  residences,  and, to a
much lesser extent, loans to acquire and develop real estate for construction of
residential  properties.  These construction  lending  activities  generally are
limited to the Company's  primary  market area.  At June 30, 1997,  construction
loans  amounted to  approximately  $17.0 million or 9.8% of the Company's  total
loan portfolio.  As of such date, the Company's  portfolio of construction loans
consisted  of $13.4  million  of loans  for the  construction  of  single-family
residential  real  estate  and $3.6  million  of loans for the  construction  of
commercial real estate.  Construction loan originations totaled $9.0 million and
decreased  by $1.8  million or 16.7%  during the fiscal year ended June 30, 1997
when  compared  to the same  period  in  1996.  Construction  loan  originations
declined  during  fiscal  1997  primarily  due to an  excess  supply  in the new
construction  market  and the  Company's  desire to limit its  exposure  to this
market segment to current investment levels.

         Construction   loans  are  made  to  individuals  for  the  purpose  of
constructing  a personal  residence.  In such  circumstances,  the Company  will
underwrite such loans on a  construction/permanent  mortgage loan basis. At June
30, 1997,  approximately 51.4% of total outstanding construction loans were made
to local real estate  builders and  developers  with whom the Company has worked
for a number of years for the purpose of  constructing  primarily  single-family
residential  developments,  with the remaining 48.6% of total construction loans
made to individuals for the purpose of constructing a personal  residence.  Upon
application,  credit  review and  analysis of personal and  corporate  financial
statements, the Company will grant local builders with whom it has done business
lines of credit up to designated amounts. These credit lines may be used for the
purpose of construction of speculative (or unsold)  residential  properties.  In
some  instances,  lines of credit will also be granted for purposes of acquiring
finished  residential  lots and developing  speculative  residential  properties
thereon.  Such lines generally have not exceeded $1.0 million,  with the largest
line totaling $1.4 million.  Once approved for a construction  line, a developer
must  still  submit  plans  and   specifications   and  receive  the   Company's
authorization,  including  an appraisal of the  collateral  satisfactory  to the
Company,  in order to begin utilizing the line for a particular  project.  As of
June 30,  1997,  the  Company  also had $7.4  million  or 4.3% of the total loan
portfolio  invested in land development loans, which consisted of 35 loans to 24
developers.

         Construction  loans generally have  maturities of 18 months,  including
one 6 month  extension,  with  payments  being made monthly on an  interest-only
basis.  Thereafter,  the permanent financing arrangements will generally provide
for either an adjustable or fixed interest rate,  consistent  with the Company's
policies with respect to residential and commercial real estate financing. For a
discussion  of the  Company's  policy  with  respect to  renewing a  speculative
construction  loan at the expiration of its term if the underlying  property has
not been sold, see "-Contractual Maturities".
<PAGE>
         The Company intends to maintain its involvement in construction lending
within its primary market area. Such loans afford the Company the opportunity to
increase the interest rate  sensitivity of its loan  portfolio.  Commercial real
estate and  construction  lending is  generally  considered  to involve a higher
level of risk as  compared  to  single-family  residential  lending,  due to the
concentration  of principal in a limited  number of loans and  borrowers and the
effects of general economic  conditions on real estate  developers and managers.
Moreover,  a  construction  loan can  involve  additional  risks  because of the
inherent  difficulty in estimating both a property's  value at completion of the
project and the estimated cost (including  interest) of the project.  The nature
of these loans is such that they are  generally  more  difficult to evaluate and
monitor.  In  addition,  speculative  construction  loans to a  builder  are not
necessarily  pre-sold and thus pose a greater potential risk to the Company than
construction loans to individuals on their personal residences.

         The Company has  attempted  to minimize the  foregoing  risks by, among
other  things,  limiting  the  extent  of its  commercial  real  estate  lending
generally  and by limiting its  construction  lending to  primarily  residential
properties.  In addition,  the Savings Bank has adopted underwriting  guidelines
which impose stringent  loan-to-value,  debt service and other  requirements for
loans which are believed to involve higher elements of credit risk, by generally
limiting the  geographic  area in which the Savings Bank will do business to its
primary  market area and by working with builders  with whom it has  established
relationships.

         Consumer  Loans.  The Company  offers  consumer  loans,  although  such
lending activity has not historically been a large part of its business. At June
30, 1997, $14.2 million or 8.2% of the Company's total loan portfolio  consisted
of consumer loans. The consumer loans offered by the Company include home equity
loans, home equity lines of credit,  education loans,  automobile loans, deposit
account secured loans and personal loans.  Most of the Company's  consumer loans
are secured by real  estate and are  primarily  obtained  through  existing  and
walk-in customers.

         The Company will originate either a fixed-rate,  fixed term home equity
loan,  or a home equity line of credit with a variable  rate.  At June 30, 1997,
approximately  54.7% of the Company's home equity loans were at a fixed rate for
a fixed term.  Although  there have been a few  exceptions  with greater loan to
value  ratios,  substantially  all of such loans are  originated  with a loan to
value ratio which,  when coupled with the outstanding  first mortgage loan, does
not exceed 80%.

         Commercial Loans and Lease  Financings.  At June 30, 1997, $93 thousand
or less than 1% of the Company's  total loan  portfolio  consisted of commercial
loan and lease  financings.  During  fiscal 1991,  the Company began to purchase
participation  interests in pools of leases of general commercial  chattel.  The
Company  ceased  purchasing  participation  interests  in fiscal  1992  based on
management's  belief  that the quality of the pools were not as good as those it
had invested in previously  and because some of the  participation  interests in
pools it had acquired started to experience some losses. Commercial loans, which
include loans secured by accounts receivable,  business inventory and equipment,
and similar  collateral  totaled $91  thousand or less than 1% of the  Company's
total loan portfolio.  The Company  intends to selectively  develop this line of
business  in  order  to  increase   interest  income  and  to  possibly  attract
compensating  deposit account balances.  Due to the higher risks associated with
commercial loans not secured by real estate, future commercial loan originations
will be modest.
<PAGE>
         Loan Fee Income.  In addition to interest earned on loans,  the Company
receives   income  from  fees  in  connection  with  loan   originations,   loan
modifications, late payments, prepayments and for miscellaneous services related
to its loans. Income from these activities varies from period to period with the
volume and type of loans made and competitive conditions.

         The Company  charges loan  origination  fees which are  calculated as a
percentage of the amount borrowed.  Loan origination and commitment fees and all
incremental  direct loan origination  costs are deferred and recognized over the
contractual  remaining  lives  of the  related  loans  on a level  yield  basis.
Discounts and premiums on loans purchased are accreted and amortized in the same
manner.  In accordance  with FASB 91, the Company has recognized  $229 thousand,
$216 thousand and $248  thousand of deferred loan fees during fiscal 1997,  1996
and 1995,  respectively,  in  connection  with loan  refinancings,  payoffs  and
ongoing  amortization of outstanding loans. The increase in loan origination fee
income for fiscal 1997 was  primarily  attributable  to a higher volume of loans
originated with loan origination fees.

         Non-Performing   Loans,   Real   Estate   Owned   and   Troubled   Debt
Restructurings.  When a borrower fails to make a required payment on a loan, the
Company  attempts to cure the  deficiency by contacting the borrower and seeking
payment.  Contacts are  generally  made on the  fifteenth day after a payment is
due. In most cases,  deficiencies are cured promptly.  If a delinquency  extends
beyond 15 days, the loan and payment history is reviewed and efforts are made to
collect the loan. While the Company  generally prefers to work with borrowers to
resolve such problems, when the account becomes 90 days delinquent,  the Company
does institute foreclosure or other proceedings,  as necessary,  to minimize any
potential loss.

         Loans  are  placed on  non-accrual  status  when,  in the  judgment  of
management,   the  probability  of  collection  of  interest  is  deemed  to  be
insufficient  to warrant further  accrual.  When a loan is placed on non-accrual
status, previously accrued but unpaid interest is deducted from interest income.
The Company normally does not accrue interest on loans past due 90 days or more.
The Company will continue to accrue interest on education loans past due 90 days
or more because of the repayment  guarantee provided by the Federal  government.
The  Company  may also  continue  to  accrue  interest  if,  in the  opinion  of
management, it believes it will collect on the loan.

         Real estate  acquired by the Company as a result of  foreclosure  or by
deed-in-lieu of foreclosure is classified as real estate owned until it is sold.
When property is acquired,  it is recorded at the lower of cost or fair value at
the date of acquisition and any write-down resulting therefrom is charged to the
allowance for losses on real estate owned. All costs incurred in maintaining the
Company's  interest in the  property are  capitalized  between the date the loan
becomes  delinquent and the date of acquisition.  After the date of acquisition,
all costs incurred in  maintaining  the property are expensed and costs incurred
for the improvement or development of such property are capitalized.
<PAGE>
         The  following  table  sets forth the  amounts  and  categories  of the
Company's non-performing assets at the dates indicated.
<TABLE>
<CAPTION>
                                                                  At June 30,
                                          -------------------------------------------------------
                                            1997        1996         1995        1994       1993
                                          -------      ------      ------      ------      ------
                                                            (Dollars in Thousands)
<C>                                       <C>          <C>         <C>         <C>         <C>
Non-accruing loans:
Real estate:
   Single-family ....................     $  --        $  100      $  185      $  106      $   61
   Multi-family .....................        --          --           561         581        --
   Commercial(1) ....................         274         274         274         271        --
Consumer ............................        --          --          --          --             3
Commercial loans & leases ...........        --             3           9        --          --
                                          -------      ------      ------      ------      ------
Total non-accrual loans .............         274         377       1,029         958          64
                                          -------      ------      ------      ------      ------
Accruing loans greater than
   90 days delinquent ...............        --          --          --             4          98
                                          -------      ------      ------      ------      ------
     Total non-performing loans .....     $   274      $  377      $1,029      $  962      $  162
                                          -------      ------      ------      ------      ------
Real estate owned ...................        --          --          --            25        --
                                          -------      ------      ------      ------      ------
     Total non-performing assets ....     $   274      $  377      $1,029      $  987      $  162
                                          =======      ======      ======      ======      ======
Troubled debt restructurings ........     $  --        $  603      $  930      $  944      $  956
                                          =======      ======      ======      ======      ======
Total non-performing loans and
   troubled debt restructurings as a
   percentage of net loans receivable        0.17%       0.66%       1.47%       1.54%       0.94%
                                          =======      ======      ======      ======      ======
Total non-performing assets
   to total assets ..................        0.09%       0.15%       0.45%       0.45%       0.08%
                                          =======      ======      ======      ======      ======
Total non-performing assets
   and troubled debt restructurings
   as a percentage of total assets ..        0.09%       0.38%       0.86%       0.87%       0.53%
                                          =======      ======      ======      ======      ======
-----------
(1) At June 30, 1997,  non-accrual commercial real estate loans consisted of one
loan.
</TABLE>
         The $103 thousand  decrease in non-accrual  loans during fiscal 1997 is
primarily  comprised of a $100 thousand  decrease in  non-accrual  single-family
real estate loans.

         At  June  30,  1997,  the  Company  had  one  performing   restructured
multi-family loan with a total  outstanding  principal balance of $599 thousand.
The loan is secured by an eight unit  apartment  building and one  single-family
residence  located in Oakmont  Borough.  Though  originally  appraised  for $840
thousand in 1991, a revised  appraisal report dated September 1995 has indicated
an appraised value of  approximately  $475 thousand.  Though no charge-offs have
been recorded to date,  the loan has been  internally  classified as substandard
due to payment history and collateral value. The Company believes that it has an
adequate valuation allowance with respect to this loan.
<PAGE>
         At June 30, 1997,  the Company had one land  development  participation
loan, with an outstanding principal balance of $383 thousand, that was granted a
third extension.  The loan, which was originated to finance the development of a
45 lot upscale  residential  subdivision,  provides for interest only  payments,
floats  monthly at a net  participant  rate of prime plus  seven-eighths  of one
percent,  and matures in March 2000. At June 30, 1997, 21 lots remained  unsold.
The third extension was granted due to the continued weak market demand for lots
within  the   subdivision.   In  exchange  for  granting  the  extension,   loan
participants,  including  the  Company,  received a renewal  fee of 0.75% of the
loan's  outstanding  principal  balance  and a lot  release  price  paid  to the
participants  of 75% with a minimum amount of $175 thousand per lot. If the loan
is paid off prior to  maturity,  a  pro-rated  refund of the renewal fee will be
issued  to  the  borrower.  Management  believes  that  the  loan  is  presently
well-secured  based upon an approximate 19.5% loan to value first-lien  position
and the  obligor's  strong  net-worth  and  paying  capacity.  The loan has been
internally classified substandard due to the low level of lot sale activity.

         As of June 30, 1997, the Company had one  non-accruing  commercial real
estate loan with an outstanding principal balance of $274 thousand that was over
90 days  delinquent.  The Company  stopped  accruing  interest on the loan as of
September  1993.  The loan is secured by a  restaurant  and real estate which is
located in Wexford,  PA. The property was  appraised  for $395  thousand in June
1988. Since such date, an addition to the restaurant has been  constructed.  The
obligors on this loan are the two former principal owners of the restaurant. The
restaurant  and the two obligors on this loan have filed under  Chapter 7 of the
Federal  Bankruptcy Code. Through June 30, 1997 the Company was unable to obtain
relief from stay to proceed with a foreclosure  action  against the property.  A
third party has  acquired the  restaurant  business and property in a Bankruptcy
Court  supervised  restructuring  plan by, among other things,  agreeing to make
certain periodic payments into the bankruptcy  estate.  The Bankruptcy Court has
not as of yet approved the bankruptcy plan. The Company,  however,  is presently
receiving  interest  only  payments at a modified  rate of 8%, as opposed to the
original  contract  rate  of  9%.  Under  terms  of  the  pending  but as of yet
unapproved  bankruptcy  restructuring plan, the Company has agreed,  among other
things,  to a  reduction  in the  contract  rate of  interest  to 8% and certain
repayment modifications.

         In addition to the  foregoing,  at June 30, 1997 the Company had a 7.9%
or $907  thousand  participation  interest in a first  mortgage loan on a 12 1/2
acre  property  in  Allegheny  County,  Pennsylvania  which  includes a 194 room
Sheraton  hotel and  restaurant  and an 8,100 square foot office  building.  The
Company acquired its interest in 1984. The loan, which was originated to acquire
the property  and  construct  the hotel,  matures in March 1999 and provides for
principal  and  interest  payments  at  8.2%  based  on a  30-year  amortization
schedule.  The borrower is current in its payments but the loan  continues to be
monitored  due to the nature of the hotel  industry in general and a decrease in
the capital accounts of the general partners.

         During  fiscal 1997,  1996 and 1995,  approximately  $15  thousand,  $9
thousand and $42 thousand, respectively, of interest would have been recorded on
loans accounted for on a non-accrual  basis and troubled debt  restructurings if
such loans had been current  according to the original loan  agreements  for the
entire period.  These amounts were not included in the Company's interest income
for the respective periods. The amount of interest income on loans accounted for
on a  non-accrual  basis and troubled debt  restructurings  that was included in
income  during the same periods  amounted to  approximately  $20  thousand,  $75
thousand and $144 thousand, respectively.
<PAGE>
         Allowances   for  Loan  Losses.   The  allowance  for  loan  losses  is
established  through  provisions for loan losses charged against  income.  Loans
deemed to be uncollectible are charged against the allowance account. Subsequent
recoveries,  if any, are credited to the allowance.  The allowance is maintained
at a level believed  adequate by management to absorb  estimated  potential loan
losses.  Management's determination of the adequacy of the allowance is based on
periodic evaluations of the loan portfolio considering past experience,  current
economic  conditions,  composition  of the loan  portfolio  and  other  relevant
factors.  This  evaluation is  inherently  subjective,  as it requires  material
estimates that may be susceptible to significant change.

         Effective  December 21, 1993, the FDIC, in conjunction  with the Office
of the  Comptroller of the Currency,  the Office of Thrift  Supervision  and the
Federal Reserve Board,  adopted an Interagency Policy Statement on the Allowance
for Loan and Lease Losses  ("Policy  Statement").  The Policy  Statement,  which
effectively supersedes previous FDIC proposed guidance, includes guidance (i) on
the  responsibilities  of management for the assessment and  establishment of an
adequate allowance and (ii) for the agencies' examiners to use in evaluating the
adequacy  of  such  allowance  and  the  policies  utilized  to  determine  such
allowance.  The Policy Statement also sets forth  quantitative  measures for the
allowance with respect to assets classified substandard and doubtful,  described
below,  and with  respect  to the  remaining  portion of an  institution's  loan
portfolio.   Specifically,   the  Policy  Statement  sets  forth  the  following
quantitative measures which examiners may use to determine the reasonableness of
an allowance:  (i) 50% of the portfolio that is classified doubtful; (ii) 15% of
the portfolio that is classified  substandard  and (iii) for the portions of the
portfolio that have not been  classified  (including  loans  designated  special
mention), estimated credit losses over the upcoming twelve months based on facts
and  circumstances  available on the evaluation date. While the Policy Statement
sets forth this quantitative measure, such guidance is not intended as a "floor"
or "ceiling".

         Federal  regulations  require  that each  insured  savings  institution
classify  its  assets  on a regular  basis.  In  addition,  in  connection  with
examinations  of insured  institutions,  federal  examiners  have  authority  to
identify  problem assets and, if  appropriate,  classify  them.  There are three
classifications  for  problem  assets:  "substandard",  "doubtful"  and  "loss".
Substandard  assets have one or more defined weaknesses and are characterized by
the distinct  possibility that the insured institution will sustain some loss if
the deficiencies are not corrected. Doubtful assets have the weaknesses of those
classified as substandard with the added characteristic that the weaknesses make
collection  or  liquidation  in full on the basis of currently  existing  facts,
conditions and values questionable,  and there is a high possibility of loss. An
asset  classified as loss is considered  uncollectible  and of such little value
that  continuance  as an  asset of the  institution  is not  warranted.  Another
category  designated "asset watch" is also utilized by the Bank for assets which
do not currently expose an insured institution to a sufficient degree of risk to
warrant  classification  as substandard,  doubtful or loss. Assets classified as
substandard or doubtful require the institution to establish general  allowances
for loan  losses.  If an asset or portion  thereof is  classified  as loss,  the
insured institution must either establish specific allowances for loan losses in
the amount of 100% of the portion of the asset  classified  loss,  or charge-off
such amount.  General  loss  allowances  established  to cover  possible  losses
related  to  assets  classified  substandard  or  doubtful  may be  included  in
determining  an  institution's  regulatory  capital,  while  specific  valuation
allowances for loan losses do not qualify as regulatory capital.
<PAGE>
         The Company's general policy is to internally  classify its assets on a
regular  basis and  establish  prudent  general  valuation  allowances  that are
adequate to absorb losses that have not been identified but that are inherent in
the loan portfolio.  The Company maintains general valuation  allowances that it
believes  are  adequate  to  absorb  losses in its loan  portfolio  that are not
clearly   attributable  to  specific  loans.  The  Company's  general  valuation
allowances  are within the following  ranges:  (i) 0% to 5% of assets subject to
special mention; (ii) 5% to 25% of assets classified substandard;  and (iii) 50%
to 100% of assets  classified  doubtful.  Any loan classified as loss is charged
off.  To  further  monitor  and  assess  the  risk  characteristics  of the loan
portfolio,  loan  delinquencies are reviewed to consider any developing  problem
loans.  Based upon the  procedures  in place,  considering  the  Company's  past
charge-offs  and  recoveries  and  assessing  the current  risk  elements in the
portfolio, management believes the allowance for loan losses at June 30, 1997 is
adequate.

         The Company has  consistently  added to the allowance for possible loan
losses  during  the past three  fiscal  years.  The  allowance  for loan  losses
increased from $1.96 million at June 30, 1996 to approximately  $2.00 million at
June 30, 1997. These increases reflect a number of factors, the most significant
of which is the industry trend towards greater  emphasis on the allowance method
of providing for loan losses and the specific charge-off method.
<PAGE>
         The following table summarizes  changes in the Company's  allowance for
loan losses and other selected statistics for the periods indicated.
 
<TABLE>
<CAPTION>
                                                                         At June 30,
                                               ----------------------------------------------------------------
                                                 1997           1996          1995          1994         1993
                                               --------      --------      --------      --------      --------
                                                                   (Dollars in Thousands)
<S>                                            <C>           <C>           <C>           <C>           <C>
Average net loans ........................     $153,726      $141,643      $133,517      $118,302      $124,530
                                               ========      ========      ========      ========      ========
Allowance balance (at beginning of period)     $  1,964      $  1,836      $  1,634      $  1,447      $    864
Provision for loan losses ................           60           150           211           211           666
Charge-offs:
 Real estate:
    Single-family ........................           15            25          --               6            11
    Multi-family .........................         --            --            --            --            --
    Commercial ...........................         --            --            --            --              46
    Construction .........................         --            --            --            --            --
 Land acquisition and development ........         --            --            --            --            --
 Consumer:
    Home equity ..........................         --            --            --            --            --
    Education ............................         --            --            --            --            --
    Other ................................         --            --            --               4            15
 Commercial loans and leases ..............           3             4            12            18            14
                                               --------      --------      --------      --------      --------
 Total charge-offs .......................           18            29            12            28            86
                                               --------      --------      --------      --------      --------
Recoveries:
 Real estate:
     Single-family .......................            1          --            --            --            --
     Multi-family ........................         --            --            --            --            --   
     Commercial ..........................         --            --            --            --            --
     Construction ........................         --            --            --            --            --
 Land acquisition and development ........         --            --            --            --            --
 Consumer:
    Home equity ..........................         --            --            --            --            --
    Education ............................         --            --            --            --            --
    Other ................................         --               1             1             3             2
 Commercial loans and leases .............            2             6             2             1             1
                                               --------      --------      --------      --------      --------
    Total recoveries .....................            3             7             3             4             3
                                               --------      --------      --------      --------      --------
Net loans charged-off ....................           15            22             9            24            83
Transfer to real estate owned loss reserve         --            --            --            --            --
                                               --------      --------      --------      --------      --------
Allowance balance (at end of period) .....     $  2,009      $  1,964      $  1,836      $  1,634      $  1,447
                                               ========      ========      ========      ========      ========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                                                         At June 30,
                                               ----------------------------------------------------------------
                                                 1997           1996          1995          1994         1993
                                               --------      --------      --------      --------      --------
                                                                   (Dollars in Thousands)
<S>                                            <C>           <C>           <C>           <C>           <C>

Allowance for loan losses as a
   percent of total loans receivable .....         1.16%         1.17%         1.25%         1.15%         1.10%
                                               ========      ========      ========      ========      ========
Net loans charged off as a
   percentage of average net loans .......         0.01%         0.02%         0.01%         0.02%         0.07%
                                               ========      ========      ========      ========      ========
Allowance for loan losses to
   non-performing loans ..................       733.21%       520.95%       178.43%       169.85%       893.21%
                                               ========      ========      ========      ========      ========
Net loans charged-off to
   allowance for loan losses .............         0.75%         1.12%         0.49%         1.47%         5.74%
                                               ========      ========      ========      ========      ========
Recoveries to charge-offs ................        16.67%        24.14%        25.00%        14.29%         3.49%
                                               ========      ========      ========      ========      ========
</TABLE>
<PAGE>
         The following  table presents the allocation of the allowances for loan
losses by loan category at the dates indicated.
<TABLE>
<CAPTION>
                                                                            At June 30,
                         ----------------------------------------------------------------------------------------------------------
                                 1997                  1996                 1995                   1994                  1993
                         ------------------   ------------------    ------------------    -------------------    ------------------ 
                                 % of Total            % of Total           % of Total             % of Total            % of Total
                                   Loans by              Loans by             Loans by               Loans by              Loans by
                          Amount   Category   Amount     Category   Amount    Category     Amount    Category   Amount     Category
                                                               (Dollars in Thousands)
<S>                      <C>        <C>       <C>         <C>       <C>         <C>       <C>         <C>       <C>         <C>
Real estate loans:
     Single-family ..    $  175      67.25%   $  161       65.16%   $  146       63.17%   $  124       60.06%   $  128       63.33%
     Multi-family ...       142       2.02       141        1.92        12        1.57        18        2.05        16        2.46
     Commercial .....       449       8.46       469        7.77       593        8.27       546        6.37       554        6.88
     Construction ...        58       9.78        38       11.44        49       14.38        71       19.17        28       13.60
     Land acquisition
      and development        59       4.27        69        5.35        31        3.18        36        3.23        37        3.37
     Unallocated ....       722         --       711          --       693          --       577          --       465          --
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  
      Total real
       estate loans .     1,605      91.78     1,589       91.64     1,524       90.57     1,372       90.88     1,228       89.64
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  
Consumer loans:
     Home equity ....       123       7.06       120        7.10       124        8.50       116        8.13       120        9.04
     Education ......         5       0.30         6        0.35         4        0.27         4        0.25         7        0.57
     Other ..........        10       0.81        10        0.88        14        0.61        15        0.61        14        0.50
     Unallocated ....       258         --       215          --       127          --        83         --         60          --
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  

      Total consumer
       loans ........       396       8.17       351        8.33       269        9.38       218        8.99       201       10.11
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  
Commercial loans ....         5       0.05         2        0.02        --          --        --          --        --          --
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  
Commercial lease
  financings ........         3       0.00        22        0.01        43        0.05        44        0.13        18        0.25
                         ------     ------    ------      ------    ------      ------    ------      ------    ------      ------  
                         $2,009     100.00%   $1,964      100.00%   $1,836      100.00%   $1,634      100.00%   $1,447      100.00%
                         ======     ======    ======      ======    ======      ======    ======      ======    ======      ====== 
</TABLE>
         Management  believes that the reserves it has  established are adequate
to cover  any  potential  losses in the  Company's  loan and real  estate  owned
portfolios.  However, future adjustments to these reserves may be necessary, and
the Company's results of operations could be adversely affected if circumstances
differ  substantially  from the  assumptions  used by  management  in making its
determinations in this regard.

Mortgage-Backed Securities

         Mortgage-backed   securities  ("MBS")  include  mortgage   pass-through
certificates ("PCs") and collateralized  mortgage obligations  ("CMOs").  With a
pass-through  security,  investors  own an  undivided  interest  in the  pool of
mortgages that  collateralize the PCs;  principal and interest is passed through
to the investor as it is generated by the mortgages underlying the pool. PCs may
<PAGE>
be  insured  or  guaranteed  by  the  Federal  Home  Loan  Mortgage  Corporation
("FHLMC"), the Federal National Mortgage Association ("FNMA") and the Government
National Mortgage  Association ("GNMA") or privately issued with varying degrees
of credit enhancements. A CMO reallocates mortgage pool cash flow to a series of
bonds (called  traunches)  with varying  stated  maturities,  estimated  average
lives, coupon rates and prepayment characteristics.

         At June 30, 1997, the Company's  mortgage-backed  securities  portfolio
totaled $37.5  million as compared to $42.1  million at June 30, 1996.  The $4.6
million or 10.9%  decrease in MBS balances  outstanding  during  fiscal 1997 was
primarily  attributable to the sale of approximately $1.6 million of low balance
MBS pools and the  reinvestment  of MBS  principal  and  interest  cash flows in
higher  yielding  callable  government  agency  securities.  At  June  30,  1997
approximately  $18.9 million or 50.3% (book value) of the Company's portfolio of
mortgage-backed  securities,  including  CMOs,  were  comprised of adjustable or
floating  rate  instruments,  as compared to $21.2  million or 49.9% at June 30,
1996.   Substantially  all  of  the  Company's  floating  rate   mortgage-backed
securities  adjust  monthly  based upon  changes in  certain  short-term  market
indexes (e.g. LIBOR, Prime, etc.).
<PAGE>
         The following  tables set forth the amortized cost and market values of
the Company's mortgage-backed securities available for sale and held to maturity
as of the periods indicated.
<TABLE>
<CAPTION>

MBS Available for Sale at June 30             1997             1996            1995
---------------------------------             ----             ----            ----
                                                     (Dollars in Thousands)
<S>                                        <C>             <C>              <C>
FHLMC PCs                                  $   931         $  2,880         $   ---
GNMA PCs                                     1,306            1,580             ---
FNMA PCs                                    10,708           11,359             ---
CMOs - agency collateral                     5,472            6,956             ---
CMOs - other                                   ---              ---             ---
                                           -------          -------         --------  
Total amortized cost                       $18,417          $22,775         $     0
                                           =======          =======         ========  
Total market value                         $18,280          $22,428         $     0
                                           =======          =======         ========  
<CAPTION>

MBS Held to Maturity at June 30               1997             1996             1995
-------------------------------               ----             ----             ----
                                                     (Dollars in Thousands)
<S>                                        <C>             <C>              <C>
FHLMC PCs                                  $   351          $   450          $ 4,881
GNMA PCs                                     1,219            1,268            2,095
FNMA PCs                                       194              269              984
CMOs - agency collateral                    16,728           16,878           14,695
CMOs - other                                   718              825              ---
                                           -------          -------          -------  
Total amortized cost                       $19,210          $19,690          $22,655
                                           =======          =======          =======
Total market value                         $19,381          $19,733          $22,892
                                           =======          =======          =======
</TABLE>
 
         The Company believes that its present MBS available-for-sale allocation
of $18.3  million  or  48.8% of the  carrying  value  of the MBS  portfolio,  is
adequate to meet anticipated future liquidity requirements and to reposition its
balance sheet and asset/liability mix should it wish to do so in the future.
<PAGE>
         The  following  table  sets  forth  the  amortized  cost,   contractual
maturities  and  weighted  average  yields  of  the  Company's   mortgage-backed
securities, including CMOs, at June 30, 1997.
<TABLE>
<CAPTION>

                                                    At June 30, 1997
                            --------------------------------------------------------------------
                                           After          After
                            One Year      One to         Five to           Over
                             or Less    Five Years      Ten Years        Ten Years        Total
                             -------    ----------      ---------        ---------        -----
                                                   (Dollars in Thousands)
<S>                         <C>           <C>           <C>             <C>              <C>

MBS available for sale      $   103       $ 1,811       $   2,782       $   13,721       $18,417
                               5.86%         6.37%           6.02%            7.14%         6.89%

MBS held to maturity .      $  --         $    75       $    --         $   19,135       $19,210
                                  0%         8.14%              0%            7.02%         7.03%

Total ................      $   103       $ 1,886       $   2,782       $   32,856       $37,627
                            =======       =======       =========       ==========       =======
Weighted average yield         5.86%         6.44%           6.02%            7.07%         6.96%
                            =======       =======       =========       ==========       =======
</TABLE>

Due to prepayments of the underlying  loans, and the prepayment  characteristics
of the CMO  traunches,  the actual  maturities of the Company's  mortgage-backed
securities are expected to be substantially less than the scheduled  maturities.
As a result of the volatility of market interest rates experienced during fiscal
1997,  Management maintained an approximately equal weighting between fixed rate
and variable rate MBS products.

Investment Securities

         The  Company  may  invest in  various  types of  securities,  including
corporate debt and equity  securities,  U.S.  Government  and government  agency
obligations,  securities  of  various  federal,  state and  municipal  agencies,
commercial  paper,  bankers'  acceptances,  federal funds, and  interest-bearing
deposits with other financial institutions.

         The  Company's  investment  activities  are  directly  monitored by the
Company's  Investment  Committee under policy guidelines adopted by the Board of
Directors.  In recent years, the general  objective of the Company's  investment
policy  has  been  to  manage  the  Company's  GAP  and  generally  to  increase
interest-earning  assets.  As reflected in the table below,  the Company  during
fiscal 1997  continued to increase its  holdings of U.S.  Government  and agency
obligations,  which  amounted to $84.1 million or 91.9% of the total  investment
portfolio  at June 30, 1997 as  compared to $54.2  million or 88.7% of the total
investment  portfolio at June 30, 1996.  Approximately $81.9 million or 89.5% of
the Company's total investment  portfolio at June 30, 1997 was comprised of U.S.
Government   agency  securities  with  longer-terms  to  maturity  and  optional
principal  redemption features ("callable bonds"). By increasing its holdings of
callable longer-term securities, the Company has been able to earn higher levels
of net interest  income,  while  improving the credit  quality of its investment
portfolio.  While a substantial portion of the Company's investment portfolio is
funded with  short-term  borrowings,  such borrowings can be repaid if all, or a
portion of, the Company's callable agency bonds are redeemed prior to maturity.
<PAGE>
         The following  tables set forth the amortized cost and market values of
the Company's investment securities portfolio at the dates indicated.

<TABLE>
<CAPTION>
Investment Securities Available for Sale at June 30,   

                                                  1997        1996         1995
                                                 ------      ------      -------
                                                      (Dollars in Thousands)
<S>                                              <C>         <C>         <C>
Corporate debt obligations ................      $ --        $ --        $  --
U.S. Government and agency securities .....       2,192       2,193         --
                                                 ------      ------      -------

Total amortized cost ......................       2,192       2,193         --
Equity securities .........................       1,497        --           --
                                                 ------      ------      -------
Total amortized cost ......................      $3,689      $2,193      $  --
                                                 ======      ======      =======
Total market value ........................      $3,553      $1,981      $  --
                                                 ======      ======      =======
<CAPTION>
Investment Securities Held to Maturity at June 30,   


                                                 1997        1996         1995
                                                ------      ------      -------
                                                      (Dollars in Thousands)
<S>                                            <C>          <C>          <C>
Corporate debt obligations ..............      $ 2,145      $ 4,956      $16,453
U.S. Government and agency securities ...       81,850       51,981       45,072
State and municipal securities ..........         --            300         --
                                               -------      -------      -------
                                                83,995       57,237       61,525
FHLB stock ..............................        3,927        1,900        1,153
                                               -------      -------      -------
Total amortized cost ....................      $87,922      $59,137      $62,678
                                               =======      =======      =======
Total market value ......................      $87,816      $58,571      $63,127
                                               =======      =======      =======
</TABLE>

         No  investment  securities  owned by the Company at June 30, 1997 had a
carrying  value greater than 10% of the Company's  stockholders'  equity at such
date,  other than  securities  issued by United States  Government  agencies and
corporations.
<PAGE>
         Information  regarding the amortized cost,  contractual  maturities and
weighted average yields of the Company's  investment  portfolio at June 30, 1997
is presented below.
<TABLE>
<CAPTION>
                                                           At June 30, 1997
                                 -----------------------------------------------------------------------
                                                 After          After
Investment Securities            One Year       One to          Five to         Over
  Available for Sale             or Less       Five Years      Ten Years      Ten Years       Total
  ------------------             -------       ----------      ---------      ---------       -----
                                                           (Dollars in Thousands)
<S>                               <C>            <C>            <C>           <C>            <C>
Corporate debt obligations        $ --           $ --           $ --          $ --           $ --
                                       0%             0%             0%            0%             0%

U.S. Government and agency
   securities ............        $ --           $ --           $ --          $2,192         $2,192
                                       0%             0%             0%         6.23%          6.23%

Total ....................        $ --           $ --           $ --          $2,192         $2,192
                                  ======         ======         ======        ======         ======
Weighted average yield ...             0%             0%             0%         6.23%          6.23%
                                  ======         ======         ======        ======         ======

Equity securities ........        $ --           $ --           $ --          $1,497         $1,497
                                  ------         ------         ------        ------         ------

Total ....................        $ --           $ --           $ --          $3,689         $3,689
                                  ======         ======         ======        ======         ======


<CAPTION>
                                                            At June 30, 1997
                                --------------------------------------------------------------------
                                                After            After
Investment Securities           One Year        One to          Five to         Over
   Held to Maturity              or Less      Five Years       Ten Years      Ten Years       Total
   ----------------              -------      ----------       ---------      ---------       -----
                                                       (Dollars in Thousands)
<S>                               <C>            <C>            <C>           <C>            <C>

Corporate debt obligations        $1,645         $ 500          $  ---        $  ---         $ 2,145
                                   7.29%          6.40%              0%            0%           7.08%

U.S. Government and agency
   securities                     $  ---         $1,500         $47,732       $32,618        $81,850
                                      0%          6.82%           7.47%         8.21%           7.75%

Total                             $1,645         $2,000         $47,732       $32,618         $83,995
                                  ======         ======         =======       =======         =======
Weighted average yield             7.29%          6.71%           7.47%         8.21%          7.74%
                                  =====          =====          ======        ======         ======

</TABLE>
<PAGE>
         Information  regarding  the  amortized  cost,  earliest  call dates and
weighted average yield of the Company's investment portfolio at June 30, 1997 is
presented  below.  All Company  investments in callable bonds were classified as
held-to-maturity at June 30, 1997.
<TABLE>
<CAPTION>
                                                             At June 30, 1997
                                  ------------------------------------------------------------------- 
                                                   After           After
                                  One Year         One to         Five to       Over
                                  or Less       Five Years      Ten Years      Ten Years       Total
                                  -------       ----------      ---------      ---------       -----
                                                             (Dollars in Thousands)
<S>                               <C>             <C>             <C>         <C>             <C>

Corporate debt obligations        $ 1,645         $   500         $--         $  --           $ 2,145
                                     7.29%           6.40%           0%             0%           7.08%

U.S. Government and agency
   securities ............        $57,878         $23,972         $--         $ 2,192         $84,042
                                     7.84%           7.56%           0%          6.23%           7.72%

Total ....................        $59,523         $24,472         $--         $ 2,192         $86,187
                                  =======         =======         ====        =======         =======
Weighted average yield ...           7.82%           7.54%           0%          6.23%           7.70%
                                  =======         =======         ====        =======         =======

Equity securities ........        $  --           $  --           $--         $ 1,497         $ 1,497
                                  -------         -------         ----        -------         -------

Total ....................        $59,523         $24,472         $--         $ 3,689         $87,684
                                  =======         =======         ====        =======         =======
</TABLE>

         The Company to date has not  engaged,  and does not intend to engage in
the immediate future, in trading investment securities.

Sources of Funds

         The  Company's  principal  source of funds for use in  lending  and for
other general business  purposes has  traditionally  come from deposits obtained
through the  Company's  home and branch  offices.  Funding is also  derived from
Federal  Home  Loan  Bank  advances,  short-term  borrowings,  amortization  and
prepayments  of  outstanding  loans  and  mortgage-backed  securities  and  from
maturing investment securities.

         Deposits.  The Company's  deposits  totaled  $170.9 million at June 30,
1997 as compared to $170.8 million at June 30, 1996.  The $36 thousand  increase
was attributable to an approximate $1.0 million increase in core deposits offset
by a $949 thousand decrease in certificates of deposit. In order to mitigate the
decline in time deposits,  and to attract new and lower cost core deposits,  the
Company  continued  to offer a no  minimum  balance,  "free",  checking  account
product.  Current deposit  products  include regular  savings  accounts,  demand
accounts,  negotiable order of withdrawal  (NOW) accounts,  money market deposit
accounts,  and  certificates  of  deposit  ranging  in terms from 30 days to ten
<PAGE>
years.  Included among these deposit  products are  certificates of deposit with
negotiable  interest  rates and balances of $100,000 or more,  which amounted to
$11.1  million  or 6.5% of the  Company's  total  deposits  at June 30,  1997 as
compared  to $9.7  million  or 5.7% at June  30,  1996.  The  Company's  deposit
products  also  include  Individual   Retirement   Account   certificates  ("IRA
certificates").

         The  Company's  deposits  are  obtained  primarily  from  residents  of
northern Allegheny,  southern Butler and eastern Beaver counties,  Pennsylvania.
The Company  attracts  deposit  accounts by offering a wide variety of accounts,
competitive  interest rates, and convenient  office locations and service hours.
The Company utilizes traditional  marketing methods to attract new customers and
savings  deposits,  including print media  advertising and direct mailings.  The
Company  does not  advertise  for  deposits  outside of its local market area or
utilize  the  services  of deposit  brokers,  and  Management  believes  that an
insignificant   number  of  deposit  accounts  were  held  by  non-residents  of
Pennsylvania at June 30, 1997. The Company has drive-up  banking  facilities and
automated  teller  machines  ("ATMs")  at  its  McCandless,  Franklin  Park  and
Cranberry Township offices. The Company participates in the MAC(R) and CIRRUS(R)
ATM networks.

         The  Company  has been  competitive  in the  types of  accounts  and in
interest rates it has offered on its deposit products and continued to price its
savings products nearer to the market average rate as opposed to the upper range
of market offering  rates.  The Company has continued to emphasize the retention
of  core  deposits,   particularly  demand  deposits.   Financial   institutions
generally, including the Company, have experienced a certain degree of depositor
disintermediation to other investment alternatives. Management believes that the
degree of  disintermediation  experienced  by the Company has not had a material
impact on overall liquidity.
<PAGE>
         The  following  table sets forth the average  balance of the  Company's
deposits and the average  rates paid  thereon for the past three years.  Average
balances are derived from month-end balances.
<TABLE>
<CAPTION>
                                                              At June 30,
                                   -----------------------------------------------------------------
                                           1997                   1996                  1995
                                   ----------------------------------------------------------------- 
                                    Amount       Rate     Amount        Rate      Amount      Rate
                                    ------       ----     ------        ----      ------      ----
                                                        (Dollars in Thousands)
<S>                                <C>           <C>     <C>            <C>     <C>           <C>
Regular savings and club
    accounts ................      $ 36,330      2.61%   $ 37,560       2.66%   $ 46,805      2.74%
NOW accounts ................        14,398      0.88      14,483       1.35      14,951      1.75
Money market deposit
    accounts ................        12,045      2.63      11,438       2.64      13,537      2.62
Certificate of deposit
    accounts ................        99,773      5.66     102,263       5.76      94,430      5.55
Escrows .....................         2,471      1.82       2,536       1.81       2,257      1.68
                                   --------              --------               --------
    Total interest-bearing
      deposits and escrows ..       165,017      4.29     168,280       4.42     171,980      4.16
Non-interest-bearing checking
    accounts ................         6,459        --       4,559         --       3,583        --
                                   --------              --------               --------
    Total deposits and
      escrows ...............      $171,476      4.13%   $172,839       4.30%   $175,563      4.07%
                                   ========      ====    ========       ====    ========      ==== 
</TABLE>

         The  following  table sets forth the net  deposit  flows of the Company
during the periods indicated.
<TABLE>
<CAPTION>

                                                           Year Ended June 30,
                                            ---------------------------------------------
                                              1997              1996              1995
                                            --------          --------          --------
                                                      (Dollars in Thousands)
<S>                                         <C>               <C>               <C>
(Decrease) before interest credited         $ (7,011)         $ (5,339)         $(18,490)
Interest credited                              7,047             7,396             6,947
                                            --------          --------          --------
Net deposit (decrease) increase             $     36          $  2,057          $(11,543)
                                            ========          ========          ========
</TABLE>
<PAGE>
         The  following  table  sets  forth  maturities  of the  Company's  time
deposits of $100,000 or more at June 30, 1997 by time remaining to maturity.
<TABLE>
<CAPTION>

                                                                 Amounts
                                                                 -------
                                                          (Dollars in Thousands)
<S>                                                             <C>
         Three months or less                                   $  2,852
         Over three months through six months                      2,105
         Over six months through twelve months                     1,931
         Over twelve months                                        4,173
                                                               ---------
                                                                 $11,061
</TABLE>
         Borrowings. Borrowings are comprised of Federal Home Loan Bank advances
and repurchase  agreements with securities  brokers with original  maturities of
ninety-two days or less. At June 30, 1997,  borrowings  totaled $84.6 million as
compared to $48.7 million at June 30, 1996.  The $35.9 million or 73.7% increase
was  primarily   used  to  fund  the  Company's   purchase  of  investment   and
mortgage-backed  securities  during fiscal 1997.  The Company  believes that the
judicious  use of  borrowings  has allowed it to pursue a strategy of increasing
net interest  income by purchasing  investment  securities with lower total cost
wholesale  funding.  Wholesale  funding also  provides the Company with a larger
degree of control with respect to the term  structure  of its  liabilities  than
traditional  retail  deposits.  The  Company  also  avoids the  additional  cost
associated with federal deposit  insurance  premiums  through the utilization of
borrowings, as opposed to retail deposits.

Competition

         The Company faces significant  competition in attracting deposits.  Its
most direct competition for deposits has historically come from commercial banks
and other  savings  institutions  located in its market  area.  The Company also
faces  additional  significant  competition  for  investors'  funds  from  other
financial  intermediaries.  The Company  competes  for deposits  principally  by
offering depositors a variety of deposit programs,  convenient branch locations,
hours and other services. The Company does not rely upon any individual group or
entity for a material portion of its deposits.

         The Company's  competition for real estate loans comes principally from
mortgage banking  companies,  other savings  institutions,  commercial banks and
credit unions. The Company competes for loan originations  primarily through the
interest rates and loan fees it charges,  the efficiency and quality of services
it provides borrowers,  referrals from real estate brokers and builders, and the
variety of its products.  Factors which affect  competition  include the general
and local economic  conditions,  current  interest rate levels and volatility in
the mortgage markets.

Employees

         The Savings Bank had 50 full-time  employees and 11 part-time employees
as of June 30,  1997.  None of these  employees is  represented  by a collective
bargaining  agent. The Savings Bank believes that it enjoys excellent  relations
with its personnel.
<PAGE>
                           REGULATION AND SUPERVISION 

The Company

         General.  The  Company,  as a  bank  holding  company,  is  subject  to
regulation and supervision by the Federal Reserve Board and by the  Pennsylvania
Department  of Banking  (the  "Department").  The  Company is  required  to file
annually a report of its operations  with, and is subject to examination by, the
Federal Reserve Board and the Department.

         BHCA Activities and Other Limitations.  The Bank Holding Company Act of
1956, as amended ("BHCA") prohibits a bank holding company from acquiring direct
or  indirect  ownership  or control of more than 5% of the voting  shares of any
bank,  or  increasing  such  ownership  or  control of any bank,  without  prior
approval of the Federal Reserve Board. The BHCA also generally  prohibits a bank
holding  company from  acquiring any bank located  outside of the state in which
the existing bank  subsidiaries  of the bank holding  company are located unless
specifically  authorized by applicable  state law. No approval under the BHCA is
required,  however, for a bank holding company already owning or controlling 50%
of the voting shares of a bank to acquire additional shares of such bank.

         The  BHCA  also  prohibits  a  bank  holding   company,   with  certain
exceptions, from acquiring more than 5% of the voting shares of any company that
is not a bank and from  engaging in any business  other than banking or managing
or controlling banks. Under the BHCA, the Federal Reserve Board is authorized to
approve the  ownership of shares by a bank holding  company in any company,  the
activities of which the Federal  Reserve  Board has  determined to be so closely
related  to  banking  or to  managing  or  controlling  banks  as to be a proper
incident thereto.  In making such  determinations,  the Federal Reserve Board is
required  to  weigh  the  expected  benefit  to  the  public,  such  as  greater
convenience,  increased competition or gains in efficiency, against the possible
adverse effects,  such as undue concentration of resources,  decreased or unfair
competition, conflicts of interest or unsound banking practices.

         The Federal  Reserve  Board has by regulation  determined  that certain
activities are closely related to banking within the meaning of the BHCA.  These
activities  include operating a mortgage company,  finance company,  credit card
company,  factoring company,  trust company or savings  association;  performing
certain data  processing  operations;  providing  limited  securities  brokerage
services;  acting as an investment or financial advisor;  acting as an insurance
agent for certain types of credit-related  insurance;  leasing personal property
on a full-payout,  non-operating  basis;  providing tax planning and preparation
services; operating a collection agency; and providing certain courier services.
The Federal  Reserve Board also has  determined  that certain other  activities,
including real estate  brokerage and  syndication,  land  development,  property
management   and   underwriting   of  life   insurance  not  related  to  credit
transactions, are not closely related to banking and a proper incident thereto.

         Capital  Requirements.  The Federal  Reserve Board has adopted  capital
adequacy  guidelines  pursuant to which it assesses  the  adequacy of capital in
examining and supervising a bank holding  company and in analyzing  applications
to it under the BHCA.  The Federal  Reserve  Board capital  adequacy  guidelines
generally  require bank holding  companies to maintain total capital equal to 8%
of total risk-adjusted  assets, with at least one-half of that amount consisting
of Tier I or core capital and up to one-half of that amount  consisting  of Tier
II or supplementary capital. Tier I capital for bank holding companies generally
consists of the sum of common stockholders' equity and perpetual preferred stock
<PAGE>
(subject in the case of the latter to limitations on the kind and amount of such
stocks which may be included as Tier I capital),  less goodwill. Tier II capital
generally  consists of hybrid capital  instruments;  perpetual  preferred  stock
which is not eligible to be included as Tier I capital;  term  subordinated debt
and  intermediate-term  preferred stock;  and,  subject to limitations,  general
allowances for loan losses.  Assets are adjusted under the risk-based guidelines
to take into account different risk characteristics, with the categories ranging
from 0% (requiring  no  additional  capital) for assets such as cash to 100% for
the bulk of assets which are typically held by a bank holding company, including
multi-family  residential and commercial real estate loans,  commercial business
loans and consumer loans.  Single-family  residential first mortgage loans which
are not (90 days or more) past-due or non-performing and which have been made in
accordance with prudent  underwriting  standards are assigned a 50% level in the
risk-weighing system, as are certain privately-issued mortgage-backed securities
representing indirect ownership of such loans.  Off-balance sheet items also are
adjusted to take into account certain risk characteristics.

         In addition to the risk-based capital requirements, the Federal Reserve
Board  requires bank holding  companies to maintain a minimum  leverage  capital
ratio of Tier I capital to total  assets of 3.0%.  Total assets for this purpose
does not include goodwill and any other  intangible  assets and investments that
the Federal Reserve Board determines should be deducted from Tier I capital. The
Federal Reserve Board has announced that the 3.0% Tier I leverage  capital ratio
requirement is the minimum for the top-rated bank holding  companies without any
supervisory,  financial or operational weaknesses or deficiencies or those which
are not  experiencing or  anticipating  significant  growth.  Other bank holding
companies  will be  expected to maintain  Tier I leverage  capital  ratios of at
least 4.0% to 5.0% or more, depending on their overall condition.

         The Company is in compliance with the  above-described  Federal Reserve
Board regulatory capital requirements.

         Commitments  to Affiliated  Institutions.  Under Federal  Reserve Board
policy,  the Company is expected to act as a source of financial strength to the
Savings   Bank  and  to  commit   resources  to  support  the  Savings  Bank  in
circumstances  when it might not do so absent  such  policy.  The  legality  and
precise scope of this policy is unclear,  however,  in light of recent  judicial
precedent.

The Savings Bank

         General.  The  Savings  Bank is subject  to  extensive  regulation  and
examination by the Department and by the FDIC, which insures its deposits to the
maximum  extent  permitted  by  law,  and is  subject  to  certain  requirements
established  by the  Federal  Reserve  Board.  The  federal  and state  laws and
regulations  which are  applicable to banks  regulate,  among other things,  the
scope of their business, their investments, their reserves against deposits, the
timing of the  availability  of deposited funds and the nature and amount of and
collateral for certain  loans.  The laws and  regulations  governing the Savings
Bank  generally  have been  promulgated  to protect  depositors  and not for the
purpose of protecting stockholders.

         FDIC  Insurance  Premiums.  The Savings  Bank  currently  pays  deposit
insurance  premiums  to  the  FDIC  based  on  a  risk-based  assessment  system
established  by the  FDIC for all  SAIF-member  institutions.  Under  applicable
regulations,  institutions  are assigned to one of three capital groups which is
based  solely on the  level of an  institution's  capital - "well  capitalized",
"adequately  capitalized" and  "undercapitalized"-  which is defined in the same
manner as the regulations establishing the prompt corrective action system under
<PAGE>
Section 38 of the Federal Deposit  Insurance Act ("FDIA"),  as discussed  below.
These three groups are then divided into three  subgroups  which reflect varying
levels of supervisory concern,  from those which are considered to be healthy to
those which are considered to be of substantial  supervisory concern. The matrix
so created results in nine assessment risk  classifications,  with rates ranging
from   0.00%  for  well   capitalized,   healthy   institutions   to  0.27%  for
undercapitalized institutions with substantial supervisory concerns. The Savings
Bank is a "well-capitalized" institution as of June 30, 1997.

         On September 30, 1996 the President signed the Deposit  Insurance Funds
Act of 1996 (the  "Funds  Act")  into law.  The Funds Act  called  for a Special
Assessment on  SAIF-assessable  deposits as of March 31, 1995 to capitalize  the
SAIF to its designated  reserve ratio of 1.25%.  The Company  recorded a pre-tax
charge of approximately $1.1 million during the quarter ended September 30, 1996
using an FDIC estimated  assessment  rate of $0.657 for every $100 of assessable
deposits. During the quarter ended December 31, 1996, the Company accrued a $102
thousand refund of prepaid federal deposit insurance premiums as a result of the
capitalization  of the  SAIF.  The  Funds  Act  also  provides  for a  Financing
Corporation  ("FICO")  debt  service  assessment.  The current FICO debt service
assessment  annual rate for SAIF members is 6.3 basis points (or 6.3 (cents) per
$100 of assessable deposits).

         Capital Requirements.  The FDIC has promulgated regulations and adopted
a statement of policy  regarding the capital adequacy of  state-chartered  banks
which,  like the Savings Bank,  are not members of the Federal  Reserve  System.
These  requirements  are  substantially  similar to those adopted by the Federal
Reserve Board regarding bank holding companies, as described above.

         The FDIC's capital regulations establish a minimum 3.0% Tier I leverage
capital requirement for the most highly-rated state-chartered, non-member banks,
with an  additional  cushion  of at least 100 to 200 basis  points for all other
state-chartered,  non-member banks,  which effectively will increase the minimum
Tier I leverage  ratio for such other  banks to 4.0% to 5.0% or more.  Under the
FDIC's  regulation,  highest-rated  banks are those that the FDIC determines are
not  anticipating or experiencing  significant  growth and have well diversified
risk,  including no undue interest rate risk exposure,  excellent asset quality,
high  liquidity,  good earnings and, in general,  which are  considered a strong
banking organization, rated composite 1 under the Uniform Financial Institutions
Rating System.

         A bank which has less than the  minimum  leverage  capital  requirement
shall,  within  60 days of the date as of which it  fails to  comply  with  such
requirement,  submit to its FDIC regional  director for review and  approval,  a
reasonable  plan describing the means and timing by which the bank shall achieve
its minimum leverage capital  requirement.  A bank which fails to file such plan
with the FDIC is deemed to be  operating  in an unsafe and unsound  manner,  and
could  subject the bank to a  cease-and-desist  order from the FDIC.  The FDIC's
regulation also provides that any insured depository institution with a ratio of
Tier I capital to total  assets that is less than 2.0% is deemed to be operating
in an unsafe or unsound  condition  pursuant to Section  8(a) of the FDIA and is
subject  to  potential  termination  of  deposit  insurance.  However,  such  an
institution will not be subject to an enforcement  proceeding  thereunder solely
on account of its  capital  ratios if it has entered  into and is in  compliance
with a written  agreement with the FDIC to increase its Tier I leverage  capital
ratio to such level as the FDIC deems  appropriate and to take such other action
as may be  necessary  for the  institution  to be  operated  in a safe and sound
<PAGE>
manner. The FDIC capital  regulation also provides,  among other things, for the
issuance by the FDIC or its designee(s) of a capital directive, which is a final
order  issued to a bank that fails to  maintain  minimum  capital to restore its
capital to the minimum  leverage  capital  requirement  within a specified  time
period.   Such   directive  is  enforceable  in  the  same  manner  as  a  final
cease-and-desist order.

Miscellaneous

         The  Savings  Bank is subject to certain  restrictions  on loans to the
Company,  on  investments in the stock or securities  thereof,  on the taking of
such stock or  securities as  collateral  for loans to any borrower,  and on the
issuance  of a  guarantee  or letter of  credit  on behalf of the  Company.  The
Savings  Bank  is  also  subject  to  certain  restrictions  on  most  types  of
transactions with the Company,  requiring that the terms of such transactions be
substantially  equivalent to terms of similar  transactions with  non-affiliated
firms.  In  addition,  there are  various  limitations  on the  distribution  of
dividends to the Company by the Savings Bank.

         The foregoing  references to laws and regulations  which are applicable
to the Company and the Savings  Bank are brief  summaries  thereof  which do not
purport to be complete and which are qualified in their entirety by reference to
such laws and regulations.


                           FEDERAL AND STATE TAXATION 

         General.  The Company and the Savings Bank are subject to the generally
applicable  corporate tax  provisions of the Internal  Revenue Code of 1986 (the
"Code"),  as well as certain  additional  provisions  of the Code which apply to
thrift and other types of financial  institutions.  The following  discussion of
tax  matters  is  intended  only as a  summary  and  does  not  purport  to be a
comprehensive  description  of the tax rules  applicable  to the Company and the
Savings Bank.

         Fiscal Year. The Company currently files a consolidated  federal income
tax return on the basis of the calendar year ending on December 31.

         Method of Accounting.  The Company  maintains its books and records for
federal income tax purposes using the accrual method of accounting.  The accrual
method of accounting  generally requires that items of income be recognized when
all events have occurred that  establish the right to receive the income and the
amount of income can be determined  with  reasonable  accuracy and that items of
expense be deducted  at the later of (i) the time when all events have  occurred
that establish the liability to pay the expense and the amount of such liability
can be  determined  with  reasonable  accuracy  or (ii) the time  when  economic
performance with respect to the item of expense has occurred.

         Bad Debt  Reserves.  Under Section 593 of the Internal  Revenue Code of
1986 (the "Code"),  thrift  institutions  such as the Savings  Bank,  which meet
certain  definitional tests primarily relating to their assets and the nature of
their  business,  are  permitted to establish a tax reserve for bad debts and to
make  annual   additions   thereto,   which  additions  may,  within   specified
limitations, be deducted in arriving at their taxable income. The Savings Bank's
deduction with respect to "qualifying loans",  which are generally loans secured
by certain interests in real property, may currently be computed using an amount
<PAGE>
based on the Savings Bank's actual loss experience (the "experience method"), or
a percentage equal to 8.0% of the Savings Bank's taxable income (the "percentage
of taxable income  method"),  computed without regard to this deduction and with
additional  modifications and reduced by the amount of any permitted addition to
the non-qualifying  reserve.  The Savings Bank has generally used the percentage
of taxable income method in the past.

         The Small Business Jobs Protection Act of 1996, adopted in August 1996,
generally  (i) repeals the  provision  of the Code which  authorizes  use of the
percentage  of taxable  income  method by  qualifying  savings  institutions  to
determine deductions for bad debts,  effective for taxable years beginning after
1995,  and (ii) requires that a savings  institution  recapture for tax purposes
(i.e. take into income) over a six-year period its applicable  excess  reserves,
which for a savings  institution  such as West View which is a "small bank",  as
defined  in the Code,  generally  is the  excess of the  balance of its bad debt
reserves as of the close of its last taxable year  beginning  before  January 1,
1996 over the balance of such  reserves as of the close of its last taxable year
beginning before January 1, 1988, which recapture would be suspended for any tax
year that begins  after  December  31,  1995 and before  January 1, 1998 (thus a
maximum of two  years) in which a savings  institution  originates  an amount of
residential  loans which is not less than the average of the principal amount of
such loans made by a savings  institution  during  its six most  recent  taxable
years beginning  before January 1, 1996. As an institution with less than $500.0
million  in assets,  the  Savings  Bank can elect to either  use the  experience
method  available to commercial  banks of this size or it can adopt the specific
charge-off method applicable to "large banks" (banks with total assets in excess
of $500.0 million).  The amount of tax bad debt reserves subject to recapture is
approximately  $1.2 million.  In accordance  with FASB No. 109,  deferred income
taxes have  previously  been  provided on this  amount,  therefore  no financial
statement  expense  should  be  recorded  as a  result  of this  recapture.  The
Company's  supplemented  bad debt reserve of  approximately  $3.8 million is not
subject to recapture.  The Company does not believe that these  provisions  will
have  a  material  adverse  effect  on  the  Company's  financial  condition  or
operations.

         The above-referenced legislation also repeals certain provisions of the
Code that only apply to thrift  institutions  to which Section 593 applies:  (i)
the denial of a portion of certain tax credits to a thrift institution; (ii) the
special rules with respect to the  foreclosure  of property  securing loans of a
thrift institution; (iii) the reduction in the dividends received deduction of a
thrift  institution;  and (iv) the ability of a thrift  institution to use a net
operating  loss to offset its income  from a residual  interest in a real estate
mortgage  investment  conduit.  It is not  anticipated  that the repeal of these
provisions  will  have a  material  adverse  effect on the  Company's  financial
condition or operations.

         Audit by IRS. The Company's consolidated federal income tax returns for
taxable  years  through  December  31,  1993 have been closed for the purpose of
examination by the Internal Revenue Service.

         State Taxation.  The Company is subject to the  Pennsylvania  Corporate
Net Income Tax and Capital Stock and Franchise Tax. The  Pennsylvania  Corporate
Net Income Tax rate was reduced from 10.99% to 9.99%  effective  January 1, 1995
and is imposed  on the  Company's  unconsolidated  taxable  income  for  federal
purposes  with  certain  adjustments.  In general,  the  Capital  Stock Tax is a
property  tax  imposed at the rate of 12.75% of a  corporation's  capital  stock
value, which is determined in accordance with a fixed formula based upon average
net income and net worth.
<PAGE>
         The  Savings  Bank  is  taxed  under  the  Pennsylvania  Mutual  Thrift
Institutions  Tax Act  (enacted on  December  13, 1988 and amended in July 1989)
(the "MTIT"),  as amended to include thrift  institutions  having capital stock.
Pursuant to the MTIT,  the Savings  Bank's  current tax rate is 11.5%.  The MTIT
exempts the Savings  Bank from all other taxes  imposed by the  Commonwealth  of
Pennsylvania  for state income tax purposes and from all local taxation  imposed
by  political  subdivisions,  except  taxes  on  real  estate  and  real  estate
transfers.  The MTIT is a tax upon net earnings,  determined in accordance  with
generally accepted accounting principles ("GAAP") with certain adjustments.  The
MTIT, in computing GAAP income,  allows for the deduction of interest  earned on
state and federal  securities,  while  disallowing  a  percentage  of a thrift's
interest expense  deduction in the proportion of those securities to the overall
investment  portfolio.  Net operating losses, if any,  thereafter can be carried
forward three years for MTIT purposes.
<PAGE>
Item 2.    Properties.

         The following table sets forth certain  information with respect to the
offices and other properties of the Company at June 30, 1997.
<TABLE>
<CAPTION>
                                                                                                  Net Book
                                                                                                  Value of
         Description/Address                             Leased/Owned                             Property
         -------------------                             ------------                             --------
                                                                                            (Dollars in Thousands)
<S>                                                      <C>                                        <C>
         McCandless Office                               Owned                                      $171
            9001 Perry Highway
            Pittsburgh, PA  15237

         West View Boro Office                           Owned                                        12
            456 Perry Highway
            Pittsburgh, PA  15229

         Cranberry Township Office                       Owned                                       294
            20531 Perry Highway
            Cranberry Township, PA  16066

         Sherwood Oaks Office                            Leased(1)                                   ---
            100 Norman Drive
            Cranberry Township, PA  16066

         Bellevue Boro Office                            Leased(2)                                    18
            572 Lincoln Avenue
            Pittsburgh, PA  15202

         Franklin Park Boro Office                       Owned                                       613
            2566 Brandt School Road
            Wexford, PA  15090

         Wexford Loan Production Office                  Leased(3)                                   ---
            10521 Perry Highway
            Wexford, PA 15090

(1)  The Company operates this office out of a retirement  community.  The lease
     expires in June 2000.

(2)  The lease is for a period  of 15 years  ending  in  September  2006 with an
     option for the Company to renew the lease for an additional five years.

(3)  The lease is for a period to end December 1997.
</TABLE>

Item 3.  Legal Proceedings.

         The information  required herein is incorporated by reference from page
43 of the  Company's  1997  Annual  Report,  Note 12 of  Notes  to  Consolidated
Financial Statements, "Litigation".


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

         Not applicable.
<PAGE>
PART II.

Item 5.   Market for Registrant's Common Equity and Related Stockholder Matters.

         The information  required herein is incorporated by reference from page
57 of the Company's 1997 Annual Report.

Item 6.   Selected Financial Data.

         The information required herein is incorporated by reference from pages
2 to 3 of the Company's 1997 Annual Report.

Item 7.   Management's Discussion and Analysis of Financial Condition and 
          Results of Operations.

         The information required herein is incorporated by reference from pages
4 to 24 of the Company's 1997 Annual Report.

Item 7A.  Quantitative and Qualitative Disclosures About Market Risk.

         The information required herein is incorporated by reference from pages
11 to 15 of the Company's 1997 Annual Report.


Item 8.   Financial Statements and Supplementary Data.

         The information required herein is incorporated by reference from pages
25 to 56 of the Company's 1997 Annual Report.

Item 9.   Changes in and Disagreements on Accounting and Financial Disclosure.

         Not applicable.


PART III.

Item 10.  Directors and Executive Officers of the Registrant.

         The information required herein is incorporated by reference from pages
2 to 5 of  the  Company's  Proxy  Statement  for  the  1997  Annual  Meeting  of
Stockholders dated September 26, 1997 ("Proxy Statement").

Item 11.  Executive Compensation.

         The information required herein is incorporated by reference from pages
8 to 12 of the Company's Proxy Statement.

Item 12.  Security Ownership of Certain Beneficial Owners and Management.

         The information required herein is incorporated by reference from pages
6 to 8 of the Company's Proxy Statement.

Item 13.  Certain Relationships and Related Transactions.

         The information  required herein is incorporated by reference from page
13 of the Company's Proxy Statement.
<PAGE>
PART IV.

Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K.

         (a)  Documents filed as part of this report.

         (1) The  following  documents  are filed as part of this report and are
incorporated herein by reference from the Company's 1997 Annual Report.

         Report of Independent Auditors.

         Consolidated  Statements  of  Financial  Condition at June 30, 1997 and
         1996.

         Consolidated  Statements  of Income for the Years Ended June 30,  1997,
         1996 and 1995.

         Consolidated  Statements  of  Changes in  Stockholders'  Equity for the
         Years Ended June 30, 1997, 1996 and 1995.

         Consolidated  Statements  of Cash  Flows for the Years  Ended  June 30,
         1997, 1996 and 1995.

         Notes to the Consolidated Financial Statements.


         (2) All  schedules  for  which  provision  is  made  in the  applicable
accounting  regulation of the  Securities  and Exchange  Commission  ("SEC") are
omitted because they are not applicable or the required  information is included
in the Consolidated Financial Statements or notes thereto.
<PAGE>
         (3)(a)The  following  exhibits are filed as part of this Form 10-K, and
this list includes the Exhibit Index.

      No.                        Description                           Page
      ---                        -----------                           ----
      3.1         Articles of Incorporation                              *
      3.2         By-Laws                                                *
      4           Stock Certificate of WVS Financial Corp.               *
     10.1         WVS Financial Corp. Recognition Plans and
                      Trusts for Executive Officers,
                      Directors and Key Employees**                      *
     10.2         WVS Financial Corp. 1993 Stock Incentive Plan**        *
     10.3         WVS Financial Corp. 1993 Directors' Stock
                      Option Plan**                                      *
     10.4         WVS Financial Corp. Employee Stock Ownership
                      Plan and Trust**                                   *
     10.5         Amended West View Savings Bank Employee
                      Profit Sharing Plan**                              *
     10.6         Employment Agreements between WVS Financial
                      Corp. and Robert Sinewe, Margaret
                      VonDerau, David Bursic and Edward
                      Wielgus**                                        E-1
     10.7         Directors Deferred Compensation Program**              *
     11           Statement Re Computation of Per Share Earnings      E-41
     13           1997 Annual Report to Stockholders                  E-42
     21           Subsidiaries of the Registrant - Reference is
                      made to Item 1. "Business" for the
                      required information
     23           Consent of Independent Auditors                     E-105
     27           Financial Data Schedule                             E-106

*    Incorporated  by  reference  from the  Registration  Statement  on Form S-1
     (Registration No. 33-67506) filed by the Company with the SEC on August 16,
     1993, as amended.

**   Management contract or compensatory plan or arrangement.

         (3)(b)Reports filed on Form 8-K.

            None.
<PAGE>


                                   SIGNATURES


         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                           WVS FINANCIAL CORP.



September 25, 1997                    By:  /s/Robert C. Sinewe
                                           -------------------
                                           Robert C. Sinewe
                                           President and Chief Executive Officer

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



/s/Robert C. Sinewe                                           September 25, 1997
-------------------
Robert C. Sinewe, Director, President and
Chief Executive Officer (Principal
Executive Officer)


/s/James S. McKain Jr.                                        September 25, 1997
----------------------
James S. McKain Jr., Chairman of the Board


/s/David J. Bursic
------------------                                            September 25, 1997
David J. Bursic, Vice President, Treasurer
and Chief Financial Officer (Principal
Financial and Accounting Officer)


/s/David L. Aeberli
-------------------                                           September 25, 1997
David L. Aeberli, Director


/s/Arthur H. Brandt
-------------------                                           September 25, 1997
Arthur H. Brandt, Director


/s/William J. Hoegel
--------------------                                          September 25, 1997
William J. Hoegel, Director

<PAGE>

/s/Donald E. Hook
-----------------                                             September 25, 1997
Donald E. Hook, Director


/s/James H. Ritchie
-------------------                                           September 25, 1997
James H. Ritchie, Director


/s/John M. Seifarth
-------------------                                           September 25, 1997
John M. Seifarth, Director


/s/Margaret VonDerau
---------------------                                         September 25, 1997
Margaret VonDerau, Director, Senior
Vice President and Corporate Secretary