FORM 10-Q  SECURITIES AND EXCHANGE COMMISSION  WASHINGTON, D.C. 20549    (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES   EXCHANGE ACT OF 1934  For the quarterly period ended September 30, 2002  OR  ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES   EXCHANGE ACT OF 1934  For the transition period from _______ to _______  Commission File Number                    0-11242                  First Commonwealth Financial Corporation                           (Exact name of registrant as specified in its charter)     Pennsylvania                                       25-1428528                (State or other jurisdiction of                    (I.R.S. Employer    incorporation or organization)                 Identification No.)     22 North Sixth Street                         Indiana, PA  15701             (Address of principal executive offices)                       (Zip Code)                                     724-349-7220                                         (Registrant's  telephone number, including area code)                                          N/A                                    (Former name, former address and former fiscal year, if changed since last   report.)  Indicate a 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        .

Number of shares outstanding of issuer's common stock, $1.00 Par  Value as of October 25, 2002 was 58,847,898.

 FIRST COMMONWEALTH FINANCIAL CORPORATION AND SUBSIDIARIES  PART I - FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS            Included in Part I of this  report:                        PAGE            First Commonwealth Financial  Corporation and                  Subsidiaries Consolidated Balance Sheets . . .       3                    Consolidated Statements of Income. . . . . . .       4                    Consolidated Statements of Changes in                        Shareholders' Equity. . . . . . . . . . .       5                    Consolidated Statements of Cash Flows. . . . .       6                    Notes to Consolidated Financial Statements . .       7  ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL            CONDITION AND RESULTS OF OPERATIONS  . . . . . . . .      11 ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT              MARKET RISK . . . . . . .  . . . . . . . . . . . . .      31 ITEM 4.   CONTROLS AND PROCEDURES . . . . . . . . . .  . . . .      32                            PART II - OTHER INFORMATION  Other Information . . . . . . . . . . . . . . . . . . . . . .       33   Signatures. . . . . . . . . . . . . . . . . . . . . . . . . .       34   Certification of Chief Executive Officer. . . . . . . . . . .       35  Certification of Chief Financial Officer. . . . . . . . . . .       37  Exhibits and Reports on Form 8K     

  FIRST COMMONWEALTH FINANCIAL CORPORATION AND SUBSIDIARIES  CONSOLIDATED BALANCE SHEETS   (Unaudited)  (Dollars in thousands)

|                                                                                                                                                                                                                                                                                                                                   | September  30,2002                                 | December  31,2001                        |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------|------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
| **ASSETS**                                                                                                                                                                                                                                                                                                                             |                                               |                                     |
|   Cash and due from banks on demand .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            | $    97,071                    |  $    98,130    |
|   Interest-bearing deposits with banks.        . . . . . . . . . . . .                                                                                                                                                                                                                                                            |     2,611                      |      4,250           |
|   Federal funds sold  . . . . . .        . . . . . . . . . . . . . . .                                                                                                                                                                                                                                                       |      -0-                       |        -0- |
|   Securities available for sale, at market.        . . . . . . . . . .                                                                                                                                                                                                                                                            |  1,467,113                                    |  1,469,118                          |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|    Securities held to maturity, at cost,   (Market value $252,980 in 2002             and $298,643 in 2001) . . . . . . . . . . . . . . .        . . . .                                                                                                                                                 |   243,849                                     |    293,290                     |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Loans . . . . . . . . . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            | 2,618,369                                          |  2,569,231                          |
|     Unearned income . . . .        . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                                  |       (904)               |      (1,297)         |
|     Allowance for credit losses        . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                                  |    (34,794)                              |     (34,157)              |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | ___________                              |
|       Net loans .        . . . . . . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                        |  2,582,671                                    |  2,533,777                          |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Property and equipment. . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |     45,940                          |     46,418                |
|   Other real estate owned . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |      1,661                     |      1,619           |
|   Goodwill. . . . . . . . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |      8,132                     |      6,539           |
|   Amortizing intangibles. . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |         36      |        232 |
|   Other assets .. . . . . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |    127,361                               |    130,157                     |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | _________                                |
|                 TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                         | $4,576,445                                         | $4,583,530                               |
|                                                                                                                                                                                                                                                                                                                                   | ==========                                         | ==========                               |
| **LIABILITIES**                                                                                                                                                                                                                                                                                                                        |                                               |                                     |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Deposits  (all domestic):                                                                                                                                                                                                                                                                                                       |                                               |                                     |
|     Noninterest bearing . .        . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                                  |  $   393,092                        |   $   412,695        |
|     Interest bearing. . . .        . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                                  |  2,740,976                                    |   2,680,455                    |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | __________                               |
|       Total deposits.        . . . . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                        | 3,134,068                                          |  3,093,150                          |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Short-term borrowings . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |   334,580                                     |    427,736                     |
|   Other liabilities . . . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |    28,160                                |     28,358                |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Company  obligated mandatorily redeemable capital             securities of subsidiary trust. . . . . . . . . . .        . . . .                                                                                                                                                                                 |    35,000                                |     35,000                |
|   Other long-term debt. . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |   645,577                                     |    629,220                     |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | __________                               |
|       Total long-term        debt. . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                        |   680,577                                     |    664,220                     |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | __________                               |
|       Total liabilities        . . . . . . . . . . . . . . . . . . . .                                                                                                                                                                                                                                        |   4,177,385                              |  4,213,464                          |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
| **SHAREHOLDERS' EQUITY**                                                                                                                                                                                                                                                                                                               |                                               |                                     |
|                                                                                                                                                                                                                                                                                                                                   |                                               |                                     |
|   Preferred  stock, $1 par value per share,            3,000,000 shares authorized, none issued . . . . .        . . . .                                                                                                                                                                                           |       -0-                 |       -0-       |
|   Common  stock, $1 par value per share,     100,000,000 shares authorized,  62,525,412     shares issued; 58,847,898 and  58,451,624     shares outstanding at September 30, 2002 and             December 31, 2001 respectively. . . . . . . . . . .        . . . . |          62,525 |     62,525                |
|   Additional paid-in capital. . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |    64,929                                |     66,176                |
|   Retained earnings . . . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |   292,560                                     |    288,219                     |
|   Accumulated other comprehensive income.        . . . . . . . . . . .                                                                                                                                                                                                                                                            |    28,797                                |      8,703           |
|   Treasury  stock (3,677,514 shares at September 30, 2002 and             4,073,788 at December 31, 2001, at cost). . . . . .        . . . .                                                                                                                                                                       |    (46,429)                              |     (51,431)              |
|   Unearned ESOP shares. . . . . . . .        . . . . . . . . . . . . .                                                                                                                                                                                                                                                            |     (3,322)                         |      (4,126)         |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | __________                               |
|       Total shareholders'        equity. . . . . . . . . . . . . . . .                                                                                                                                                                                                                                        |   399,060                                     |    370,066                     |
|                                                                                                                                                                                                                                                                                                                                   | __________                                         | __________                               |
|                TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY. . . . . . .                                                                                                                                                                                                                              |  $4,576,445                                   | $4,583,530                               |
|                                                                                                                                                                                                                                                                                                                                   | ==========                                         | ==========                               |

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

  3

FIRST COMMONWEALTH FINANCIAL CORPORATION  AND SUBSIDIARIES            CONSOLIDATED STATEMENTS OF  INCOME   (Unaudited)  (Dollars in thousands, except per share data)                     

|                                                                                                                                                                                                          | For the  QuarterEnded September 30,              | For the  9 MonthsEnded September 30,               |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|----------------------------------------------------|
|                                                                                                                                                                                                          |
|                                                                                                                                                                                                          |
|                                                                                                                                                                                                          | __  2002__                                       | __  2001__                                         | __2002__ |    2001_ |
| **Interest Income**                                                                                                                                                                                           |                                             |                                               |   |   |
|   Interest and fees on loans . . . . .        . . . . .                                                                                                                                                  |    $ 44,943                            |  $   50,847                              | $135,490 | $  153,824 |
|   Interest  and dividends on investments:                                                                                                                                                                |                                             |                                               |   |   |
|     Taxable interest . . . .        . . . . . . . . . .                                                                                                                                        |    21,005                              |     23,639                          |   65,034 |    70,413 |
|     Interest exempt from Federal        income taxes. .                                                                                                                                        |     2,363                         |      2,432                     |    7,172 |     7,177 |
|     Dividends. . . . . . . .        . . . . . . . . . .                                                                                                                                        |       464               |        615           |    1,457 |     2,044 |
|   Interest on Federal funds sold . . .        . . . . .                                                                                                                                                  |         2     |          3 |        6 |       491 |
|   Interest on bank deposits. . . . . .        . . . . .                                                                                                                                                  |         7     |         21      |       26 |        59 |
|                                                                                                                                                                                                          |   _______                                   |    _______                               | ________ |  ________ |
|       Total interest        income. . . . . . . . . . .                                                                                                                              |    68,784                              |     77,557                          |   209,185 |   234,008 |
|                                                                                                                                                                                                          |                                             |                                               |   |   |
| **Interest  Expense**                                                                                                                                                                                         |                                             |                                               |   |   |
|   Interest on deposits . . . . . . . .        . . . . .                                                                                                                                                  |    19,409                              |     29,723                          |    61,512 |    93,023 |
|   Interest on short-term borrowings. .        . . . . .                                                                                                                                                  |     1,305                         |      2,742                     |     4,572 |     8,975 |
|                                                                                                                                                                                                          |                                             |                                               |   |   |
|   Interest on company obligated mandatorily             redeemable capital securities of subsidiary             trust . . . . . . . . . . . . . . . . . . . |                832 |        832           |     2,494 |     2,494 |
|   Interest on other long-term debt . .        . . . . .                                                                                                                                                  |     8,911                         |      8,703                     |    26,305 |    25,769 |
|                                                                                                                                                                                                          |    ______                              |     ______                          |    ______ |    ______ |
|       Total interest        on long-term debt . . . . .                                                                                                                              |     9,743                         |      9,535                     |    28,799 |    28,263 |
|                                                                                                                                                                                                          |    ______                              |     ______                          |    ______ |    ______ |
|       Total interest        expense . . . . . . . . . .                                                                                                                              |    30,457                              |     42,000                          |    94,883 |   130,261 |
|                                                                                                                                                                                                          |    ______                              |     ______                          |    ______ |    ______ |
| **Net Interest  Income**                                                                                                                                                                                      |    38,327                              |     35,557                          |   114,302 |   103,747 |
|   Provision for credit losses. . . . .        . . . . .                                                                                                                                                  |     3,103                         |      3,542                     |     9,028 |     8,506 |
|                                                                                                                                                                                                          |    ______                              |     ______                          |    ______ |    ______ |
| **Net interest income after provision for                   credit losses . . . . . . . . . . . . .**                                                                                          |    35,224                              |     32,015                          |   105,274 |    95,241 |
|                                                                                                                                                                                                          |                                             |                                               |   |   |
| **Other Income**                                                                                                                                                                                              |                                             |                                               |   |   |
|   Securities gains . . . . . . . . . .        . . . . .                                                                                                                                                  |        26          |      1,330                     |       641 |     3,325 |
|   Trust income . . . . . . . . . . . .        . . . . .                                                                                                                                                  |     1,227                         |      1,265                     |     3,782 |     3,815 |
|   Service charges on deposit accounts.        . . . . .                                                                                                                                                  |     3,010                         |      2,804                     |     8,449 |     8,092 |
|   Insurance commissions. . . . . . . .        . . . . .                                                                                                                                                  |     1,055                         |      1,111                     |     2,862 |     2,399 |
|   Income from bank owned life insurance.        . . . .                                                                                                                                                  |     1,186                         |      1,096                     |     3,428 |     3,156 |
|   Other income . . . . . . . . . . . .        . . . . .                                                                                                                                                  |     2,897                         |      3,153                     |     8,565 |     9,612 |
|                                                                                                                                                                                                          |    ______                              |    _______                               |   _______ |   _______ |
|       Total other        income . . . . . . . . . . . .                                                                                                                              |     9,401                         |     10,759                          |    27,727 |    30,399 |
|                                                                                                                                                                                                          |                                             |                                               |   |   |
| **Other  Expenses**                                                                                                                                                                                           |                                             |                                               |   |   |
|   Salaries and employee benefits . . .        . . . . .                                                                                                                                                  |    14,505                              |     13,588                          |    43,915 |    40,658 |
|   Net occupancy expense  . . . .        . . . . . . . .                                                                                                                                             |     1,668                         |      1,577                     |     4,967 |     4,977 |
|   Furniture and equipment expense. . .        . . . . .                                                                                                                                                  |     2,391                    |      2,168                     |     7,357 |     6,548 |
|   Data processing expense. . . . . . .        . . . . .                                                                                                                                                  |       558               |        795           |     1,484 |     2,383 |
|   Pennsylvania shares tax expense. . .        . . . . .                                                                                                                                                  |       969               |        944           |     2,960 |     2,855 |
|   Goodwill amortization. . . . . . . .        . . . . .                                                                                                                                                  |         0     |        230           |         0 |       691 |
|   Intangible amortization. . . . . . .        . . . . .                                                                                                                                                  |         8     |        122           |       196 |       368 |
|   Litigation settlement. . . . . . . .        . . . . .                                                                                                                                                  |         0     |          0 |     8,000 |         0 |
|   Restructuring charges. . . . . . . .        . . . . .                                                                                                                                                  |     2,473                         |          0 |     5,589 |         0 |
|   Other operating expenses . . . . . .        . . . . .                                                                                                                                                  |     6,919                         |      6,609                     |    22,081 |    19,012 |
|                                                                                                                                                                                                          |   _______                                   |    _______                               |   _______ |   _______ |
|       Total other        expenses . . . . . . . . . . .                                                                                                                              |    29,491                              |     26,033                          |    96,549 |    77,492 |
|                                                                                                                                                                                                          |   _______                                   |   _______                                     |   _______ |   _______ |
| **Income before income taxes**.         . . . . .         . . .                                                                                                                                               |    15,134                              |     16,741                          |    36,452 |    48,148 |
|   Applicable income taxes . . . . . .        . . . . .                                                                                                                                                   |     2,947                         |      4,023                     |     5,670 |    11,373 |
|                                                                                                                                                                                                          |  ________                                   |   ________                                    |  ________ |  ________ |
| **Net income . . . . . . . . . . . . . .        . .**                                                                                                                                                         |  $ 12,187                                   |   $ 12,718                                    |  $ 30,782 |  $ 36,775 |
|                                                                                                                                                                                                          |   =======                                   |   =======                                     |   ======= |     ======= |
|                                                                                                                                                                                                          |                                             |                                               |   |   |
| Average Shares Outstanding . . . . . . . .        . . .                                                                                                                                                       |  58,521,562                                 | 57,975,650                                         | 58,342,470  | 57,833,280  |
| Average Shares Outstanding Assuming Dilution        . .                                                                                                                                                       |  58,862,215                                 | 58,342,525                                         | 58,734,144  | 58,062,021  |
| **Per Share Data:**                                                                                                                                                                                           |                                             |                                               |   |   |
|   Basic earnings per share. . . . . .        . . . . .                                                                                                                                                   |  $ 0.21                                     |   $ 0.22                                      |  $   0.53 |   $  0.64 |
|   Diluted earnings per share. . . . .        . . . . .                                                                                                                                                   |  $ 0.21                                     |   $ 0.22                                      |  $   0.52 |   $ 0.63 |
|   Cash dividends per share. . . . . .        . . . . .                                                                                                                                                   |   $ 0.150                                   |    $ 0.145                               |   $   0.450 |    $ 0.435 |

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

4FIRST COMMONWEALTH  FINANCIAL CORPORATION AND SUBSIDIARIES  CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY   (Unaudited)  (Dollars in thousands)

|                                                                                                                                                                                                                                                                                                                                                                                                              | Common        Stock        ______      | Additional        Paid-In        Capital        _________ | Retained        Earnings        ________      | Accumulated        Other        Comprehensive        Income        _____________ | Treasury        Stock        ________  | Unearned        ESOP        Shares        ______ | Total        Shareholders'        Equity        _____________ |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------|-----------------------------------------------------------|-----------------------------------------------|----------------------------------------------------------------------------------|----------------------------------------|--------------------------------------------------|---------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
| **Balance at         December 31, 2000. .**                                                                                                                                                                                                                                                                                                                                                                       | $62,525                                | $67,223                                                   | $272,169                                 |  $(7,808)                                                                   | $(54,666)                              | $(5,287)                                         | $334,156                                                      |
|   Comprehensive income                                                                                                                                                                                                                                                                                                                                                                                       |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|     Net income. . . .                                                                                                                                                                                                                                                                                                                                                                              |     -0-                 |     -0-                                    |   36,775                            |     -0-                                                           |     -0-                 |    -0-                                 |   36,775                                                 |
|     Other comprehensive             income, net of              tax:              Unrealized               holding gains on              securities               arising during              the period . . .      |     -0-                 |     -0-                                    |      -0-             |  34,287                                                                     |     -0-                 |    -0-                                 |   34,287                                                 |
|       Less:                        reclassification               adjustment for                gains on               securities                included in net               income . . . .   |     -0-        _______  |     -0-        _______                     |   -0-         ________              |   (2,127)          _______                                             |     -0-        ________ |    -0-        ________                 |    (2,127)        _________                         |
|     Total other              comprehensive             income . . . . . .                                                                                                                                                                                                                                                                                  |     -0-        _______  |     -0-        _______                     |     -0-         ________       |  32,160        _______                                                      |     -0-        ________ |    -0-        ________                 |   32,160        _________                                |
|   Total comprehensive            income. . . . . . .                                                                                                                                                                                                                                                                                                                                               |     -0-                 |     -0-                                    |  36,775                             |  32,160                                                                     |     -0-                 |    -0-                                 |   68,935                                                 |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Cash dividends            declared . . . . . .                                                                                                                                                                                                                                                                                                                                                   |     -0-                 |     -0-                                    |   (25,372)                               |    -0-                                                                 |     -0-                 |    -0-                                 |   (25,372)                                          |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Decrease in unearned            ESOP shares  . . . .                                                                                                                                                                                                                                                                                                                                        |     -0-                 |     -0-                                    |      -0-             |    -0-                                                                 |     -0-                 |    893                                 |      893                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Discount on dividend           reinvestment plan            purchases . . . . .                                                                                                                                                                                                                                                                                                        |     -0-                 |     (460)                                  |      -0-             |    -0-                                                                 |     -0-                 |    -0-                                 |      (460)                                |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Treasury stock            reissued. . . . . .                                                                                                                                                                                                                                                                                                                                                    |     -0-        ________ |     (725)        _______                   |      -0-         ________ |    -0-        ______                                                   |   3,126        ________           |    -0-        _______                  |    2,401        ________                            |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
| **Balance at         September 30, 2001.**                                                                                                                                                                                                                                                                                                                                                                   | $62,525        =======                 | $66,038        =======                                    | $283,572         ========                | $24,352        =======                                                           | $(51,540)        =========             | $(4,394)        ========                         | $380,553        ========                                      |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
| **Balance at         December 31, 2001 . .**                                                                                                                                                                                                                                                                                                                                                                      | $62,525                                | $66,176                                                   | $288,219                                      | $ 8,703                                                                          | $(51,431)                              | $(4,126)                                         | $370,066                                                      |
|   Comprehensive income                                                                                                                                                                                                                                                                                                                                                                                       |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|     Net income. . . . .                                                                                                                                                                                                                                                                                                                                                                            |     -0-                 |     -0-                                    |   30,782                            |      -0-                                                |    -0-                       |    -0-                                 |   30,782                                                 |
|     Other comprehensive             income,net of tax:              Unrealized                holding gains on               securities                arising during               the period . . .                          |    -0-                       |     -0-                                    |     -0-                   | 20,490                                                                           |     -0-                 |    -0-                                 |   20,490                                                 |
|       Less:                        reclassification               adjustment for                gains on               securities                included in net               income . . . . . |    -0-        _______        |     -0-        _______                     |     -0-         ________  |    (396)        ________                                               |     -0-        ________ |    -0-        ________                 |      (396)        _________               |
|     Total other              comprehensive             income. . . . . .                                                                                                                                                                                                                                                                                   |    -0-        _______        |     -0-        _______                     |     -0-         ________  | 20,094        _______                                                            |     -0-        ________ |    -0-        ________                 |   20,094        _________                                |
|   Total comprehensive            income. . . . . .                                                                                                                                                                                                                                                                                                                                       |    -0-                       |     -0-                                    |  30,782                             | 20,094                                                                           |     -0-                 |    -0-                                 |   50,876                                                 |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Cash dividends            declared . . . . . .                                                                                                                                                                                                                                                                                                                                                   |     -0-                 |     -0-                                    |  (26,441)                                |     -0-                                                           |      -0-      |    -0-                                 |   (26,441)                                               |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Decrease in unearned           ESOP shares. . . . .                                                                                                                                                                                                                                                                                                                                         |    -0-                       |     -0-                                    |     -0-                   |     -0-                                                           |     -0-                 |    804                                 |      804                                  |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Discount on dividend           reinvestment plan            purchases . . . . .                                                                                                                                                                                                                                                                                                        |    -0-                       |    (476)                                        |    -0-                    |     -0-                                                           |     -0-                 |    -0-                                 |      (476)                                |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
|   Treasury stock            reissued. . . . . .                                                                                                                                                                                                                                                                                                                                                    |    -0-                       |    (771)                                        |      -0-             |     -0-                                                           |   5,002                           |    -0-                                 |    4,231                                            |
|                                                                                                                                                                                                                                                                                                                                                                                                              | ______                                 | ______                                                    | ________                                      | _______                                                                          | _________                              | ________                                         | ________                                                      |
|                                                                                                                                                                                                                                                                                                                                                                                                              |                                   |                                                      |                                          |                                                                             |                                   |                                             |                                                          |
| **Balance at         September 30,2002. .**                                                                                                                                                                                                                                                                                                                                                                       | $62,525        =======                 | $64,929        =======                                    | $292,560         ========           |  $28,797         =======                                               | $(46,429)        =========             | $(3,322)        ========                         | $399,060         ========                                |

  The accompanying notes are an integral part of these consolidated financial  statements.  5

FIRST COMMONWEALTH FINANCIAL  CORPORATION AND SUBSIDIARIES              CONSOLIDATED STATEMENTS  OF CASH FLOWS  (Unaudited)       (Dollars in thousands)   

|                                                                                                                                                                                                | For the  Nine MonthsEnded September 30,        |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------------------------|
|                                                                                                                                                                                                |                                           |
|                                                                                                                                                                                                | 2002                                           | 2001 |
|                                                                                                                                                                                                |                                           |   |
| **Operating Activities**                                                                                                                                                                            |                                           |   |
|   Net income. . . . . . . . . . . . .        . . . . . . . . . . . . . .                                                                                                                       |  $  30,782                           | $  36,775    |
|    Adjustments to reconcile net income to net     cash provided by operating  activities:                                                                                       |                                           |   |
|      Provision for credit        losses. . . . . . . . . . . . . . . . .                                                                                                        |      9,028                 |  8,506 |
|      Depreciation and amortization.        . . . . . . . . . . . . . . .                                                                                                        |      5,364                 |  5,625 |
|      Net gains on sales        of assets . . . . . . . . . . . . . . . .                                                                                                        |       (680)           |  (4,456) |
|      Income from increase        in cash surrender value of bank owned              life insurance. . . . . . . . . . . . .        . . . . . . . . . . |     (3,428)                     |  (3,156) |
|      Decrease in interest        receivable. . . . . . . . . . . . . . .                                                                                                        |      2 322                 |    999 |
|      Decrease in interest        payable . . . . . . . . . . . . . . . .                                                                                                        |     (3,124)                     | (18,841) |
|      Increase (decrease)        in income taxes payable .  . . . . . . .                                                                                                   |     (2,705)                     |    945 |
|      Change in deferred        taxes . . . . . . . . . . . . . . . . . .                                                                                                        |       (374)           |     (74) |
|      Other-net. . . . .        . . . . . . . . . . . . . . . . . . . . .                                                                                                        |      3,595                 |  (3,083) |
|                                                                                                                                                                                                |     ______                      |   _______ |
|       Net cash provided        by operating activities . . . . . . . . .                                                                                                   |     40,782                      | 23,240 |
|                                                                                                                                                                                                |                                           |   |
| **Investing  Activities**                                                                                                                                                                           |                                 |       |
|    Transactions with securities held to maturity:                                                                                                                                              |                                           |   |
|    Proceeds from sales. . . . . .        . . . . . . . . . . . . . . . .                                                                                                                  |        -0-       |    -0- |
|    Proceeds from maturities and redemptions        . . . . . . . . . . .                                                                                                                  |     64,723                      |   109,057    |
|    Purchases. . . . . . . . . . .        . . . . . . . . . . . . . . . .                                                                                                                  |    (15,241)                          | (18,629) |
|    Transactions with securities available for sale:                                                                                                                                            |                                           |   |
|    Proceeds from sales. . . . . .        . . . . . . . . . . . . . . . .                                                                                                                  |     12,602                      | 85,657 |
|    Proceeds from maturities and redemptions        . . . . . . . . . . .                                                                                                                  |    363,974                           | 342,071  |
|    Purchases. . . . . . . . . . .        . . . . . . . . . . . . . . . .                                                                                                                  |   (343,056)                               | (653,693)  |
|   Proceeds from sales of loans and other        assets . . . . . . . . .                                                                                                                       |     71,698                      | 69,219 |
|   Acquisition of affiliate, net of cash        received. . . . . . . . .                                                                                                                       |         (4) |    -0- |
|   Investment in bank owned life insurance        . . . . . . . . . . . .                                                                                                                       |     (5,000)                     | (15,000) |
|   Net decrease (increase) in time deposits        with banks . . . . . .                                                                                                                       |      1,639                 |  (2,719) |
|   Net increase in loans . . . . . . .        . . . . . . . . . . . . . .                                                                                                                       |   (129,917)                               | (181,388)  |
|   Purchases of premises and equipment        . . . . . . . . . . . . . .                                                                                                                       |     (4,717)                     |  (5,379) |
|                                                                                                                                                                                                |    ________                          | ________ |
|     Net cash provided (used)        by investing activities. . . . . . .                                                                                                             |     16,701                      | (270,804)  |
|                                                                                                                                                                                                |                                           |   |
| **Financing  Activities**                                                                                                                                                                           |                                           |   |
|                                                                                                                                                                                                |                                           |   |
|   Repayments of other long-term debt.        . . . . . . . . . . . . . .                                                                                                                       |     (1,050)                     |     (673) |
|   Proceeds from issuance of other long-term        debt. . . . . . . . .                                                                                                                       |     18,200                      |   9,500 |
|   Discount on dividend reinvestment plan        purchases. . . . . . . .                                                                                                                       |       (476)           |     (460) |
|   Dividends paid. . . . . . . . . . .        . . . . . . . . . . . . . .                                                                                                                       |    (26,381)                          |  (25,335) |
|   Net increase (decrease) in Federal funds        purchased . . . . . .                                                                                                                        |    (30,525)                          |  67,525 |
|   Net increase (decrease) in other short-term        borrowings. . . . .                                                                                                                       |    (62,630)                          |  32,238 |
|   Sale of branch and deposits, net of        cash received . . . . . . .                                                                                                                       |        -0-       |   (9,591) |
|   Net increase in deposits. . . . . .        . . . . . . . . . . . . . .                                                                                                                       |     40,918                      | 153,947 |
|   Proceeds from sale of treasury stock.        . . . . . . . . . . . . .                                                                                                                       |      3,402                 |   2,401 |
|                                                                                                                                                                                                |    ________                          |  _______ |
|     Net cash provided (used)        by financing activities. . . . . . .                                                                                                             |    (58,542)                          | 229,552 |
|                                                                                                                                                                                                |    ________                          |  _______ |
|     Net decrease in cash and        cash equivalents . . . . . . . . . .                                                                                                             |     (1,059)                     |  (18,012) |
|                                                                                                                                                                                                |                                           |   |
|   Cash and cash equivalents at January        1. . . . . . . . . . . . .                                                                                                                       |     98,130                      | 101,848 |
|                                                                                                                                                                                                |    ________                          | _______ |
|   Cash and cash equivalents at September        30. . . . . . . . . . .                                                                                                                        |  $  97,071                           |  $  83,836 |
|                                                                                                                                                                                                |    ========                          | ======= |

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

6

  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  September 30, 2002  (Unaudited)

NOTE 1     Management  Representation  The consolidated financial statements include the accounts of First Commonwealth  Financial Corporation and its subsidiaries ("the Corporation").   All significant intercompany transactions and balances have been eliminated.   Certain prior period amounts have been reclassified to conform with the current  period presentation.  The accounting and reporting policies of the Corporation  conform with accounting principles generally accepted in the United States of  America.  The preparation of financial statements in conformity with generally  accepted accounting principles requires management to make estimates, assumptions  and judgments that affect the amounts reported in the financial statements and  accompanying notes. Actual realized amounts could differ from those estimates.   In the opinion of management, the unaudited interim consolidated financial statements  include all adjustments (consisting of only normal recurring adjustments) necessary  for a fair statement of financial position as of September 30, 2002, and the  results of operations for the three month and nine month periods ended September  30, 2002 and 2001, and statements of cash flows and changes in shareholders'  equity for the nine month periods ended September 30, 2002 and 2001.  The  results of operations for the interim periods are not necessarily indicative  of the results that may be expected for the full year or any other interim period.   These interim financial statements should be read in conjunction with the Corporation's  2001 Annual Report on Form 10-K.NOTE 2     Cash Flow Disclosures (dollar amounts in thousands)

|                                                                                                 | 2002                           | 2001                    |
|------------------------------------------------------------------------------------------------------|--------------------------------|-------------------------|
|                                                                                                 |                           |                    |
| Cash  paid during the first nine months of the year for:                                             |                           |                    |
|                                                                                                 |                           |                    |
|   Interest                                                                                      |  $ 98,007                 | $149,102                |
|   Income taxes                                                                                  |  $   9,010           | $ 10,206                |
|                                                                                                 |                           |                    |
| Noncash  investing and financing activities:                                                         |                           |                    |
|                                                                                                 |                           |                    |
|   ESOP loan reductions                                                                          |  $     804 | $    893 |
|   Loans transferred to other real estate  owned and    repossessed assets        |  $   4,568           | $  3,743           |
|   Gross increase in market value adjustment  to    securities available for sale |  $ 30,913                 | $ 49,477                |
|   Treasury stock reissued for acquisition                                                       |  $     830 | $    -0- |
|                                                                                                 |                           |                    |

 

  7

  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  September 30, 2002  (Unaudited)

  NOTE 3     Comprehensive Income DisclosuresThe following table identifies the related tax effects allocated to each  component of other comprehensive income in the Statements of Changes in Shareholders'  Equity: (dollar amounts in thousands)

|                                                                                                       | September  30, 2002      | September  30, 2001    |
|------------------------------------------------------------------------------------------------------------|--------------------------|------------------------|
|                                                                                                       |                     |                   |
|                                                                                                       | Pre-taxAmount            | Tax  (Expense)Benefit  | Net of  TaxAmount | Pre-taxAmount | Tax  (Expense)Benefit | Net of  TaxAmount |
|                                                                                                       |                     |                   |   |   |   |   |
| Unrealized gains (losses) on securities:                                                                   |                     |                   |   |   |   |   |
|   Unrealized holding gains (losses)             arising during the period . . . . | $31,523                  | $(11,033)              | $20,490 | $52,750 | $(18,463) | $34,287 |
|   Less: reclassification adjustment             for gains realized in net income. |     (610) |     214 |     (396) |   (3,273) |   1,146 |   (2,127) |
|                                                                                                       | _______                  |  ______           | _______ | _______ | _______ | _______ |
|       Net unrealized        gains (losses) .                                      |  30,913             |  (10,819)         |  20,094 |  49,477 |  (17,317) |  32,160 |
|                                                                                                       | _______                  | ______                 | _______ | _______ | _______ | _______ |
|                Other comprehensive income. .                            |  $30,913            | $(10,819)              | $20,094 | $49,477 | $(17,317) | $32,160 |
|                                                                                                       | =======                  | =======                | ======== | ======== | ======= | ======== |

NOTE 4     Business Combination  Effective March 1, 2002, the Corporation acquired all of the outstanding shares  of Strategic Capital Concepts, Inc. ("SCC") and Strategic Financial  Advisors, Inc. ("SFA"), each a Pennsylvania corporation headquartered  in Allison Park, Pennsylvania.  As a registered investment adviser, Strategic  Capital Concepts provides financial planning, asset management and consulting  services to individuals, businesses, retirement plans, trusts and estates.   Strategic Financial Advisors offers investment and insurance products as well  as employee benefit services.  Each of the outstanding shares of Strategic  Capital Concepts, Inc. and Strategic Financial Advisors, Inc. were exchanged  for shares of the Corporation's common stock.  In addition, the shareholders  of SCC and SFA are entitled to receive additional shares of the Corporation's  common stock for each of the years 2002 through 2005 based on a formula defined  in the merger agreement which takes into consideration the financial performance  of SCC and SFA after the merger date.  The merger was accounted for as  a purchase transaction whereby the identifiable tangible and intangible assets  and liabilities of SCC and SFA have been recorded at their fair values at the  acquisition date.  Goodwill in the amount of $1.6 million was recorded  as a result of the transaction.  As prescribed under the purchase method  of accounting, the results of operations of SCC and SFA from the date of acquisition  are included in the Corporation's financial statements for 2002.  In October,  2002 SFA was merged into SCC and the name was changed to First Commonwealth  Financial Advisors Inc.  This acquisition should expand the Corporation's  product offerings and positively impact fee based revenue, which is a continuing  priority.NOTE 5     Goodwill and Other Intangible Assets  On January 1, 2002, the Corporation adopted FASB Statement No. 142, "Goodwill  and Other Intangible Assets" ("FAS No. 142"), which addresses  the accounting and reporting for acquired goodwill and other intangible assets  which supersedes APB Opinion No. 17, "Intangible Assets". FAS No.  142 includes requirements to test goodwill and indefinite-lived intangible

  8  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  September 30, 2002  (Unaudited)

  NOTE 5     Goodwill and Other Intangible Assets (continued)assets for impairment rather than amortize them.  As of January 1,  2002, the Corporation had goodwill, net of accumulated amortization, of approximately  $5.8 million subject to the transitional testing provisions of FAS No. 142.   Also, management reclassified an intangible asset previously recorded by an  insurance subsidiary when acquiring the expiring list of policy holders from  their joint-venture partner to goodwill with a net carrying amount of $718 thousand.  As of January 1, 2002, the Corporation discontinued the amortization of goodwill  which is expected to reduce other operating expense by $922 thousand in 2002.   Goodwill amortization expense was $230 thousand and $691 thousand for the third  quarter and first nine months of 2001 respectively.  Goodwill represented  basic and diluted earnings per share of $0.004 and $0.012 for the three and  nine month periods ending September 30, 2001.  Upon implementation of the  standard, the Corporation determined no impairment existed on its outstanding  goodwill.NOTE 6     Restructuring Charges  The Corporation incurred restructuring charges during the first nine months  of 2002 of $5.6 million which included $3.1 million recognized in the second  quarter of 2002 and an additional $2.5 million recognized in the third quarter  of 2002 as additional activities were identified for inclusion in restructuring.   The restructuring charges were comprised of $4.2 million related to employee  separation costs, $1.1 million related to realignment of the various Boards  of Directors and Board committees and $324 thousand resulting from the write  off of obsolete signage and supplies.  These amounts are included as restructuring  charges, as a component of Other Expenses on the Consolidated Statements of  Income.  These restructuring charges resulted from the merger of the charters  of the Corporation's two commercial banks (First Commonwealth Bank and Southwest  Bank) and the adoption of a new common brand and identity for all financial  services subsidiaries.  (Further information on these activities is included  in the Management's Discussion and Analysis of Financial Condition and Results  of Operation section of this document.)  Employee separation costs consists of the severance packages for 95 employees,  70 in the second quarter of 2002 and 25 in the third quarter of 2002, from various  affiliates of the Corporation including all levels of staff from the executive  management level to back office support staff.  The amounts of employee  separation costs accrued and charged to expense were $2.8 million and $1.4 million  in the second and third quarters of 2002, respectively, for a total of $4.2  million for the nine month period.  The write off of the signage and supplies  occurred in the second quarter of 2002 and the charges related to the Board  realignment occurred in the third quarter of 2002.  The actual termination benefits paid and charged against the total restructuring  liability through September 30, 2002 were $317 thousand.  Net adjustments  to the liability through September 30, 2002 were $36 thousand and the actual  number of employees terminated were 84 as 11 employees took other positions  with the Corporation.

  9

  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  September 30, 2002  (Unaudited)

  NOTE 7     New Accounting Pronouncements  Effective January 1, 2002, the Corporation adopted FASB Statement No. 144, "Accounting  for the Impairment or Disposal of Long-Lived Assets" ("FAS No. 144")  which requires that long-lived assets be reviewed for impairment whenever events  or changes in circumstances, such as a significant decrease in the market value  of an asset or the extent or manner in which an asset is used indicate that  the carrying amount of an asset may not be recoverable.  If there is an  indication that the carrying amount of an asset may not be recoverable, future  undiscounted cash flows expected to  result from the use and disposition  of the asset are estimated.  If the sum of the expected cash flows is less  than the carrying value of the asset a loss is recognized for the difference  between the carrying value and the market value of the asset.  This statement  also requires measurement of long-lived assets classified as held for sale at  the lower of their carrying amount or fair value less cost to sell and to cease  depreciation or amortization on these assets.  Implementation of FAS No.  144 did not have a material impact on the Corporation's financial condition  or results of operations.  In April 2002, the FASB issued Statement No. 145, "Rescission of FASB Statements  No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical Corrections"  ("FAS No. 145").  FAS No. 145 rescinds Statement 4, which required  all gains and losses from extinguishment of debt to be aggregated and, if material,  classified as an extraordinary item, net of related income tax effect.   As a result, the criteria in Opinion 30 will now be used to classify those gains  and losses.  This statement also amends FASB Statement No. 13 to require  that certain lease modifications that have economic effects similar to sale-leaseback  transactions be accounted for in the same manner as sale-leaseback transactions.   This statement also makes technical corrections to existing pronouncements,  which are not substantive but in some cases may change accounting practice.   FAS No.145 was effective for transactions occurring after May 15, 2002.   Implementation of FAS No. 145 did not have a material impact on the Corporation's  financial condition or results of operations.  In July 2002, the FASB issued Statement No. 146, "Accounting for Costs  Associated with Exit or Disposal Activities" ("FAS No. 146").   FAS No. 146 replaces EITF Issue No. 94-3, "Liability Recognition for Certain  Employee Termination Benefits and Other Costs to Exit an Activity (including  Certain Costs Incurred in a Restructuring)".  The standard requires  companies to recognize costs associated with exit or disposal activities when  they are incurred rather than at the date of a commitment to an exit or disposal  plan.  Statement 146 is to be applied prospectively to exit or disposal  activities initiated after December 31, 2002. Upon adoption, FAS No. 146 is  not expected to have a material impact on the Corporation's financial condition  or results of operations.   In October 2002, the FASB issued Statement No. 147, "Acquisitions of Certain  Financial Institutions, an amendment of FASB Statements No. 72 and 144 and FASB  No. 9" ("FAS No. 147").  FAS No. 147 removes acquisitions  of financial institutions, except for transactions between two or more mutual  enterprises, from the scope of both FASB Statement 72 and Interpretation 9 and  requires that those transactions be accounted for in accordance with

  10  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  September 30, 2002  (Unaudited)

  NOTE 7     New Accounting Pronouncements (continued)  FASB Statements No. 141 and No. 142.  As a result, the requirement in FASB  Statement 72 to recognize, and subsequently amortize, any excess of the fair  value of liabilities assumed over the fair value of tangible and identifiable  assets acquired as an unidentifiable asset no longer applies to acquisitions  within the scope of this statement.  In addition, this statement amends  FASB Statement No. 144 to include in its scope long-term customer relationship  intangible assets of financial institutions such as depositor and borrower-relationship  intangible assets and credit cardholder assets.  Consequently, those intangible  assets are subject to the same undiscounted cash flow recoverability test and  impairment loss recognition and measurement provisions that FASB Statement 144  requires for other long-lived assets that are held and used.  The provisions  of FAS No. 147 were effective October 1, 2002.  Implementation of FAS No.  147 did not have a material impact on the Corporation's financial condition  or results of operations.   

 ITEM 2. MANAGEMENT'S DISCUSSION AND  ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS**First Nine Months of 2002 as Compared to the First Nine Months of 2001**  This discussion and the related financial data are presented to assist in the  understanding and evaluation of the consolidated financial condition and results  of operations of First Commonwealth Financial Corporation (the "Corporation")  including its subsidiaries.  In addition to historical information, this  discussion and analysis contains forward-looking statements.  The forward-looking  statements contained herein are subject to certain risks and uncertainties that  could cause actual results to differ materially from those projected in the  forward-looking statements.  Important factors that might cause such a  difference include, but are not limited to, those discussed in this "Management's  Discussion and Analysis of Financial Condition and Results of Operations."   Readers are cautioned not to place undue reliance on these forward-looking statements,  which reflect management's analysis only as of the date hereof.  The Corporation  undertakes no obligation to publicly revise or update these forward-looking  statements to reflect events or circumstances that arise after the date hereof.  Net income for the first nine months of 2002 was $30.8 million which decreased  $6.0 million when compared to $36.8 million earned in the comparable period  of 2001.  Basic and diluted earnings per share were $0.53 and $0.52 per  share respectively for the first nine months of 2002 compared to $0.64 per share  and $0.63 per share respectively for the same period of 2001.  The 2002  period included $5.6 million ($3.6 million after-tax) of nonrecurring restructuring  charges related to the merger of the charters of the Corporation's two commercial  banks (First Commonwealth Bank and Southwest Bank) and the adoption of a new  common brand and identity for all financial services subsidiaries.  These  restructuring charges included $4.2

  11   FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

  RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001**(continued)  million related to separation compensation for those employees whose positions  were eliminated or chose not to relocate as a result of the merger of the subsidiary  banks which took place on October 15, 2002. Additional restructuring charges  of $1.1 million stemmed from the consolidation of various boards and committees  to provide more efficient and effective corporate governance.  Ongoing  savings from these restructuring charges are anticipated to be $3.6 million  per year.  The fourth quarter will also include additional charges related  to the implementation of the new common brand and identity.  Net income  for the first nine months of 2002 was also negatively impacted by the $8.0 million  litigation settlement ($5.2 million, net of tax effect) recorded in the first  quarter.  This settlement related to a lender liability action filed in  1994 against one of the Corporation's subsidiary banks and followed an adverse  pre-trial judgment by the trial judge on procedural grounds.    Core net income (excluding securities transactions, gains on asset sales and  nonrecurring charges) was $39.2 million for the nine months of 2002, representing  an increase of 15.3% compared to $34.0 million for the nine months of 2001.   Gains on the sale of assets includes securities gains of $641 thousand and $3.3  million in 2002 and 2001, respectively, as well as a $989 thousand gain on the  sale of a branch and a group of mortgages in 2001.  Diluted earnings per  share for core earnings was $0.67 for the first nine months of 2002 compared  to diluted earnings per share of $0.59 for the first nine months of 2001.   Return on average assets was 0.90% and return on average equity was 10.58% during  the 2002 period, compared to 1.09% and 13.84%, respectively during the same  period of 2001.  Return on average assets and return on average equity  based on core earnings were 1.15% and 13.47%, respectively for the first nine  months of 2002 compared to 1.01% and 12.79%, respectively for the year-to-date  period of 2001.

|                                | For the Nine Months  Ended September 30, |
|-------------------------------------|------------------------------------------|
|                                | 2002                                     | 2001 |
| **Reconciliation of Core Earnings** |                                     |   |
|                                |                                     |   |
| Net  income as reported             |  $30,782                            | $36,775 |
| Non-core  items (net of tax):       |                                     |   |
|   Gains on sale of assets      |      (417)      |    (2,804) |
|   Restructuring charges        |    3,633                       |     -0- |
|   Litigation settlement        |    5,200                       |     -0- |
|                                |  _______                            | _______ |
| Core  net income                    |  $39,198                            | $33,971 |
|                                |  =======                            | ======= |
| Core  basic earnings per share      |    $0.67                       |    $0.59 |
| Core  diluted earnings per share    |    $0.67                       |    $0.59 |
| Core  return on average assets      |      1.15%           |     1.01% |
| Core  return on average equity      |     13.47%                |    12.79% |

 

  12  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001**(continued)  The fundamental source of First Commonwealth's earnings, net interest income,  is defined as the difference between income on earning assets and the cost of  funds supporting those assets.  Net interest income was $114.3 million  for the first nine months of 2002 compared to $103.7 million for the same period  of 2001.  Net interest margin (net interest income, on a tax-equivalent  basis, as a percentage of average earning assets) improved to 3.79% for the  nine months of 2002 compared to 3.49% for the same period of 2001 as the cost  of funds declined more than asset yields and interest rates fell to near historic  lows. The cost of deposits dipped 129 basis points (1.29%) for the nine-month  period of 2002 while loan yields declined 111 basis points (1.11%) over the  same period.  Continued pressure on net interest income is anticipated  by the Corporation despite active management of interest rate risk.  Significant  initiatives have been undertaken by the Corporation to expand its fee based  services to minimize shrinkage of the net interest margin.  The following table shows the effect of changes in volumes and rates on interest  income and interest expense.  Analysis of Changes in Net Interest Income  (dollar amounts in thousands)

|                                               | 2002 Change from 2001    |
|----------------------------------------------------|--------------------------|
|                                               | TotalChange              | Change Dueto Volume | Change Dueto Rate |
|                                               |                     |   |   |
| Interest-earning  assets:                          |                     |   |   |
|   Time deposits with banks                    |  $(   33) | $    7 |  $(    40) |
|   Securities                                  |    (5,971)          |    215 |   (6,186) |
|   Federal funds sold                          |     (485) |    (468) |      (17) |
|   Loans                                       |  (18,334)           |  2,933 |  (21,267) |
|                                               |  _______            | _______ |  ________ |
|     Total interest income           |  (24,823)           |  2,687 |  (27,510) |
|                                               |  _______            | _______ |  ________ |
| Interest-bearing  liabilities:                     |                     |   |   |
|   Deposits                                    |  (31,511)           |  (1,697) |  (29,814) |
|   Short-term borrowings                       |    (4,403)          |  1,780 |   (6,183) |
|   Long-term debt                              |     536   |    637 |     (101) |
|                 |  _______            | _______ |  ________ |
|     Total interest expense          |  (35,378)           |    720 |  (36,098) |
|                                               |  _______            | _______ |  _______ |
|       Net interest income | $10,555                  |   $ 1,967 |  $ 8,588 |
|                                               | =======                  | =======  |  ======= |

  13  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001**(continued)  Interest and fees on loans declined $18.3 million for 2002 compared to 2001  levels.  The decrease in interest income included decreases in interest  income due to rate of $21.3 million which were partially offset by increases  in interest income due to volume of $2.9 million.  The total yield on loans  for the first nine months of 2002 was 7.17%, compared to loan yields of 8.28%  for the first nine months of 2001.  Average loans for the first nine months  of 2002 rose $58.9 million compared to the first nine months of 2001 as increases  in commercial loans, municipal loans and indirect installment loans were partially  offset by decreases in average mortgage loans.  During 2002 the Corporation  continued to offer competitive fixed rate mortgages to customers wanting to  lock in rates during the current low interest rate environment.  The Corporation  has reduced interest rate risk related to new mortgage loan production through  utilization of various lending programs whereby loans originated by subsidiary  banks are immediately sold along with the right to service these loans.  Interest income on investments declined $6.0 million for the nine months of  2002 compared to the corresponding period of 2001 as decreases in interest income  due to rate were only slightly offset by increases in interest income due to  volume.  Total yield on investments was 6.06% for the first nine months  of 2002 compared to 6.54% for the same period of 2001.  Declines in interest  income due to rate for U.S. government agency securities were $3.9 million as  yields on U.S. government agency securities decreased 48 basis points (0.48%)  for the 2002 period compared to 2001.  Average investments for the nine  months of 2002 included an increase of $38.7 million for corporate bonds compared  to 2001 generating an increase in interest income of $2.0 million.  Interest on deposits decreased $31.5 million for the 2002 period compared to  2001, as interest on total savings deposits decreased by $8.5 million and interest  on time deposits dropped by $23.0 million.  Interest expense on deposits  for the first nine months of 2002 reflected decreases due to rate of $19.5 million  as the cost of total savings deposits decreased 115 basis points (1.15%) and  the cost of time deposits fell 142 basis points (1.42%) compared to costs for  the same period of 2001.  Average deposits for the first nine months of  2002 included decreases in average time deposits of $138.2 million which were  partially offset by increases in average total savings deposits of $76.7 million  over 2001 averages.  Interest expense on short-term borrowings decreased $4.4 million for the nine  months of 2002 compared to the corresponding period of 2001 as decreases in  interest expense due to rate of $6.2 million were partially offset by increases  in interest expense due to volume of $1.8 million compared to 2001 levels.   The cost of short-term borrowings for the 2002 period decreased by 253 basis  points (2.53%) compared to 2001 costs of 4.37%.  The average balance of  short-term borrowings for the first nine months of 2002 increased by $57.0 million  compared to 2001 averages.

  14  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001** (continued)  Interest expense on long-term debt rose $536 thousand for the nine months of  2002 compared to the corresponding period of 2001 as a result of volume increases.   Average long-term debt for the nine months of 2002 increased by $14.9 million  compared to 2001 averages as maturities were extended for short term borrowings  from the Federal Home Loan Bank, to take advantage of the lower interest rate  environment.  The provision for credit losses was $9.0 million for the nine months of 2002  compared to $8.5 million for the nine months of 2001.  Net charge-offs  against the allowance for credit losses were $8.4 million in the 2002 period,  reflecting a decrease of $544 thousand compared to 2001 levels.  The most  significant components of this period to period change were a decline of $1.6  million in net charge-offs for commercial real estate loans partially offset  by an increase in net charge-offs for commercial loans not secured by real estate  of $1.3 million.  Net charge-offs as a percent of average loans outstanding  were 0.32% for the nine months of 2002 compared to 0.35% for the same period  of 2001.  The provision for credit losses as a percent of net charge-offs  was 107.59% at September 30, 2002 compared to 95.20% at September 30, 2001.   See the "Credit Review" section for an analysis of the credit quality  of the loan portfolio.

  15  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

  RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001**  (continued)  Below is an analysis of the consolidated allowance for credit losses for the  nine month periods ended September 30, 2002 and 2001.

|                                           | 2002                             | 2001                                   |
|------------------------------------------------|----------------------------------|----------------------------------------|
|                                           |                             |                                   |
|                                           | (amounts in thousands)           |
|                                           |                             |                                   |
| Balance  January 1,                            | $34,157                          |  $33,601                          |
| Loans  charged off:                            |                             |                                   |
|   Commercial, financial and agricultural  |   4,633                     |    2,413                     |
|   Real estate-construction           |       3 |      -0-           |
|   Real estate-commercial                  |     349           |    1,963                     |
|   Real estate-residential                 |   1,627                     |    1,616                     |
|   Loans to individuals               |    3,081                    |    3,406                     |
|   Lease financing receivables             |     307           |      392           |
|                                           | _______                          |   ______                          |
|     Total loans charged off     | $10,000                          |  $ 9,790                          |
|                                           |                             |                                   |
| Recoveries  of previously charged off loans:   |                             |                                   |
|   Commercial, financial and agricultural  |    1,086                    |      217           |
|   Real estate-construction                |     -0-           |      -0-           |
|   Real estate-commercial                  |     -0-           |      -0-           |
|   Real estate-residential            |      16      |       48      |
|   Loans to individuals                    |     502           |      585           |
|   Lease financing receivables             |       5 |        5 |
|                                           | _______                          |  _______                          |
|     Total recoveries            |    1,609                    |      855           |
|                                           | _______                          |  _______                          |
|       Net charge offs |    8,391                    |    8,935                     |
|                                           | _______                          |  _______                          |
| Provision  charged to operations               |    9,028                    |    8,506                     |
|                                           | _______                          |  _______                          |
| Balance  September 30,                         | $34,794                          |  $33,172                          |
|                                           | =======                          |  =======                          |

  Net securities gains were $641 thousand during the first nine months of 2002  compared to $3.3 million for the same period of 2001.  Securities gains  during the 2002 period resulted primarily from the sale of Pennsylvania bank  stocks, U.S. Treasury securities and fixed rate corporate bonds classified as  securities "available for sale" with book values of $1.1 million,  $1.5 million, and $3.0 million, respectively.  The bank stocks sold were  related to merger activity while the other securities sold were related to asset  sector shift strategies.  Activity during the first nine months of 2001  activity focused on the same strategies.  Asset sector shift strategies  generated securities gains of $1.7 million resulting from the sale fixed rate  corporate bonds with book values of $37.4 million.  Additional securities  gains during the first nine months of 2001 resulted from the sale of fully valued  Pennsylvania bank stocks with book values totaling $12.7 million. 

  16  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001**  (continued)  Service charges on deposits are the most significant component of non-interest  income amounting to 30.5% of the total.  This category rose $357 thousand  over the comparable period of 2001, primarily as a result of increases in bank  club and account analysis fees.  Insurance commissions rose $463 thousand  for the nine-month period of 2002.  Increases included personal lines,  commercial lines and annuities.  Insurance commissions were also positively  impacted by inclusion of First Commonwealth Financial Advisors insurance production  since March 1, 2002.    Other income for the first nine months of 2002 fell to $8.6 million representing  a decline of $1.0 million compared to $9.6 million reported for the first nine  months of 2001. This decrease was due in part to gains on sale of assets included  in the 2001 period.  The Corporation sold one of its branches during the  first quarter of 2001 which resulted in a gain of $777 thousand.  The 2001  period also included a gain of $212 thousand from the sale of $12.9 million  of 30 year residential mortgage loans with significant prepayment exposure during  the falling interest rate environment.    Fee based revenue, such as insurance commissions, mutual fund sales fees and  investment management fees are expected to be positively impacted in future  periods as First Commonwealth Financial Advisors is incorporated into the integrated  advisory sales model utilized to integrate products between the Corporation's  bank, insurance and trust subsidiaries.  Certified financial planners from  the new subsidiaries will be included on the employee team used to deliver products  and services to commercial clients through our "Total Solutions Financial  Management" approach.  Noninterest expense was $96.6 million for the nine months of 2002 reflecting  an increase of $19.1 million over the 2001 level of $77.5 million.  The  increase in noninterest expense for 2002 was primarily the result of nonrecurring  charges for the previously described litigation settlement and corporate restructuring  of $8.0 million and $5.6 million, respectively.   Employee costs were  $43.9 million for the nine months of 2002, representing 1.29% of average assets  on an annualized basis for 2002.  Salary costs for the 2002 period increased  $1.9 million or 5.9% compared to 2001 levels of $32.1 million.  Employee  benefit costs for the first nine months of 2002 reflected increases of $1.4  million over the first nine months of 2001 and included increases in health  insurance costs, expenses of the Corporation's employee stock ownership plan  and 401(k) plan compared to the first nine months of 2001.  As a result of the merger of the Corporation's banking subsidiaries, Southwest  Bank and First Commonwealth Bank, which occurred on October 15, 2002 as scheduled,  banking operations are being consolidated under First Commonwealth Bank.   This change will provide banking clients with greater flexibility, efficiency  and seamless service throughout our market-area.  As a result of this merger,  there was a consolidation of support functions with some staff positions being  eliminated. The personnel within the branches and relationship managers in corporate  services will

  17  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS 

 RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001** (continued)  continue to serve in the same manner.  Employees whose positions were being  eliminated were notified and continued to work in their positions for at least  60 days.  Notified employees had the opportunity to seek other positions  within the Corporation or to receive a separation package based on years of  service.  Also, related to the merger, the structure of all of the Boards  of Directors and Board committees for the Corporation was realigned.  As  the result of these activities, restructuring charges of $5.6 million are reported  on the income statement for the first nine months of 2002.  Ongoing savings  from the restructuring are anticipated to be $3.6 million per year.  Other  charges included during 2002 as part of the restructuring related to writing  off obsolete signs and supplies due to the name change under one charter and  amounted to $324 thousand.  Occupancy expenses for the first nine months of 2002 was flat compared to the  first nine months of 2001.  Furniture and equipment expenses of $7.4 million  reflected increases of $809 thousand over 2001 levels and included increases  in computer software depreciation and software maintenance of $1.3 million,  primarily related to the upgrade of core banking software.  Outside data processing expense declined $899 thousand for the nine-month period  of 2002 compared to the first nine months of 2001 and was positively impacted  by the conversion of Southwest Bank from outsourced processing to that provided  by a subsidiary of the Corporation.  Accounting changes from the adoption  of FAS No. 142 resulted in a decrease of $691 thousand of goodwill amortization  for the first nine months of 2002 compared to the first nine months of 2001.   Under the new pronouncement, goodwill amortization was discontinued effective  January 1, 2002.    Other operating expenses for the 2002 period were $22.1 million reflecting a  rise of $3.1 million over the 2001 amount of $19.0 million.  The first  nine months of 2002 included increases in loss on sale of assets, primarily  the loss on sale of vehicles previously leased, of $549 thousand compared to  2001 levels.  Other professional fees for the 2002 period reflected increases  of $1.3 million over the first nine months of 2001 and included consulting fees  related to implementation of the Corporation's "Balanced Scorecard"  performance measurement system, enhancements to product and customer profitability  systems, corporate restructuring and common branding and identity.  Consultants  are also being utilized to assist in the ongoing efforts to develop a world  class sales culture and to generate new deposit dollars and relationships.   Corporate restructuring and movement towards a sales culture also impacted the  decision to have employee benefit plans reviewed by outside specialists during  2002.  Promotions expense for the first nine months of 2002 reflected an  increase of $1.5 million compared to the first nine months of 2001, due in part  to expenses incurred in the successful marketing campaign for free checking  products introduced during 2002.  These products are expected to have a  favorable impact on deposit growth, costs and service charge revenue in future  periods as well as providing potential add on sales of other financial products  and services.  

  18  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS 

 RESULTS OF OPERATIONS (continued)**First Nine Months of 2002 as Compared to the First Nine Months of 2001** (continued)  Also impacting this category were expenditures related to the launch of the  new Corporate brand and identity.  This exciting campaign is designed to  educate and build enthusiasm among current and potential clients.  Additional  expenditures for this campaign will be incurred in the fourth quarter of 2002.  Income tax expense was $5.7 million for the first nine months of 2002 compared  to $11.4 million for the first nine months of 2001.  The Corporation's  effective tax rate was 15.6% for the 2002 period compared to 23.6% for the corresponding  period of 2001.  Income tax expense for the 2002 period included $2.8 million  and $2.0 million of tax benefits resulting from the previously described litigation  settlement and restructuring charges, respectively.  The Corporation's  effective tax rate for the 2002 period, excluding these one time charges was  18.1%.**Three Months ended September 30, 2002 as Compared to the Three Months Ended  September 30, 2001**  Net income was $12.2 million for the third quarter of 2002 a decline of $531  thousand, compared to 2001 results of $12.7 million.  The 2002 period included  a $2.5 million ($1.6 million after-tax) one-time restructuring charge related  to employee separation pay and costs related to realignment of all Boards of  Directors and Board committees.  Core earnings (excluding securities transactions,  nonrecurring gains on sale of assets and nonrecurring charges) increased $1.9  million or 16.2% in the 2002 period.  Basic and diluted earnings per share  were $0.21 during the 2002 quarter compared to $0.22 for the same period of  2001.  Diluted core earnings per share was $0.23 for the third quarter  of 2002 compared to $0.20 for the third quarter of 2001.  Return on average  assets was 1.06% and return on average equity was 12.11% during the 2002 quarter,  compared to 1.10% and 13.72%, respectively during the 2001 quarter.  Core  return on average assets and core return on average equity were 1.20% and 13.69%  for the third quarter of 2002.

|                                | For the Quarter,  Ended September 30,     |
|-------------------------------------|-------------------------------------------|
|                                | 2002                                      | 2001 |
| **Reconciliation of Core Earnings** |                                      |   |
|                                |                                      |   |
| Net  income as reported             |  $12,187                             | $12,718 |
| Non-core  items (net of tax):       |                                      |   |
|   Gains on sale of assets      |        (17) |     (865) |
|   Restructuring charges        |    1,608                        |     -0- |
|                                |  _______                             | _______ |
|     Core net income  |  $13,778                             | $11,853 |
|                                |  =======                             | ======= |
| Core  basic earnings per share      |    $0.24                        |    $0.20 |
| Core  diluted earnings per share    |    $0.23                        |    $0.20 |
| Core  return on average assets      |      1.20%            |     1.03% |
| Core  return on average equity      |     13.69%                 |    12.78% |

 

  19  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION   RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**Three Months ended September 30, 2002 as Compared to the Three Months Ended  September 30, 2001**(continued)****  Net interest income for the third quarter of 2002 of $38.3 million represented  a rise of $2.8 million compared to the third quarter of 2001.  Net interest  margin (net interest income, on a tax-equivalent basis, as a percentage of average  earning assets) for the 2002 period was 3.78%, reflecting an increase of 30  basis points (0.30%) from 3.48% reported in 2001 since the cost of funds declined  more than asset yields, as interest rates fell throughout 2001 and remained  at low levels during the 2002 period.  Interest and fees on loans for the three months ended September 30, 2002 decreased  $5.9 million compared to the three months ended September 30, 2001, primarily  as a result of rates dropping, most notably for variable rate commercial loans.   The total yield on loans for the third quarter of 2002 was 7.05% representing  a decrease of 97 basis points (0.97%) compared to yields for the third quarter  of 2001.  Declines in interest and fees on loans due to rate for the third  quarter of 2002 compared to the third quarter of 2001 were only slightly offset  by increases in interest income due to volume for commercial loans.  Average  loans for the third quarter of 2002 increased $31.4 million compared to averages  for the third quarter of 2001 and included increases in commercial loans and  indirect installment loans which were partially offset by decreases in residential  mortgage loans.  Interest income on investments for the three months ended September 30, 2002  was $23.8 million, reflecting a dip of $2.9 million compared to the three months  ended September 30, 2001.  Decreases in interest income due to rate for  government agency securities were $1.2 million as yields on government agency  securities declined 44 basis points (0.44%) compared to yields for 2001.   Total yield on investments was 5.94% for the third quarter of 2002 compared  to 6.37% for the third quarter of 2001.  Changes in investment income due  to rate totaled $1.8 million for the 2002 period as the overall level of interest  rates were lower than in the prior year.  Volume decreases also reduced  investment income in the 2002 period by $1.1 million as average investment volume  fell by $68.0 million, primarily in the government agency and asset backed securities  categories.   Interest on deposits for the third quarter of 2002 was $19.4 million, reflecting  a drop of $10.3 million compared to the third quarter of 2001 as both rates  and volumes declined for the 2002 period.  Interest expense on savings  decreased due to rate of $3.1 million for the 2002 period as savings costs fell  from 2.15% in 2001 to 1.06% in 2002.  Interest on time deposits reflected  decreases due to rate of $6.1 million and decreases due to volume of $1.2 million  for the third quarter of 2002 compared to the third quarter of 2001.  Average  time deposits were $1,607.6 million for 2002 compared to $1,731.4 million for  the corresponding period of 2001.  The cost of time deposits continued  to decline as the 2002 period cost of 4.02% compared favorably to the 2001 cost  of 5.42%.

  20  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**Three Months ended September 30, 2002 as Compared to the Three Months Ended  September 30, 2001** (continued)****  Interest on short-term borrowings for the third quarter of 2002 decreased $1.4  million compared to the third quarter of 2001 due to both rate and volume decreases.   Short-term borrowing costs were 1.79% for the 2002 period compared to 3.57%  for the 2001 period resulting from declines in rate of $1.3 million and volume  of $116 thousand.  Average short-term borrowings decreased $14.8 million  for the third quarter of 2002 compared to the corresponding period of 2001.   Interest on long term debt for the three months ended September 30, 2002 increased  by $208 thousand over the three months ended September 30, 2001.  Average  long term debt rose $15.8 million for the 2002 quarter as maturities were extended  for short term borrowings from the Federal Home Loan Bank taking advantage of  the lower rate environment.  The provision for credit losses was $3.1 million for the three months ended  September 30, 2002 compared to $3.5 million for the three months ended September  30, 2001.  Net charge-offs for the third quarter of 2002 were $2.6 million,  compared to net charge-offs of $4.3 million for the third quarter of 2001.   Net charge-offs for the third quarter of 2002 included decreases in charge-offs  of commercial loans secured by real estate and commercial loans not secured  by real estate of $1.3 million and $204 thousand respectively, compared to 2001  levels.  Net securities gains were $26 thousand for the third quarter of 2002 compared  to securities gains of $1.3 million for the third quarter of 2001.  The  2002 period included gains from the call of municipal securities classified  as "held to maturity" with book values of $3.4 million.  Securities  gains for the third quarter of 2001 resulted primarily from sale of Pennsylvania  bank stocks with a book value of $12.7 million.  Service charges on deposits rose $206 thousand for the third quarter of 2002  compared to the same period of 2001 and were favorably impacted by the Corporation's  "High Performance" checking product launched in 2002.  This product  should continue to favorably impact future periods.  Income from bank owned  life insurance rose $90 thousand and insurance commissions slipped $56 thousand  for the third quarter of 2002 compared to the third quarter of 2001.  Other income for the three months ended September 30, 2002 was $2.9 million,  $256 thousand below the $3.2 million reported for the third quarter of 2001.   Period to period changes included decreased gains on sales of assets, bank club  income and debit card interchange income offset in part by increased MAC income.  Total noninterest expense for the three months ended September 30, 2002 was  $29.5 million reflecting an increase of $3.5 million over the $26.0 million  that was reported for the prior year period.  The increase for 2002 includes  $2.5 million of expense related to separation pay for additional employees as  well as amounts paid to retiring directors.  As part of the 

  21   FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 RESULTS OF OPERATIONS (continued)**Three Months Ended September 30, 2002 as Compared to the Three Months Ended  September 30, 2001**(continued)  plan for the organization reflecting the consolidation of the multiple bank  charters into one, the renaming and branding of First Commonwealth Bank, as  well as realigning for its new vision on corporate governance, all of the Board  of Directors and Board committees for the corporation and its subsidiaries have  been restructured.  Most of the retiring directors were from boards of  previously acquired banks.  Employee costs were $14.5 million during the  third quarter of 2002 which reflects an increase of $917 thousand over 2001  levels.  Salaries rose by $506 thousand and employee benefit costs increased  by $411 thousand compared to prior period levels.  Employee benefit costs  rose primarily due to increased health insurance costs of $237 thousand compared  to 2001 levels. Occupancy expense rose $91 thousand for the third quarter of 2002 compared  to the same period of 2001.  Higher building rental expense was the principal  factor in the period to period increase.  Furniture and equipment expense  increased $223 thousand for the third quarter of 2002 primarily due to a rise  in software depreciation and software maintenance costs.  Outside data  processing expenses declined $237 thousand for the third quarter of 2002 due  to the conversion of one of the Corporation's subsidiary banks to in-house data  processing in the fourth quarter of 2001.  The three months ended September  30, 2002 also included a decrease of $230 thousand related to the implementation  of FAS No. 142 during 2002 which changed the accounting treatment for goodwill  from an amortizing intangible to a non-amortizing intangible.  Other operating expenses for the third quarter of 2002 increased $310 thousand  and included increased other professional fees ($346 thousand) and promotion  expense ($430 thousand) offset in part by reductions in Pennsylvania sales tax  expense ($253 thousand) and printing expense ($106 thousand).  As previously  discussed, these charges resulted from various restructuring and marketing initiatives  including sales and common branding, as well as performance measurement system  enhancements.  Income taxes were $2.9 million for the 2002 period compared to $4.0 million  for the corresponding period of 2001.  The Corporation's effective tax  rate was 19.5% for the third quarter of 2002 compared to 24.0% for the third  quarter of 2001.  The 2002 period included the tax benefit of $900 thousand  related to the nonrecurring expenses for restructuring.  The Corporation's  effective tax rate excluding nonrecurring expenses was 21.7% for the three months  ended September 30, 2002.  LIQUIDITYLiquidity is a measure of the Corporation's ability to efficiently meet  normal cash flow requirements of both borrowers and depositors.  In the  ordinary course of business, funds are generated from the banking subsidiaries  core deposit base and the maturity or repayment of earning assets such as securities  and loans.  As an additional secondary source,

  22

  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

LIQUIDITY (continued)  short-term liquidity needs may be provided through the use of overnight Federal  funds purchased, borrowings through the use of lines available for repurchase  agreements and borrowings from the Federal Reserve Bank.  Additionally,  the banking subsidiaries are members of the Federal Home Loan Bank and may borrow  under overnight and term borrowing arrangements.  The sale of earning assets  may also provide an additional source of liquidity.  The Corporation monitors liquidity through regular computations of prescribed  liquidity ratios.  The Corporation actively manages liquidity within a  defined range and has developed liquidity contingency plans, including ensuring  availability of alternate funding sources to maintain liquidity under a variety  of business conditions.  In addition to the previously described funding  sources, the Corporation also has the ability to access the capital markets.  At September 30, 2002 total earning assets were $4,331.0 million, down slightly  from the $4,334.6 million recorded at December 31, 2001.  Net loans rose  $48.9 million for the first nine months of 2002 fueled by increases in the commercial,  municipal and installment categories offset in part by decreases in mortgage  loans.  Interest bearing liabilities were $3,756.1 million at September  30, 2002, a decline of $16.3 million compared to year-end 2001.  Total  deposits rose by $40.9 million as declines in demand deposits of $19.6 million  and time deposits of $17.8 million were more than offset by increased savings  deposits of $78.4 million over the same period.  The growth in savings  deposits was focused primarily in the MMDA category, as clients registered a  preference for this product due to economic uncertainties.  The Corporation  has launched a program ("High Performance Checking") which focuses  on growing deposits, principally in the low cost categories, that is expected  to favorably impact deposit growth and mix.  Total borrowings dipped by  $76.8 million for the first nine months of 2002 primarily due to the rise in  deposits and maturities of investment securities.    Marketable securities that the Corporation holds in its investment portfolio  are an additional source of liquidity. These securities are classified as "securities  available for sale" and while the Corporation does not have specific intentions  to sell these securities, they have been designated as "available for sale"  because they may be sold for the purpose of obtaining future liquidity, for  management of interest rate risk or as part of the implementation of tax management  strategies.  As of September 30, 2002, securities available for sale had  an amortized cost of $1,422.8 million and an approximate fair value of $1,467.1  million.**Interest Sensitivity**  The objective of interest rate sensitivity management is to maintain an appropriate  balance between the stable growth of income and the risks associated with maximizing  income through interest sensitivity imbalances.  While no single number  can accurately describe the impact of changes in interest rates on net interest  income, interest rate sensitivity positions, or "gaps", when measured  over a variety of time periods, may be helpful.

  23  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

**Interest Sensitivity**(continued)****An asset or liability is considered to be interest-sensitive if the rate  it yields or bears is subject to change within a predetermined time period.   If interest-sensitive assets ("ISA") exceed interest-sensitive liabilities  ("ISL") during the prescribed time period, a positive gap results.   Conversely, when ISL exceed ISA during a time period, a negative gap results.  The cumulative gap at the 365 day repricing period was negative in the amount  of $376.2 million or 8.22% of total assets as of September 30, 2002.  A  positive gap tends to indicate that earnings will be impacted favorably if interest  rates rise during the period and negatively when interest rates fall during  the time period.  A negative gap tends to indicate that earnings will be  affected inversely to interest rate changes.  In other words, as interest  rates fall, a negative gap should tend to produce a positive effect on earnings,  and when interest rates rise, a negative gap should tend to affect earnings  negatively.  The primary components of ISA include adjustable rate loans and investments,  loan repayments, investment maturities and money market investments.  The  primary components of ISL include maturing certificates of deposit, money market  deposits, savings deposits, NOW accounts and short-term borrowings.

  24  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

**Interest Sensitivity**(continued)  The following table lists the amounts and ratios of assets and liabilities with  rates or yields subject to change within the periods indicated as of September  30, 2002 and December 31, 2001 (Dollar amounts in thousands).

|                                                     | September  30, 2002             |
|----------------------------------------------------------|---------------------------------|
|                                                     | 0-90Days                        | 91-180Days | 181-365Days | Cumulative0-365 Days |
|                                                     |                            |   |   |   |
| Loans                                                    | $  950,194                      | $154,182 | $(233,829) | $  870,547   |
| Investments                                              |   236,435                  |  139,057 |  273,353 |  648,845 |
| Other interest-earning assets                            |     2,611        |      -0- |  543 812 |  546 423 |
|                                                     | _________                       | ________ | ________ |   _________ |
|   Total  interest-sensitive assets                  |   1,189,240           |  293,239 |  583,336 |   2,065,815 |
|                                                     | _________                       | ________ | ________ | _________ |
| Certificates of deposit                                  |     151,811      |  423,657 |  260,500 |  835,968 |
| Other deposits                                           |   1,168,516           |      -0- |      -0- |   1,168,516 |
| Borrowings                                               |     435,635      |      436 |    1,467 |  437,538 |
|                                                     | _________                       | ________ | ________ | _________ |
|   Total  interest-sensitive   liabilities |   1,755,962           |  424,093 |  261,967 | 2,442,022 |
|                                                     | _________                       | ________ | ________ | _________ |
| Gap                                                      | $  (566,722)               | $(130,854) |  $ 321,369 |  $(376,207) |
|                                                     |  ==========                | ======== | ======== | ========== |
| ISA/ISL                                                  |      0.68   |     0.69 |     2.23 |      0.85 |
| Gap/Total Assets                                         |      12.38% |      2.86% |      7.02% |       8.22% |
|                                                     |                            |
|                                                          | December  31, 2001              |
|                                                     | 0-90Days                        | 91-180Days | 181-365Days | Cumulative0-365 Days |
|                                                     |                            |   |   |   |
| Loans                                                    | $ 839,279                  | $ 155,276  | $ 276,760  | $1,271,315   |
| Investments                                              |   154,327                  |   90,890 |  180,001 |  425,218 |
| Other interest-earning assets                            |     4,250        |      -0- |      -0- |    4,250 |
|                                                     | _________                       | ________ | ________ |  _________ |
|   Total  interest-sensitive assets                  |   997,856                  |  246,166 |  456,761 |  1,700,783   |
|                                                     | _________                       | ________ | ________ | _________ |
| Certificates of deposit                                  |   329,825                  |  284,518 |  407,188 | 1,021,531  |
| Other deposits                                           | 1,090,160                       |      -0- |      -0- | 1,090,160  |
| Borrowings                                               |   430,189                  |      350 |      750 |   431,289  |
|                                                     | _________                       | ________ | ________ | _________  |
|   Total  interest-sensitive   Liabilities | 1,850,174                       |  284,868 |  407,938 | 2,542,980  |
|                                                     | _________                       | ________ | ________ | _________  |
| Gap                                                      | $  (852,318)                    | $  (38,702) | $  48,823 | $ (842,197)  |
|                                                     |  ==========                |  ========= | ======== | ========== |
| ISA/ISL                                                  |      0.54   |     0.86 |     1.12 |      0.67  |
| Gap/Total Assets                                         |      18.60% |      0.84% |      1.07% |      18.37%  |

  25  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

**Interest Sensitivity**(continued)  Although the periodic gap analysis provides management with a method of measuring  current interest rate risk, it only measures rate sensitivity at a specific  point in time.  Therefore, to more precisely measure the impact of interest  rate changes on the Corporation's net interest income, management simulates  the potential effects of changing interest rates through computer modeling.   The dynamic simulation model used by the Corporation captures all assets, liabilities  and off-balance sheet financial instruments, accounting for significant variables  that are believed to be affected by interest rates.  These variables include  prepayment speeds on mortgage loans and mortgage backed securities, cash flows  from loans, deposits and investments and balance sheet growth assumptions.   The model also captures embedded options, such as interest rate caps/floors  or call options, and accounts for changes in rate relationships as various rate  indices lead or lag changes in market rates.  The Corporation is then better  able to implement strategies which would include an acceleration of a deposit  rate reduction or lag in a deposit rate increase.  The repricing strategies  for loans would be inversely related.  The Corporation's asset/liability management policy guidelines limit interest  rate risk exposure for the succeeding twelve month period.  Simulations  are prepared under the base case where interest rates remain flat and the most  likely case where interest rates are defined using projections of economic factors.   Additional simulations are produced estimating the impact on net interest income  of a 300 basis point (3.00%) movement upward or downward from the base case  scenario.  The Corporation's current asset/liability management policy  indicates that a 300 basis point (3.00%) change in interest rates up or down  cannot result in more than a 7.5% change in net interest income when compared  to a base case, without Board approval and a strategy in place to reduce interest  rate risk below the established maximum level.  The analysis at September  30, 2002 indicated that a 300 basis point (3.00%) increase in interest rates  would increase net interest income 116 points (1.16%) above the base case scenario  and a 300 basis point (3.00%) decline in interest rates would decrease net interest  income by 979 basis points (9.79%) below the base case scenario, over the next  twelve months.  Assuming a 300 basis point (3.00%) decrease in interest  rates, the Corporation is currently out of compliance with the asset/liability  management policy.  Management believes the probability of a 300 basis  point decrease in interest rates is not likely and no action is warranted at  this time.  Additional simulation decreasing interest rates 100 basis points  (1.00%) would result in a decrease in net interest income of 290 basis points  (2.90%), within policy limits.

  26   FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

**Interest Sensitivity**(continued)  The Corporation's "Asset/Liability Management Committee" ("ALCO")  is responsible for the identification, assessment and management of interest  rate risk exposure, liquidity, capital adequacy and investment portfolio position.   The primary objective of the ALCO process is to ensure that the Corporation's  balance sheet structure maintains prudent levels of risk within the context  of currently known and forecasted economic conditions and to establish strategies  which maximize the Corporation's net interest income based on the assumption  of those risks.  The ALCO attempts to mitigate interest rate risk through  the use of strategies such as asset sales, asset and liability pricing and matched  maturity funding.  The ALCO strategies are established by the Corporation's  senior management.  The ALCO continues to evaluate the use of derivative  instruments to protect against the risk of adverse price or interest rate movements  on the values of certain assets and liabilities, although none are being utilized  currently.CREDIT REVIEW  The following table identifies amounts of loan losses and nonperforming loans.   Past due loans are those which were contractually past due 90 days or more as  to interest or principal payments but are well secured and in the process of  collection.  Renegotiated loans are those which terms have been renegotiated  to provide a reduction or deferral of principal or interest as a result of the  deteriorating financial position of the borrower and are in compliance with  the restructured terms.   

  27  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

CREDIT REVIEW(continued)

|                                                                                                | At September 30,                         |
|-----------------------------------------------------------------------------------------------------|------------------------------------------|
|                                                                                                | 2002                                     | 2001 |
|                                                                                                | (amounts in thousands)                   |
| Nonperforming  Loans:                                                                               |                                     |   |
|                                                                                                |                                     |   |
|   Loans on nonaccrual basis                                                                    | $   24,463                     | $   23,068 |
|   Past due loans                                                                               |     14,385                |     20,449 |
|   Renegotiated loans                                                                           |        209 |        835 |
|                                                                                                | __________                               | __________ |
|     Total nonperforming loans                                                        | $   39,057                     | $   44,352 |
|                                                                                                | ==========                               | ========== |
|   Other real estate owned                                                                      | $    1,661                | $    1,716 |
|                                                                                                |                                     |   |
|   Loans outstanding at end of period                                                           | $2,617,465                               | $2,594,029 |
|                                                                                                |                                     |   |
|   Average loans outstanding (year-to-date)                                                     | $2,596,081                               | $2,537,192 |
|                                                                                                |                                     |   |
|   Nonperforming loans as percent of total  loans                                               |      1.49%           |      1.71% |
|                                                                                                |                                     |   |
|   Provision for credit losses                                                                  | $    9,028                |  $    8,506  |
|                                                                                                |                                     |   |
|   Net charge-offs                                                                              | $    8,391                | $    8,935 |
|                                                                                                |                                     |   |
|   Net charge-offs as percent of average    loans outstanding                    |      0.32%           |      0.35% |
|                                                                                                |                                     |   |
|   Provision for credit losses as percent     of net charge-offs                 |    107.59%                     |      95.20% |
|                                                                                                |                                     |   |
|   Allowance for credit losses as percent    of average loans outstanding        |      1.34%           |      1.31% |
|                                                                                                |                                     |   |
|   Allowance for credit losses as percent     of end-of-period loans outstanding |      1.33%           |      1.28% |
|                                                                                                |                                     |   |
|   Allowance for credit losses as percent     of nonperforming loans             |     89.09%                |     74.79% |

  The Corporation considers a loan to be impaired when, based on current information  and events, it is probable that the Corporation will be unable to collect principal  or interest due according to the contractual terms of the loan.  Loan impairment  is measured based on the present value of expected cash flows discounted at  the loan's effective interest rate or, as a practical expedient, at the loan's  observable market price or the fair value of the collateral if the loan is collateral  dependent.  Payments received on impaired loans are applied against the  recorded investment in the loan.  For loans other than those that the Corporation  expects repayment through liquidation of the collateral, when the remaining  recorded investment in the impaired loan is less than or equal to the present  value of the expected cash flows, income is recorded on a cash basis.   Impaired loans include loans on a nonaccrual basis and renegotiated loans.

  28  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

CREDIT REVIEW (continued)  The following table identifies impaired loans, and information regarding the  relationship of impaired loans to the reserve for credit losses at September  30, 2002 and September 30, 2001.

|                                                                             | 2002                    | 2001              |
|----------------------------------------------------------------------------------|-------------------------|-------------------|
|                                                                             | (amounts  in thousands) |
|                                                                             |                    |              |
| Recorded investment in impaired loans at end of  period                          | $24,672                 | $23,903           |
|                                                                             |                    |              |
| Year to date average balance of impaired loans                                   | $25,009                 | $13,332           |
|                                                                             |                    |              |
| Allowance for credit losses related to impaired  loans                           | $ 6,113                 | $ 3,242           |
|                                                                             |                    |              |
| Impaired loans with an allocation of the allowance  for   credit losses     | $15,640                 | $15,683           |
|                                                                             |                    |              |
| Impaired loans with no allocation of the allowance  for  credit losses | $ 9,032                 | $ 8,220           |
|                                                                             |                    |              |
| Year to date income recorded on impaired loans on  a cash basis                  | $   220       | $   379 |

  Other than those described above, there are no material credits that management  has serious doubts as to the borrower's ability to comply with the present loan  repayment terms.  Additionally, the portfolio is well diversified and as  of September 30, 2002, there were no significant concentrations of credit.  Nonperforming loans at September 30, 2002 decreased $5.3 million compared to  2001 levels as reductions in past due loans and renegotiated loans were slightly  offset by an increase in nonaccrual loans.  Past due loans improved both  when compared to year-end 2001 and September 30, 2001. Nonaccrual loans include  two significant credits in both periods.  The largest credit ($6.3 million)  is not past due and carries an 80% guaranty of a U.S. government agency.   While a sale of the underlying assets is pending, final settlement may not occur  until the second quarter of 2003.  The expected loss on this credit is  fully reserved.  The second credit, which was $5.9 million at year-end  2001, continues to be resolved through liquidation of collateral and exercising  other remedies.  The balance outstanding at September 30, 2002, related  to this credit is $3.3 million.  The Corporation anticipates final resolution  of this credit by the second quarter of 2003 without additional losses in excess  of amounts currently reserved.  Nonperforming loans at September 30, 2002,  compared favorably to the balance at December 31, 2001 as past due loans and  renegotiated loans declined offset in part by higher nonaccrual loan balances.   Nonperforming loans as a percent of total loans was 1.49% at September 30, 2002,  compared to 1.62% at December 31, 2001, and 1.71% at September 30, 2001, while  the allowance for credit losses as a percent of nonperforming loans was 89.09%,  82.28% and 74.79%, respectively for the same periods.   

  29   FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

CREDIT REVIEW (continued)  The Corporation's loan portfolio continues to be monitored by senior management  to identify potential portfolio risks and detect potential credit deterioration  in the early stages.  Committees formed during 2001 for the purpose of  reviewing watchlist credits for workout progress or deterioration and monitoring  loan loss adequacy and the status of significant nonperforming credits continue  to provide additional internal monitoring and analysis in addition to that provided  by the credit committees of the banks and parent company.  Credit risk  is mitigated during the loan origination process through the use of sound underwriting  policies and collateral requirements.  Management also attempts to minimize  loan losses by analyzing and modifying collection techniques on a periodic basis.  The Corporation maintains an allowance for credit losses at a level deemed sufficient  to absorb losses which are inherent in the loan and lease portfolios.   Management and the Corporation's Board of Directors review the adequacy of the  allowance on a quarterly basis to ensure that the provision for credit losses  has been charged against earnings in an amount necessary to maintain the allowance  at a level that is appropriate based on management's assessment of probable  estimated losses.The Corporation's methodology for assessing the appropriateness of the allowance  for credit losses consists of several key elements.  These elements include  a specific allowance for primary watch list classified loans, a formula allowance  based on historical trends, an additional allowance for special circumstances  and an unallocated allowance.  The Corporation believes that the allowance  for credit losses is adequate at this time.  Uncertain economic conditions  pose a risk to the banking industry but management believes that its risk management  process serves as an early warning system so that appropriate responses will  be implemented, as required.   CAPITAL RESOURCESShareholders' equity stood at $399.1 million at September 30, 2002, a $29.0  million or 7.8% rise compared to December 31, 2001.  Dividends declared  reduced equity by $26.4 million and $25.4 million for the first nine months  of 2002 and 2001, respectively.  Payments by the Corporation's Employee  Stock Ownership Plan (the "ESOP") to reduce debt it incurred to acquire  the Corporation's common stock for future distribution as employee compensation,  net of fair value adjustments to ESOP shares, increased equity by $804 thousand.   Amounts paid to fund the discount on reinvested dividends reduced equity by  $476 thousand.  The market value adjustment for available for sale securities  net increased equity by $20.1 million for the period.  Proceeds from the  reissuance of treasury shares to provide for stock options exercised increased  equity by $3.4 million during 2002.  Equity capital was also impacted during  2002 by an increase of $830 thousand from the reissuance of treasury shares  to fund an acquisition.   

  30  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION  AND RESULTS OF OPERATIONS

 CAPITAL RESOURCES (continued)  A strong capital base provides the Corporation with a foundation to expand lending,  to protect depositors and provide for growth while protecting against future  uncertainties.  The evaluation of capital adequacy depends on a variety  of factors, including asset quality, liquidity, earnings history and prospects,  internal controls and management ability.  In consideration of these factors,  management's primary emphasis with respect to the Corporation's capital position  is to maintain an adequate and stable ratio of equity to assets.  The Federal Reserve Board has issued risk-based capital adequacy guidelines  which are designed principally as a measure of credit risk.  These guidelines  require:  (1) at least 50% of a banking organization's total capital be  common and other "core" equity capital ("Tier I Capital");  (2) assets and off-balance-sheet items be weighted according to risk; (3) the  total capital to risk-weighted assets ratio be at least 8%; and (4) a minimum  leverage ratio of Tier I capital to average total assets.  The minimum  leverage ratio is not specifically defined, but is generally expected to be  3-5 percent for all but the most highly rated banks, as determined by a regulatory  rating system.  The table below presents the Corporation's capital position at   September 30, 2002:

|                          | Amount  (in thousands) | Percent  of Adjusted  Assets |
|-------------------------------|------------------------|------------------------------|
|                          |                   |                         |
| Tier  I Capital               | $397,060               |  12.8%                  |
| Risk-Based  Requirement       |  123,976          |  4.0                    |
|                          |                   |                         |
| Total  Capital                |  431,854          | 13.9                         |
| Risk-Based  Requirement       |  247,952          |  8.0                    |
|                          |                   |                         |
| Minimum  Leverage Capital     |  397,060          |  8.8                    |
| Minimum  Leverage Requirement |  136,094          |  3.0                    |

  For an institution to qualify as well capitalized under regulatory guidelines,  Tier 1, Total and Leverage Capital ratios must be at least 6.0%, 10.0% and 5.0%,  respectively.  At September 30, 2002, the Corporation's banking subsidiaries  exceeded those requirements.   ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  Information appearing in Item 2 of this report under the caption "Interest  Sensitivity" is incorporated herein by reference in response to this item.

  31  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES

 ITEM 4.  CONTROLS AND PROCEDURES  (a) Disclosure controls and procedures.  Within 90 days before filing this  report, we evaluated the effectiveness of the design and operation of our disclosure  controls and procedures.  Our disclosure controls and procedures are the  controls and other procedures that we designed to ensure that we record, process,  summarize and report in a timely manner the information we must disclose in  reports that we file with or submit to the SEC.  Joseph E. O'Dell, our  President and Chief Executive Officer, and John J. Dolan, our Executive Vice  President and Chief Financial Officer, reviewed and participated in this evaluation.   Based on this evaluation, Messrs. O'Dell and Dolan concluded that, as of the  date of their evaluation, our disclosure controls were effective.  (b) Internal controls.  Since the date of evaluation described above, there  have not been any significant changes in our internal accounting controls or  in other factors that could significantly affect those controls. 

  32  FIRST COMMONWEALTH FINANCIAL CORPORATION AND CONSOLIDATED SUBSIDIARIES

PART II - OTHER INFORMATION  ITEM 1.   LEGAL PROCEEDINGS            There were no material legal  proceedings to which the Corporation            or its subsidiaries are a  party, or of which any of their            property is the subject, except  proceedings which arise in the            normal course of business  and, in the opinion of management, will            not have a material adverse  effect on the consolidated operations            or financial position of the  Corporation and its subsidiaries.              ITEM 2.   CHANGES IN SECURITIES            Not applicable  ITEM 3.   DEFAULTS UPON SENIOR SECURITIES            Not applicable  ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS            Not applicable  ITEM 5.   OTHER INFORMATION            The Corporation's Chief Executive  Officer and Chief Financial            Officer have furnished to  the SEC the certification with respect            to this Form 10-Q that is  required by Section 906 of the             Sarbanes-Oxley Act of 2002.    ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K            (a)      Exhibits                    Exhibit  10.1 Form of Separation Agreement and General                      Release  of Robert F. Koslow                    Exhibit  10.2 Form of Separation Agreement and General                       Release of David S. Dahlmann                    Exhibit  99.1 Chief Executive Officer Certification pursuant                       to 18 U.S.C. Section 1350 as adopted pursuant to Section                       906 of the Sarbanes-Oxley Act of 2002                    Exhibit  99.2 Chief Financial Officer Certification pursuant                       to 18 U.S.C. Section 1350 as adopted pursuant to Section                       906 of the Sarbanes-Oxley Act of 2002            (b)      Reports on Form 8-K                     None

  33  SIGNATURES

 Pursuant to the requirements of the Securities Exchange Act of 1934,  the registrant has duly caused this report to be signed on its behalf by the  undersigned thereunto duly authorized.  FIRST COMMONWEALTH FINANCIAL CORPORATION  (Registrant)

 DATED: NOVEMBER 8, 2002     /S/Joseph E. O'Dell                               ____________________________________                               Joseph E. O'Dell, President and                               Chief Executive Officer  DATED: NOVEMBER 8, 2002     /S/John J. Dolan                                     _____________________________________                               John J. Dolan, Executive Vice                               President and Chief Financial Officer

  34**CHIEF EXECUTIVE OFFICER CERTIFICATION**

****  I, Joseph E. O'Dell, President and Chief Executive Officer, certify that: 

| 1. | I have reviewed this quarterly report on Form 10-Q of First Commonwealth      Financial Corporation;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | Based on my knowledge, this quarterly report does not contain any      untrue statement of a material fact or omit to state a material fact necessary      to make the statements made, in light of the circumstances under which such      statements were made, not misleading with respect to the period covered      by this quarterly report;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 3. | Based on my knowledge, the financial statements, and other financial      information included in this quarterly report, fairly present in all material      respects the financial condition, results of operations and cash flows of      the registrant as of, and for, the periods presented in this quarterly report;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| 4. | The registrant's other certifying officers and I are responsible      for establishing and maintaining disclosure controls and procedures (as      defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and      we have:      a) designed such disclosure controls and procedures to ensure that material      information relating to the registrant, including its consolidated subsidiaries,      is made known to us by others within those entities, particularly during      the period in which this quarterly report is being prepared;      b) evaluated the effectiveness of the registrant's disclosure controls and      procedures as of a date within 90 days prior to the filing date of this      quarterly report (the "Evaluation Date"); and      c) presented in this quarterly report our conclusions about the effectiveness      of the disclosure controls and procedures based on our evaluation as of      the Evaluation Date; |
| 5. | The registrant's other certifying officers and I have disclosed,        based on our most recent evaluation, to the registrant's auditors and        the audit committee of registrant's board of directors (or persons performing        the equivalent function):

a) all significant deficiencies in the design or operation of        internal controls which could adversely affect the registrant's ability        to record, process, summarize and report financial data and have identified        for the registrant's auditors any material weaknesses in internal controls;        and

b) any fraud, whether or not material, that involves management or        other employees who have a significant role in the registrant's internal        controls; and                                                                                                                                                                                                    |

       

                    35

| 6.  | The registrant's other certifying officers and I have indicated in      this quarterly report whether or not there were significant changes in internal      controls or in other factors that could significantly affect internal controls      subsequent to the date of our most recent evaluation, including any corrective      actions with regard to significant deficiencies and material weaknesses. |
|----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

                  November 8, 2002            /S/Joseph E. O'Dell                                               Date                               Signature                                              President and Chief Executive Officer                                                            Title

  36

**CHIEF FINANCIAL OFFICER CERTIFICATION**

 I, John Dolan, Executive Vice President and Chief Financial Officer,  certify that:

| 1. | I have reviewed this quarterly report on Form 10-Q of First Commonwealth      Financial Corporation;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2. | Based on my knowledge, this quarterly report does not contain any      untrue statement of a material fact or omit to state a material fact necessary      to make the statements made, in light of the circumstances under which such      statements were made, not misleading with respect to the period covered      by this quarterly report;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 3. | Based on my knowledge, the financial statements, and other financial      information included in this quarterly report, fairly present in all material      respects the financial condition, results of operations and cash flows of      the registrant as of, and for, the periods presented in this quarterly report;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 4. | The registrant's other certifying officers and I are responsible        for establishing and maintaining disclosure controls and procedures (as        defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and        we have:

a) designed such disclosure controls and procedures to ensure        that material information relating to the registrant, including its consolidated        subsidiaries, is made known to us by others within those entities, particularly        during the period in which this quarterly report is being prepared;

b) evaluated the effectiveness of the registrant's disclosure        controls and procedures as of a date within 90 days prior to the filing        date of this quarterly report (the "Evaluation Date"); and

c) presented in this quarterly report our conclusions about        the effectiveness of the disclosure controls and procedures based on our        evaluation as of the Evaluation Date; |
| 5. | The registrant's other certifying officers and I have disclosed,      based on our most recent evaluation, to the registrant's auditors and the      audit committee of registrant's board of directors (or persons performing      the equivalent function):      a) all significant deficiencies in the design or operation of internal controls      which could adversely affect the registrant's ability to record, process,      summarize and report financial data and have identified for the registrant's      auditors any material weaknesses in internal controls; and      b) any fraud, whether or not material, that involves management or other      employees who have a significant role in the registrant's internal controls;      and                                                                                                                                                                                                                                               |

   

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| 6. | The registrant's other certifying officers and I have indicated in      this quarterly report whether or not there were significant changes in internal      controls or in other factors that could significantly affect internal controls      subsequent to the date of our most recent evaluation, including any corrective      actions with regard to significant deficiencies and material weaknesses. |
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                 November 8, 2002            /S/John J. Dolan                                                        Date                      Signature                                        Executive  Vice President and                                         Chief Financial Officer                                                                         Title

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