<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON D.C. 20549

                                    FORM 10-Q

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

FOR THE PERIOD ENDED:          JUNE 30, 2001


                       NORTH FORK BANCORPORATION, INC.
             (Exact name of Company as specified in its charter)


         DELAWARE                                         36-3154608
(State or other Jurisdiction of                         (I.R.S. Employer
  incorporation or organization)                       Identification No.)


275 BROADHOLLOW ROAD, MELVILLE, NEW YORK                      11747
(Address of principal executive offices)                    (Zip Code)


                                 (631) 844-1004
                (Company's telephone number, including area code)



Indicate by check mark whether the Company (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 Company was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:

                           Yes (X)      No ( )


Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

CLASS OF COMMON STOCK                 NUMBER OF SHARES OUTSTANDING - 8/10/01
  $.01 PAR VALUE                                  162,030,936


                                       1
<PAGE>   2
                                      INDEX

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS (UNAUDITED)
         North Fork Bancorporation, Inc. and Subsidiaries.
              1)  Consolidated Balance Sheets.
              2)  Consolidated Statements of Income.
              3)  Consolidated Statements of Cash Flows.
              4)  Consolidated Statements of Changes in Stockholders' Equity.
              5)  Consolidated Statements of Comprehensive Income.
              6)  Notes to Consolidated Financial Statements.

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

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
         The information required by this item is contained throughout Item 2,
         "Management's Discussion and Analysis of Financial Condition and
         Results of Operations" and is incorporated by reference.

PART II. OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS
         Not Applicable.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS
         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
         Not Applicable.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)    The following exhibits are submitted herewith:

                Exhibit #             Description
                  (11)          Statement Re: Computation
                                  of Per Share Earnings.

(b)      Current Reports on Form 8-K

          1)   Current Report on Form 8-K dated June 11, 2001 (announcing that
               the Company issued a joint press release with Commercial Bank of
               New York announcing that they expect to close the Company's
               acquisition of Commercial Bank of New York during the fourth
               quarter of 2001).

          2)   Current Report on Form 8-K dated June 13, 2001 (announcing that
               the Company will host an investor and analyst conference in New
               York City on June 14, 2001).


                                       2
<PAGE>   3
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
<TABLE>
<CAPTION>
                                                                               -----------------------------------------------
                                                                                  JUNE 30,       DECEMBER 31,        JUNE 30,
(in thousands, except per share amounts)                                            2001             2000              2000
                                                                               -----------------------------------------------
ASSETS:
<S>                                                                              <C>               <C>               <C>
Cash & Due from Banks..........................................................   $313,708          $292,456          $248,269
Money Market Investments.......................................................     17,708            17,578            72,807
Securities:
   Available-for-Sale  ($1,451,672 and $1,701,463 pledged at
      June 30, 2001 and December 31, 2000, respectively).......................  4,385,911         3,467,663         3,449,273
   Held-to-Maturity  ($564,664 and $722,075 pledged at
       June 30, 2001 and December 31, 2000, respectively)......................    860,891         1,090,677         1,219,444
                                                                                 ---------         ---------         ---------
      Total Securities.........................................................  5,246,802         4,558,340         4,668,717
                                                                                 ---------         ---------         ---------
Loans..........................................................................  9,847,779         9,409,762         9,100,542
  Less: Unearned Income and Fees...............................................     12,699            15,049            16,760
            Allowance for Loan Losses..........................................     92,853            89,653            88,010
                                                                                 ---------         ---------         ---------
                  Net Loans....................................................  9,742,227         9,305,060         8,995,772
                                                                                 ---------         ---------         ---------
Goodwill.......................................................................    328,057           337,202           341,619
Core Deposit Intangibles.......................................................      8,817             9,817            10,930
Premises & Equipment...........................................................    102,711            96,844           100,517
Accrued Income Receivable......................................................     93,165            96,914            91,208
Other Assets...................................................................    114,790           126,751           152,909
                                                                                 ---------         ---------         ---------
     Total Assets..............................................................$15,967,985       $14,840,962       $14,682,748
                                                                               ===========       ===========       ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:

Demand Deposits................................................................ $2,162,881        $2,025,249        $1,846,973
Savings Deposits...............................................................  2,914,540         2,858,757         2,967,729
NOW and Money Market Deposits..................................................  1,873,534         1,370,214         1,155,552
Other Time Deposits............................................................  2,346,616         2,285,196         2,373,567
Certificates of Deposits, $100,000 and Over....................................    884,471           629,779           577,599
                                                                                 ---------         ---------         ---------
     Total Deposits............................................................ 10,182,042         9,169,195         8,921,420
                                                                                 ---------         ---------         ---------
Federal Funds Purchased & Securities Sold Under
   Agreements to Repurchase....................................................  2,112,122         2,350,882         2,800,282
Other Borrowings...............................................................  1,552,155         1,653,265         1,144,710
Broker Payables................................................................    322,918                --            35,206
Accrued Expenses & Other Liabilities...........................................    215,793           209,363           194,301
                                                                                 ---------         ---------         ---------
      Total Liabilities........................................................$14,385,030       $13,382,705       $13,095,919
                                                                                 ---------         ---------         ---------
Capital Securities.............................................................   $244,351          $244,339          $244,326

STOCKHOLDERS' EQUITY:

Preferred Stock, par value $1.00; authorized 10,000,000 shares, unissued       $        --       $        --       $        --
Common stock, par value $0.01; authorized 500,000,000 shares;
    issued 174,580,778 shares at June 30, 2001.................................      1,746             1,746             1,740
Additional Paid in Capital.....................................................    358,296           359,679           352,503
Retained Earnings..............................................................  1,235,924         1,147,375         1,059,843
Accumulated Other Comprehensive Income/(Loss)..................................     25,413             9,694          (41,435)
Deferred Compensation..........................................................   (29,494)          (32,474)          (26,585)
Treasury Stock at cost;  12,678,398 shares at June 30, 2001....................  (253,281)         (272,102)           (3,563)
                                                                                 ---------         ---------         ---------
      Total Stockholders' Equity...............................................  1,338,604         1,213,918         1,342,503
                                                                                 ---------         ---------         ---------
      Total Liabilities and Stockholders' Equity...............................$15,967,985       $14,840,962       $14,682,748
                                                                               ===========       ===========       ===========
</TABLE>



See Accompanying Notes to Consolidated Financial Statements


                                       3
<PAGE>   4
Consolidated Statements of Income (Unaudited)
<TABLE>
<CAPTION>
                                                                         THREE MONTHS ENDED              SIX MONTHS ENDED
                                                                      -------------------------------------------------------
                                                                      JUNE 30,        JUNE 30,        JUNE 30,       JUNE 30,
(in thousands, except per share amounts)                                2001            2000           2001           2000
                                                                      -------------------------------------------------------
INTEREST INCOME:
<S>                                                                   <C>             <C>            <C>             <C>
Loans...........................................................      $195,836        $181,922       $390,385        $350,846
Mortgage-Backed Securities......................................        62,291          71,662        122,746         142,459
Other Securities................................................        10,097          13,306         22,374          23,014
U.S. Treasury & Government Agency Securities....................         1,815           2,684          4,141           5,125
State & Municipal Obligations...................................         2,092             929          4,162           1,848
Money Market Investments........................................           729             639          1,541           2,017
                                                                       -------         -------        -------         -------
Total Interest Income...........................................       272,860         271,142        545,349         525,309
                                                                       -------         -------        -------         -------

INTEREST EXPENSE:

Savings, NOW and Money Market Deposits..........................        22,929          19,909         45,067          38,818
Other Time Deposits.............................................        30,674          30,023         62,176          56,476
Certificates of Deposit, $100,000 and Over......................        11,379           7,690         21,000          14,877
Federal Funds Purchased & Securities Sold Under
   Agreements to Repurchase.....................................        22,250          38,726         53,653          72,307
Other Borrowings................................................        21,601          21,828         46,141          50,535
                                                                       -------         -------        -------         -------
   Total Interest Expense.......................................       108,833         118,176        228,037         233,013
                                                                       -------         -------        -------         -------
   Net Interest Income..........................................       164,027         152,966        317,312         292,296
Provision for Loan Losses.......................................         4,000           2,250          7,750          11,250
                                                                       -------         -------        -------         -------
   Net Interest Income after Provision for Loan Losses..........       160,027         150,716        309,562         281,046
                                                                       -------         -------        -------         -------
NON-INTEREST INCOME:

Customer Related Fees and Service Charges.......................        14,066          11,459         27,084          22,234
Investment Management, Commissions & Trust Fees.................         4,034           4,623          8,008           9,356
Mortgage Banking Operations.....................................         1,097             942          2,087           1,797
Check Cashing Fees..............................................           822             742          1,587           1,280
Other Operating Income..........................................         2,514           2,984          4,995           5,350
Net Securities Gains/(Losses)...................................         1,336          11,148          5,208         (8,600)
Trading Income..................................................            --              --          7,943              --
Gain on Sale of Branch Facilities...............................            --          10,392             --          10,392
Gain on Sale of Loans...........................................            --              --             --           2,303
                                                                       -------         -------        -------         -------
     Total Non-Interest Income..................................        23,869          42,290         56,912          44,112
                                                                       -------         -------        -------         -------
NON-INTEREST EXPENSE:

Employee Compensation and Benefits..............................        30,232          27,730         59,681          56,337
Occupancy and Equipment, net....................................        10,347           8,864         20,583          17,784
Amortization of Goodwill........................................         4,978           5,114          9,945           7,876
Amortization of Core Deposit Intangibles........................           500             557          1,000           1,113
Capital Securities Costs........................................         5,140           5,140         10,280           9,774
Other Operating Expenses........................................        13,281          10,964         25,831          22,532
Dime Related Expenses...........................................            --           2,300             --           8,300
Merger Related Restructure Charge...............................            --              --             --          50,499
                                                                       -------         -------        -------         -------
    Total Non-Interest Expense..................................        64,478          60,669        127,320         174,215
                                                                       -------         -------        -------         -------
Income Before Income Taxes......................................       119,418         132,337        239,154         150,943
Provision for Income Taxes......................................        41,199          46,318         82,508          63,013
                                                                       -------         -------        -------         -------
     Net Income.................................................       $78,219         $86,019       $156,646         $87,930
                                                                       ========        =======       ========         =======

PER SHARE:

Earnings Per Share - Basic......................................         $0.49           $0.50          $0.98           $0.53
Earnings Per Share - Diluted....................................         $0.49           $0.50          $0.97           $0.52
Cash Dividends .................................................         $0.21           $0.18          $0.42           $0.36
Weighted Average Shares Outstanding - Basic.....................       159,392         171,672        159,300         166,994
Weighted Average Shares Outstanding - Diluted...................       161,173         172,847        160,970         168,144
</TABLE>

See Accompanying Notes to Consolidated Financial Statements

                                       4
<PAGE>   5
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>

FOR THE SIX MONTHS ENDED JUNE 30,                                                                     2001         2000
CASH FLOWS FROM OPERATING ACTIVITIES:                                                              -------------------------
<S>                                                                                                   <C>           <C>
Net Income..........................................................................                  $156,646      $87,930
ADJUSTMENTS TO RECONCILE NET INCOME TO
    NET CASH PROVIDED BY OPERATING ACTIVITIES:

Provision for Loan Losses...........................................................                     7,750       11,250
Depreciation and Amortization.......................................................                     8,219        7,273
Amortization of Goodwill & Core Deposit Intangibles.................................                    10,945        8,989
Amortization of Securities Premiums.................................................                     3,864        2,790
Accretion of Discounts and Net Deferred Loan Fees...................................                  (15,464)     (10,518)
Securities (Gains)/Losses, net......................................................                   (5,208)        8,600
Gain on Sale of Branch Facilities...................................................                        --     (10,392)
Gain on Sale of Loans...............................................................                        --      (2,303)
Other, net..........................................................................                     8,057       16,334
                                                                                                       -------      -------
    Net Cash Provided by Operating Activities.......................................                   174,809      119,953
                                                                                                       -------      -------
CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of Securities Held-to-Maturity............................................                   (4,557)     (10,083)
Maturities, Redemptions, Calls and Principal Repayments on
    Securities Held-to-Maturity.....................................................                   128,755      141,509
Purchases of Securities Available-for-Sale..........................................               (1,074,835)    (358,857)
Proceeds from Sales of Securities Available-for-Sale................................                   157,375    1,585,216
Maturities, Redemptions, Calls and Principal Repayments on
    Securities Available-for-Sale...................................................                   465,338      228,264
Loans Originated, net of principal repayments and charge-offs.......................                 (467,931)    (467,574)
Proceeds from the Sale of Loans.....................................................                    29,102      254,624
Transfers to Other Real Estate, net of sales........................................                      (67)          207
(Purchases)/Sales of Premises and Equipment, net....................................                  (11,380)       10,273
Purchase Acquisition, net of cash acquired..........................................                        --       36,858
                                                                                                       -------      -------
    Net Cash (Used in)/Provided by Investing Activities.............................                 (778,200)    1,420,437
                                                                                                       -------      -------
CASH FLOWS FROM FINANCING ACTIVITIES:

Net Increase/(Decrease) in Customer Deposits Liabilities............................                 1,012,847    (221,722)
Net Decrease in Borrowings..........................................................                 (339,870)  (1,338,212)
Purchase of Treasury Stock..........................................................                   (4,996)     (10,216)
Exercise of Options and Common Stock Sold for Cash..................................                    19,839        2,030
Cash Dividends Paid.................................................................                  (63,047)     (54,395)
                                                                                                       -------      -------
    Net Cash Provided by/(Used in) Financing Activities.............................                   624,773  (1,622,515)
                                                                                                       -------      -------
    Net Increase/(Decrease) in Cash and Cash Equivalents............................                    21,382     (82,125)
Cash and Cash Equivalents at Beginning of the Period................................                   310,034      403,201
                                                                                                       -------      -------
Cash and Cash Equivalents at End of the Period......................................                  $331,416     $321,076
                                                                                                      ========     ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash Paid During the Period for:
    Interest Expense................................................................                  $230,833     $242,036
                                                                                                      ========     ========
    Income Taxes....................................................................                    86,255        1,412
                                                                                                      ========     ========
Securities Transferred from Held-to-Maturity to Available-for-Sale
    in Accordance with SFAS 133.....................................................                   119,578           --
                                                                                                      ========     ========
During the Period the Company Purchased Various Securities which
    Settled in the Subsequent Period................................................                   332,918       35,206
                                                                                                      ========     ========
In February 2000, the Company acquired all of the outstanding common
stock of Reliance Bancorp, Inc.  Each share of Reliance's common stock
was exchanged for 2.0 shares of the Company's common stock.
Noncash activity related to the Reliance acquisition not reflected above for the
six months ended June 30, 2000 is as follows:

Fair Value of Assets Acquired.......................................................                        --   $2,340,970
Intangible Assets...................................................................                        --      285,693
Common Stock Issued.................................................................                        --    (332,947)
                                                                                                                  --------
Liabilities Assumed ................................................................                        --   $2,293,716
                                                                                                                 ==========
</TABLE>

See Accompanying Notes to Consolidated Financial Statements


                                       5
<PAGE>   6
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)
(Dollars in thousands, except per share amounts)

<TABLE>
<CAPTION>
                                                                                    Accumulated
                                                             Additional                Other
                                                     Common   Paid in      Retained   Comprehensive
                                                     Stock    Capital      Earnings   Income/(Loss)
                                                     ------------------------------------------------
<S>                                                   <C>      <C>        <C>           <C>
BALANCE, DECEMBER 31, 1999......................    $1,931   $560,979   $1,026,546    ($37,818)
Net Income......................................          --         --       87,930          --
Cash Dividends ($.36 per share).................          --         --      (62,568)         --
Cash Dividends-Acquired Company.................          --         --       (4,718)         --
Issuance of Stock-Reliance Acquisition
   (17,120,638 shares)..........................          --    (38,989)          --          --
Fair Value of Options-Reliance Acquisition......          --     14,075           --          --
Issuance of Stock (124,924 shares)..............           1      1,975           --          --
JSB Common Stock Retired (19,687,149 shares)....       (197)   (184,872)      13,540          --
Purchases of Treasury Stock (636,300 shares)....          --         --           --          --
Restricted Stock Activity, net..................          --        (20)          --          --
Stock Based Compensation Activity, net..........           5       (645)        (887)         --
Accumulated Other Comprehensive Income/(Loss)...          --         --           --      (3,617)
                                                      ------   --------   ----------    --------
BALANCE, JUNE 30, 2000..........................      $1,740   $352,503   $1,059,843    ($41,435)
                                                      ======   ========   ==========    ========



BALANCE, DECEMBER 31, 2000......................      $1,746   $359,679   $1,147,375      $9,694
Net Income......................................          --         --      156,646          --
Cash Dividends ($.42 per share).................          --         --      (68,097)         --
Issuance of Stock (84,240 shares)...............          --        533           --          --
Purchases of Treasury Stock (200,000 shares)....          --         --           --          --
Restricted Stock Activity, net..................          --         16           --          --
Stock Based Compensation Activity, net..........          --     (1,932)          --          --
Accumulated Other Comprehensive Income/(Loss)...          --         --           --      15,719
                                                      ------   --------   ----------    --------
BALANCE, JUNE 30, 2001..........................      $1,746   $358,296   $1,235,924     $25,413
                                                      ======   ========   ==========    ========
</TABLE>



<TABLE>
<CAPTION>
                                                      Deferred     Treasury
                                                    Compensation    Stock      Total

<S>                                                <C>           <C>           <C>
BALANCE, DECEMBER 31, 1999......................   ($28,007)     ($524,533)    $999,098
Net Income......................................         --             --       87,930
Cash Dividends ($.36 per share).................         --             --      (62,568)
Cash Dividends-Acquired Company.................         --             --       (4,718)
Issuance of Stock-Reliance Acquisition
   (17,120,638 shares)..........................         --        357,861      318,872
Fair Value of Options-Reliance Acquisition......         --             --       14,075
Issuance of Stock (124,924 shares)..............         --             54        2,030
JSB Common Stock Retired (19,687,149 shares)....         --        171,529           --
Purchases of Treasury Stock (636,300 shares)....         --        (10,216)     (10,216)
Restricted Stock Activity, net..................      1,422           (228)       1,174
Stock Based Compensation Activity, net..........         --          1,970          443
Accumulated Other Comprehensive Income/(Loss)...         --             --       (3,617)
                                                    ---------     ---------  ----------

BALANCE, JUNE 30, 2000..........................   ($26,585)       ($3,563)  $1,342,503
                                                    =========     =========  ==========


BALANCE, DECEMBER 31, 2000......................   ($32,474)     ($272,102)  $1,213,918
Net Income......................................         --             --      156,646
Cash Dividends ($.42 per share).................         --             --      (68,097)
Issuance of Stock (84,240 shares)...............         --          1,675        2,208
Purchases of Treasury Stock (200,000 shares)....         --         (4,996)      (4,996)
Restricted Stock Activity, net..................      2,980           (625)       2,371
Stock Based Compensation Activity, net..........         --         22,767       20,835
Accumulated Other Comprehensive Income/(Loss)...         --             --       15,719
                                                    ---------     ---------      ------
BALANCE, JUNE 30, 2001..........................   ($29,494)     ($253,281)  $1,338,604
                                                    ========      =========   ==========
</TABLE>

See Accompanying Notes to Consolidated Financial Statements

                                       6
<PAGE>   7
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(in thousands)
<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED              SIX MONTHS ENDED
                                                                    ------------------------------------------------------------
                                                                         JUNE 30,        June 30,        JUNE 30,       June 30,
                                                                           2001            2000            2001           2000
                                                                    ------------------------------------------------------------
<S>                                                                      <C>             <C>           <C>              <C>
Net Income.....................................................          $78,219         $86,019       $156,646         $87,930
Other Comprehensive income, net of taxes:
    Cash Flow Hedges(1):
        Net Derivative Gains/(Losses)..........................            1,512              --          (845)              --
        Reclassification Adjustment - Net Derivative Gains.....                -              --          1,232              --
    Securities Available-for-Sale:
        Unrealized (Losses)/Gains..............................          (6,113)         (1,268)         18,743         (9,207)
        Less: Reclassification of Realized Gains/(Losses)......              875           7,246          3,411         (5,590)
                                                                         -------         -------       --------         -------
Other Comprehensive Income.....................................          (5,476)         (8,514)         15,719         (3,617)
                                                                         -------         -------       --------         -------
Comprehensive Income...........................................          $72,743         $77,505       $172,365         $84,313
                                                                         =======         =======       ========         =======

</TABLE>


(1)  See Asset/Liability Management section of this document for further
     discussion.


See Accompanying Notes to Consolidated Financial Statements

                                       7
<PAGE>   8
                        NORTH FORK BANCORPORATION, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                             JUNE 30, 2001 AND 2000

FORWARD LOOKING STATEMENTS

         This document and other documents filed with the Securities and
Exchange Commission ("SEC") have forward-looking statements. In addition, senior
management may make forward-looking statements orally to analysts, investors,
the media, and others. Forward-looking statements might include one or more of
the following:

         -Projections of revenues, income, earnings per share, capital
          expenditures, dividends, capital structure, or other financial items;

         -Descriptions of plans or objectives of management for future
          operations, products, or services, including pending acquisition
          transactions;

         -Forecasts of future economic performance; and

         -Descriptions of assumptions underlying or relating to any of the
          foregoing.

         Forward-looking statements can be identified by the fact that they do
not relate strictly to historical or current facts. They often include words
such as "believe", "expect", "anticipate", "intend", "plan", "estimate", or
words of similar meaning, or future or conditional verbs such as "will",
"would", "should", "could", or "may".

         Forward-looking statements present the Company's expectations or
predictions of future conditions, events or results. They are not guarantees of
future performance. By their nature, forward-looking statements are subject to
risks and uncertainties. There are a number of factors, many of which are beyond
the Company's control, that could cause actual conditions, events, or results to
differ significantly from those described in the forward-looking statements.

         Factors that may cause or contribute to such differences include, among
others, the following possibilities: (1) changes in general business and
economic conditions on both a regional and national level; (2) increased
competition in terms of the products and services the Company offers and the
markets in which the Company conducts its business; (3) changes in the interest
rate environment, which may impact interest margins; and (4) accounting, tax,
legislative, regulatory, and technological changes may also affect the business
in which the Company is engaged.

         Forward-looking statements speak only as of the date they are made. The
Company does not undertake to update forward-looking statements to reflect
circumstances or events that occur after the date the forward-looking statements
are made.

BASIS OF PRESENTATION

         North Fork Bancorporation, Inc. (the "Company") is a $16.0 billion
multi-bank holding company headquartered in Melville, New York. The Company's
primary bank subsidiary, North Fork Bank ("North Fork"), operates through 150
full-service retail-banking facilities located in the New York metropolitan
area, one of the most densely populated and wealthiest markets in the nation.
North Fork focuses on providing superior customer service to both personal and
commercial clients by offering the convenience of electronic banking as well as
an array of financial products and brokerage/investment management services
through its non-bank subsidiaries, Compass Investment Services Corp. ("Compass")
and Amivest Corporation ("Amivest"). The Company's other bank subsidiary,
Superior Savings of New England, N.A. ("Superior"), a nationally chartered bank
headquartered in the Connecticut county of New Haven, operates from two
locations, where it currently conducts an electronic banking operation focused
on gathering deposits throughout the northeast.

         The accounting and reporting policies of the Company are in conformity
with accounting principles generally accepted in the United States of America
and prevailing practices within the financial services industry. The preparation
of financial statements in conformity with accounting principles generally
accepted in the United States of America requires that management make estimates
and assumptions that affect the reported amounts of assets and liabilities, and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Such estimates are subject to change in the future as additional
information becomes available or previously existing circumstances are modified.
Actual results could differ from those estimates. Certain reclassifications have
been made to prior year amounts to conform to current year presentations.

         Results of operations for the three and six month periods ended June
30, 2001 are not necessarily indicative of the results of operations which may
be expected for the full year 2001 or any other interim periods.

         These statements should be read in conjunction with the Company's 2000
Annual Report on Form 10-K, which is incorporated herein by reference.


                                       8
<PAGE>   9
RECENT ACCOUNTING DEVELOPMENTS

ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

         Effective January 1, 2001, the Company adopted Statement of Financial
Accounting Standards No. 133 "Accounting for Derivative Instruments and Hedging
Activities" ("SFAS 133"), as amended. SFAS 133 establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contracts and for hedging activities. The
statement requires that all derivative instruments be recorded on the balance
sheet at fair value. However, the accounting for changes in fair value of the
derivative instrument depends on whether the derivative instrument qualifies as
a hedge. If the derivative instrument qualifies as a hedge, the accounting
treatment varies based on the type of risk being hedged. If the derivative
instrument does not qualify as a hedge, changes in fair value are reported in
earnings when they occur. Under SFAS 133, an entity that elects to apply hedge
accounting is required to establish, at the inception of the hedge, the method
it will use for assessing the effectiveness of the hedging derivative and the
measurement approach for determining the ineffective aspect of the hedge. Those
methods must be consistent with the entity's approach to managing risk. SFAS 133
has not had a material impact on the consolidated financial statements during
the first six months of 2001, however, future volatility of earnings and other
comprehensive income may result due to management's use of derivatives in
connection with potential hedging strategies, market values of derivatives and
hedged items, and future guidance issued by FASB with regards to the
implementation of SFAS 133. See Asset/Liability Management section of this
document for additional disclosure.

ACCOUNTING FOR TRANSFERS AND SERVICING OF FINANCIAL ASSETS AND EXTINGUISHMENTS
OF LIABILITIES

         In September 2000, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards No. 140 "Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities"
("SFAS 140"), a replacement of Statement No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities", ("SFAS 125").
SFAS 140 revised the standards of accounting for securitizations and other
transfers of financial assets and collateral and requires certain disclosures,
but it carries over most of SFAS 125's provisions without reconsideration. SFAS
140 provides accounting and reporting standards for transfers and servicing of
financial assets and extinguishments of liabilities based on consistent
application of a financial components approach that focuses on control. Under
this approach, after a transfer of financial assets, an entity recognizes the
financial and servicing assets it controls and the liabilities it has incurred,
derecognizes the financial assets when control has been surrendered, and
derecognizes liabilities when extinguished. This statement provides consistent
standards for distinguishing transfers of financial assets that are sales from
transfers that are secured borrowings. SFAS 140 was generally effective for
transfers and servicing of financial assets and extinguishments of liabilities
occurring after March 31, 2001. SFAS 140 was effective for recognition and
reclassification of collateral and for disclosures relating to securitization
transactions and collateral for fiscal years ending after December 15, 2000. The
adoption of SFAS 140 did not have a material impact on the Company's financial
condition or results of operations.

BUSINESS COMBINATIONS

     In July 2001, the FASB issued Statement of Financial Accounting Standards
No. 141 "Business Combinations" ("SFAS 141") effective June 30, 2001. SFAS 141
addresses financial accounting and reporting for business combinations and
requires the use of the purchase method of accounting for all business
combinations; the use of the pooling-of-interests method of accounting is
eliminated for transactions initiated after June 30, 2001. SFAS 141 also
establishes guidelines as to how the purchase method is to be applied. This
guidance is similar to that previously contained in APB opinion No. 16,
however, SFAS 141 establishes additional disclosure requirements for
transactions occurring after the effective date.

GOODWILL AND OTHER INTANGIBLE ASSETS

     In July 2001, the FASB also issued Statement of Financial Accounting
Standards No. 142 "Goodwill and Other Intangible Assets" ("SFAS 142"). SFAS 142
addresses the initial recognition and measurement of intangible assets acquired
individually or as part of a group of other assets not constituting a business
combination (SFAS 141 addresses the initial recognition and measurement of
goodwill and other intangible assets acquired in a business combination).

     In accordance with the provisions of SFAS 142 amortization will cease
effective January 1, 2002 on all goodwill identified as having an indefinite
useful life. Goodwill identified as such will be assessed for impairment on an
annual basis, by applying a fair-value based test as defined in the Statement.
SFAS 142 also provides additional guidance on acquired intangibles that should
be separately recognized and amortized over their estimated useful lives. Such
intangible assets remain subject to the impairment provisions of SFAS 121.


                                       9
<PAGE>   10
     Assuming the standards set forth in SFAS 142 were effective the beginning
of the current year, net income and earnings per share for the three and six
months ended June 30, 2001 would have been $83.1 million or diluted earnings
per share of $.52  and $166.3 million or diluted earnings per share of $1.03,
respectively. Additionally, SFAS 142 requires that the company complete an
initial goodwill impairment assessment on all goodwill recognized in its
consolidated financial statements as of the statements effective date to
determine if a transition impairment charge needs to be recognized. Management
does not anticipate that the assessment will result in a transition impairment
charge.

MANAGEMENT'S DISCUSSION AND ANALYSIS
PROPOSED BUSINESS COMBINATION

     Commercial Bank of New York

         On February 13, 2001, the Company entered into an Agreement and Plan of
    Reorganization with Commercial Bank of New York ("CBNY"), whereby it would
    acquire CBNY for approximately $175 million in cash. The transaction is
    pending regulatory approval and is anticipated to close in the fourth
    quarter of 2001. The Company's operating results in 2001 will not be
    materially affected by the acquisition. At June 30, 2001, CBNY had $1.4
    billion in total assets, $.4 billion in loans, $1.2 billion in deposit
    liabilities, and $104 million in shareholders equity. CBNY operates from 14
    retail banking facilities, including 11 in the New York City borough of
    Manhattan.

OVERVIEW

         The following table sets forth selected financial highlights for the
three and six month periods ended June 30, 2001 and 2000, respectively. The
succeeding discussion and analysis describes the changes in components of
operating results giving rise to net income.

<TABLE>
<CAPTION>
                                                                 THREE MONTHS ENDED                    SIX MONTHS ENDED
                                                           -------------------------------------------------------------------
                                                                JUNE 30,        JUNE 30,            JUNE 30,           JUNE 30,
(in thousands, except ratios & per share amounts)                 2001           2000                2001               2000
------------------------------------------------------------------------------------------------------------------------------
EARNINGS:
<S>                                                              <C>            <C>               <C>                 <C>
    Net Income.........................................          $78,219        $86,019           $156,646            $87,930
-----------------------------------------------------------------------------------------------------------------------------

PER SHARE:

    Earnings Per Share - Basic.........................            $0.49          $0.50              $0.98              $0.53
    Earnings Per Share - Diluted.......................            $0.49          $0.50              $0.97              $0.52
    Cash Dividends.....................................            $0.21          $0.18              $0.42              $0.36
    Dividend Payout Ratios.............................           42.86%          36.0%             43.30%             70.59%
    Book Value.........................................            $8.27          $7.72              $8.27              $7.72
    Average Equivalent Shares - Basic..................          159,392        171,672            159,300            166,994
    Average Equivalent Shares - Diluted................          161,173        172,847            160,970            168,144
-----------------------------------------------------------------------------------------------------------------------------
SELECTED RATIOS:

    Return on Average Total Assets (1).................            2.07%          2.35%              2.10%              1.23%
    Return on Average Stockholders' Equity (1).........           23.28%         25.10%             23.92%             13.81%
    Core Efficiency Ratio..............................           33.67%         32.96%             34.30%             34.05%
    Net Interest Margin................................            4.77%          4.52%              4.67%              4.39%
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)  Return on average total assets and average stockholders' equity, excluding
     merger related expenses and other special items was 2.01% and 21.45% for
     the three months ended June 30, 2000, respectively, and 1.93% and 21.68%
     for the six months ended June 30,2000, respectively. The dividend payout
     ratio, excluding merger related expenses and other special items was 43.61%
     for the months ended June 30, 2000.

         The Company reported net income of $78.2 million, or diluted earnings
per share of $.49, for the second quarter ended June 30, 2001, as compared with
net income, as adjusted for certain non-recurring items, of $73.5 million or
adjusted diluted earnings per share of $.43 for the comparable prior year
quarter. Net income and diluted earnings per share, as reported, for the three
months ended June 30, 2000, were impacted by gains recognized from the sale of
certain branch facilities and equity securities, partially offset by additional
expenses incurred in the attempt to acquire Dime Bancorp, Inc. The aggregate
impact of these items, net of taxes, was $12.5 million, or $.07 per share.


                                       10
<PAGE>   11
         Net income for the six months ended June 30, 2001, was $156.6 million
or diluted earnings per share of $.97, as compared with net income, as adjusted
for certain non-recurring items, of $138.1 million or adjusted diluted earnings
per share of $.82 for the six months ended June 30, 2000. Net income and diluted
earnings per share, as reported, for the six months ended June 30, 2000 were
impacted by the recognition of merger related restructuring costs and other
items associated with the JSB merger, Dime related acquisition expenses and net
securities losses, partially offset by gains recognized from the sale of certain
branch facilities. The aggregate impact of these items, net of taxes, was $50.1
million, or $.30 per share.

         On June 26, 2001, the Board of Directors declared a regular quarterly
cash dividend of $.21 per common share. The dividend is payable August 15, 2001
to shareholders of record at the close of business July 27, 2001.

NET INTEREST INCOME

         Net interest income, which represents the difference between interest
earned on interest earning assets and interest incurred on interest bearing
liabilities, is the primary source of earnings. Net interest income is affected
by the level and composition of assets, liabilities, and equity, as well as
changes in market interest rates.

         Net interest income for the second quarter of 2001 increased $11.0
million, or 7.2 %, to $164.0 million, when compared to $153.0 million in the
comparable prior year quarter. The net interest margin during the most recent
quarter improved by 25 basis points to 4.77% from 4.52% for the second quarter
of 2000. The improvement in both net interest income and the net interest margin
resulted from management's successful execution of its strategy. This strategy
included increasing the level of higher yielding loans, positioning its
borrowings to benefit from lower market interest rates and growing core
deposits.

         Interest income increased modestly during the second quarter of 2001 to
$272.9 million when compared to $271.1 million in the comparable prior year
period. The yield on average interest earning assets declined 9 basis points to
7.84%, when compared to 7.93% for the second quarter of 2000.

         Average loans for the second quarter of 2001 increased $772.4 million
or 8.6%, to $9.8 billion, when compared to June 30, 2000. The yield on average
loans declined 9 basis points to 8.06% for the second quarter 2001. Each segment
of the loan portfolio showed measurable growth, with commercial loans
representing the largest growth component. Average loans represented 68.7% of
average interest earning assets as compared to 64.5% in the comparable prior
year period reflecting management's decision to fund a portion of loan growth
from the securities portfolios cash flows. Recent reductions in both short-term
interest rates and the prime rate of interest should continue to have a
favorable impact on loan growth, which will lower loan yields during the
remainder of 2001.

         Average securities declined $520.7 million, or 10.6%, when compared to
the second quarter of 2000, while the yield declined 13 basis points to 7.40%,
when compared to the second quarter of 2000. Factors contributing to these
declines are lower market interest rates during 2001 coupled with management's
aforementioned strategy of re-investing securities portfolios cash flows into
higher yielding loans.

         Interest expense declined $9.3 million, or 7.9%, to $108.8 million
during the second quarter of 2001 when compared to $118.2 million in 2000. This
decline was attributable to a 37 basis point reduction in cost of funds to
3.87%. Factors contributing to the reduction were lower market interest rates
and growth in core deposits (both demand and interest bearing), thereby reducing
the level of higher costing wholesale borrowings.

         Average savings, NOW, and money market deposits, which represent a
stable funding source, increased $387.4 million to $4.6 billion with a cost of
funds of 2.0% for the 2001 second quarter from $4.2 billion, costing 1.90%
during the second quarter of 2000. At June 30, 2001, demand deposits represented
21.2% of total deposits, as compared to 20.7% at June 30, 2000. Core deposit
growth and the corresponding increase in cost of funds resulted primarily from
the expanded presence in the Manhattan market place, an emphasis on developing
deposit relationships with borrowers and introducing new products and services
to meet commercial customer needs. In addition, the use of incentive
compensation plans and the conversion of previously acquired savings bank
locations into full service commercial banking branches positively impacted this
growth.

         Average time deposits increased $272.7 million or 9.0% to $3.3 billion
at a cost of funds of 5.11% during the second quarter of 2001 from $3.0 billion
costing 5.0% during the second quarter of 2000. The increase in cost of funds
resulted from higher market interest rates throughout 2000 and the lagging price
resets associated with time deposits. The rapid decline in market interest rates
during 2001 is expected to have a continuing favorable impact on deposit pricing
during the next several quarters.


                                       11
<PAGE>   12
         Average borrowings declined $577.7 million or 14.5% to $3.4 billion,
while costs declined 95 basis points to 15.1%. The decisions made in 2000 to
maintain a higher relative level of short-term borrowings has had a positive
impact on the net interest margin during 2001, as many of these instruments
have reset at the lower market interest rates. The effects of these factors
will continue to have an impact on 2001 results as market interest rates
continued to decline and the rates on the borrowings reset downward. Management
has also initiated steps to extend the maturities on a portion of these
borrowings to provide protection against the eventual reversal of this interest
rate trend. At June 30,2001, the weighted average maturity of other borrowings
was 3.2 years.

         Net interest income for the June 30,2001 quarter was $164 million
resulting in a net interest margin of 4.77% , an improvement of 19 basis points
over the immediately preceding quarter. Substantially all of the improvement was
derived from a reduction in the cost of funds. Management does not anticipate
this upward trend in net interest margin continuing in the near term.

         Consistent with its capital management strategy, the Company purchased
approximately $930 million of available-for-sale securities toward the end of
the current quarter that was funded by a blend of borrowings and deposits. This
action will positively impact net interest income and earnings in succeeding
periods but will compress the net interest margin.

         The following table sets forth a summary analysis of the relative
impact on net interest income of changes in the average volume of interest
earning assets and interest bearing liabilities and changes in average rates on
such assets and liabilities. Because of the numerous simultaneous volume and
rate changes during the periods analyzed, it is not possible to precisely
allocate changes to volume or rate. For presentation purposes, changes which are
not solely due to volume changes or rate changes have been allocated to these
categories based on the respective percentage changes in average volume and
average rates as they compare to each other.

<TABLE>
<CAPTION>
                                                           THREE MONTHS ENDED                        SIX MONTHS ENDED
                                                              2001 VS. 2000                           2001 VS. 2000
                                                   ---------------------------------------   --------------------------------------
                                                                CHANGE IN                                CHANGE IN
                                                    AVERAGE       AVERAGE    NET INTEREST     AVERAGE      AVERAGE    NET INTEREST
 (in thousands)                                     VOLUME         RATE         INCOME        VOLUME         RATE         INCOME
                                                   --------------------------------------------------------------------------------
INTEREST INCOME FROM EARNING ASSETS:
<S>                                                <C>           <C>          <C>           <C>              <C>        <C>
Securities........................................ ($9,547)      ($1,460)     ($11,007)     ($18,810)        $3,031     ($15,779)
Loans, net (2)....................................   15,975       (2,077)        13,898        37,046         2,462        39,508
Money Market Investments..........................      432         (392)            40         (421)         (391)         (812)
                                                      -----       ------          -----        ------         -----        ------
   Total Interest Income..........................    6,860       (3,929)         2,931        17,815         5,102        22,917
                                                      -----       ------          -----        ------         -----        ------

INTEREST EXPENSE ON LIABILITIES:

Savings, NOW & Money Market Deposits..............    1,935         1,085         3,020         3,838         2,411         6,249
Time Deposits.....................................    3,490           850         4,340         6,768         5,054        11,822
Federal Funds Purchased and Securities Sold
  Under Agreements to Repurchase.................. (11,849)       (4,628)      (16,477)      (13,995)       (4,659)      (18,654)
Other Borrowings..................................    3,788       (4,015)         (227)            53       (4,447)       (4,394)
                                                      -----       ------          -----        ------         -----        ------
   Total Interest Expense.........................  (2,636)       (6,708)       (9,344)       (3,336)       (1,641)       (4,977)
                                                      -----       ------          -----        ------         -----        ------
Net Change in Net Interest Income.................   $9,496        $2,779       $12,275       $21,151        $6,743       $27,894
                                                     ======        ======       =======       =======        ======       =======
</TABLE>


(1)  The above table is presented on a tax equivalent basis.

(2)  Non-accrual loans are included in average loans, net of unearned income.


                                       12
<PAGE>   13
MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)
NET INTEREST INCOME (CONTINUED)

     The following tables present an analysis of net interest income by each
major category of interest earning assets and interest bearing liabilities for
the three and six month periods ended June 30, 2001 and 2000, respectively.

<TABLE>
<CAPTION>
FOR THE THREE MONTHS ENDED JUNE 30,                                     2001                                   2000

                                                        ---------------------------------------------------------------------------
                                                           AVERAGE                   AVERAGE      AVERAGE                   AVERAGE
 (dollars in thousands )                                   BALANCE      INTEREST       RATE       BALANCE      INTEREST      RATE
                                                        ---------------------------------------------------------------------------
INTEREST EARNING ASSETS:
<S>                                                      <C>              <C>          <C>      <C>              <C>         <C>
Securities....................................           $4,380,057       $80,783      7.40%    $4,900,775       $91,789     7.53%
Loans, net (1)................................            9,761,554       196,050      8.06%     8,989,125       182,153     8.15%
Money Market Investments......................               67,901           808      4.77%        38,569           767     8.00%
                                                         ----------       -------               ----------       -------
  Total Interest Earning Assets...............           14,209,512       277,641      7.84%    13,928,469       274,709     7.93%
                                                         ----------       -------               ----------       -------

NON INTEREST EARNING ASSETS:

Cash and Due from Banks.......................              273,930                                243,139
Other Assets (2)..............................              661,684                                566,799
                                                        -----------                            -----------
  Total Assets................................          $15,145,126                            $14,738,407
                                                        ===========                            ===========

INTEREST BEARING LIABILITIES:

Savings, NOW and Money Market Deposits.........          $4,592,345       $22,929      2.00%    $4,204,952       $19,909     1.90%
Time Deposits..................................           3,304,022        42,053      5.11%     3,031,302        37,713     5.00%
                                                         ----------       -------               ----------       -------
  Total Savings and Time Deposits..............           7,896,367        64,982      3.30%     7,236,254        57,622     3.20%
Federal Funds Purchased and Securities Sold
  Under Agreements to Repurchase...............           1,704,272        22,249      5.24%     2,580,818        38,726     6.04%
Other Borrowings...............................           1,692,672        21,602      5.12%     1,393,806        21,828     6.30%
                                                         ----------       -------               ----------       -------
  Total Borrowings.............................           3,396,944        43,851      5.18%     3,974,624        60,554     6.13%
                                                         ----------       -------               ----------       -------
    Total Interest Bearing Liabilities.........         $11,293,311      $108,833      3.87%   $11,210,878      $118,176     4.24%
                                                         ----------       -------               ----------       -------
Rate Spread....................................                                        3.97%                                 3.69%

NON-INTEREST BEARING LIABILITIES:

Demand Deposits................................          $2,040,803                             $1,773,792
Other Liabilities..............................             193,382                                178,066
                                                         ----------                             ----------
 Total Liabilities.............................          13,527,496                             13,162,736
Capital Securities.............................             244,349                                244,324
 Stockholders' Equity..........................           1,373,281                              1,331,347
                                                         ----------                             ----------
  Total Liabilities and Stockholders' Equity...         $15,145,126                            $14,738,407
                                                        ===========                            ===========
Net Interest Income and Net Interest Margin ...                          $168,808      4.77%                    $156,533     4.52%
Less: Tax Equivalent Adjustment (3)............                           (4,781)                                (3,567)
                                                                          -------                                -------
    Net Interest Income.......................                          $164,027                               $152,966
                                                                        ========                               ========
</TABLE>


(1)  For purposes of these computations, non-accrual loans are included in
     average loans.

(2)  For purposes of these computations, unrealized gains/(losses) on
     available-for-sale securities are recorded in other assets.

(3)  Interest income on a tax equivalent basis includes the additional amount of
     income that would have been earned if investment in tax exempt money market
     investments and securities, state and municipal obligations, non-taxable
     loans, public equity and debt securities, and U.S. Treasuries had been made
     in securities and loans subject to Federal, State, and Local income taxes
     yielding the same after tax income. The tax equivalent amount for $1.00 of
     those aforementioned categories was $1.77, $1.60, $1.55, $1.23, and $1.03
     for the three months ended June 30, 2001; and $1.75, $1.43, $1.55, $1.43,
     and $1.03 for the three months ended June 30, 2000.


                                       13
<PAGE>   14
MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)

<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED JUNE 30,                                       2001                                2000
                                                        ------------------------------------------------------------------------
                                                         AVERAGE                  AVERAGE     AVERAGE                 AVERAGE
 (dollars in thousands )                                 BALANCE      INTEREST     RATE       BALANCE     INTEREST      RATE
INTEREST EARNING ASSETS:                                ------------------------------------------------------------------------
<S>                                                      <C>            <C>          <C>      <C>           <C>           <C>
Securities.......................................        $4,402,833     $162,543     7.44%    $4,914,881    $178,321      7.30%
Loans, net (1)...................................         9,640,382      390,819     8.18%     8,703,649     351,312      8.12%
Money Market Investments.........................            64,049        1,683     5.30%        78,492       2,495      6.39%
                                                         ----------      -------              ----------     -------
  Total Interest Earning Assets..................        14,107,264      555,045     7.93%    13,697,022     532,128      7.81%
                                                         ----------      -------              ----------     -------

NON INTEREST EARNING ASSETS:
Cash and Due from Banks..........................           266,741                              231,784
Other Assets (2).................................           652,199                              476,775
                                                        -----------                          -----------
  Total Assets...................................       $15,026,204                          $14,405,581
                                                        ===========                          ===========
INTEREST BEARING LIABILITIES:
Savings, NOW and Money Market Deposits...........        $4,425,686      $45,067     2.05%    $4,033,564     $38,818      1.94%
Time Deposits....................................         3,181,947       83,176     5.27%     2,919,717      71,354      4.91%
                                                         ----------      -------              ----------     -------
  Total Savings and Time Deposits................         7,607,633      128,243     3.40%     6,953,281     110,172      3.19%
Federal Funds Purchased and Securities Sold
  Under Agreements to Repurchase.................         1,961,358       53,653     5.52%     2,458,626      72,307      5.91%
Other Borrowings.................................         1,700,031       46,141     5.47%     1,657,060      50,535      6.13%
                                                         ----------      -------              ----------     -------
  Total Borrowings...............................         3,661,389       99,794     5.50%     4,115,686     122,842      6.00%
                                                         ----------      -------              ----------     -------
    Total Interest Bearing Liabilities...........       $11,269,022     $228,037     4.08%   $11,068,967    $233,014      4.23%
                                                         ----------      -------              ----------     -------
Rate Spread......................................                                    3.85%                                3.58%

NON-INTEREST BEARING LIABILITIES:
Demand Deposits..................................        $1,973,259                           $1,706,386
Other Liabilities................................           195,361                              162,815
                                                            -------                              -------
 Total Liabilities...............................        13,437,642                           12,938,168
Capital Securities...............................           244,346                              232,254
 Stockholders' Equity............................         1,344,216                            1,235,159
                                                            -------                              -------
  Total Liabilities and Stockholders' Equity.....       $15,026,204                          $14,405,581
                                                        ===========                          ===========
Net Interest Income and Net Interest Margin......                       $327,008     4.67%                  $299,114      4.39%
Less: Tax Equivalent Adjustment (3)..............                         (9,695)                             (6,818)
                                                                          ------                              ------
     Net Interest Income.........................                       $317,313                            $292,296
                                                                        ========                            ========
</TABLE>


(1)  For purposes of these computations, non-accrual loans are included in
     average loans.
(2)  For purposes of these computations, unrealized gains/(losses) on
     available-for-sale securities are recorded in other assets.
(3)  Interest income on a tax equivalent basis includes the additional amount of
     income that would have been earned if investment in tax exempt money market
     investments and securities, state and municipal obligations, non-taxable
     loans, public equity and debt securities, and U.S. Treasuries had been made
     in securities and loans subject to Federal, State, and Local income taxes
     yielding the same after tax income. The tax equivalent amount for $1.00 of
     those aforementioned categories was $1.77, $1.60, $1.55, $1.23, and $1.03
     for the six months ended June 30, 2001; and $1.75, $1.43, $1.55, $1.43, and
     $1.03 for the six months ended June 30, 2000.


                                       14
<PAGE>   15
NON-INTEREST INCOME

         Non-interest income, exclusive of net securities gains and other
non-recurring items, increased $1.8 million, or 8.6%, to $22.5 million for the
second quarter of 2001, when compared to $20.8 million in 2000. The improvement
was achieved through a $2.6 million, or 22.8%, increase in customer related fees
and service charges to $14.1 million. This increase resulted from the growth in
core deposits, the introduction of new fee based services and products, changes
to fee schedules, and the continued implementation of the Company's fee
schedules on the former JSB and Reliance customer base. Partially offsetting
this improvement was a $.6 million decline in investment management,
commissions, and trust fees to $4.0 million and a $.5 million decline in other
operating income to $2.5 million. The decline in investment management,
commissions, and trust fees was attributable to the recent volatility in the
stock market, resulting in declines in mutual fund and annuity sales activity.

         Net securities gains recognized during the most recent quarter were
$1.3 million, as compared to $11.1 million during the comparable quarter in
2000. Net securities gains recognized during second quarters of 2001 and 2000
resulted from the sale of equity positions in certain publicly traded companies.

         Additionally, the Company recognized a net gain of $10.4 million on the
sale of certain branch facilities during the second quarter of 2000.

NON-INTEREST EXPENSE

         Non-interest expense increased $6.1 million, or 10.5%, to $64.5
million during the most recent quarter, as compared to $58.4 million in the
second quarter of 2000, when adjusted for the expenses incurred in connection
with the proposed acquisition of Dime Bancorp, Inc. of $2.3 million. This
resulted from increases of $2.5 million in employee compensation and benefits,
$2.3 million in other operating expenses and a $1.5 million increase in
occupancy and equipment costs. Increases in employee compensation and benefits
expense is due to increases in incentive compensation directly linked to the
growth in deposits and related fee income, annual merit increases, increased
costs associated with employee benefits, and costs associated with the
expansion in the Manhattan market. Occupancy and equipment costs and other
operating expenses increased due to the Company's de novo expansion in
Manhattan and other costs associated with new business initiatives.

         The Company's core efficiency ratio, which represents the ratio of
non-interest expense, excluding other real estate costs and other non-recurring
charges, to net interest income on a tax equivalent basis and non-interest
income, excluding securities gains and losses and other non-recurring income,
was 33.7% in the 2001 second quarter, as compared with 33.0% for the comparable
prior year period. The core efficiency ratio demonstrates management's ability
to maintain a disciplined approach to monitoring its operating structure,
controlling related costs, and continuing to grow revenue.

INCOME TAXES

         The effective tax rate for the three and six month periods ended June
30, 2001 was 34.5%, as compared to 35%, exclusive of the merger and related
restructuring charge, for the three and six month periods ended June 30, 2000.
Management anticipates that the effective tax rate for the remainder of 2001
will be approximately 34.5%.

LOAN PORTFOLIO

         The following table represents the components of the loan portfolio for
the periods indicated:
<TABLE>
<CAPTION>
                                                         -------------------------------------------------------------------------
                                                          JUNE 30,        % OF     DECEMBER 31,     % OF       JUNE 30,       % OF
(dollars in thousands)                                      2001         TOTAL         2000        TOTAL         2000        TOTAL
                                                         -------------------------------------------------------------------------
<S>                                                      <C>             <C>       <C>             <C>       <C>             <C>
Mortgage Loans-Multi-Family.....................         $3,306,790      34%       $3,316,894      35%       $3,283,083      36%
Mortgage Loans-Residential......................          2,694,767      27%        2,634,030      28%        2,640,017      29%
Mortgage Loans-Commercial.......................          1,595,783      16%        1,503,795      16%        1,456,321      16%
Commercial Loans................................          1,217,479      12%        1,035,071      11%          885,486      10%
Consumer Loans..................................            835,744       9%          778,218       8%          722,029       8%
Construction  and Land Loans....................            197,216       2%          141,754       2%          113,606       1%
                                                         ----------     ---        ----------     ---        ----------     ---
                                                         $9,847,779     100%       $9,409,762     100%       $9,100,542     100%
Less:  Unearned Income and Fees.................             12,699                    15,049                    16,760
                                                         ----------     ---        ----------     ---        ----------     ---
Loans, net......................................         $9,835,080                $9,394,713                $9,083,782
                                                         ----------     ---        ----------     ---        ----------     ---
</TABLE>

         At June 30,2001, the loan portfolio increased $751.3 million or 8.3%,
to $9.8 billion when compared to $9.1 billion at June 30, 2000, with growth
reflected in all segments of the portfolio. Quality loan demand should continue
to remain strong in the near term.


                                       15
<PAGE>   16
         The loan portfolio is primarily secured by real estate in the New York
metropolitan area. The risk inherent in the portfolio is dependent on both
regional and general economic stability, which affects property values, and the
financial well being and creditworthiness of the borrowers.

         To minimize the credit risk related to the portfolio's real estate
concentration, management utilizes prudent underwriting standards and
diversifies the type and locations of loans. Multi-family mortgage loans
generally are for $1-5 million and are secured by properties located in the New
York metropolitan area. The multi-family business includes loans on various
types and geographically diverse apartment complexes. These mortgages are
dependent largely on sufficient income to cover operating expenses and may be
affected by government regulation, such as rent control regulations, which
could impact the future cash flows of the property. Since most multi-family
mortgages do not fully amortize, the principal outstanding is not significantly
reduced prior to contractual maturity. The residential mortgage portfolio is
comprised primarily of first mortgage loans on owner occupied 1-4 family
residences located in the Company's market area. The commercial mortgage
portfolio contains loans secured by professional office buildings, retail
stores, shopping centers and industrial developments. Commercial loans consist
primarily of loans to small and medium size businesses, as well as lease
finance lending. The commercial mortgage and commercial loan portfolios do not
contain syndicated loans. Consumer loans are primarily issued to finance new
and used automobiles and are originated through an expanded dealer network. The
credit risk in auto lending is dependent on the creditworthiness of the
borrower and the value of the collateral. The consumer loan portfolio does not
contain higher risk credit card and sub-prime loans. Land loans are used to
finance the acquisition of vacant land for future residential and commercial
development. Construction loans finance the construction and rehabilitation of
both residential, and multi- family projects and to a lessor extent commercial
developments. The construction and land development portfolios do not contain
any higher risk equity participation loans ("AD&C") loans.

         Real estate underwriting standards include various limits on the
loan-to-value ratios based on the type of property, and management considers,
among other things, the creditworthiness of the borrower, the location of the
real estate, the condition and value of the security property, the quality of
the organization managing the property, and the viability of the project
including occupancy rates, tenants and lease terms. Additionally, underwriting
standards require appraisals and periodic inspections of the properties as well
as ongoing monitoring of operating results.

ASSET QUALITY

         The components of non-performing assets and restructured, accruing
loans are detailed in the table below:
<TABLE>
<CAPTION>
                                                                   ------------------------------------------------------
                                                                    JUNE 30,             DECEMBER 31,            JUNE 30,
(in thousands)                                                        2001                   2000                  2000
                                                                   ------------------------------------------------------
<S>                                                                  <C>                 <C>                      <C>
Loans Ninety Days Past Due and Still Accruing................        $4,973                 $5,777                $4,692
Non-Accrual Loans............................................        10,657                  9,144                 9,189
                                                                     ------                  -----                 -----
Non-Performing Loans.........................................        15,630                 14,921                13,881
Other Real Estate............................................           566                    499                   913
                                                                     ------                  -----                 -----
Non-Performing Assets........................................       $16,196                $15,420               $14,794
                                                                    =======                =======               =======
Allowance for Loan Losses to Non-Performing Loans............          594%                   601%                  634%
Allowance for Loan Losses to Total Loans, net................         0.94%                  0.95%                 0.97%
Non-Performing Loans to Total Loans, net.....................         0.16%                  0.16%                 0.15%
Non-Performing Assets to Total Assets........................         0.10%                  0.10%                 0.10%
</TABLE>

         At June 30, 2001, non-performing assets increased modestly to $16.2
million, when compared to $15.4 million at December 31, 2000 and $14.8 million
at June 30, 2000. As depicted in the table above, the level of non-performing
loans to total loans has remained constant as the loan portfolio continues to
grow, while reserve coverage ratios remain adequate. The modest level of
non-performing assets over the past several years is a result of the
effectiveness of the Company's loan administration and workout procedures, as
well as a strong local economy. Non-performing loans at June 30, 2001 consisted
of $4.8 million in consumer loans, $4.7 million in residential mortgages, $2.5
million in commercial mortgages, and $3.6 million in commercial loans. No
assurance can be given as to the future level of non-performing assets, since
the economic environment, interest rates, and other internal and external
factors will influence these levels.


                                       16
<PAGE>   17
ALLOWANCE FOR LOAN LOSSES

         The provision for loan losses during the most recent quarter increased
$1.7 million to $4.0 million when compared to $2.3 million for the comparable
prior year period. The increase in the Company's level of provision is
consistent with the growth experienced in the loan portfolio during the past
year. For the six months ended June 30, 2001 the provision declined by $3.5
million when compared to the comparable prior year period. Reflected in the
prior year period was a special provision of approximately $6.8 million. The
additional provision during 2000 was recognized to conform the provisioning
policies of JSB and Reliance to those of the Company and to restore the
Company's post-merger reserve coverage ratios to approximate pre-merger levels.

         The determination of the adequacy of the allowance for loan losses and
the periodic provisioning for estimated losses included in the consolidated
financial statements is the responsibility of management. The evaluation process
is undertaken on a quarterly basis but may increase in frequency should
conditions arise that would require management's prompt attention. Conditions
giving rise to such action are business combinations, opportunities to dispose
of non-performing and marginally performing loans by bulk sale or any
development, which may indicate an adverse trend.

         During the last several years, several mergers and acquisitions of
commercial banks and thrift companies were completed. Generally, in these
transactions, the merged entity's loan underwriting standards were less
restrictive than the Company's, thereby increasing the level of risk in the
portfolio.

         The methodology employed for assessing the appropriateness of the
allowance consists of the following criteria:

     -    The establishment of reserve amounts for all specifically identified
          criticized loans, including those arising from business combinations
          and those that have been designated as requiring attention by
          management's internal loan review program, bank regulatory
          examinations or the Company's external auditors.

     -    An average one-year loss factor is applied to smaller balance
          homogenous types of loans not subject to specific review. These loans
          include residential 1-4 family properties and consumer loans.

     -    An allocation to the remaining loans giving effect to historical loss
          experience over several years and linked to cyclical trends.

         Recognition is also given to the changed risk profile brought about
from previous business combinations, customer knowledge, the results of the
ongoing credit-quality monitoring processes and the cyclical nature of economic
and business conditions. An important consideration in applying these
methodologies is the concentration of real estate related loans located in the
New York metropolitan area.

         Since many of the loans depend upon the sufficiency of collateral, any
adverse trend in the real estate markets could seriously affect underlying
values available to protect the Company from loss. This condition existed in the
early 1990's when the Company experienced sizable real estate loan losses.

         Other evidence used to support the amount of the allowance and its
components is as follows:

          -    Regulatory examinations.
          -    The amount and trend of criticized loans.
          -    Actual losses.
          -    Peer comparisons with other financial institutions.
          -    Economic data associated with the real estate market in the
               Company's market area.
          -    Opportunities to dispose of marginally performing loans for cash
               consideration.

         Based upon the process employed and giving recognition to all attendant
factors associated with the loan portfolio, management considers the allowance
for loan losses to be adequate at June 30, 2001.

         The following table represents a summary of the changes in the
allowance for loan losses for the six months ended June 30, 2001 and 2000:

<TABLE>
<CAPTION>
                                                                            2001          2000
(dollars in thousands)
<S>                                                                        <C>           <C>
Balance at Beginning of Year............................................   $89,653       $74,525
Provision for Loan Losses...............................................     7,750        11,250
Recoveries Credited to the Allowance....................................     3,575         3,463
                                                                           -------      --------
                                                                           100,978        89,238
Losses Charged to the Allowance.........................................   (8,125)      (10,297)
Additional Allowance Acquired  in the Reliance Acquisition..............         -         9,069
                                                                           -------      --------
Balance at End of Period................................................   $92,853       $88,010
                                                                           =======      ========

Net Charge-Offs to Average Loans, net...................................     0.09%         0.16%
</TABLE>


                                       17
<PAGE>   18
SECURITIES PORTFOLIO

     The composition of and the amortized cost and estimated fair values of
available-for-sale and held-to-maturity securities portfolios were as follows:

<TABLE>
<CAPTION>
                                               JUNE 30, 2001               DECEMBER 31, 2000                   JUNE 30, 2000
                                               -----------------------------------------------------------------------------------
AVAILABLE-FOR-SALE                               AMORTIZED       FAIR        AMORTIZED          FAIR        AMORTIZED       FAIR
(in thousands)                                     COST          VALUE         COST             VALUE         COST         VALUE
                                               --------------------------------------------- -------------------------------------
<S>                                             <C>           <C>           <C>              <C>           <C>          <C>
CMO's Private Issuances......................   $2,164,241    $2,209,416    $1,544,537       $1,576,245    $1,611,360   $1,586,993
CMO's Agency Issuances.......................      821,141       833,063       476,315          486,202       506,035      491,969
Mortgage-Backed Securities...................      508,044       509,365       553,793          555,470       656,018      638,613
U.S. Government Agencies' Obligations........       97,826        98,708       150,200          151,746       131,348      129,731
U.S. Treasury Securities.....................       10,007        10,047        20,030           20,050        20,038       19,947
State & Municipal Obligations................      120,391       121,665        89,664           90,530            --           --
Equity Securities (1)........................      254,410       254,284       253,405          256,145       269,372      278,485
Other Securities.............................      365,945       349,363       362,711          331,275       327,796      303,535
                                                   -------       -------       -------          -------       -------      -------
                                                $4,342,005    $4,385,911    $3,450,655       $3,467,663    $3,521,967   $3,449,273
                                                ==========    ==========    ==========       ==========    ==========   ==========
</TABLE>


<TABLE>
<CAPTION>
                                                 ------------------------------------------------------------------------------
HELD-TO-MATURITY                                  AMORTIZED       FAIR        AMORTIZED       FAIR        AMORTIZED       FAIR
(in thousands)                                      COST          VALUE         COST          VALUE         COST         VALUE
                                                 ------------------------------------------------------------------------------
<S>                                               <C>           <C>           <C>           <C>           <C>          <C>
CMO's Private Issuances......................     $506,798      $508,669      $576,370      $571,110      $631,000     $600,987
CMO's Agency Issuances.......................           --            --        58,988        58,691        86,817       85,781
Mortgage-Backed Securities...................      271,038       269,958       361,363       357,488       405,381      388,533
State & Municipal Obligations................       70,419        71,287        78,711        78,982        78,659       76,788
U.S. Government Agencies' Obligations........           --            --            24            24            38           38
Other Securities.............................       12,636        12,606        15,221        14,994        17,549       17,294
                                                    ------        ------        ------        ------        ------       ------
                                                  $860,891      $862,520    $1,090,677    $1,081,289    $1,219,444   $1,169,421
                                                  ========      ========    ==========    ==========    ==========   ==========
</TABLE>

 (1) Amortized cost and fair value includes $197.4 million in Federal Home Loan
     Bank stock for all periods presented.

         The growth in the available-for-sale CMO portfolios resulted from the
aforementioned capital management strategy. Approximately, $930 million of these
securities were purchased during the latter part of the quarter, with
approximately $323 million settling subsequent to quarter end.

         The strategy for the securities portfolio is to maintain a short
duration minimizing exposure to sustained increases in interest rates. This is
achieved primarily through investments in securities with predictable cash flows
and short average lives, and secondly, through the use of certain adjustable
rate investments. The duration of the portfolio at June 30, 2001 was 3.2 years.

         The amortizing securities are almost exclusively mortgage-backed
securities ("MBS"). These instruments provide a relatively stable source of cash
flows, although they may be impacted by changes in interest rates. Such MBS
securities are either guaranteed by FLHMC, GNMA or FNMA, or constitute
collateralized mortgage-backed obligations ("CMO's") backed by U.S. government
agency securities or CMO private issuances, which are principally AAA rated and
are conservative current pay sequentials or PAC structures.

         Equity securities maintained in the available-for-sale portfolio were
comprised principally of FHLB common stock and common and preferred stock of
certain publicly traded companies. Other securities maintained in the
available-for-sale portfolio consist of capital securities of certain financial
institutions and corporate bonds.

         In connection with the adoption of SFAS 133 in the first quarter of
2001, management reclassified securities with an amortized cost of $119.6
million and a fair value of $119.0 million from the held-to-maturity portfolio
to the available-for-sale portfolio.

         At June 30, 2001, securities carried at $3.2 billion were pledged to
secure securities sold under agreements to repurchase, other borrowings, and for
other purposes as required by law. Securities pledged for which the collateral
may be sold or repledged by the secured parties approximated $2.0 billion, while
securities pledged which the secured parties may not sell or repledge
approximated $1.2 billion at June 30, 2001.


                                       18
<PAGE>   19
CAPITAL

         The Company and its banking subsidiaries are subject to the risk based
capital guidelines administered by the bank regulatory agencies. The risk based
capital guidelines are designed to make regulatory capital requirements more
sensitive to differences in risk profiles among banks and bank holding
companies, to account for off-balance sheet exposure and to minimize
disincentives for holding liquid assets. Under these guidelines, assets and
off-balance sheet items are assigned to broad risk categories, each with
appropriate weights. The resulting capital ratios represent capital as a
percentage of total risk weighted assets and off-balance sheet items. The
guidelines require all banks and bank holding companies to maintain a minimum
ratio of total risk based capital to total risk weighted assets of 8%,
including a minimum ratio of Tier I capital to total risk weighted assets of 4%
and a Tier I capital to average assets of 4% ("Leverage Ratio"). Failure to
meet minimum capital requirements can initiate certain mandatory, and possibly
additional discretionary actions by regulators, that, if undertaken, could have
a direct material effect on the Company's consolidated financial statements. As
of June 30, 2001, the most recent notification from the various bank regulators
categorized the Company and its banking subsidiaries as well capitalized under
the regulatory framework for prompt corrective action. Under the capital
adequacy guidelines, a well capitalized institution must maintain a minimum
total risk based capital to total risk weighted assets ratio of at least 10%, a
minimum Tier I capital to total risk weighted assets ratio of at least 6%, a
minimum leverage ratio of at least 5% and not be subject to any written order,
agreement or directive. There are no conditions or events since such
notification that management believes have changed this classification.

         The following table sets forth the Company's regulatory capital at June
30, 2001 and 2000, under the rules applicable at such dates. Management believes
that the Company and its banking subsidiaries meet all capital adequacy
requirements.

<TABLE>
<CAPTION>
                                                                  JUNE 30, 2001               JUNE 30, 2000
                                                              --------------------------------------------------
 (dollars in thousands )                                      AMOUNT         Ratio        AMOUNT         RATIO
                                                              --------------------------------------------------
<S>                                                           <C>            <C>          <C>            <C>
Tier 1 Capital...................................               $1,220,586    12.67%        $1,275,716    14.71%
Regulatory Requirement...........................                  385,347     4.00%           346,862     4.00%
                                                                   -------     ----            -------     ----
Excess...........................................                 $835,239     8.67%          $928,854    10.71%
                                                                  ========     ====           ========    =====
Total Risk Adjusted Capital......................               $1,313,439    13.63%        $1,367,827    15.77%
Regulatory Requirement...........................                  770,694     8.00%           693,725     8.00%
                                                                   -------     ----            -------     ----
Excess...........................................                 $542,745     5.63%          $674,102     7.77%
                                                                  ========     ====           ========     ====
Risk Weighted Assets.............................               $9,633,678                  $8,671,559
</TABLE>

         The Company's leverage ratio at June 30, 2001 was 8.24%. The Tier 1,
total risk-based and leverage capital ratios of North Fork were 11.51%, 12.50%,
and 7.47%, respectively, at June 30, 2001.

         On June 26, 2001, the Board of Directors declared a regular quarterly
cash dividend of $.21 per common share. The dividend is payable August 15, 2001
to shareholders of record at the close of business July 27, 2001.

         In September 2000, the Board of Directors approved the repurchase of up
to 17.1 million, or 10% of the Company's common shares outstanding. As of June
30, 2001, 14.3 million shares had been repurchased at an average cost of $19.87.
No shares were repurchased during the most recent quarter.

ASSET/LIABILITY MANAGEMENT

         The Company's primary earnings source is the net interest margin, which
is affected by changes in the level of interest rates, the relationship between
rates, the impact of interest rate fluctuations on asset prepayments, the level
and composition of assets and liabilities, and the credit quality of the loan
portfolio. Management's asset/liability objectives are to maintain a strong,
stable net interest margin, to utilize capital effectively without taking undue
risks and to maintain adequate liquidity.

         The risk assessment program includes a coordinated approach to the
management of liquidity, capital and interest rate risk. This risk assessment
process is governed by policies and limits established by senior management
which are reviewed and approved by the Asset/Liability Committee of the Board of
Directors ("ALCO"). ALCO provides guidance for the day to day asset/liability
activities of the Company. ALCO meets periodically to evaluate the impact of
changes in market interest rates on interest earning assets and interest bearing
liabilities, net interest margin, capital and liquidity, and to evaluate
management's strategic plan. The balance sheet structure is primarily short-term
with most assets and liabilities repricing or maturing in less than five years.
Management monitors the sensitivity of net interest income by utilizing a
dynamic simulation model complemented by a traditional gap analysis. This model
measures net interest income sensitivity and volatility to interest rate
changes. It involves a degree of estimation based on certain assumptions that
management believes to be reasonable. Factors considered include actual
maturities, estimated cash flows, repricing characteristics,


                                       19
<PAGE>   20
deposit growth/retention and, primarily, the relative sensitivity of assets and
liabilities to changes in market interest rates. Utilizing this process,
management can estimate and project the impact of changes in interest rates on
net interest income. This relative sensitivity is important to consider since
the core deposit base is not subject to the same degree of interest rate
sensitivity as its assets and borrowings. Core deposit costs are internally
controlled and generally exhibit less sensitivity to changes in interest rates
than the adjustable rate assets or liabilities whose yields or cost of funds are
based on external indices and change in concert with market interest rates.
Management has established certain limits for the potential volatility of net
interest income, assuming certain levels of change in market interest rates with
the objective of maintaining a stable level of net interest income under various
probable rate scenarios. Management may choose to extend the maturity of its
funding sources and/or reduce the repricing mismatches of its assets or
liabilities by using derivative instruments such as interest rate swaps.
Additionally, management may use interest rate collars, interest rate floors,
and interest rate cap agreements to assist in insulating it from volatile
interest rate changes.

         Based upon the aforementioned factors regarding the simulation model,
projected net interest income for the next twelve months was modeled based on
both an immediate rise and fall in interest rates as well as gradual movements
in interest rates over the twelve-month period. Based on the information and
assumptions in effect at June 30, 2001, management believes that a 100 basis
point gradual increase in interest rates over the next twelve months would
decrease net interest income by $3.7 million, or .5%, while a gradual decrease
in interest rates would increase net interest income by $15.8 million, or 2.2%.
It should be emphasized, however, that the estimated exposures set forth above
are dependent on material assumptions such as those previously discussed.

         The traditional gap analysis complements the income simulation
modeling, primarily focusing on the longer term structure of the balance sheet,
since the gap analysis does not assess the relative sensitivity of assets and
liabilities to changes in interest rates. The gap analysis is prepared based on
the maturity and repricing characteristics of interest earning assets and
interest bearing liabilities for selected time periods. The mismatch between
repricings or maturities within a time period is commonly referred to as the
"gap" for that period. A positive gap (asset sensitive), where interest-rate
sensitive assets exceed interest-rate sensitive liabilities, generally will
result in the net interest margin increasing in a rising rate environment and
decreasing in a falling rate environment. A negative gap (liability sensitive)
will generally have the opposite results on the net interest margin. However,
the gap analysis is static in nature; therefore, the maturity and repricing
characteristics of interest earning assets and interest bearing liabilities can
change considerably with changes in interest rates.

         As part of the Company's overall interest rate risk management
strategy management periodically uses derivative instruments to minimize
significant unplanned fluctuations in earnings and cash flows caused by
interest rate volatility. The Company's interest rate risk management strategy
involves modifying the repricing characteristics of certain assets and
liabilities so that changes in interest rates do not have a significant adverse
effect on net interest income, the net interest margin and cash flows.
Derivative instruments that management periodically uses as part of its
interest rate risk management strategy include interest rate swaps, caps and
floors.

 Derivative instruments outstanding at June 30, 2001 are summarized as follows:

<TABLE>
<CAPTION>
                                                                        FIXED           VARIABLE
                                                     NOTIONAL       INTEREST RATE     INTEREST RATE
                                  MATURITY            AMOUNT            RANGE             RANGE
----------------------------------------------------------------------------------------------------
(dollars in thousands)

PAY FIXED SWAPS-MATURING:

<S>                                                       <C>         <C>                       <C>
2001..........................................            $200,000    4.66% - 4.72%             4.03%
2002..........................................             100,000            4.18%             4.09%
2003..........................................             700,000    4.54% - 4.88%     3.79% - 4.09%
2004..........................................             100,000            5.23%             4.00%
2008..........................................              75,000            6.14%             4.30%
                                                            ------
                                                        $1,175,000
                                                        ==========
PAY FLOATING SWAPS-MATURING:
                                                            ------
2001..........................................             $50,000    6.75% - 6.88%     4.03% - 4.13%
                                                        ==========
</TABLE>


                                       20
<PAGE>   21
MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)
ASSET/LIABILITY MANAGEMENT (CONTINUED)

         The $1,175 million in swap agreements hedging certain borrowings
require the Company to make periodic fixed rate payments, while receiving
periodic variable rate payments indexed to the three month LIBOR rate based on a
common notional amount and maturity date. Payments related to the Company's swap
agreements are made either monthly, quarterly or semi-annually by one of the
parties based on contractual terms. These swap agreements, which qualify as cash
flow hedges, have original maturities of up to 10 years, and as of June 30, 2001
had an unrealized gain of $.7 million. At adoption of SFAS 133, a transition
gain of $2.2 million (net of taxes of $.9 million) was recorded as a component
of other comprehensive income for the swaps outstanding at January 1, 2001
accounted for as cash flow hedges. The $50 million in swap agreements hedging
certain time deposits require the Company to make periodic floating rate
payments while receiving periodic fixed rate payments indexed to the one month
LIBOR rate. These agreements qualify as fair value hedges and mature within
three months. These swaps and the hedged time deposits had fair values at June
30, 2001 of $50.3 million and $49.7 million, respectively. The use of interest
rate swap agreements increased interest expense during the most recent quarter
by $.2 million and decreased interest expense during the six month period by $.7
million.

         The credit risk associated with these financial instruments is
the risk of non-performance by the counterparties to the agreements. However,
management does not anticipate non-performance by the counterparties and
monitors risk through its asset/liability management procedures.

LIQUIDITY

         The objective of liquidity management is to ensure the availability of
sufficient resources by the Company and its subsidiaries to meet their financial
commitments and to capitalize on opportunities for business expansion. Liquidity
management addresses the ability to meet deposit withdrawals either on demand or
at contractual maturity, to repay other borrowings as they mature and to make
new loans and investments as opportunities arise.

         Sources of liquidity include dividends from its subsidiaries,
borrowings, the sale of available-for-sale securities, and funds available
through the capital markets. Dividends from the Company's banking subsidiaries
are limited by regulatory guidelines.

         The bank subsidiaries have numerous sources of liquidity including loan
and security principal repayments and maturities, lines-of-credit with other
financial institutions, the ability to borrow under repurchase agreements and
Federal Home Loan Bank ("FHLB") advances, utilizing their unpledged securities
and mortgage related loan portfolios, the sale of available-for-sale securities,
the securitization or sale of loans, and growth in deposits.

         The banking subsidiaries currently have the ability to borrow an
additional $4.9 billion on a secured basis, utilizing mortgage related loans and
securities as collateral. At June 30, 2001, the Company had $2.7 billion in
outstanding borrowings with the FHLB.

         The Company and its banking subsidiaries' liquidity positions are
monitored daily to ensure the maintenance of an optimum level and efficient use
of available funds. Management believes that sufficient liquidity exists to meet
their operating requirements.


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<PAGE>   22
                                   SIGNATURES

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












Date:  August 14, 2001                          /s/ Daniel M. Healy
                                                ________________________________
                                                Daniel M. Healy
                                                Executive Vice President &
                                                Chief Financial Officer


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