SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                -----------------

                                    FORM 10-Q

   (Mark One)

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

                  For the quarterly period ended June 30, 2002

                                 OR

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

           For the transition period from ____________ to ____________

                        Commission file number 000-24811

                              SOUND FEDERAL BANCORP
             (Exact name of registrant as specified in its charter)

          Federal                                               13-4029393
-------------------------------                              ---------------
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                              Identification No.)

                 300 Mamaroneck Ave., Mamaroneck, New York 10543
                 -----------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (914) 698-6400
               (Registrant's telephone number including area code)

                                       N/A
            ---------------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed from last Report)

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

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

                                                       Shares
            Class                                 Outstanding at
        --------------                            August 12, 2002
         Common Stock,                            ---------------
         par value, $0.10                             4,778,292



<PAGE>



                                TABLE OF CONTENTS


                         PART I -- FINANCIAL INFORMATION

Item 1.  Financial Statements (Unaudited)

   Consolidated Balance Sheets at June 30, 2002 and March 31, 2002             1

   Consolidated Statements of Income for the Three Months
   Ended June 30, 2002 and 2001                                                2

   Consolidated Statement of Changes in Stockholders' Equity for the Three
   Months Ended June 30, 2002                                                  3

   Consolidated Statements of Cash Flows for the Three Months
   Ended June 30, 2002 and 2001                                                4

   Notes to Unaudited Consolidated Financial Statements                        5

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations                                                 8

Item 3.  Quantitative and Qualitative Disclosures about Market Risk           12


                          PART II -- OTHER INFORMATION

Item 1.  Legal Proceedings                                                    13

Item 2.  Changes in Securities and Use of Proceeds                            13

Item 3.  Defaults upon Senior Securities                                      13

Item 4.  Submission of Matters to a Vote of Security Holders                  13

Item 5.  Other Information                                                    13

Item 6.  Exhibits and Reports on Form 8-K                                     13

         Signatures                                                           14

<PAGE>

Part 1. - Financial Information
Item 1.  Financial Statements

<TABLE>
<CAPTION>
Sound Federal Bancorp and Subsidiary
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(Dollars in thousands)                                                                         June 30,                March 31,
                                                                                                 2002                    2002
                                                                                            -------------           ------------
Assets
<S>                                                                                        <C>                     <C>
 Cash and due from banks                                                                   $        6,651          $        6,931
 Federal funds sold                                                                                35,370                  19,847
                                                                                              -----------            ------------
             Total cash and cash equivalents                                                       42,021                  26,778
                                                                                              -----------            ------------
 Securities available for sale, at fair value (including $35,995 and $35,779 pledged as
    collateral under repurchase agreements at June 30, 2002 and March 31, 2002,
     respectively)                                                                                143,842                 150,231
 Loans, net:
     Mortgage loans                                                                               437,283                 419,120
     Consumer loans                                                                                 2,432                   1,469
     Allowance for loan losses (Note 4)                                                            (2,296)                 (2,221)
                                                                                              ------------           -------------
          Total loans, net                                                                        437,419                 418,368
                                                                                              -----------            ------------

 Accrued interest receivable                                                                        3,465                   3,241
 Federal Home Loan Bank stock                                                                       4,141                   4,141
 Premises and equipment, net                                                                        5,489                   5,459
 Deferred income taxes                                                                                573                     942
 Goodwill                                                                                          13,970                  13,970
 Other assets                                                                                         545                     855
                                                                                              -----------             -----------
           Total assets                                                                    $      651,465          $      623,985
                                                                                              ===========            ============

Liabilities and Stockholders' Equity
  Liabilities:
      Deposits                                                                             $      544,626          $      519,905
      Borrowings (Note 5)                                                                          34,967                  34,922
      Mortgage escrow funds                                                                         4,402                   5,021
      Accrued expenses and other liabilities                                                        3,650                   3,122
                                                                                                ---------             -----------
         Total liabilities                                                                        587,645                 562,970
                                                                                                ---------             -----------
  Stockholders' equity (Note 1):
     Preferred stock ($0.10 par value; 10,000,000 shares
     authorized;                                                                                        -                       -
     none issued and outstanding)
     Common stock ($0.10 par value; 20,000,000 shares authorized; 5,223,218 and
       5,220,218 shares issued at June 30, 2002 and March 31, 2002, respectively)                     522                     522
     Additional paid-in capital                                                                    22,596                  22,525
     Treasury stock, at cost (444,926 shares at June 30, 2002 and March 31, 2002)                  (4,350)                 (4,350)
     Common stock held by the Employee Stock Ownership Plan ("ESOP")                               (1,057)                 (1,105)
     Common stock awards under the Recognition and Retention Plan ("RRP")                            (208)                   (244)
     Retained earnings                                                                             44,589                  42,566
     Accumulated other comprehensive income, net of taxes (Note 6)                                  1,728                   1,101
                                                                                              ------------           ------------
          Total stockholders' equity                                                               63,820                  61,015
                                                                                              ------------            -----------
          Total liabilities and stockholders' equity                                       $      651,465           $     623,985
                                                                                              ============            ============

</TABLE>

See accompanying notes to unaudited consolidated financial statements.
<page>

<TABLE>
<CAPTION>

Sound Federal Bancorp and Subsidiary

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share data)
                                                                    For the Three Months Ended
                                                                             June 30,
                                                                 -------------------------------
                                                                       2002               2001
   Interest and Dividend Income
<S>                                                             <C>                 <C>
    Loans                                                       $      7,614        $      5,813
    Mortgage-backed and other securities                               2,040               3,147
    Federal funds sold and other overnight deposits                      105                 307

    Other earning assets                                                  65                  98
                                                                   ---------           ---------
    Total interest and dividend income                                 9,824               9,365
                                                                   ---------           ---------


   Interest Expense
    Deposits                                                           3,103               5,054
     Borrowings                                                          416                 269
     Other interest-bearing liabilities                                   20                  16
                                                                   ---------           ---------
    Total interest expense                                             3,539               5,339
                                                                   ----------          ---------

    Net interest income                                                6,285               4,026
    Provision for loan losses (Note 4)                                    75                  25
                                                                   ---------           ---------
    Net interest income after provision for loan losses                6,210               4,001
                                                                   ---------           ---------

   Non-Interest Income
     Service charges and fees                                            170                 139
     Gain on sale of real estate owned                                    --                  57
                                                                   ---------           ---------
     Total non-interest income                                           170                 196
                                                                   ---------           ---------

   Non-Interest Expense
     Compensation and benefits                                         1,428               1,225
     Occupancy and equipment                                             444                 321
     Data processing service fees                                        229                 192
     Advertising and promotion                                           148                 156
     Other                                                               594                 440
                                                                   ---------           ---------
     Total non-interest expense                                        2,843               2,334
                                                                   ---------           ---------

    Income before income tax expense                                   3,537               1,863
    Income tax expense                                                 1,376                 688
                                                                   ---------           ---------
    Net income                                                  $      2,161        $      1,175
                                                                   =========           =========

    Basic earnings per common share (Note 3)                    $       0.46        $       0.25
                                                                   =========           =========
   Diluted earnings per common share (Note 3)                   $       0.46        $       0.25
                                                                   =========           =========
</TABLE>


See accompanying notes to unaudited consolidated financial statements.

<PAGE>

Sound Federal Bancorp and Subsidiary

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the Three Months Ended June 30, 2002 (Unaudited) (Dollars in thousands,
except per share data)

<TABLE>
<CAPTION>

                                                                                            Common         Common
                                                                Additional                   Stock          Stock
                                                     Common      Paid-In      Treasury      Held By        Awards        Retained
                                                     Stock       Capital       Stock         ESOP        Under RRP       Earnings
                                                     -----       -------       -----         ----        ---------       --------
<S>                                                    <C>          <C>           <C>       <C>          <C>              <C>
Balance at March 31, 2002                           $  522       $ 22,525      $(4,350)  $   (1,105)  $      (244)     $    42,566
Net income                                              --            --           --           --             --            2,161
Other comprehensive income (Note 6)                     --            --           --           --             --              --

  Total comprehensive income
Dividends paid ($0.07 per share)                        --            --            --          --             --             (138)
Issuance of stock pursuant to stock option plan         --            27           --           --             --             --
Vesting of RRP shares                                   --            --           --           --             36             --
ESOP shares committed to be released for
   allocation                                           --             44           --           48           --              --
                                                    -------    -----------     -------      -------      ----------       --------
Balance at June 30, 2002                          $    522     $   22,596   $   (4,350)  $   (1,057)  $      (208)     $    44,589
                                                   =======       ========      ========     ========     ==========       ========
</TABLE>

<TABLE>
<CAPTION>

                                                       Accumulated
                                                          Other             Total
                                                      Comprehensive     Stockholders'
                                                         Income            Equity
                                                         -------           ------
<S>                                                  <C>                <C>
Balance at March 31, 2002                           $      1,101       $      61,015
Net income                                                    --               2,161
Other comprehensive income (Note 6)                          627                 627
                                                                           ---------
  Total comprehensive income                                                   2,788
Dividends paid ($0.07 per share)                              --                (138)
Issuance of stock pursuant to stock option plan               --                  27
Vesting of RRP shares                                         --                  36
ESOP shares committed to be released for
   allocation                                                 --                  92
                                                       ----------          ---------
Balance at June 30, 2002                            $      1,728       $      63,820
                                                       ===========        ==========
</TABLE>

See accompanying notes to unaudited consolidated financial statements.

<PAGE>

<TABLE>
<CAPTION>
Sound Federal Bancorp and Subsidiary
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)                                                                    For the Three Months Ended
(In thousands)                                                                            June 30,
                                                                               ------------------------------
                                                                                   2002             2001
                                                                               -------------     ------------
OPERATING ACTIVITIES
<S>                                                                          <C>                <C>
  Net income                                                                 $      2,161       $      1,175
  Adjustments to reconcile net income to net cash provided
      by operating activities:
      Provision for loan losses                                                        75                 25
      Depreciation, amortization and accretion                                        193               (210)
      ESOP and RRP expense                                                            128                 92
      Income taxes                                                                    131              1,111
      Gain on sale of real estate owned                                                --                (57)
      Other adjustments, net                                                          342               (584)
                                                                               ----------          ----------
            Net cash provided by operating activities                               3,030              1,552
                                                                               ----------          ---------

INVESTING ACTIVITIES
  Purchases of securities available for sale                                      (13,272)           (19,658)
  Proceeds from principal payments, maturities and calls of securities             20,826             25,433
  Disbursements for loan originations                                             (57,689)           (43,873)
  Principal collection on loans                                                    38,451             16,730
  Net decrease in certificates of deposit                                              --                991
  Proceeds from sales of real estate owned                                            114                254
  Purchases of premises and equipment                                                (208)               (37)
                                                                               -----------         ----------
                  Net cash used in investing activities                           (11,778)           (20,160)
                                                                               -----------         ----------

FINANCING ACTIVITIES
  Net increase (decrease) in deposits                                              24,721             (2,379)
  Net decrease in mortgage escrow funds                                              (619)              (938)
  Issuance of stock pursuant to stock option plan                                      27                 --
  Purchases of treasury stock                                                          --               (483)
  Dividends paid on common stock                                                     (138)              (140)
                                                                               -----------         ----------
            Net cash provided by (used in) financing activities                    23,991             (3,940)
                                                                               -----------         ----------

  Increase in cash and cash equivalents                                            15,243            (22,548)
  Cash and cash equivalents at beginning of period                                 26,778             40,849
                                                                               ----------          ---------
  Cash and cash equivalents at end of period                                 $     42,021      $      18,301
                                                                               ==========          =========

SUPPLEMENTAL INFORMATION
  Interest paid                                                              $      3,348      $       5,341
  Income taxes paid (received)                                                      1,250             (1,109)
   Loans transferred to real estate owned                                              --                118
                                                                               ==========          =========
</TABLE>

See accompanying notes to unaudited consolidated financial statements.



<PAGE>


Sound Federal Bancorp and Subsidiary

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.       Reorganization and Stock Offerings

     On October 8, 1998, Sound Federal Bancorp issued shares of its common stock
in connection with a Plan of Reorganization ("the  "Reorganization") and related
Subscription and Community  Offering (the  "Offering").  In the  Reorganization,
Sound  Federal  Savings  and Loan  Association  (the  "Bank")  converted  from a
federally  chartered mutual savings  association to a federally  chartered stock
savings  association  (the  "Conversion").  The  Bank  became  the  wholly-owned
subsidiary of Sound Federal Bancorp, which became the majority-owned  subsidiary
of Sound  Federal,  MHC (the  "Mutual  Holding  Company").  Collectively,  Sound
Federal Bancorp and the Bank are referred to herein as "the Company".

     Sound  Federal  Bancorp  issued a total of  5,212,218  shares of its common
stock in the  Reorganization  and Offering,  consisting of 2,810,510  shares (or
53.92%) issued to the Mutual Holding  Company,  102,200 shares (or 1.96%) issued
to the Sound Federal  Savings and Loan  Association  Charitable  Foundation  and
2,299,508  shares (or  44.12%)  issued to other  stockholders.  After  deducting
offering  costs of $1.1  million,  the net cash  proceeds from the Offering were
$20.0 million.

     On June 13, 2002, the Mutual Holding Company adopted a plan to convert to a
capital stock corporation. Upon conversion, shares of the Company's common stock
held by the public will be exchanged  for shares of a Delaware  holding  company
which will become the Bank's parent company. In addition, shares of the Delaware
holding  company will be offered for sale to the Bank's  depositors  and certain
borrowers in a subscription  offering. The shares to be sold in the subscription
offering  represent the ownership  interest of the Mutual Holding  Company.  The
conversion and offering will result in additional capital and an increase in the
number of shares outstanding.

2.       Basis of Presentation

     The consolidated financial statements included herein have been prepared by
the  Company  without  audit.  In  the  opinion  of  management,  the  unaudited
consolidated financial statements include all adjustments,  consisting of normal
recurring accruals,  necessary for a fair presentation of the financial position
and results of operations for the periods  presented.  Certain  information  and
footnote disclosures normally included in accordance with accounting  principles
generally  accepted  in the United  States of  America  have been  condensed  or
omitted  pursuant to the rules and  regulations  of the  Securities and Exchange
Commission;  however,  the Company believes that the disclosures are adequate to
make the  information  presented not misleading.  The operating  results for the
periods  presented are not necessarily  indicative of results to be expected for
any other interim period or for the entire fiscal year ending March 31, 2003.

     The consolidated financial statements have been prepared in conformity with
accounting  principles  generally  accepted in the United States of America.  In
preparing the consolidated financial statements,  management is required to make
estimates  and  assumptions   that  affect  the  reported   amounts  of  assets,
liabilities,  income and expense. Actual results could differ significantly from
these  estimates.  A  material  estimate  that is  particularly  susceptible  to
near-term change is the allowance for loan losses, which is discussed in Note 4.

     The unaudited interim  consolidated  financial  statements presented herein
should be read in  conjunction  with the annual audited  consolidated  financial
statements of the Company for the fiscal year ended March 31, 2002,  included in
the Company's 2002 Annual Report.

3.       Earnings Per Share

     Weighted  average  common  shares  used in  calculating  basic and  diluted
earnings  per  share  ("EPS")  for the three  months  ended  June 30,  2002 were
4,650,458  and  4,744,132,  respectively.  For the quarter  ended June 30, 2001,
weighted  average common shares used in  calculating  basic and diluted EPS were
4,632,924 and 4,661,953,  respectively.  Diluted EPS reflects incremental shares
for stock  options and unvested RRP shares,  computed  using the treasury  stock
method.

4.       Allowance for Loan Losses

     The allowance  for loan losses is increased by  provisions  for loan losses
charged to income and by  recoveries of prior  charge-offs,  and is decreased by
charge-offs. Losses are charged to the allowance when all or a portion of a loan
is deemed to be  uncollectible.  Recoveries of loans previously  charged-off are
credited to the allowance for loan losses when realized.  Management's  periodic
determination of the allowance is based on continuing  reviews of the portfolio,
using a consistently-applied methodology. The allowance for loan losses consists
of losses inherent in the loan portfolio that are both probable and estimable at
the date of the  financial  statements.  In  determining  the allowance for loan
losses,  management  considers  factors  such as the  Company's  past  loan loss
experience,  known  and  inherent  risks in the  portfolio,  adverse  situations
affecting a  borrower's  ability to repay,  the  estimated  value of  underlying
collateral, and current economic conditions.

<page>

     Determining the allowance for loan losses involves  significant  management
judgments utilizing the best information available.  Those judgments are subject
to further  review by  various  sources,  including  the  Company's  regulators.
Changes in the  allowance  may be  necessary  in the future  based on changes in
economic and real estate market conditions,  new information  obtained regarding
known problem loans, the  identification  of additional  problem loans and other
factors, certain of which are outside of management's control.

     Activity in the  allowance  for loan losses for the  periods  indicated  is
summarized as follows:
<TABLE>
<CAPTION>

                                          Three Months Ended               Year Ended
                                                June 30,                    March 31,
                                            2002            2001             2002
                                       -------------   -------------        --------
                                               (in thousands)
<S>                                    <C>             <C>               <C>
Balance at beginning of period....     $     2,221     $     2,047       $       2,047
Provision for loan losses.........              75              25                 175
Charge-offs.......................             --               --                 (15)
Recoveries........................             --               --                  14
                                       ------------    ------------      -------------
Balance at end of period..........     $     2,296     $     2,072       $       2,221
                                         =========       =========       =============
</TABLE>


5.       Borrowings

     The Company  had the  following  outstanding  borrowings  under  securities
repurchase agreements with the FHLB at June 30, 2002:

<TABLE>
<CAPTION>
                                                                                                       Accrued
                                                                                                      Interest
        Maturity Date                 Call Features                   Rate         Borrowings          Payable
        -------------                 -------------                   ----         ----------          -------
                                                                                       (dollars in thousands)
<S>                      <C>                                          <C>        <C>             <C>
      January 2008        Quarterly beginning January 2003             5.42%    $       9,883      $      101
      December 2008       Quarterly beginning November 2001            4.72             5,000              --
      March 2003                           None                        2.54             7,000              15
      March 2004                           None                        3.57             7,000              21
      March 2005                           None                        4.22             6,000              21
                                                                                  -----------        --------
                                                                       4.17%    $      34,883      $      158
                                                                                  ===========        ========
</TABLE>

     The  securities  transferred  to  the  FHLB  subject  to  these  repurchase
agreements include U.S. Government and agency securities available for sale with
a carrying value of $17.1 million and mortgage-backed  securities  available for
sale with a carrying  value of $18.9  million.  Accrued  interest  receivable on
these securities totaled $245,000 at June 30, 2002.

     An  outstanding  FHLB advance of $84,000 is included in  borrowings  in the
consolidated  balance  sheets at June 30, 2002 and March 31, 2002.  This advance
bears interest at a fixed rate of 8.29% and matures in December 2002.

6.       Comprehensive Income

     Comprehensive  income  represents the sum of net income and items of "other
comprehensive  income  or loss"  that are  reported  directly  in  stockholders'
equity,  such as the change during the period in the  after-tax  net  unrealized
gain or loss on securities available for sale.

<page>

     The Company's  other  comprehensive  income (loss) is summarized as follows
for the three months ended June 30:

<TABLE>
<CAPTION>
                                                                                           2002             2001
                                                                                           ----             ----
                                                                                              (In thousands)
<S>                                                                                   <C>          <C>
           Net unrealized holding gain (loss) arising during the
                period on securities available for sale..................             $      1,023  $       (250)
           Related deferred income tax effect............................                     (396)          101
                                                                                              -----     --------

           Other comprehensive income (loss).............................             $        627     $    (149)
                                                                                              ====        =======
</TABLE>

     The Company's  accumulated other comprehensive income, which is included in
stockholders' equity, is summarized as follows:

<TABLE>
<CAPTION>

                                                                                     June 30,           March 31,
                                                                                       2002               2002
                                                                                     ---------         ---------
                                                                                            (In thousands)

<S>                                                                                 <C>               <C>
           Net unrealized holding gain on securities available for sale..           $    2,985        $   1,962
           Additional minimum pension liability..........................                 (170)            (170)
           Related deferred income taxes.................................               (1,087)            (691)
                                                                                    -----------       ---------
           Accumulated other comprehensive income......................             $    1,728        $   1,101
                                                                                    ===========       =========

</TABLE>

Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations

General

     The Company's  results of operations depend primarily upon its net interest
income,  which is the  difference  between  income  earned  on  interest-earning
assets, such as loans and securities, and the interest expense paid on deposits.
The Company's  operations  are affected to a much lesser degree by  non-interest
income,  such as banking  service  charges and fees. Net income is also affected
by, among other things,  provisions for loan losses and  non-interest  expenses.
The Company's  principal operating  expenses,  aside from interest expense,  are
compensation  and benefits,  occupancy and equipment,  data  processing  service
fees,  advertising  and  promotion  and  other  expenses  such as ATM  expenses,
professional  fees and insurance  premiums.  The Company's results of operations
also are affected significantly by general economic and competitive  conditions,
particularly  changes  in market  interest  rates,  government  legislation  and
policies affecting fiscal affairs, housing and financial institutions,  monetary
policies  of the Federal  Reserve  System,  and the  actions of bank  regulatory
authorities.

     When used in this report on Form 10-Q,  the words or phrases  "will  likely
result," "are  expected  to," "will  continue,"  "is  anticipated,"  "estimate,"
"project"  or similar  expressions  are  intended to  identify  "forward-looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1995.  Such  statements are subject to certain risks and  uncertainties  that
could cause actual  results to differ  materially  from  historical  results and
those  presently  anticipated  or  projected.  Among  others,  these  risks  and
uncertainties  include  changes in economic  conditions in the Company's  market
area,  changes in  policies by  regulatory  agencies,  fluctuations  in interest
rates,  demand  for loans in the  Company's  market  area and  competition.  The
Company  wishes to  caution  readers  not to place  undue  reliance  on any such
forward-looking  statements,  which speak only as of the date made.  The Company
wishes  to advise  readers  that the  factors  listed  above  could  affect  the
Company's financial performance and could cause the Company's actual results for
future periods to differ  materially from its  forward-looking  statements.  The
Company  does not  undertake,  and  specifically  declines  any  obligation,  to
publicly  release  the  result  of  any  revisions  which  may  be  made  to any
forward-looking  statements to reflect events or circumstances after the date of
such  statements or to reflect the occurrence of  anticipated  or  unanticipated
events.

Recent Developments

     On June 13 2002, the Mutual Holding  Company adopted a plan to convert to a
capital stock corporation. Upon conversion, shares of the Company's common stock
held by the public will be exchanged  for shares of a Delaware  holding  company
which will become the Bank's parent company. In addition, shares of the Delaware
holding  company will be offered for sale to the Bank's  depositors  and certain
borrowers in a subscription  offering. The shares to be sold in the subscription
offering represent the ownership interest of the Mutual Holding Company.

Financial Condition

     The Company's  total assets  amounted to $651.5 million at June 30, 2002 as
compared to $624.0 million at March 31, 2002. Net loans  increased $19.0 million
or 4.6% to $437.4  million at June 30,  2002 as  compared  to $418.4  million at
March 31,  2002.  Cash and cash  equivalents  increased  $15.2  million to $42.0
million at June 30, 2002 as compared to $26.8  million at March 31, 2002.  These
increases were funded  principally by a $24.7 million increase in deposits and a
$6.4 million decrease in securities.  Total deposits  amounted to $544.6 million
at June 30,  2002,  as  compared  to $519.9  million  at March 31,  2002.  Total
stockholders' equity increased $2.8 million to $63.8 million at June 30, 2002 as
compared to $61.0  million at March 31,  2002,  primarily  attributable  to $2.2
million in net income and a $627,000 increase in accumulated other comprehensive
income.

Results of Operations

     General.  Net income amounted to $2.2 million or $0.46 per common share for
the quarter ended June 30, 2002, as compared to $1.2 million or $0.25 per common
share for the quarter  ended June 30,  2001.  The increase in net income for the
current  quarter was due  primarily to a $2.3  million  increase in net interest
income,  partially  offset by increases of $509,000 in non-interest  expense and
$688,000 in income tax expense.

     Net Interest  Income.  Net interest  income for the quarter  ended June 30,
2002 amounted to $6.3 million,  a $2.3 million  increase from the same period in
the prior year.  The  interest  rate spread was 4.02% and 2.90% for the quarters
ended June 30, 2002 and 2001,  respectively.  The net interest  margin for those
periods was 4.19% and 3.13%,  respectively.  The  increases in the interest rate
spread and net interest margin are the result of declining market interest rates
during  calendar 2001. The decrease in market interest rates reduced the cost of
our  interest-bearing  liabilities faster than the rates on our interest-earning
assets such as loans or securities.  However,  if market interest rates decrease
further,  interest  rate  spread  and net  interest  margin may  decrease  since
competitive  factors could prohibit  lowering interest rates on deposit accounts
any  further.   In  addition,   as  interest   rates   increase,   the  cost  of
interest-bearing  liabilities  will  increase  faster  than  the  rates  on  our
interest-earning  assets, also causing decreases in net interest rate spread and
net interest margin.

     Interest  Income.  Interest  income totaled $9.8 million during the quarter
ended June 30, 2002 as compared to $9.4 million for the same period in the prior
year.   This  increase  is  due  to  an  $85.4   million   increase  in  average
interest-earning assets to $601.5 million during the quarter ended June 30, 2002
as compared to $516.1  million  for the same  quarter in the prior year,  offset
partially by a 73 basis point decrease in the average yield on  interest-earning
assets  to  6.55%  from  7.28%.   The   increase  in  the  average   balance  of
interest-earning assets was due primarily to deposit growth,  including deposits
from a branch  that was opened in  December  2001.  The  decrease in the average
yield on  interest-earning  assets reflects the origination of fixed-rate  loans
and  adjustable-rate  repricings of our securities  portfolio  during periods of
declining interest rates (particularly the second half of calendar 2001).

     Loans.  Interest  income on loans  increased  $1.8 million or 31.0% to $7.6
million for the quarter  ended June 30, 2002 as compared to $5.8 million for the
same quarter in 2001.  This increase is due to a $120.8 million  increase in the
average balance of loans to $426.5 million from $305.7 million, partially offset
by a 47 basis point decrease in the yield earned to 7.16% from 7.63%.

     The  growth of the loan  portfolio  is  principally  a result of  increased
originations  as  borrowers  sought to take  advantage  of the  lowest  mortgage
interest  rates in forty years.  The low market  interest rates created a robust
housing market and also  compelled  many  consumers to refinance  their existing
mortgage loans. The Company originated $57.7 million of loans during the quarter
ended June 30,  2002 as compared  to $43.9  million for the same  quarter in the
prior year.  These loans were  originated  at rates lower than the yields  being
earned on the existing loan portfolio.  As a result, the average yield earned on
the loan portfolio  decreased during fiscal 2002 and the first quarter of fiscal
2003. The yield on the loan portfolio may decrease further until market interest
rates begin to increase.

     Mortgage-Backed   Securities.   Interest  on   mortgage-backed   securities
decreased  $970,000 to $1.5  million for the quarter  ended June 30,  2002,  due
primarily to a decrease of $40.9 million in the average balance to $97.5 million
and a decrease of 97 basis points in the average yield to 6.22% from 7.19%.  The
lower  average  balances in the current year reflect  principal  repayments  and
prepayments  on  mortgage-backed  securities,  which  the Bank used to fund loan
growth.

<page>

     Other  Securities.  Interest  on other  securities  decreased  $137,000  to
$528,000 for the quarter ended June 30, 2002, as compared to the same quarter in
2001, due to a 210 basis point decrease in the average yield to 4.78% from 6.88%
partially  offset by a $5.5  million  increase in the  average  balance to $44.3
million.  The decrease in the average yield is the result of declining  interest
rates during fiscal 2002.

     Federal Funds Sold and Other Overnight Deposits. For the quarter ended June
30, 2002,  interest on Federal funds sold and other overnight deposits decreased
$202,000 to $105,000, reflecting a 302 basis point decrease in the average yield
earned to 1.45%,  partially  offset by a $1.4  million  increase  in the average
balance to $29.0 million.  The decrease in the average yield earned reflects the
declining interest rate environment during fiscal 2002.

     Interest  Expense.  Interest  expense for the  quarter  ended June 30, 2002
totaled $3.5 million, as compared to $5.3 million for the quarter ended June 30,
2001. The decrease in interest  expense is due to a decrease in the average cost
of liabilities to 2.53% from 4.38%  resulting  from  declining  market  interest
rates during fiscal 2002. The average  balance of  interest-bearing  liabilities
increased  $72.5  million to $561.8  million for the quarter ended June 30, 2002
from $489.3 million for the same quarter in the prior year.

     Interest  expense on time  deposits  totaled  $2.6  million for the current
quarter as compared to $4.3 million for the same  quarter in 2001.  The decrease
is due primarily to a 263 basis point decrease in the average cost to 3.20% from
5.83%,  offset  partially by a $27.1 million  increase in the average balance of
time  deposits to $320.6  million  from $293.5  million in the same quarter last
year.  Interest on savings accounts amounted to $311,000 for the current quarter
as compared to $511,000 for the quarter  ended June 30, 2001.  The decrease is a
result of an 85 basis point decrease in the average cost of savings  accounts to
1.05% from 1.90%,  offset  partially by a $10.9 million  increase in the average
balance  of  savings  accounts  to $118.7  million.  Interest  expense  on other
deposits  (NOW and money market  accounts)  amounted to $234,000 for the quarter
ended June 30, 2002 as compared  to $279,000  for the same  quarter in the prior
year. The average cost of these accounts  decreased 50 basis points to 1.13% and
the average balance increased $14.6 million to $83.2 million.

     For the  quarter  ended  June 30,  2002,  interest  expense  on  borrowings
amounted to  $416,000  as  compared  to $269,000 in the prior year.  The average
balance of borrowings for the current  quarter was $34.9 million and the average
cost was 4.78%.  For the quarter  ended June 30,  2001,  the average  balance of
borrowings  was $14.7  million and the average  cost was 7.33%.  The increase in
FHLB borrowings was used by the Company to fund loan originations  during fiscal
2002.

     Provision for Loan Losses.  Management regularly reviews the Company's loan
portfolio and makes  provisions for loan losses in amounts  required to maintain
the allowance for loan losses in accordance with generally  accepted  accounting
principles.  The allowance  consists of known and inherent  losses that are both
probable and  estimable at the date of the financial  statements.  The allowance
for loan losses consists of amounts  allocated to specific  nonperforming  loans
and to  loans  in  each  major  portfolio  category.  Loan  categories  such  as
single-family  residential  mortgage loans, which represent 90.8% of total loans
at June 30, 2002, are generally  evaluated on an aggregate or "pool" basis.  The
Company's allowance for loan losses is predominately  determined on a pool basis
by applying loss factors to the current balances of the various loan categories.
The  loss  factors  are  determined  by  management  based on an  evaluation  of
historical  loss  experience,  delinquency  trends,  volume  and type of lending
conducted, and the impact of current economic conditions in the Company's market
area.

     The  provision  for loan losses was $75,000 for the quarter  ended June 30,
2002 as compared to $25,000 for the quarter ended June 30, 2001.  Non-performing
loans amounted to $952,000 or 0.22% of total loans at June 30, 2002, as compared
to $1.1 million or 0.35% of total loans at June 30, 2001. The allowance for loan
losses  amounted  to $2.3  million or 0.52% of total  loans at June 30, 2002 and
$2.2 million or 0.53% of total loans at March 31, 2002.

     Non-Interest Income.  Non-interest income totaled $170,000 and $196,000 for
the quarters  ended June 30, 2002 and 2001,  respectively.  Non-interest  income
consists  principally of service  charges on deposit  accounts,  late charges on
loans and various other service fees.  Service fees amounted to $170,000 for the
quarter  ended June 30, 2002 as compared  to  $139,000  for the same  quarter in
2001. The quarter ended June 30, 2001 included a gain on the sale of real estate
owned of $57,000.

<page>

     Non-Interest  Expense.  Non-interest  expense  totaled $2.8 million for the
quarter  ended June 30, 2002 as compared to $2.3  million for the quarter  ended
June 30,  2001.  This  increase is due  primarily  to  increases  of $203,000 in
compensation  and benefits,  $123,000 in occupancy and equipment and $154,000 in
other  non-interest  expenses.  The  increase in  compensation  and  benefits is
primarily due to a new branch location opened in December 2001,  increased costs
related to  lending  operations  and  overall  internal  growth.  Occupancy  and
equipment  expense was higher in the  current  quarter as a result of a $125,000
refund of property taxes related to branch  locations that reduced  expenses for
the quarter ended June 30, 2001. Other non-interest expenses increased primarily
due to the new branch location and internal growth to support lending and branch
operations.

     Income Taxes.  Income tax expense amounted to $1.4 million and $688,000 for
the quarters ended June 30, 2002 and 2001, respectively. The effective tax rates
for those same periods were 38.9% and 36.9%, respectively.

Liquidity and Capital Resources

     The  Company's  primary  sources of funds are  deposits,  the proceeds from
principal and interest payments on loans and mortgage-backed securities, and the
proceeds  from  maturities  of  investments.   While  maturities  and  scheduled
amortization of loans and securities are a predictable source of funds,  deposit
flows and mortgage prepayments are greatly influenced by general interest rates,
economic conditions and competition.

     The Company's primary investing  activities are the origination of mortgage
loans, and the purchase of short-term  investments,  government agency bonds and
adjustable  rate  mortgage-backed   securities.   These  activities  are  funded
primarily by deposit growth and principal  repayments on loans,  mortgage-backed
securities and other investment securities. For the quarter ended June 30, 2002,
the Company  originated loans totaling $57.7 million and purchased $13.3 million
of  securities.  These  disbursements  were  funded in part by $20.8  million in
principal payments, maturities and calls of securities and $38.5 million in loan
principal repayments.  For the year ended March 31, 2002, the Company originated
$220.4 million of loans and purchased $57.7 million of securities.

     Liquidity  management for the Company is both a daily and long-term process
which is part of the Company's  overall  management  strategy.  Excess funds are
generally  invested  in  short-term   investments  such  as  Federal  funds  and
certificates  of deposit.  In the event that the Bank should require  additional
sources of funds,  it could  borrow from the Federal  Home Loan Bank of New York
under an available line of credit.

     At June 30, 2002, the Company had outstanding loan origination  commitments
of $70.5 million.  The Company  anticipates  that it will have sufficient  funds
available  to meet its current  loan  commitments.  Time  deposits  scheduled to
mature  in one  year or  less  from  June  30,  2002,  totaled  $270.4  million.
Management believes that a significant portion of such deposits will remain with
the Company.

     The Bank is subject to certain  minimum  leverage,  tangible and risk-based
capital  requirements  established by regulations of the OTS. These  regulations
require savings associations to meet three minimum capital standards: a tangible
capital  ratio  requirement  of 1.5% of total  assets as adjusted  under the OTS
regulations;  a  leverage  ratio  requirement  of 4.0% of core  capital  to such
adjusted  total assets;  and a risk-based  capital ratio  requirement of 8.0% of
core and  supplementary  capital  to total  risk-based  assets.  The OTS  prompt
corrective  action  regulations  impose  a 4.0%  core  capital  requirement  for
categorization  as an  "adequately  capitalized"  thrift and a 5.0% core capital
requirement for categorization as a "well capitalized" thrift. Goodwill and most
other  intangible  assets are  deducted in  determining  regulatory  capital for
purposes of all  capital  ratios.  In  determining  the amount of  risk-weighted
assets for purposes of the risk-based capital requirement, a savings association
must  compute  its  risk-based  assets by  multiplying  its assets  and  certain
off-balance  sheet  items  by  risk-weights,  which  range  from 0% for cash and
obligations  issued by the United States  Government or its agencies to 100% for
consumer and commercial  loans, as assigned by the OTS capital  regulations.  At
June 30,  2002,  the Bank  exceeded  all of the OTS minimum  regulatory  capital
requirements,   and  was  classified  as  a  well-capitalized   institution  for
regulatory purposes.

<page>

     The following table sets forth the capital  position of the Bank as of June
30, 2002 and March 31,  2002.  The actual  capital  amounts and ratios set forth
below are for the Bank only and, accordingly,  do not include additional capital
retained by Sound Federal Bancorp.

<TABLE>
<CAPTION>

                                                                                       OTS
                                                                                    Requirements
                                                                  --------------------------------------------
                                                                    Minimum Capital         Classification as
                                             Bank Actual               Adequacy             Well Capitalized
                                         -----------------        -------------------      -------------------
                                         Amount      Ratio        Amount       Ratio       Amount     Ratio
                                         ------      -----        ------       -----       ------     -----
                                                                 (Dollars in thousands)
June 30, 2002
<S>                                   <C>              <C>       <C>              <C>      <C>         <C>
Tangible capital....................  $   42,113       6.6%      $   9,528        1.5%
Tier I (core) capital...............      42,113       6.6          25,405        4.0     $   31,757     5.0%
Risk-based capital:
   Tier I...........................      42,113      13.1                                    19,341     6.0
   Total............................      44,410      13.8          25,788        8.0         32,236    10.0

March 31, 2002
Tangible capital....................  $   39,865       6.5%      $   9,139        1.5%
Tier I (core) capital...............      39,865       6.5          24,371        4.0     $   30,464     5.0%
Risk-based capital:
   Tier I...........................      39,865      12.7                                    18,776     6.0
   Total............................      42,087       3.5          25,035        8.0         31,294    10.0

</TABLE>


Item 3.  Quantitative and Qualitative Disclosures about Market Risk

     The Company's most  significant  form of market risk is interest rate risk,
as the majority of the Company's assets and liabilities are sensitive to changes
in interest rates. The Company's assets consist primarily of fixed rate mortgage
loans, which have longer maturities than the Company's liabilities which consist
primarily  of  deposits.  The  Company's  mortgage  loan  portfolio,  consisting
primarily of loans secured by residential  real property  located in Westchester
County,  New York and Fairfield  County,  Connecticut,  is also subject to risks
associated with the local economy.  The Company does not own any trading assets.
At June 30, 2002,  the Company did not have any hedging  transactions  in place,
such as  interest  rate  swaps  and  caps.  The  Company's  interest  rate  risk
management  program focuses primarily on evaluating and managing the composition
of the Company's  assets and liabilities in the context of various interest rate
scenarios.  Factors beyond management's  control,  such as market interest rates
and competition, also have an impact on interest income and interest expense.

     During the quarter ended June 30, 2002,  there were no significant  changes
in the Company's assessment of market risk.


<PAGE>


Part II--OTHER INFORMATION

Item 1.  Legal Proceedings

     The Company is not  involved in any pending  legal  proceedings  other than
routine legal  proceedings  occurring in the ordinary  course of business.  Such
routine  legal  proceedings  in the  aggregate  are believed by management to be
immaterial to the Company's financial condition and results of operations.

Item 2.  Changes in Securities and Use of Proceeds

         None

Item 3.  Defaults upon Senior Securities

         None

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

         None


Item 5.  Other Information

         None


Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibit 99.1 - Certification of Chief Executive Officer and Chief Financial
     Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b)  The  Company  filed a Report  on Form 8-K on June 19,  2002  under  Item 5,
     "Other  Events".   The  Form  8-K  included  the  Company's  press  release
     announcing the adoption of a Plan of Conversion and Reorganization.





<PAGE>


                                   SIGNATURES

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






                                         Sound Federal Bancorp
                                         ----------------------------------
                                        (Registrant)





                                     By: /s/ Anthony J. Fabiano
                                         -----------------------------------
                                         Anthony J. Fabiano
                                         Duly Authorized and Chief Financial
                                          and Accounting Officer


August 12, 2002

<PAGE>



                                                                   Exhibit 99.1


      Certification of Chief Executive Officer and Chief Financial Officer
            Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



     Richard P.  McStravick,  Chief  Executive  Officer and Anthony J.  Fabiano,
Chief Financial Officer of Sound Federal Bancorp (the "Company") each certify in
his capacity as an officer of the Company  that he has  reviewed  the  quarterly
report  on Form  10-Q  for the  quarter  ended  June  30,  2002  and that to his
knowledge:

(1)  the report fully complies with the  requirements of Sections 13(a) or 15(d)
     of the Securities Exchange Act of 1934; and

(2)  the information  contained in the report fairly  presents,  in all material
     respects, the financial condition and results of operations of the Company.



August 12, 2002                                  /s/ Richard P. McStravick
------------------                                -------------------------
Date                                              Richard P. McStravick,
                                                  Chief Executive Officer


August 12, 2002                                   /s/ Anthony J. Fabiano
------------------                                -------------------------
Date                                              Anthony J. Fabiano,
                                                  Chief Financial Officer