U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 10-KSB

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2001

Commission File No.: 000-27481

ROME BANCORP, INC.(Name of small business issuer in its charter)

Delaware									 161573070(State or other jurisdiction of								(I.R.S. Employer
incorporation or organization)							Identification No.)

100 W. Dominick Street, Rome, New York 13440-5810(Address of principal executive offices)(315) 336-7300(Issuer's Telephone Number)

Securities registered under Section 12(g) of the Exchange Act:

Common Stock, par value $0.01 per shareTitle of Class

Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes XNo __

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [   ]

The revenues for the issuer's fiscal year ended December 31, 2001 were $18,092,000.

State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, as of a specified date within the last 60 days. On March 08, 2002: $14,462,431.

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. Rome Bancorp had 2,919,133shares outstanding as of March 08, 2002.

DOCUMENTS INCORPORATED BY REFERENCE

The definitive proxy statement pursuant to Regulation 14A to be delivered to the Commission for filing and the 2001 Annual Report to Shareholders for the fiscal year ended December 31, 2001 which has not previously been mailed to the Commission, are incorporated by reference into Parts II and III of this report.

Transitional Small Business Disclosure Format (check one):
Yes No X

|TABLE OF CONTENTS |         
|----------------- | --------
|                  |         
|PART I            |         
|                  |         
|                  | ITEM 1. 
|                  | ITEM 2. 
|                  | ITEM 3. 
|                  | ITEM 4. 
|                  |         
|PART II           |         
|                  |         
|                  | ITEM 5. 
|                  |         
|                  | ITEM 6. 
|                  |         
|                  | ITEM 7. 
|                  | ITEM 8. 
|                  |         
|                  |         
|PART III          |         
|                  |         
|                  | ITEM 9. 
|                  | ITEM 10.
|                  | ITEM 11.
|                  |         
|                  | ITEM 12.
|                  | ITEM 13.



PART I

ITEM 1.	DESCRIPTION OF THE BUSINESS

General

Rome Bancorp, Inc. (Rome Bancorp, the Company) is a Delaware corporation organized on June 9, 1999 as the stock holding company for The Rome Savings Bank (Rome Savings), a New York-chartered stock savings bank headquartered in Rome, New York. Rome Bancorp's principal business is to hold the capital stock of Rome Savings.

Rome Savings was originally chartered in 1851 as a New York mutual savings bank headquartered in Rome, New York. Deposits in Rome Savings are insured by the FDIC, and Rome Savings is examined and regulated by the New York State Department of Banking (Department of Banking) and the FDIC. Rome Savings is a community and customer oriented retail savings bank that offers traditional deposit products, residential real estate mortgage loans and consumer, commercial and commercial real estate loans. In addition, Rome Savings purchases securities issued by the U.S. Government and government agencies, municipal securities, mortgage-backed securities and other investments permitted by applicable laws and regulations. At December 31, 2001, Rome Bancorp, Inc. had assets of $247.4 million, deposits of $189.2 million and shareholders' equity of $36.4 million.

Business Strategy

Our revenues are derived principally from interest on our loans and interest and dividends on our investment securities. Our primary sources of funds are deposits, scheduled amortization and prepayments of loan principal and mortgage-backed securities, maturities and calls of investment securities and funds provided by operations.

Market Area

Operations are conducted out of our executive office in Rome, New York and three branch offices located in Oneida County, New York, two of which are located in Rome and one in New Hartford, New York. As of June 30, 2001, we maintained a 6.41% share of all Oneida County, New York deposits, ranking us sixth in the size of deposits in Oneida County. We also maintained a 41.67% market share of all reported funds on deposit in the City of Rome as of June 30, 2001, making us the largest depository institution in Rome.

Our geographic market area for loans and deposits is principally Oneida County, New York. The local economy is recovering from the loss of certain key employers such as Griffiss Air Force Base in Rome and Martin Marietta in Utica. As a result, the local market is not dependent on one key employer. The principal employment sectors are services (excluding financial), wholesale and retail trade and manufacturing.

Similar to national trends, most of the job growth currently realized in Oneida County has been in service related industries, and service jobs now account for the largest portion of the workforce. Our market area also includes a growing number of healthcare, engineering, software and technical firms which have located in Oneida County in order to take advantage of its well-educated work force including current and former military and defense industry personnel. Rome, New York is located 15 miles west of Utica and 50 miles east of Syracuse.

Future growth opportunities for Rome Bancorp will be influenced by growth and stability in the regional and statewide economies, other demographic trends and the competitive environment. We believe that we have developed lending products and marketing strategies to address the credit-related needs of the residents in our local market area.

Competition

Rome Bancorp faces intense competition both in making loans and attracting deposits. New York has a high concentration of financial institutions, many of which are branches of large money center and regional banks which have resulted from the consolidation of the banking industry in New York and surrounding states. Some of these competitors have greater resources than we do and may offer services that we do not provide. For example, Rome Savings does not provide trust or investment services, or credit cards, and does not yet provide banking services through home computers. Customers who seek "one stop shopping" may be drawn to these institutions.

Competition for loans comes principally from commercial banks, savings institutions, mortgage banking firms, credit unions, finance companies, insurance companies and brokerage and investment banking firms. The most direct competition for deposits has historically come from credit unions, commercial banks, savings banks and savings and loan associations. Rome Bancorp faces additional competition for deposits from short-term money market funds, corporate and government securities funds, and from brokerage firms, mutual funds, and insurance companies.

Lending Activities

General. Rome Savings has a long standing commitment to originate commercial real estate, commercial and consumer loans in addition to a traditional emphasis on residential lending. As of December 31, 2001, we had total loans of $169.2 million. We retain substantially all of the loans that we originate.

Our loans are subject to federal and state laws and regulations. The interest rates we charge on loans are affected principally by the demand for loans, the supply of money available for lending purposes and the interest rates offered by our competitors. These factors are, in turn, affected by general and local economic conditions, monetary policies of the federal government, including the Federal Reserve Board, legislative tax policies and governmental budgetary matters.

Loan Portfolio.	The following table sets forth the composition of our mortgage and other loan portfolios, by type of loan, in dollar amounts and in percentages at the dates indicated.

|                                |                        |          |           |          |           | At December 31,        |           |          |           |         
|------------------------------- | ---------------------- | -------- | --------- | -------- | --------- | ---------------------- | --------- | -------- | --------- | --------
|                                |                        | 2001     |           | 2000     |           | 1999                   |           | 1998     |           | 1997    
|                                |                        |          | Percent   |          | Percent   |                        | Percent   |          | Percent   |         
|                                |                        |          | of        |          | of        |                        | of        |          | of        |         
|                                |                        | Amount   | Total     | Amount   | Total     | Amount                 | Total     | Amount   | Total     | Amount  
|                                |                        |          |           |          |           | (Dollars in thousands) |           |          |           |         
|Mortgage loans:                 |                        |          |           |          |           |                        |           |          |           |         
|                                | One to four family     | $ 62,099 | 36.70%    | $ 62,937 | 37.57%    | $ 64,258               | 44.85%    | $ 65,752 | 48.06%    | $ 66,154
|                                | Commercial real estate | 49,266   | 29.12     | 47,512   | 28.36     | 32,971                 | 23.01     | 29,499   | 21.56     | 28,440  
|                                | Construction and land  | 2,165    | 1.28      | 1,047    | 0.62      | 1,136                  | 0.79      | 391      | 0.29      | 936     
|                                | Total mortgage loans   | 113,530  | 67.10     | 111,496  | 66.55     | 98,365                 | 68.65     | 95,642   | 69.91     | 95,530  
|                                |                        |          |           |          |           |                        |           |          |           |         
|Commercial loans                | 17,602                 | 10.40    | 17,815    | 10.63    | 19,984    | 13.95                  | 17,271    | 12.62    | 15,197    | 11.45   
|                                |                        |          |           |          |           |                        |           |          |           |         
|Consumer loans:                 |                        |          |           |          |           |                        |           |          |           |         
|                                | Automobile             | 20,085   | 11.87     | 22,248   | 13.28     | 10,376                 | 7.24      | 9,460    | 6.92      | 8,325   
|                                | Property improvement   | 3,018    | 1.78      | 2,201    | 1.31      | 1,883                  | 1.31      | 2,108    | 1.54      | 2,264   
|                                | Education              | 4,523    | 2.67      | 4,648    | 2.78      | 4,735                  | 3.30      | 5,224    | 3.82      | 5,226   
|                                | Other                  | 10,446   | 6.18      | 9,126    | 5.45      | 7,945                  | 5.55      | 7,099    | 5.19      | 6,175   
|                                | Total consumer loans   | 38,072   | 22.50     | 38,223   | 22.82     | 24,939                 | 17.40     | 23,891   | 17.47     | 21,990  
|                                |                        |          |           |          |           |                        |           |          |           |         
|Total loans                     | 169,204                | 100.00%  | 167,534   | 100.00%  | 143,288   | 100.00%                | 136,804   | 100.00%  | 132,717   | 100.00% 
|                                |                        |          |           |          |           |                        |           |          |           |         
|Less: Allowance for loan losses | 1,597                  |          | 1,688     |          | 1,776     |                        | 1,956     |          | 1,742     |         
|Loans, net                      | $ 167,607              |          | $ 165,846 |          | $ 141,512 |                        | $ 134,848 |          | $ 130,975 |         

Loan Maturity. The following table presents the contractual maturity of our commercial loans at December 31, 2001 The table does not include the effect of prepayments or scheduled principal amortization.





|                       |                     |                          | At December 31, 2001
|---------------------- | ------------------- | ------------------------ | --------------------
|                       |                     |                          | Commercial Loans    
|                       |                     |                          | (In thousands)      
|Amounts due:           |                    
|Within one year        | $ 8,514            
|After one year:        |                    
|                       | One to three years  | 1,895                   
|                       | Three to five years | 3,166                   
|                       | Five to ten years   | 3,394                   
|                       | Ten to twenty years | 633                     
|                       | Over twenty years   | -                       
|                       |                     | Total due after one year | 9,088               
|Total commercial loans | $ 17,602           







The following table presents, as of December 31, 2001, the dollar amount of all commercial loans, due after December 31, 2002, and whether these loans have fixed interest rates or adjustable interest rates.



|                 | Due After December 31, 2002
|---------------- | ---------------------------
|                 | Fixed                      
|                 | (In thousands)             
|                 |                            
|Commercial loans | $ 6,889                    



Residential Mortgage Lending. Rome Savings emphasizes the origination of mortgage loans secured by one- to four-family properties that serve as the primary residence of the owner. As of December 31, 2001, loans on one- to four-family residential properties accounted for $62.1 million, or 36.7%, of Rome Savings' total loan portfolio. Of residential mortgage loans outstanding on that date, 27.7% were ARM loans and 72.3% were fixed rate loans.

Commercial Real Estate Loans. We originate commercial real estate loans to finance the purchase of real property, which generally consists of developed real estate. In underwriting commercial real estate loans, consideration is given to the property's historic cash flow, current and projected occupancy, location and physical condition. At December 31, 2001, our commercial real estate loan portfolio consisted of 187 loans, totaling $49.3 million, or 29.1%, of total loans. Most of the commercial real estate portfolio consists of loans which are collateralized by properties in our normal lending area. To a lesser extent, commercial real estate loans are secured by out of market properties. Our commercial real estate loan portfolio is diverse, and does not have any significant loan concentration by type of industry or borrower. We lend up to a maximum loan-to-value ratio of 75% on commercial properties and require a minimum debt coverage ratio of 1.25.

Commercial Loans. In addition to commercial real estate loans, we also engage in small business commercial lending, including business installment loans, lines of credit and other commercial loans. At December 31, 2001, our commercial loan portfolio consisted of 453 loans, totaling $17.6 million, or 10.4% of total loans.

Consumer Loans. Rome Savings offers a variety of consumer loans. At December 31, 2001, the consumer loan portfolio totaled $38.1 million or 22.5% of total loans. Consumer loans generally are offered for terms of up to five or 10 years, depending on the collateral, at fixed interest rates. We expect consumer lending to be an area of steady lending growth, with installment loans continuing to account for the major portion of our consumer lending volume. Automobile loans currently comprise the largest portion at 52.8% of the consumer loan portfolio, which consists primarily of loans for used cars.

Asset Quality

Non-performing Assets. Non-performing assets totaled $755,000 at December 31, 2001 compared with $1.3 million at December 31, 2000.

The following table presents information regarding non-accrual mortgage and consumer and other loans, accruing loans delinquent 90 days or more, and foreclosed real estate as of the dates indicated.



|                                      |                  |       |       |                        |      
|------------------------------------- | ---------------- | ----- | ----- | ---------------------- | -----
|                                      |                  |       |       | At December 31,        |      
|                                      |                  | 2001  | 2000  | 1999                   | 1998 
|                                      |                  |       |       | (Dollars in thousands) |      
|Nonaccruing loans:                    |                  |       |       |                        |      
|                                      | Mortgage loans   | $ 51  | 41    | 224                    | 355  
|                                      | Commercial loans | 420   | 1,076 | 112                    | 439  
|                                      | Consumer loans   | 103   | 41    | 22                     | 5    
|                                      | Total            | 574   | 1,158 | 358                    | 799  
|Accruing loans delinquent 90          |                  |       |       |                        |      
|                                      | days or more     | 181   | 188   | 129                    | 132  
|Total non-performing loans            | 755              | 1,346 | 487   | 931                    | 1,474
|Foreclosed real estate, net           | -                | -     | 183   | 293                    | 1,626
|Total non-performing assets           | $ 755            | 1,346 | 670   | 1,224                  | 3,100
|Non-performing loans to total loans   | 0.45%            | 0.80% | 0.34% | 0.68%                  | 1.11%
|Non-performing assets to total assets | 0.31%            | 0.55% | 0.30% | 0.54%                  | 1.45%



We define the population of impaired loans to be all non-accrual commercial real estate and commercial loans greater than $250,000. Impaired loans are individually assessed to determine whether a loan's carrying value is not in excess of the fair value of the collateral or the present value of the loan's cash flows. Smaller balance homogeneous loans that are collectively evaluated for impairment, such as residential mortgage loans and consumer loans, are specifically excluded from the impaired loan portfolio. The Company's recorded investment in loans that are considered impaired totaled $389,000 and $651,000 at December 31, 2001 and 2000, respectively. We had no loans classified as impaired at December 31, 1999.



Allowance for Loan Losses. The following table sets forth activity in Rome Savings' allowance for loan losses and other ratios at or for the dates indicated.



|                             |                             |         | At or For the Years Ended December 31, |                       
|---------------------------- | --------------------------- | ------- | -------------------------------------- | ----------------------
|                             |                             | 2001    | 2000                                   | 1999                  
|                             |                             |         |                                        | (Dollars in thousands)
|Balance at beginning of year | $ 1,688                     | 1,776   | 1,956                                  | 1,742                 
|Provision for loan losses    | 325                         | 650     | 175                                    | 390                   
|Charge-offs:                 |                             |         |                                        |                       
|                             | Mortgage loans              | 37      | 36                                     | 184                   
|                             | Commercial loans            | 341     | 795                                    | 338                   
|                             | Consumer loans              | 213     | 153                                    | 88                    
|                             |                             | 591     | 984                                    | 610                   
|Recoveries                   | 175                         | 246     | 255                                    | 235                   
|Net charge-offs (recoveries) | 416                         | 738     | 355                                    | 176                   
|Balance at end of year       | $ 1,597                     | 1,688   | 1,776                                  | 1,956                 
|Ratio of net charge-offs to  |                             |         |                                        |                       
|                             | average loans outstanding   |         |                                        |                       
|                             | during the period           | 0.25%   | 0.49%                                  | 0.26%                 
|Allowance for loan losses as |                             |         |                                        |                       
|                             | a percent of loans          | 0.94%   | 1.01%                                  | 1.24%                 
|Allowance for loan losses as |                             |         |                                        |                       
|                             | a percent of non-performing |         |                                        |                       
|                             | loans                       | 211.52% | 125.41%                                | 364.68%               
|                             |                             |         |                                        |                       
|                             |                             |         |                                        |                       

The allowance for loan losses is a valuation account that reflects our evaluation of the losses inherent in our loan portfolio. We maintain the allowance through provisions for loan losses that we charge to income. We charge losses on loans against the allowance for loan losses when we believe the collection of loan principal is unlikely.

Our evaluation of risk in maintaining the allowance for loan losses includes the review of all loans on which the collectibility of principal may not be reasonably assured. We consider the following factors as part of this evaluation: our historical loan loss experience, known and inherent risks in the loan portfolio, the estimated value of the underlying collateral and current economic and market trends. There may be other factors that may warrant our consideration in maintaining an allowance at a level sufficient to provide for probable losses. Although we believe that we have established and maintained the allowance for loan losses at adequate levels, future additions may be necessary if economic and other conditions in the future differ substantially from the current operating environment.

In addition, various regulatory agencies, as an integral part of their examination process, periodically review our loan and foreclosed real estate portfolios and the related allowance for loan losses and valuation allowance for foreclosed real estate. These agencies, including the FDIC, may require us to increase the allowance for loan losses or the valuation allowance for foreclosed real estate based on their judgments of information available to them at the time of their examination, thereby adversely affecting our results of operations.

For the year ended December 31, 2001, we increased our allowance for loan losses through a $325,000 provision for loan losses based on our evaluation of the items discussed above. Rome Savings believes that its allowance for loan losses accurately reflects the level of risk in its loan portfolio. In addition to the non-performing loans, management has identified, through normal internal credit review procedures, $13.1 million in "potential problem loans" at December 31, 2001. Payments are current on $11.4 million or 86.9% of these loans. These problem loans are defined as loans not included as non-performing loans, but about which management has developed information regarding possible credit problems, which may cause the borrowers future difficulties in complying with loan repayments. Rome Savings will continue to be aggressive in identifying, monitoring and resolving potential problem loans. See "Management's Discussion and Analysis - Comparison of Results of Operations for the Years Ended December 31, 2001 and 2000 - Provision for Loan Losses."

The following table presents our allocation of the allowance for loan losses by loan category and the percentage of loans in each category to total loans at the periods indicated.

|                 |                                 |                      | At December 31, 2001 |               | At December 31, 2000 |        | At December 31, 1999
|---------------- | ------------------------------- | -------------------- | -------------------- | ------------- | -------------------- | ------ | --------------------
|                 |                                 |                      |                      | Percentage of | Loans in             |        |                     
|                 |                                 |                      |                      | Allowance to  | Each                 |        |                     
|                 |                                 |                      |                      | Total         | Category to          |        |                     
|                 |                                 |                      | Amount               | Allowance     | Total Loans          |        | Amount              
|Mortgage loans:  | (Dollars in thousands)         
|                 | One to four family              | $222                 | 13.90%               | 36.70%        |                      | $231   | 13.68%              
|                 | Commercial real estate          | 762                  | 47.71                | 29.12         |                      | 613    | 36.32               
|                 | Construction & land             | 0                    | 0.00                 | 1.28          |                      | 0      | 0.00                
|                 |                                 | Total mortgage loans | 984                  | 61.61         | 67.10                |        | 844                 
|                 |                                 |                      |                      |               |                      |        |                     
|Commercial loans | 391                             | 24.48                | 10.40                |               | 662                  | 39.22  | 10.63               
|                 |                                 |                      |                      |               |                      |        |                     
|Consumer loans   | 222                             | 13.90                | 22.50                |               | 182                  | 10.78  | 22.82               
|                 |                                 |                      |                      |               |                      |        |                     
|                 | Total allowance for loan losses | $1,597               | 100.00%              | 100.00%       |                      | $1,688 | 100.00%             
|                 |                                 |                      |                      |               |                      |        |                     
|                 |                                 |                      | At December 31, 1998 |               | At December 31, 1997 |        |                     
|                 |                                 |                      |                      | Percentage of | Loans in             |        |                     
|                 |                                 |                      |                      | Allowance to  | Each                 |        |                     
|                 |                                 |                      |                      | Total         | Category to          |        |                     
|                 |                                 |                      | Amount               | Allowance     | Total Loans          |        | Amount              
|Mortgage loans:  |                                 |                      |                      |               |                      |        |                     
|                 | One to four family              | $331                 | 16.92%               | 48.06%        |                      | $405   | 23.25%              
|                 | Commercial real estate          | 792                  | 40.49                | 21.56         |                      | 684    | 39.27               
|                 | Construction & land             | 10                   | 0.51                 | 0.29          |                      | 7      | 0.40                
|                 |                                 | Total mortgage loans | 1,133                | 57.92         | 69.91                |        | 1,096               
|                 |                                 |                      |                      |               |                      |        |                     
|Commercial loans | 594                             | 30.37                | 12.62                |               | 440                  | 25.26  | 11.45               
|                 |                                 |                      |                      |               |                      |        |                     
|Consumer loans   | 229                             | 11.71                | 17.47                |               | 206                  | 11.82  | 16.57               
|                 |                                 |                      |                      |               |                      |        |                     
|                 | Total allowance for loan losses | $1,956               | 100.00%              | 100.00%       |                      | $1,742 | 100.00%             

Securities

General. The Board of Directors reviews and approves our investment policy on an annual basis. The Board of Directors has delegated primary responsibility for ensuring that the guidelines in the investment policy are followed to the Treasurer/Chief Financial Officer. The Treasurer reports to the Asset Liability Management Committee and to the Executive Committee between its monthly meeting dates.

Our investment policy is designed primarily to manage the interest rate sensitivity of our assets and liabilities, to generate a favorable return without incurring undue interest rate and credit risk, to complement our lending activities and to provide and maintain liquidity within established guidelines. In establishing our investment strategies, we consider our interest rate sensitivity, the types of securities to be held, liquidity and other factors. New York-chartered savings banks have authority to invest in various types of assets, including U.S. Government obligations, securities of various federal agencies, obligations of states and municipalities, mortgage-backed securities, certain time deposits of insured banks and savings institutions, certain bankers' acceptances, repurchase agreements, loans of federal funds, and, subject to certain limits, corporate debt and equity securities, commercial paper and mutual funds.

The following table presents the composition of our securities portfolios in dollar amount and in percentage of each investment type at the dates indicated. It also presents the coupon type for the mortgage-backed securities portfolio.

|                                         |                                 |                             | At December 31,
|---------------------------------------- | ------------------------------- | --------------------------- | ---------------
|                                         |                                 |                             | 2001           
|                                         |                                 |                             | Amortized      
|                                         |                                 |                             | Cost           
|Held to Maturity:                        | (Dollars in thousands)         
|                                         | Mortgage-backed securities      |                             |                
|                                         |                                 | GNMA                        | $ 319          
|                                         |                                 | FHLMC                       | 15             
|                                         | U.S. Government securities      | 988                         | 2.14           
|                                         | Other bonds                     | 404                         | 0.87           
|                                         |                                 | Total held to maturity      | 1,726          
|                                         |                                 |                             |                
|Available for sale:                      |                                 |                             |                
|                                         | U.S. Government securities      | -                           | -              
|                                         | U.S. Government agencies        | 9,634                       | 20.84          
|                                         | State and Municipal obligations | 9,790                       | 21.18          
|                                         |                                 |                             |                
|                                         | Mortgage-backed securities      |                             |                
|                                         |                                 | FNMA                        | 1,000          
|                                         |                                 | FHLMC                       | 5,422          
|                                         | Corporate bonds                 | 12,195                      | 26.38          
|Total available for sale debt securities | 38,041                          | 82.30                       | 39,150         
|                                         |                                 |                             |                
|                                         | Equity securities               | 5,531                       | 11.97          
|                                         |                                 |                             |                
|                                         | FHLB stock                      | 926                         | 2.00           
|                                         |                                 |                             |                
|                                         |                                 | Total available for sale    | 44,498         
|                                         |                                 | Total investment securities | $ 46,224       
|                                         |                                 |                             |                
|(1) Based on amortized cost.             |                                 |                             |                

Carrying Values, Yields and Maturities. The following table sets forth the scheduled maturities, book value, market value and weighted average yields for Rome Savings' debt securities at December 31, 2001.

|                                                    |                  |               | More Than One Year | More Than Five Years |                        |          |         
|--------------------------------------------------- | ---------------- | ------------- | ------------------ | -------------------- | ---------------------- | -------- | --------
|                                                    | One Year or Less | to Five Years | to Ten Years       | More Than Ten Years  | Total                 
|                                                    |                  | Weighted      |                    | Weighted             |                        | Weighted |         
|                                                    | Carrying         | Average       | Carrying           | Average              | Carrying               | Average  | Carrying
|                                                    | Value            | Yield         | Value              | Yield                | Value                  | Yield    | Value   
|                                                    |                  |               |                    |                      | (Dollars in thousands) |          |         
|Available for sale securities:                      |                  |               |                    |                      |                        |          |         
|U.S. Government agencies                            | 2,009            | 5.56%         | 2,429              | 5.66                 | 3,517                  | 2.54     | 2,004   
|State and Municipal obligations (1)                 | -                | -             | 7,700              | 6.29                 | 2,121                  | 6.63     | 282     
|Mortgage-backed securities                          | -                | -             | 3,578              | 6.07                 | 2,916                  | 5.74     | -       
|Corporate bonds                                     | -                | -             | 12,594             | 6.33                 | -                      | -        | -       
|                                                    |                  |               |                    |                      |                        |          |         
|Held to maturity securities:                        |                  |               |                    |                      |                        |          |         
|U.S. Government securities                          | 499              | 6.38          | 489                | 6.70                 | -                      | -        | -       
|Mortgage-backed securities                          | 2                | 6.57          | 54                 | 8.44                 | 220                    | 11.85    | 58      
|Other                                               | -                | -             | -                  | -                    | -                      | -        | 404     
|                                                    |                  |               |                    |                      |                        |          |         
|Total debt securities                               | $ 2,510          | 5.72%         | $ 26,844           | 6.23%                | $ 8,774                | 4.83%    | $ 2,748 
|                                                    |                  |               |                    |                      |                        |          |         
|                                                    |                  |               |                    |                      |                        |          |         
|(1) Yields are presented on a tax-equivalent basis. |                  |               |                    |                      |                        |          |         

Deposit Activity and Other Sources of Funds

General. Deposits, borrowings, scheduled amortization and prepayments of loan principal, maturities and calls of investments securities and funds provided by operations are our primary sources of funds for use in lending, investing and for other general purposes. See "Management's Discussion and Analysis - Liquidity and Capital Resources."

Deposits. We offer a variety of deposit accounts having a range of interest rates and terms. We currently offer regular savings deposits (consisting of passbook and statement savings accounts), interest-bearing demand accounts, non-interest-bearing demand accounts, money market accounts and time deposits.

Deposit flows are influenced significantly by general and local economic conditions, changes in prevailing interest rates, pricing of deposits and competition. Our deposits are primarily obtained from areas surrounding our offices and we rely primarily on paying competitive rates, service and long-standing relationships with customers to attract and retain these deposits. We do not use brokers to obtain deposits.

When we determine our deposit rates, we consider local competition, U.S. Treasury securities offerings and the rates charged on other sources of funds. Core deposits (defined as savings deposits, money market accounts and demand accounts) represented 59.4% and 58.8% of total deposits on December 31, 2001 and 2000, respectively. At December 31, 2001 and 2000, time deposits with remaining terms to maturity of less than one year amounted to $52.1 million and $51.3 million, respectively. See "Management's Discussion and Analysis - Analysis of Net Interest Income" for information relating to the average balances and costs of our deposit accounts for the years ended December 31, 2001 and 2000.

At December 31, 2001, we had $9.7 million in time deposits with balances of $100,000 or more maturing as follows:



|Maturity Period                      | Amount        
|------------------------------------ | --------------
|                                     | (In thousands)
|Three months or less                 | $ 2,474       
|Over three months through six months | 2,422         
|Over six months through 12 months    | 2,640         
|Over 12 months                       | 2,194         
|Total                                | $ 9,730       

Borrowings. At December 31, 2001 the Company had outstanding borrowings of $16.9 million which were used to fund loan growth. In the future, we expect to continue to utilize borrowings as a funding source and may borrow funds pursuant to repurchase agreements, whereby we sell an asset with an agreement to repurchase it at some future date. We are a member of the Federal Home Loan Bank of New York and have available a line of credit of $24,525,000.

Subsidiary Activities

Rome Savings has three subsidiaries, 100 On the Mall Corporation, Clocktower Insurance Agency Incorporated and Clocktower Financial Corporation. 100 On the Mall acts as a manager, and developer of real estate. Its only activity is ownership of Rome Savings' main office building and premises. Clocktower Insurance owns real estate for future expansion, which is currently being leased to a Dunkin Donuts franchise adjacent to one of our branch offices. Clocktower Financial Corporation is currently inactive.



Employees

At December 31, 2001, Rome Savings had 78 full-time and 25 part-time employees. Rome Savings's employees are not represented by a collective bargaining agreement, and Rome Savings considers its relationship with its employees to be good.



REGULATION AND SUPERVISION

General

Rome Savings is a New York-chartered savings bank, and its deposit accounts are insured up to applicable limits by the Federal Deposit Insurance Corporation (FDIC) under the Bank Insurance Fund (BIF). Rome Savings is subject to extensive regulation, examination and supervision by the New York State Banking Department (Banking Department) as its chartering agency, and by the FDIC as the deposit insurer.

Rome, MHC and Rome Bancorp, as bank holding companies controlling Rome Savings are subject to the Bank Holding Company Act of 1956, as amended (BHCA), and the rules and regulations of the Federal Reserve Board (FRB) under the BHCA and to the provisions of the New York State Banking Law and the regulations of the Banking Department under the Banking Law applicable to bank holding companies. Rome, MHC and Rome Bancorp are required to file reports with, and otherwise comply with the rules and regulations of the FRB and the Banking Department. Rome Bancorp is also required to file certain reports with, and otherwise comply with, the rules and regulations of the SEC under the federal securities laws.

New York Banking Regulation

Activity Powers. Rome Savings derives its lending, investment and other activity powers primarily from the applicable provisions of the New York Banking Law and its related regulations. Under these laws and regulations, savings banks, including Rome Savings generally may invest in:

(1) 	real estate mortgages;

(2)	consumer and commercial loans;

(3)	specific types of debt securities, including certain corporate debt securities and obligations of federal, state and local governments and agencies;

(4)	certain types of corporate equity securities; and

(5)	certain other assets.

A savings bank may also exercise trust powers upon approval of the New York Banking Board. The exercise of these lending, investment and activity powers are limited by federal law and the related regulations. See "- Federal Banking Regulation - Activity Restrictions on State-Chartered Banks" below.

Loans-to-One-Borrower Limitations. With certain specified exceptions, a New York-chartered savings bank may not make loans or extend credit to a single borrower and to entities related to the borrower in an aggregate amount that would exceed 15% of the bank's net worth, plus an additional 10% of the bank's net worth if secured by the requisite collateral. Rome Savings currently complies with applicable loans-to-one-borrower limitations. At December 31, 2001, Rome Savings' limit on loans to one borrower was $9.1 million.

Dividends. Under the New York Banking Law, a stock savings bank may declare and pay a dividend on its capital stock only to the extent that the payment of the dividend would not impair the capital stock of the savings bank. In addition, Rome Savings cannot declare and pay dividends without regulatory approval in any calendar year in excess of its "net profits" of the current year combined with its "retained net profits" of the two preceding years, less any required transfer to surplus or a fund for the retirement of preferred stock. Federal law may also limit the amount of dividends that may be paid by Rome Savings. See "- Federal Banking Regulation - Prompt Corrective Action" below.

Community Reinvestment Act. Rome Savings is also subject to provisions of the Banking Law that, like the provisions of the federal Community Reinvestment Act ("federal CRA"), impose continuing and affirmative obligations upon a banking institution organized in the State of New York to serve the credit needs of its local community ("New York CRA"). See "Federal Banking Regulation - Community Reinvestment Act" below. Pursuant to the New York CRA, a bank must file with the Banking Department copies of all federal CRA reports, and the Banking Department is required to consider a bank's New York CRA rating when reviewing an application by the bank to engage in certain transactions, including mergers, asset purchases and the establishment of branch offices or automated teller machines, and provide that such assessment may serve as a basis for the denial of any such application. The New York CRA requires the Banking Department to make a written assessment of a bank's compliance with the New York CRA and to make such assessment available to the public. The Banking Department adopted, effective December 3, 1997, performance-focused regulations that were intended to parallel the current CRA regulations of the federal banking agencies and to promote consistency in New York CRA evaluations by considering more objective criteria. The regulations require a biennial assessment of a bank's compliance with the New York CRA, utilizing a four-tiered rating system, and require the Banking Department to make available to the public such rating and a written summary of the assessment results. Rome Savings' latest New York CRA rating from the Banking Department, was a rating of "Satisfactory."

Enforcement. Under the Banking Law, the Banking Department may issue an order to a New York-chartered banking institution to appear and explain an apparent violation of law, to discontinue unauthorized or unsafe practices and to keep prescribed books and accounts. Upon a finding by the Banking Department that any director, trustee or officer of any banking organization has violated any law, or has continued unauthorized or unsafe practices in conducting the business of the banking organization after having been notified by the Banking Department to discontinue such practices, the Banking Department may remove such director, trustee or officer from office after notice and an opportunity to be heard. Rome Savings does not know of any past or current practice, condition or violation that might lead to any proceeding by the Banking Department against or any of its directors or officers.

Federal Banking Regulation

Capital Requirements. FDIC regulations require BIF-insured banks, such as Rome Savings to maintain minimum levels of capital. The FDIC regulations define two classes of capital known as Tier 1 and Tier 2 capital.

The FDIC regulations establish a minimum leverage capital requirement for banks in the strongest financial and managerial condition, with a rating of 1 (the highest examination rating of the FDIC for banks) under the Uniform Financial Institutions Rating System, of not less than a ratio of 3.0% of Tier 1 capital to total assets. For all other banks, the minimum leverage capital requirement is 4.0%, unless a higher leverage capital ratio is warranted by the particular circumstances or risk profile of the depository institution.

The FDIC regulations also require that savings banks meet a risk-based capital standard. The risk-based capital standard requires the maintenance of a ratio of total capital (which is defined as the sum of Tier 1 capital and Tier 2 capital) to risk-weighted assets of at least 8% and a ratio of Tier 1 capital to risk-weighted assets of at least 4%. In determining the amount of risk-weighted assets, all assets, plus certain off balance sheet items, are multiplied by a risk-weight of 0% to 100%, based on the risks the FDIC believes are inherent in the type of asset or item.

The federal banking agencies, including the FDIC, have also adopted regulations to require an assessment of an institution's exposure to declines in the economic value of a bank's capital due to changes in interest rates when assessing the bank's capital adequacy. Under such a risk assessment, examiners will evaluate a bank's capital for interest rate risk on a case-by-case basis, with consideration of both quantitative and qualitative factors.

Institutions with significant interest rate risk may be required to hold additional capital. The agencies also issued a joint policy statement providing guidance on interest rate risk management, including a discussion of the critical factors affecting the agencies' evaluation of interest rate risk in connection with capital adequacy. Rome Savings was considered "well-capitalized" under FDIC guidelines at December 31, 2001.

Activity Restrictions on State-Chartered Banks. Section 24 of the Federal Deposit Insurance Act, as amended (FDIA), which was added by the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA), generally limits the activities and investments of state-chartered FDIC insured banks and their subsidiaries to those permissible for federally chartered national banks and their subsidiaries, unless such activities and investments are specifically exempted by Section 24 or consented to by the FDIC.

Section 24 provides an exception for investments by a bank in common and preferred stocks listed on a national securities exchange or the shares of registered investment companies if

(1) 	the bank held such types of investments during the 14-month period from September 30, 1990 through November 26, 1991;

(2) 	the state in which the bank is chartered permitted such investments as of September 30, 1991; and

(3) 	the bank notifies the FDIC and obtains approval from the FDIC to make or retain such investments. Upon receiving such FDIC approval, an institution's investment in such equity securities will be subject to an aggregate limit up to the amount of its Tier 1 capital.

Rome Savings received approval from the FDIC to retain and acquire such equity investments subject to a maximum permissible investment equal to the lesser of 100% of Rome Savings' Tier 1 capital or the maximum permissible amount specified by the Banking Act. Section 24 also provides an exception for majority owned subsidiaries of a bank, but Section 24 limits the activities of such subsidiaries to those permissible for a national bank, permissible under Section 24 of the FDIA and the FDIC regulations issued pursuant thereto, or as approved by the FDIC.

Before making a new investment or engaging in a new activity not permissible for a national bank or otherwise permissible under Section 24 of the FDIC regulations thereunder, an insured bank must seek approval from the FDIC to make such investment or engage in such activity. The FDIC will not approve the activity unless the bank meets its minimum capital requirements and the FDIC determines that the activity does not present a significant risk to the FDIC insurance funds.

Enforcement. The FDIC has extensive enforcement authority over insured savings banks, including Rome Savings. This enforcement authority includes, among other things, the ability to assess civil money penalties, to issue cease and desist orders and to remove directors and officers. In general, these enforcement actions may be initiated in response to violations of laws and regulations and to unsafe or unsound practices.

The FDIC is required, with certain exceptions, to appoint a receiver or conservator for an insured state bank if that bank is "critically undercapitalized." For this purpose, "critically undercapitalized" means having a ratio of tangible capital to total assets of less than 2%. The FDIC may also appoint a conservator or receiver for a state bank on the basis of the institution's financial condition or upon the occurrence of certain events.

Deposit Insurance. Pursuant to FDICIA, the FDIC established a system for setting deposit insurance premiums based upon the risks a particular institution poses to its deposit insurance fund. Under the risk-based deposit insurance assessment system, the FDIC assigns an institution to one of three capital categories based on the institution's financial information, as of the reporting period ending six months before the assessment period. The three capital categories are (1) well capitalized, (2) adequately capitalized and (3) undercapitalized using capital ratios that are substantially similar to the prompt corrective action capital ratios discussed below. See "- Federal Banking Regulation - Prompt Corrective Action" below. The FDIC also assigns an institution to supervisory subgroup based on a supervisory evaluation provided to the FDIC by the institution's primary federal regulator and information that the FDIC determines to be relevant to the institution's financial condition and the risk posed to the deposit insurance funds (which may include, if applicable, information provided by the institution's state supervisor). An institution's assessment rate depends on the capital category and supervisory category to which it is assigned. Any increase in insurance assessments could have an adverse effect on the earnings of insured institutions, including Rome Savings.

Under the Deposit Insurance Funds Act of 1996, the assessment base for the payments on the bonds issued in the late 1980's by the Financing Corporation to recapitalize the now defunct Federal Savings and Loan Insurance Corporation was expanded to include, beginning January 1, 1997, the deposits of BIF-insured institutions, such as Rome Savings. The rate of assessment for BIF-assessable deposits will be one-fifth of the rate imposed on deposits insured by the Savings Association Insurance Fund (SAIF).

Under the FDIA, the FDIC may terminate the insurance of an institution's deposits upon a finding that the institution has engaged in unsafe or unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC. The management of Rome Savings does not know of any practice, condition or violation that might lead to termination of deposit insurance.

Transactions with Affiliates of Rome Savings. Transactions between an insured bank, such as Rome Savings, and any of its affiliates is governed by Sections 23A and 23B of the Federal Reserve Act. An affiliate of a bank is any company or entity that controls, is controlled by or is under common control with the bank. Currently, a subsidiary of a bank that is not also a depository institution is not treated as an affiliate of the bank for purposes of Sections 23A and 23B, but the Federal Reserve Board has proposed a comprehensive regulation implementing Sections 23A and 23B, which would establish certain exceptions to this policy.



Section 23A:

Section 23A:

limits the extent to which the bank or its subsidiaries may engage in "covered transactions" with any one affiliate to an amount equal to 10% of such bank's capital stock and retained earnings, and limit on all such transactions with all affiliates to an amount equal to 20% of such capital stock and retained earnings; and

requires that all such transactions be on terms that are consistent with safe and sound banking practices.

The term "covered transaction" includes the making of loans, purchase of assets, issuance of guarantees and other similar types of transactions. Further, most loans by a bank to any of its affiliates must be secured by collateral in amounts ranging from 100 to 130 percent of the loan amounts. In addition, any covered transaction by a bank with an affiliate and any purchase of assets or services by a bank from an affiliate must be on terms that are substantially the same, or at least as favorable to the bank, as those that would be provided to a non-affiliate.

Community Reinvestment Act. Under the Community Reinvestment Act (CRA), any insured depository institution, including Rome Savings has a continuing and affirmative obligation consistent with its safe and sound operation to help meet the credit needs of its entire community, including low and moderate income neighborhoods. The CRA does not establish specific lending requirements or programs for financial institutions nor does it limit an institution's discretion to develop the types of products and services that it believes are best suited to its particular community. The CRA requires the FDIC, in connection with its examination of a savings bank, to assess the depository institution's record of meeting the credit needs of its community and to take such record into account in its evaluation of certain applications by such institution, including applications for additional branches and acquisitions.

The CRA requires the FDIC to provide a written evaluation of an institution's CRA performance utilizing a four-tiered descriptive rating system and requires public disclosure of an institution's CRA rating. Rome Savings received a "satisfactory" rating on its last CRA exam in December 1999.

Safety and Soundness Standards. Pursuant to the requirements of FDICIA, as amended by the Riegle Community Development and Regulatory Improvement Act of 1994, each federal banking agency, including the FDIC, has adopted guidelines establishing general standards relating to internal controls, information and internal audit systems, loan documentation, credit underwriting, interest rate exposure, asset growth, asset quality, earnings, and compensation, fees and benefits. In general, the guidelines require, among other things, appropriate systems and practices to identify and manage the risks and exposures specified in the guidelines. The guidelines prohibit excessive compensation as an unsafe and unsound practice and describe compensation as excessive when the amounts paid are unreasonable or disproportionate to the services performed by an executive officer, employee, director, or principal stockholder.

In addition, the FDIC adopted regulations to require a bank that is given notice by the FDIC that it is not satisfying any of such safety and soundness standards to submit a compliance plan to the FDIC. If, after being so notified, a bank fails to submit an acceptable compliance plan or fails in any material respect to implement an accepted compliance plan, the FDIC may issue an order directing corrective and other actions of the types to which a significantly undercapitalized institution is subject under the "prompt corrective action" provisions of FDICIA. If a bank fails to comply with such an order, the FDIC may seek to enforce such an order in judicial proceedings and to impose civil monetary penalties.

Prompt Corrective Action. FDICIA also established a system of prompt corrective action to resolve the problems of undercapitalized institutions. The FDIC, as well as the other federal banking regulators, adopted regulations governing the supervisory actions that may be taken against undercapitalized institutions. The regulations establish five categories, consisting of "well capitalized," "adequately capitalized," "undercapitalized," "significantly undercapitalized" and "critically undercapitalized." The severity of the action authorized or required to be taken under the prompt corrective action regulations increases as a bank's capital decreases within the three undercapitalized categories. All banks are prohibited from paying dividends or other capital distributions or paying management fees to any controlling person if, following such distribution, the bank would be undercapitalized.

Loans to a Bank's Insiders

Federal Regulation. A bank's loans to its executive officers, directors, any owner of 10% or more of its stock (each, an insider) and any of certain entities affiliated to any such person (an insider's related interest) are subject to the conditions and limitations imposed by Section 22(h) of the Federal Reserve Act and the FRB's Regulation O thereunder. Under these restrictions, the aggregate amount of the loans to any insider and the insider's related interests may not exceed the loans-to-one-borrower limit applicable to national banks, which is comparable to the loans-to-one-borrower limit applicable to Rome Savings' loans. See "New York Banking Regulation - Loans-to-One Borrower Limitations." All loans by a bank to all insiders and insiders' related interests in the aggregate may not exceed the bank's unimpaired capital and unimpaired surplus. With certain exceptions, loans to an executive officer, other than loans for the education of the officer's children and certain loans secured by the officer's residence, may not exceed the lesser of (1) $100,000 or (2) the greater of $25,000 or 2.5% of the bank's capital and unimpaired surplus. Regulation O also requires that any proposed loan to an insider or a related interest of that insider be approved in advance by a majority of the board of directors of the bank, with any interested director not participating in the voting, if such loan, when aggregated with any existing loans to that insider and the insider's related interests, would exceed either (1) $500,000 or (2) the greater of $25,000 or 5% of the bank's unimpaired capital and surplus. Generally, such loans must be made on substantially the same terms as, and follow credit underwriting procedures that are not less stringent than those that are prevailing at the time for comparable transactions with other persons.

An exception is made for extensions of credit made pursuant to a benefit or compensation plan of a bank that is widely available to employees of the bank and that does not give any preference to insiders of the bank over other employees of the bank.

New York Regulation. Provisions of the New York Banking Law impose conditions and limitations on the liabilities to a savings bank of its directors and executive officers and of corporations and partnerships controlled by such persons that are comparable in many respects to the conditions and limitations imposed on the loans and extensions of credit to insiders and their related interests under Regulation O, as discussed above. However, New York law does not affect loans to shareholders owning more than 10% or more of the savings bank's stock. Under applicable New York law, savings banks that comply with the requirements of Regulation O are deemed to be in compliance with the requirements of the New York law.

Holding Company Regulation

Federal Regulation. Rome, MHC and Rome Bancorp are governed as bank holding companies. Bank holding companies are subject to examination, regulation and periodic reporting under the BHCA, as administered by the FRB. The FRB has adopted capital adequacy guidelines for bank holding companies on a consolidated basis substantially similar to those of the FDIC for Rome Savings. As of December 31, 2001, the total capital and Tier 1 capital ratios for Rome, MHC and Rome Bancorp would, on a pro forma basis, exceed these minimum capital requirements. See "- Federal Banking Regulation - Capital Requirements" above.

The activities of bank holding companies are generally limited to the business of banking, managing or controlling banks, and other activities that the Federal Reserve Board determines to be so closely related to banking or managing or controlling banks as to be properly incident thereto. In addition, bank holding companies all of whose controlled depository institutions are "well capitalized" and "well managed," as defined in FRB Regulation Y, and which obtain satisfactory Community Reinvestment Act ratings, can declare themselves to be "financial holding companies" and engage in a broader spectrum of activities than those generally permitted to bank holding companies, including insurance underwriting and brokerage (including annuities), and underwriting and dealing securities without a revenue limit and without limits on the amounts of equity securities it may hold in conducting its underwriting and dealing activities. If financial holding companies do not continue to meet the requirements for financial holding company status, depending on the requirements they fail to meet, they may not be permitted to undertake new activities or acquisitions that are financial in nature and may lose their ability to conduct activities that are not generally permissible for bank holding companies. Rome Bancorp has not elected to be regulated as a financial holding company, but may elect to do so in the future.

Regulations of the FRB provide that a bank holding company must serve as a source of strength to any of its subsidiary banks and must not conduct its activities in an unsafe or unsound manner. Under the prompt corrective action provisions of FDICIA, a bank holding company parent of an undercapitalized subsidiary bank would be directed to guarantee, within limitations, the capital restoration plan that is required of such an undercapitalized bank. See " - Federal Banking Regulation - Prompt Corrective Action" above. If the undercapitalized bank fails to file an acceptable capital restoration plan or fails to implement an accepted plan, the FRB may prohibit the bank holding company parent of the undercapitalized bank from paying any dividend or making any other form of capital distribution without the prior approval of the FRB.

As bank holding companies, Rome, MHC and Rome Bancorp will be required to obtain the prior approval of the FRB to acquire all, or substantially all, of the assets of any bank or bank holding company. Prior FRB approval will be required for Rome, MHC or Rome Bancorp to acquire direct or indirect ownership or control of any voting securities of any bank or bank holding company if, after giving effect to such acquisition, it would, directly or indirectly, own or control more than 5% of any class of voting shares of such bank or bank holding company.

Subject to certain limitations and restrictions, a bank holding company, with the prior approval of the Federal Reserve Board, may acquire an out-of-state bank. Banks in states that do not prohibit out-of-state mergers may merge with other banks only after receiving the approval of the appropriate federal bank regulatory agency. A national or state bank may establish a de novo branch out of state if such branching is expressly permitted by the other state.

New York Regulation. Under the New York Banking Law, certain companies owning or controlling banks are regulated as bank holding companies. For the purposes of the Banking Law, the term "bank holding company," is defined generally to include any "company" that, directly or indirectly, either (a) controls the election of a majority of the directors or (b) owns, controls or holds with power to vote more than 10% of the voting stock of a bank holding company or, if Rome Bancorp is a banking institution, another banking institution, or 10% or more of the voting stock of each of two or more banking institutions. The term "company" is defined to include corporations, partnerships and other types of business entities, chartered or doing business in New York, and the term "banking institution" is defined to include commercial banks, stock savings banks and stock savings and loan associations. A company controlling, directly or indirectly, only one banking institution in New York will not be deemed to be a bank holding company for the purposes of the Banking Law. Under the Banking Law, the prior approval of the Banking Department is required before:

(1)	any action is taken that causes any company to become a bank holding company;

(2)	any action is taken that causes any banking institution to become or to be merged or consolidated with a subsidiary of a bank holding company;

(3)	any bank holding company acquires direct or indirect ownership or control of more than 5% of the voting stock of a banking institution;

(4)	any bank holding company or subsidiary thereof acquires all or substantially all of the assets of a banking institution; or

(5)	any action is taken that causes any bank holding company to merge or consolidate with another bank holding company.

Additionally, certain restrictions apply to New York bank holding companies regarding the acquisition of banking institutions that have been chartered for five years or less and are located in smaller communities. Directors, officers and employees of a New York bank holding company are subject to limitations regarding their affiliation with securities underwriting or distribution firms and with other bank holding companies, and directors and executive officers are subject to limitations regarding loans obtained from certain of the holding company's banking subsidiaries. Although Rome Bancorp is not a bank holding company for purposes of the New York Banking Law, any future acquisition of ownership, control, or the power to vote 10% or more of the voting stock of another banking institution or bank holding company would cause it to become such.

Mutual Holding Company Regulation. Under the New York Banking Law, Rome, MHC may exercise all powers and privileges of a New York-chartered mutual savings bank, except the power to take deposits. As a bank holding company, Rome, MHC will also be subject to the limitations on activities imposed on a bank holding company under the BHCA.

Change in Control Regulations

Under the federal Change in Bank Control Act, any person (including a company or a group acting in concert) seeking to acquire 10% or more of the outstanding shares of Rome Bancorp's common stock is required to submit prior notice to the Federal Reserve Board, unless the Federal Reserve Board has found that the acquisition of such shares will not result in a change in control of Rome Bancorp. Under the Bank Holding Company Act, the Federal Reserve Board has 60 days within which to act on such a notice, taking into consideration such factors as the financial and managerial resources of the acquirer, the convenience and needs of the communities served by Rome Bancorp and Rome Savings, and the anti-trust effects of the acquisition. Under the Bank Holding Company Act, any company would be required to obtain prior approval from the Federal Reserve Board before it may obtain "control" of Rome Bancorp. The term "control" is defined generally under the Bank Holding Company Act to mean the ownership or power to vote 25% or more of any class of voting securities of an institution, or the ability to control in any manner the election of a majority of the institution's directors.

Dividend Waivers by Rome, MHC

Certain mutual holding companies have waived the receipt of dividends declared by their savings institution subsidiaries. Any such dividend waiver by Rome, MHC will be subject to the following restrictions:

Federal Restrictions. In connection with its approval of the reorganization, the FRB imposed certain conditions on the waiver by Rome, MHC of dividends paid on Rome Bancorp's common stock. In particular, the FRB is expected to require that Rome, MHC obtain the prior approval of the FRB before Rome, MHC may waive any dividends from Rome Bancorp. As of the date of this report, Rome Savings is not aware that the FRB has given its approval to any waiver of dividends by any mutual holding company that has requested such approval.

The terms of the FRB approval of the reorganization also required that the amount of any dividends waived by Rome, MHC will not be available for payment to its public stockholders of Rome Bancorp (i.e., stockholders except for Rome, MHC) and that such amount will be excluded from Rome Bancorp's capital for purposes of calculating dividends payable to the public stockholders. Moreover, Rome Savings is required to maintain the cumulative amount of dividends waived by Rome, MHC in a restricted capital account that would be added to the liquidation account established in the reorganization. This amount would not be available for distribution to public stockholders. The restricted capital account and liquidation account amounts would not be reflected in Rome Savings' financial statements, but would be considered as a notational or memorandum account of Rome Savings. These accounts would be maintained in accordance with the laws, rules, regulations and policies of the Banking Department and the plan of reorganization. The plan of reorganization also provides that if Rome, MHC converts to stock form in the future (commonly referred to as a second-step conversion), any waived dividends would reduce the percentage of the converted company's shares of common stock issued to public stockholders in connection with any such transaction. Although the Office of Thrift Supervision has proposed rules that would ease the restrictions on the ability of federally-chartered mutual holding companies to waive dividends payable to them without approval, the FRB has not proposed any such rules.

Other Federal Regulation

In response to the events of September 11th, President George W. Bush signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, or the USA PATRIOT Act, on October 26, 2001. The USA PATRIOT Act gives the federal government new powers to address terrorist threats through enhanced domestic security measures, expanded surveillance powers, increased information sharing, and broadened anti-money laundering requirements. By way of amendments to the Bank Secrecy Act, Title III of the USA PATRIOT Act takes measures intended to encourage information sharing among bank regulatory agencies and law enforcement bodies. Further, certain provisions of Title III impose affirmative obligations on a broad range of financial institutions, including banks, thrifts, brokers, dealers, credit unions, money transfer agents and parties registered under the Commodity Exchange Act.

Among other requirements, Title III of the USA PATRIOT Act imposes the following requirements with respect to financial institutions:

- Pursuant to Section 352, all financial institutions must establish anti-money laundering programs that include, at minimum: (i) internal policies, procedures, and controls, (ii) specific designation of an anti-money laundering compliance officer, (iii) ongoing employee training programs, and (iv) an independent audit function to test the anti-money laundering program. Rules promulgated under this Section are due by April 24, 2002.
- Section 326 of the Act authorizes the Secretary of the Department of Treasury, in conjunction with other bank regulators, to issue regulations by October 26, 2002 that provide for minimum standards with respect to customer identification at the time new accounts are opened.
- Section 312 of the Act requires financial institutions that establish, maintain, administer, or manage private banking accounts or correspondent accounts in the United States for non-United States persons or their representatives (including foreign individuals visiting the United States) to establish appropriate, specific, and, where necessary, enhanced due diligence policies, procedures, and controls designed to detect and report money laundering. Rules promulgated under this Section are due by April 24, 2002, to be effective by July 23, 2002.
- Effective December 25, 2001, financial institutions are prohibited from establishing, maintaining, administering or managing correspondent accounts for foreign shell banks (foreign banks that do not have a physical presence in any country), and will be subject to certain record keeping obligations with respect to correspondent accounts of foreign banks.
- Bank regulators are directed to consider a holding company's effectiveness in combating money laundering when ruling on Federal Reserve Act and Bank Merger Act applications.

Federal Securities Law

Rome Bancorp's common stock is registered with the SEC under Section 12(b) of the Securities Exchange Act of 1934 (the "Exchange Act"). Rome Bancorp is subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Exchange Act.



ITEM 2.	DESCRIPTION OF PROPERTY

We conduct our business through our executive office, operations center and three banking offices. At December 31, 2001, the net book value of the computer equipment and other furniture, fixtures and equipment of Rome Savings and Rome Bancorp at their offices totaled $539,000. For more information, see Note 5 of Notes to Consolidated Financial Statements.

|Location                            | Leased or
Owned | Original Date Acquired | Net Book Value
December 31, 2001
|----------------------------------- | --------------- | ---------------------- | --------------------------------
|                                    |                 |                        | (In thousands)                  
|Executive Office:                   |                 |                        |                                 
|100 West Dominick St.
Rome, NY      | Owned           | 1956                   | $ 820                           
|Branch Offices:                     |                 |                        |                                 
|1629 Black River Boulevard
Rome, NY | Owned           | 1963                   | 288                             
|1300 Erie Boulevard
Rome, NY        | Owned           | 1997                   | 1,061                           
|82 Seneca Turnpike
New Hartford, NY | Owned           | 1983                   | 96                              
|Accounting Center:                  |                 |                        |                                 
|139 West Dominick Street
Rome, NY   | Owned           | 1995                   | 391                             

ITEM 3.	LEGAL PROCEEDINGS

As of the date of this Form 10-KSB, we are not involved in any pending legal proceedings other than routine legal proceedings occurring in the ordinary course of business. We believe that these routine legal proceedings, in the aggregate, are immaterial to our financial condition and results of operations.



ITEM 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

PART II

ITEM 5.	MARKET FOR ROME BANCORP'S COMMON STOCK AND RELATED SHAREHOLDER MATTERS

The following information included in the Rome Bancorp, Inc. 2001 Annual Report to Shareholders (the "Annual Report") is incorporated herein by reference: "Market for Rome Bancorp's Common Stock."

ITEM 6.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following information included in the Rome Bancorp, Inc. 2001 Annual Report to Shareholders (the "Annual Report") is incorporated herein by reference: "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Financial Highlights," on pages 6 through 14 of the Annual Report.

ITEM 7.	FINANCIAL STATEMENTS

The following information included in the Annual Report is incorporated herein by reference: "Consolidated Financial Statements and Notes to Consolidated Financial Statements."

ITEM 8.	CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

PART III

ITEM 9.	DIRECTORS AND PRINCIPAL OFFICERS OF ROME BANCORP

The following information included in Rome Bancorp's 2002 Proxy Statement for the 2002 Annual Meeting of Shareholders ("Proxy Statement") is incorporated herein by reference: "Proposal 1, Election of Directors" and the following subsections of the section entitled "Information About Board of Directors and Management": "Board of Directors," "Committees of the Board," "Executive Officers Who Are Not Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance."



ITEM 10.	EXECUTIVE COMPENSATION

The information set forth in the following subsections of the section entitled "Information About Board of Directors and Management" of the Proxy Statement are incorporated herein by reference: "Directors' Compensation," "Executive Compensation" (including the Summary Compensation Table), "Benefit Plans" and "Transactions with Certain Related Persons."

ITEM 11.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following subsections of the section entitled "Security Ownership of Certain Beneficial Owners and Management" included in the Proxy Statement are incorporated herein by reference: "Principal Shareholders of Rome Bancorp" and "Security Ownership of Management."

ITEM 12.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The following information included in the Proxy Statement is incorporated herein by reference: "Transactions with Certain Related Persons."

ITEM 13.	EXHIBITS AND REPORTS ON FORM 8-K

(a)	The following financial statements included in the 2001 Annual Report are incorporated herein by reference:

Consolidated Balance Sheets - At December 31, 2001 and 2000;

Consolidated Statements of Income - Years Ended December 31, 2001 and 2000;

Consolidated Statements of Shareholders' Equity and Comprehensive Income - Years Ended December 31, 2001 and 2000;

Consolidated Statements of Cash Flows - Years Ended December 31, 2001 and 2000; and

Notes to Consolidated Financial Statements - Years Ended December 31, 2001 and 2000

(b)	Exhibits. The following exhibits are either filed as part of this report or are incorporated herein by reference:

2.1	Amended Plan of Reorganization of The Rome Savings Bank.(1)

3.1 	Certificate of Incorporation of Rome Bancorp, Inc.(1)

3.2	Bylaws of Rome Bancorp, Inc.(1)

4.3	Form of Stock Certificate of Rome Bancorp, Inc.(1)

10.1	Form of Employee Stock Ownership Plan of Rome Bancorp, Inc.(1)

10.2	Form of Executive Employment Agreement, by and between Charles M. Sprock and Rome Bancorp, Inc.(1)

10.3 	Form of Benefit Restoration Plan of Rome Bancorp, Inc.(1)

13.1	Annual Report to Shareholders for the Year Ended December 31, 2001.

1. Subsidiaries of the Registrant.(1)

1. Consent of KPMG LLP

1. Rome Bancorp, Inc. 2000 Stock Option Plan filed on April 5, 2000 as Exhibit B to Registrant's Proxy Statement on Schedule 14A, is incorporated herein by reference.
2. Rome Bancorp, Inc. 2000 Recognition and Retention Plan filed on April 5, 2000 as Exhibit B to Registrant's Proxy Statement on Schedule 14A, is incorporated herein by reference.

______________________

(1)	Incorporated herein by reference in the Registration Statement on Form SB-2 (Registration No. 333-80487), filed with the Securities and Exchange Commission on June 11, 1999, as amended.

(c)	Reports on Form 8-K.

None.

This Form 10-KSB contains certain forward looking statements consisting of estimates with respect to the financial condition, results of operations and business of Rome Savings and Rome Bancorp that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include: changes in general, economic and market conditions, or the development of an adverse interest rate environment that adversely affects the interest rate spread or other income anticipated from Rome Savings' or Rome Bancorp's operations and investments.

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Rome Bancorp, Inc.

By: /s/Charles M. Sprock

President, Chairman of the Board and

Chief Executive Officer

In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

|Name                                         |  | Title                                                                                      | Date          
|-------------------------------------------- |  | ------------------------------------------------------------------------------------------ | --------------
|/s/Charles M. Sprock
Charles M. Sprock       |  | Chairman of the Board, President and Chief Executive Officer
(Principal Executive Officer) | March 27, 2002
|/s/David C. Nolan
David C. Nolan             |  | Treasurer and Chief Financial Officer (Principal Financial Officer)                        | March 27, 2002
|/s/Bruce R. Engelbert
Bruce R. Engelbert     |  | Director                                                                                   | March 27, 2002
|/s/David C. Grow
David C. Grow               |  | Director                                                                                   | March 27, 2002
|/s/Kirk B. Hinman
Kirk B. Hinman             |  | Director                                                                                   | March 27, 2002
|/s/T. Richard Leidig
T. Richard Leidig       |  | Director                                                                                   | March 27, 2002
|/s/Richard H. McMahon
Richard H. McMahon     |  | Director                                                                                   | March 27, 2002
|/s/Michael J. Valentine
Michael J. Valentine |  | Director                                                                                   | March 27, 2002
|/s/Marion C. Scoville
Marion C. Scoville     |  | Director                                                                                   | March 27, 2002