SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB
(Mark One)
[X] Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act
    of 1934 (No Fee required)

    For the fiscal year ended    June 30, 1997

[ ] Transition report pursuant to section 13 or 15(d) of the Securities Exchange
    Act of 1934 (No fee required) For the transition period from       to      .
                                                                 -----    -----

Commission File No. 0-22997

                               WSB Holding Company
                 ----------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

Pennsylvania                                                     23-2908963
---------------------------------------------                 ------------------
(State or Other Jurisdiction of Incorporation                  I.R.S. Employer
or Organization)                                              Identification No.

807 Middle St., Pittsburgh, Pennsylvania                            15212
----------------------------------------                            -----
(Address of Principal Executive Offices                           (Zip Code)

Issuer's Telephone Number, Including Area Code:                 (412) 231-7297
                                                                --------------

Securities registered under to Section 12(b) of the Exchange Act:     None
                                                                      ----
Securities registered under to Section 12(g) of the Exchange Act:

                     Common Stock, par value $0.10 per share
                     ---------------------------------------
                                (Title 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  X   NO    .
    ---     ---

         Check if there is no  disclosure  of  delinquent  filers in response to
Item 405 of  Regulation  S-B 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. [X]

         State issuer's revenues for its most recent fiscal year.   $2,376,075

         The aggregate  market value of the voting stock held by  non-affiliates
of the registrant, based on the last sale price of the registrant's Common Stock
on September 25, 1997, was approximately $3.2 million.

         As of September  29, 1997,  there were issued and  outstanding  330,600
shares of the registrant's Common Stock.

         Transition Small Business Disclosure Format (check one):
YES      NO  X
    ---     ---

                       DOCUMENTS INCORPORATED BY REFERENCE
                                      NONE


<PAGE>



                              EXPLANATION OF FILING

General

         The  Registrant's   Registration  Statement  on  Form  SB-2  (File  No.
333-29389) and  Registration  Statement on Form 8-A, (File No. 0-22997) as filed
with the Securities and Exchange  Commission in connection with the Registrant's
initial public offering,  became effective on July 15, 1997 and August 21, 1997,
respectively. The Registrant's initial public offering was consummated on August
27, 1997, at which time the Registrant's  wholly-owned  subsidiary,  Workingmens
Bank,  formerly  Workingmens  Savings  Bank  FSB  (the  "Bank"),  completed  its
conversion from the mutual to the stock form of organization (the "Conversion").
Accordingly,  the financial  statements filed with this Form 10-KSB are those of
the Bank as it existed in the mutual form of  organization  as of June 30, 1997,
and do not reflect the receipt of the  proceeds  from the  Registrant's  initial
public  offering  or  the  completion  of  the  Conversion.   In  addition,  the
Registrant's  Form 10-KSB does not include any other  narrative items or tabular
information  which are normally required to be filed in an Annual Report on Form
10-KSB.  The  Registrant's  Common Stock is not traded on any exchange or on the
Nasdaq Stock Market.

Item 3.           Legal Proceedings
-----------------------------------

         There are various  claims and lawsuits in which the Company or the Bank
are  periodically  involved,  such as  claims  to  enforce  liens,  condemnation
proceedings  on properties in which the Bank holds  security  interests,  claims
involving  the marking and servicing of real  property  loans,  and other issues
incident to the Bank's business. In the opinion of management,  no material loss
is expected from any of such pending claims or lawsuits.

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

         Not applicable.

                                     PART II

Item 5.           Market for Common Equity and Related Stockholder Matters
--------------------------------------------------------------------------

         Not applicable.



                                        1

<PAGE>



Item 6.          Management's Discussion and Analysis of Financial Condition and
                 Results of Operations
--------------------------------------------------------------------------------

Financial Condition

Total consolidated  assets increased 3.2 million,  or 10.5% to $ 33.8 million at
June 30, 1997 from $ 30.6 million at June 30, 1996. The increase in total assets
reflects a $ 482,000 increase in investment and  mortgage-backed  securities,  a
$ 962,000 increase in loans and real estate,  net, and a $ 1.6 million  increase
in cash and cash equivalents.

Deposits  increased $ 250,000 or 0.9% to $ 28.4  million at June 30, 1997 from $
28.2  million at June 30, 1996.  Interest  bearing  liabilities  increased $ 3.1
million, or 11.6% to $ 29.8 million at June 30, 1997 from $ 26.7 million at June
30, 1996. The increase reflects borrowings of $ 3.0 million from the FHLB.

Results of Operations for the Years Ended June 30, 1997 and 1996

Net Income.  Net income  decreased $ 95,000 or 309.0% from $ 31,000 for the year
ended June 30, 1996 to a net loss of $ 64,500 for the year ended June 30,  1997.
The decrease was  primarily the result of the  recognition  of the one-time SAIF
special  insurance  assessment in the amount of $ 108,000  (after taxes) and the
increase in the  provision for loan losses of $ 136,000  partially  offset by an
increase in net interest income of $ 147,000.

Net Interest Income.  Net interest income is the most  significant  component of
our income  from  operations.  Net  interest  income is the  difference  between
interest we receive on our interest-earning  assets (primarily loans, investment
and  mortgage-backed  securities)  and  interest we pay on our  interest-bearing
liabilities (primarily deposits and borrowed funds). Net interest income depends
on the volume of and rates earned on  interest-earning  assets and the volume of
and rates paid on interest-bearing liabilities.

Our net interest  income  increased $ 147,000 or 18.5% to $ 943,000 for the year
ended June 30, 1997 compared to $ 796,000 for the year ended June 30, 1996.  The
increase was due primarily to the growth of average interest-earning assets from
$ 28.3  million for the year ended June 30, 1996 to $ 30.6  million for the nine
months ended June 30, 1997. The increase in our average  interest-earning assets
of $ 2.3 million reflects an increase of $ 956,000 in average loans, an increase
of $ 2.2 million in average investment and mortgage-backed  securities offset by
a decrease of $ 830,000 million in average other interest-earnings assets.

Our interest  rate spread and net interest  margin  increased for the year ended
June 30, 1997  compared to year ended June 30, 1996.  This was due  primarily to
the  increase  in the yield on  interest-earning  assets from 7.25% for the year
ended June 30, 1996 to 7.48% for the year ended June 30, 1997.  The yield on our
average  interest  bearing  liabilities  of  4.63%  at June  30,  1997  remained
relatively consistent with the June 30, 1996 yield of 4.66%.


                                        2

<PAGE>



The yield on our average  interest-earning  assets  increased for the year ended
June 30, 1997 due to an increase in the average  balance of loans and investment
securities.

Provision for Loan Losses.  Our provision for loan losses increased $ 101,000 or
287.0% to $ 136,000  for the year ended June 30, 1997 from $ 35,000 for the year
ended June 30, 1996.

The increase in the  provision  for loan losses for the year ended June 30, 1997
was  attributable  to changes  in one of our  borrower's  ability to repay.  The
borrower had outstanding, 15 non-performing loans that ranged  from $ 30,000  to
$ 100,000, totalling  $  665,000, secured  by 1- to 4-  family  residences.  The
properties  are  located  in  Mount  Washington,  a  highly  desirable  area for
development  in the city of Pittsburgh.  During the quarter,  we became aware of
circumstances  which might decrease the value of the collateral for these loans,
due to two properties  being torn down by the borrower and maintenance for other
properties  being  neglected by the  borrower.  Full payment of the loan was due
June 30, 1997 and was not received.

Subsequent to June 30, 1997, this borrower declared  bankruptcy.  The bankruptcy
proceeding might delay  foreclosure  proceedings for a prolonged period of time.
If so, we would lose the  ability to use any monies that we might  receive  from
the sale of these  properties  and  there is no  guarantee  that  value of these
properties will be maintained or that the value of the properties  received from
foreclosure  will be sufficient to pay the amounts  outstanding  on these loans.
While we believe our loan loss  reserve is  adequate,  there can be no assurance
that our  allowance for loan loss will be adequate to cover  significant  losses
that we might incur in the future.  Also,  risks associated with these loans and
losses incurred on these loans might result in higher provisions for loan losses
in the future.

Historically,  we have  emphasized  our loss  experience  over other  factors in
establishing  the  provision  for loan losses.  We review the allowance for loan
losses in relation to (i) our past loan loss experience, (ii) known and inherent
risks in our portfolio,  (iii) adverse situations that may affect the borrower's
ability to repay, (iv) the estimated value of any underlying collateral, and (v)
current economic conditions. Because of the increased coverage of the allowances
for loan losses to total  loans,  management  believes  the  allowance  for loan
losses is at a level that is  considered to be adequate to provide for estimated
losses;  however,  there can be no assurance that further  additions will not be
made to the allowance and that such losses will not exceed the estimated amount.

Noninterest  Expense.  Our noninterest  expense  increased by $ 221,000 or 27.4%
from $ 804,000  for the year ended  June 30,  1996 to $  1,025,000  for the year
ended June 30, 1997.  The increase was  primarily  attributable  to the one-time
special SAIF  assessment of $ 161,000 and an increased in our pension expense of
$ 36,000.  Our  pension  expense  increased  due to  changes  made in our plan's
actuarial  assumptions and funding limitations.  Pursuant to the Economic Growth
and  Paperwork  Reduction  Act of 1996 (the  "Act"),  the FDIC imposed a special
assessment  on SAIF members to  capitalize  the SAIF at the  designated  reserve
level of 1.25% as of  October  1, 1996.  Based on our  deposits  as of March 31,
1995,  the date for measuring the amount of the special  assessment  pursuant to
the Act, our special assessment was

                                        3

<PAGE>



$ 161,000. Due to the recapitalization of the SAIF, we expect lower premiums for
deposit insurance in future periods.  The SAIF insurance assessment rate paid by
us before the  recapitalization  of SAIF was  23(cent) per $ 100 of deposits and
decreased to 6.5(cent) per $ 100 of deposits after the recapitalization of SAIF.

Pursuant to the Act, we will pay,  in addition to our normal  deposit  insurance
premium as a member of the SAIF,  an annual  amount equal to  approximately  6.5
basis points of outstanding SAIF-deposits toward the retirement of the Financing
Corporation  Bonds ("Fico  Bonds") issued in the 1980s to assist in the recovery
of the savings and loan industry. Members of the Bank Insurance Fund ("BIF"), by
contrast,  will pay, in  addition to their  normal  deposit  insurance  premium,
approximately  1.3 basis  points.  Beginning no later than January 1, 2000,  the
rate paid to retire the Fico Bonds will be equal for  members of the BIF and the
SAIF.  The Act also  provides for the merging of the BIF and the SAIF by January
1, 1999 provided there are no financial  institutions still chartered as savings
associations  at that time.  Should the insurance funds be merged before January
1, 2000,  the rate paid by all members of this new fund to retire the Fico Bonds
would be equal.

Income Tax Benefit.  Our income tax benefit for the year ended June 30, 1997 was
$ 67,000  compared to $ 8,000  expense for the year ended June 30,  1996.  The $
75,000 decrease was the result of pre-tax income decreasing by $ 170,000,  which
was  primarily  the  result of the SAIF  special  insurance  assessment  and the
increase  in  our  pension  expense.   Additionally,  we  invest  in  tax-exempt
securities which provides us with nontaxable income.

Liquidity and Capital Resources

We are required to maintain  minimum  levels of liquid  assets as defined by OTS
regulations.  This  requirement,  which varies from time to time  depending upon
economic  conditions  and  deposit  flows,  is based  upon a  percentage  of our
deposits and short-term borrowings. The required ratio currently is 5.0% and our
liquidity  ratio  average  was 26.13%  and 21.72% at June 30,  1997 and June 30,
1996, respectively.

Our   primary   sources  of  funds  are   deposits,   repayment   of  loans  and
mortgage-backed  securities,  maturities  of  investments  and  interest-bearing
deposits,  funds  provided  from  operations  and  advances  from  the  FHLB  of
Pittsburgh.  While scheduled repayments of loans and mortgage-backed  securities
and maturities of investment securities are predicable sources of funds, deposit
flows,  and loan  prepayments  are greatly  influenced  by the general  level of
interest  rates,  economic  conditions  and  competition.  We use our  liquidity
resources  principally  to fund  existing and future loan  commitments,  to fund
maturing  certificates of deposit and demand deposit  withdrawals,  to invest in
other  interest-earning  assets,  to maintain  liquidity,  and to meet operating
expenses.

Net cash  provided  (used) by our  operating  activities  (the cash  effects  of
transactions that enter into our  determination of net income -- e.g.,  non-cash
items, amortization and depreciation,

                                        4

<PAGE>



provision  for loan  losses)  for the year ended June 30,  1997 was $ (9,000) as
compared to $ 66,000 for the year ended June 30, 1996.

Net cash used in our  investing  activities  for the year  ended  June 30,  1997
totalled $ 1.6  million,  a decrease of $ 4.0 million  from the net cash used at
June 30, 1996 of $ 5.6  million.  The  decrease in cash was due to $ 3.5 million
less in net investment purchases and the use of $ 800,000 to construct and equip
the new branch.

Net cash provided by our financing  activities  (i.e.,  cash receipts  primarily
from net increases in deposits and net FHLB advances) for fiscal 1997 totalled $
3.2 million.  This is  primarily a result of a borrowing  from the FHLB of $ 3.0
million and an increase in deposits of $ 250,000.


Item 7.           Financial Statements
--------------------------------------


                                        5

<PAGE>

Hinds, Lind, Miller & Co.
A PROFESSIONAL CORPORATION
CERTIFIED PUBLIC ACCOUNTANTS

9401 McKnight Road                                          Phone (412) 364-6070
Pittsburgh, Pennsylvania 15237-6000                           Fax (412) 364-6176

--------------------------------------------------------------------------------



                          INDEPENDENT AUDITOR'S REPORT




The Board of Directors
Workingmens Savings Bank, F.S.B. and Subsidiary



We have audited the  accompanying  consolidated  balance  sheets of  Workingmens
Savings  Bank,  F.S.B.  and  Subsidiary  ("Bank")  at June 30, 1997 and 1996 (as
restated),  and the  related  consolidated  statements  of  income,  changes  in
retained earnings, and cash flows for the years ended June 30, 1997 and June 30,
1996  (as   restated).   These   consolidated   financial   statements  are  the
responsibility  of the Bank's  management.  Our  responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of Workingmens Savings
Bank,  F.S.B.  and Subsidiary at June 30, 1997 and 1996 (as  restated),  and the
results of their  operations  and their cash flows for the years  ended June 30,
1997 and June 30, 1996 (as  restated)  in  conformity  with  generally  accepted
accounting principles.





/s/Hinds, Lind, Miller & Co.
Pittsburgh, Pennsylvania
September 18, 1997



                                        6

<PAGE>




                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
                             June 30, 1997 and 1996



                                     ASSETS
<TABLE>
<CAPTION>
                                                                                      1997                 1996
                                                                                                       (As Restated)
                                                                                  -------------        -------------

<S>                                                                               <C>                     <C>         
Cash and cash equivalents:
   Interest bearing                                                               $  2,547,897            $    984,667
   Non-interest bearing                                                                256,907                 221,364
Securities held-to-maturity (estimated fair
   value of $ 11,980,618 and $ 10,782,060)                                          12,007,456              10,892,081
Securities available-for-sale, at fair value                                         2,684,039               3,317,811
Loans and real estate, net                                                          14,590,996              13,628,724
Federal Home Loan Bank stock, at cost                                                  153,300                 133,200
Accrued interest receivable                                                            299,469                 235,434
Premises and equipment, net                                                          1,057,667               1,072,594
Other assets                                                                           146,503                  83,382
Income taxes receivable                                                                   -                      3,537
Deferred income taxes                                                                   52,426                   9,088
                                                                                  ------------            ------------

                                                                                  $ 33,796,660            $ 30,581,882
                                                                                  ============            ============

                        LIABILITIES AND RETAINED EARNINGS

Deposits                                                                          $ 28,405,775            $ 28,156,791
Federal Home Loan Bank advances                                                      3,000,000                    -
Advances from borrowers for taxes and insurance                                        233,818                 278,488
Accrued expenses and other liabilities                                                 113,272                  59,446
                                                                                  ------------            ------------

                                                                                    31,752,865              28,494,725
                                                                                  ------------            ------------

Commitments and contingencies

Retained earnings                                                                    2,063,990               2,128,450

Net unrealized gain (loss) on
   securities available-for-sale,
   net of applicable income taxes
   of $ (9,124) and $ (28,695)                                                         (20,195)                (41,293)
                                                                                  ------------            ------------

                                                                                     2,043,795               2,087,157
                                                                                  ------------            ------------

                                                                                  $ 33,796,660            $ 30,581,882
                                                                                  ============            ============
</TABLE>

See accompanying notes.

                                        7
<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                        CONSOLIDATED STATEMENTS OF INCOME
                       Years Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
                                                                                       1997                  1996
                                                                                                         (As Restated)
                                                                                   -----------           -----------

<S>                                                                                <C>                 <C>        
INTEREST AND DIVIDEND INCOME
   Loans                                                                           $ 1,176,149            $ 1,122,699
   Investments                                                                       1,021,953                781,105
   Other interest earning assets                                                        90,343                149,012
                                                                                   -----------            -----------

               TOTAL INTEREST AND DIVIDEND INCOME                                    2,288,445              2,052,816
                                                                                   -----------            -----------

INTEREST EXPENSE
   Deposits                                                                          1,246,448              1,256,267
   Advances from FHLB                                                                   98,571                  -
                                                                                   -----------               --------

               TOTAL INTEREST EXPENSE                                                1,345,019              1,256,267
                                                                                   -----------            -----------

               NET INTEREST INCOME                                                     943,426                796,549

PROVISION FOR LOAN LOSSES                                                              136,039                 35,142
                                                                                   -----------            -----------

               NET INTEREST INCOME AFTER
                 PROVISION FOR LOAN LOSSES                                             807,387                761,407
                                                                                   -----------            -----------

NONINTEREST INCOME
   Service charges and other fees                                                       83,330                 72,441
   Net gain (loss) on sales of
      securities available-for-sale                                                     (1,608)                   969
   Income from real estate rental                                                        4,300                  7,825
   Net gain on sale of foreclosed
     real estate                                                                          -                       650
                                                                                   -----------            -----------

               TOTAL NONINTEREST INCOME                                                 86,022                 81,885
                                                                                   -----------            -----------

NONINTEREST EXPENSE
   Compensation and benefits                                                           423,786                354,638
   Occupancy and equipment expense                                                     142,352                106,517
   Insurance premiums                                                                  208,873                 69,365
   Other                                                                               249,986                273,956
                                                                                   -----------            -----------

               TOTAL NONINTEREST EXPENSE                                             1,024,997                804,476
                                                                                   -----------            -----------

               INCOME (LOSS) BEFORE INCOME TAXES                                      (131,588)                38,816

INCOME TAX EXPENSE (BENEFIT)                                                           (67,128)                 7,974
                                                                                   -----------            -----------

               NET INCOME (LOSS)                                                   $   (64,460)           $    30,842
                                                                                   ===========            ===========
</TABLE>


See accompanying notes.

                                        8
<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
             CONSOLIDATED STATEMENTS OF CHANGES IN RETAINED EARNINGS
                       Years Ended June 30, 1997 and 1996

<TABLE>
<CAPTION>




                                                                                        NET UNREALIZED
                                                                                        GAIN (LOSS) ON
                                                                                          SECURITIES
                                                                    RETAINED            AVAILABLE-FOR-
                                                                    EARNINGS                 SALE                 TOTAL
                                                                   --------------------------------------------------------


<S>                                                                <C>                  <C>                    <C>        
BALANCE AT JULY 1, 1995                                            $ 2,097,608          $     3,718            $ 2,101,326

Change in unrealized gain (loss) on
   securities available-for-sale,
   net of applicable income tax
   benefit of $ (31,278)                                                  -                 (45,011)               (45,011)

Net income                                                              30,842                 -                    30,842
                                                                   -----------          -----------            -----------

BALANCE AT JUNE 30, 1996                                             2,128,450              (41,293)             2,087,157

Change in unrealized gain (loss) on
   securities available-for-sale, net
   of applicable income taxes of
   $ 19,571                                                               -                  21,098                 21,098

Net income (loss)                                                      (64,460)                -                   (64,460)
                                                                   -----------          -----------            -----------

BALANCE AT JUNE 30, 1997                                           $ 2,063,990          $   (20,195)           $ 2,043,795
                                                                   ===========          ===========            ===========
</TABLE>



See accompanying notes.


                                        9
<PAGE>
                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                       Years Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>

                                                                                          1997                  1996
                                                                                                           (As Restated)
                                                                                       -----------          -----------
<S>                                                                                   <C>                  <C>        
OPERATIONS

   Net income (loss)                                                                  $   (64,460)         $    30,842
   Adjustments to reconcile
      net income (loss) to net cash provided
      by operating activities:
        Amortization of:
           Deferred loan origination fees                                                  (4,411)             (13,367)
           Premiums and discounts on loans
              and investment securities                                                     2,010                5,808
        Provision for loan losses                                                         136,039               35,142
        (Gain) loss on sales of
           real estate owned                                                                 -                    (650)
        Net (gain) loss on sales of
           securities available-for-sale                                                    1,608                 (969)
        Depreciation of premises
            and equipment                                                                  53,170               41,859
        (Increase) decrease in:
           Accrued interest receivable                                                    (64,035)             (67,082)
           Other assets                                                                   (63,121)             (16,563)
           Income taxes receivable                                                          3,537               30,483
           Deferred income taxes                                                          (62,909)              12,395
        Increase (decrease) in:
           Accrued expenses and
              other liabilities                                                            53,826                8,238
                                                                                      -----------          -----------

NET CASH PROVIDED (USED) BY OPERATIONS                                                     (8,746)              66,136
                                                                                      -----------          -----------


INVESTMENT ACTIVITIES

   Purchases of securities held-to-maturity                                            (4,710,730)          (9,665,088)
   Proceeds from maturities of and principal
      repayments on securities held-to-maturity                                         3,595,776            5,151,167
   Purchases of securities available-for-sale                                                   -             (503,594)
   Proceeds from maturities of
      and principal repayments on
      securities available-for-sale                                                       439,033              393,280
   Proceeds from sales of securities available-
      for-sale                                                                            231,369              675,969
   Net loan originations and principal
      repayments on loans                                                              (1,093,900)          (1,010,211)
   Proceeds from sales of real estate owned                                                  -                 160,827
   Capitalized improvements on real estate owned                                             -                  (2,150)
   Net (purchase) sale of Federal
      Home Loan Bank stock                                                                (20,100)               6,400
   Purchases of premises and equipment                                                    (38,243)            (809,049)
                                                                                      -----------          -----------

NET CASH USED BY INVESTMENT ACTIVITIES                                                 (1,596,795)          (5,602,449)
                                                                                      -----------          -----------
</TABLE>


See accompanying notes.

                                       10
<PAGE>
                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                       Years Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
                                                                                          1997                  1996
                                                                                                           (As Restated)
                                                                                      ------------         -----------
<S>                                                                                   <C>                  <C>        
FINANCING ACTIVITIES
   Net increase in deposits                                                           $    248,984         $ 2,377,906
   Net proceeds from FHLB advances                                                       3,000,000                -
   Net decrease in advances from borrowers
      for taxes and insurance                                                              (44,670)            (62,438)
                                                                                      ------------         -----------

NET CASH PROVIDED BY FINANCING ACTIVITIES                                                3,204,314           2,315,468
                                                                                      ------------         -----------

NET INCREASE (DECREASE) IN
   CASH AND CASH EQUIVALENTS                                                             1,598,773          (3,220,845)

CASH AND CASH EQUIVALENTS
   AT BEGINNING OF YEAR                                                                  1,206,031           4,426,876
                                                                                      ------------         -----------

CASH AND CASH EQUIVALENTS
   AT END OF YEAR                                                                     $  2,804,804         $ 1,206,031
                                                                                      ============         ===========


SUPPLEMENTAL DISCLOSURES Cash paid during the period for:
   Interest on deposits, advances,
      and other borrowings                                                            $  1,299,115         $ 1,235,757
   Income taxes                                                                       $       -            $      -

Noncash investing and financing activities:

      Transfer from loans to real estate owned                                        $       -            $   106,949

      Transfers from securities held to maturity
        to securities available-for-sale,
        at amortized cost                                                             $       -            $ 2,564,286

      Total increase (decrease) in unrealized
        gain (loss) on securities
        available-for-sale                                                            $     40,669         $   (76,289)

      Less: income tax expense (benefit)                                                   (19,571)             31,278
                                                                                      ------------         -----------

      Net increase (decrease) in unrealized
        gain (loss) on securities
        available-for-sale                                                            $     21,098         $   (45,011)
                                                                                      ============         ===========
</TABLE>


See accompanying notes.

                                       11
<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997




NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting and reporting policies of Workingmens Savings Bank and Subsidiary
(the "Bank") and the methods of applying those  policies  conform with generally
accepted  accounting  principles.  The accounting and reporting policies and the
methods of applying those policies which significantly  affect the determination
of financial  position,  results of  operations,  and cash flows are  summarized
below.

Nature of Operations

Workingmens Savings Bank, F.S.B. is a federally  chartered,  Savings Association
Insurance Fund (SAIF)  insured mutual savings bank  conducting its business from
its two locations in the Northside  section of the City of Pittsburgh  and South
Hills suburb of Pittsburgh. The Bank's principal sources of revenue emanate from
its  portfolio  of  residential   real  estate  mortgage  loans  and  investment
securities.

The Bank is  subject  to  regulation  and  supervision  by the  Federal  Deposit
Insurance Corporation (FDIC) and the Office of Thrift Supervision (OTS).

Use of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Material  estimates that are  particularly  susceptible  to  significant  change
relate to the determination of the allowance for loan losses. In connection with
the  determination  of  the  allowance  for  loan  losses,   management  obtains
independent appraisals for significant properties.

A majority of the Bank's loan portfolio  consists of  single-family  residential
loans in the  Pittsburgh  area.  The regional  economy is  currently  stable and
consists of various  types of  industry.  Real estate  prices in this market are
also stable,  however,  the ultimate  collectibility of a substantial portion of
the Bank's loan portfolio are susceptible to changes in local market conditions.

While  management  uses available  information to recognize  losses on loans and
foreclosed real estate,  further reductions in the carrying amounts of loans and
foreclosed   assets  may  be  necessary  based  on  changes  in  local  economic
conditions.  In  addition,  regulatory  agencies,  as an integral  part of their
examination  process,  periodically,  review the  estimated  losses on loans and
foreclosed  real  estate.  Such  agencies  may  require  the  Bank to  recognize
additional losses based on their judgments about  information  available to them
at the time of their  examination.  Because of these  factors,  it is reasonably
possible  that the  estimated  losses on loans and  foreclosed  real  estate may
change  materially in the near term.  However,  the amount of the change that is
reasonably possible cannot be estimated.


                                       12

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



Principles of Consolidation

The consolidated  financial  statements include the accounts of the Bank and its
wholly-owned subsidiary, Workingmens Service Corporation.  Intercompany balances
and  transactions  have been  eliminated.  Workingmens  Service  Corporation  is
currently  inactive and its impact on the consolidated  financial  statements is
insignificant.

Cash and Cash Equivalents

For  purposes of  reporting  cash  flows,  the Bank  considers  cash on hand and
deposits in other  financial  institutions  with an original  maturity of ninety
(90) days or less to be cash and cash equivalents.

Investment and Mortgage-Backed Securities

The Bank follows the provisions of Statement of Financial  Accounting  Standards
("SFAS")  No.  115,  "Accounting  for  Certain  Investments  in Debt and  Equity
Securities".  Accordingly,  management determines the appropriate classification
of securities at the time of purchase and  reevaluates  such  designation  as of
each balance sheet date. Debt securities are classified as held-to-maturity when
the Bank has the positive intent and ability to hold the securities to maturity.
Held-to-maturity securities are stated at amortized cost.

Debt   securities   not  classified  as   held-to-maturity   are  classified  as
available-for-  sale.  Available-for-sale  securities  are stated at fair value,
with the  unrealized  gains  and  losses,  net of tax,  reported  as a  separate
component of retained earnings.

The  amortized  cost  of  debt  securities  classified  as  held-to-maturity  or
available-for-  sale is adjusted for  amortization  of premiums and accretion of
discounts to maturity,  or in the case of mortgage-backed  securities,  over the
estimated life of the security. Such amortization is included in interest income
from  investments.  Interest and dividends are included in interest  income from
investments.  Realized  gains and losses,  and  declines  in value  judged to be
other-than-temporary  are  included in gain (loss) on sale of  investments.  The
cost of securities sold is based on the specific identification method.

In October,  1994 the Financial  Accounting Standards Board ("FASB") issued SFAS
No. 119,  "Disclosure about Derivative  Financial  Instruments and Fair Value of
Financial  Instruments." SFAS No. 119 established  disclosures about derivatives
and other financial  instruments.  Derivatives are various  instruments  used to
construct a transaction  that is derived from and reflects the underlying  value
of  assets,  other  instruments  or  various  indices.  The  primary  purpose of
derivatives, which include such items as forward contracts, interest rate swaps,
options and futures,  is to transfer price risk associated with the fluctuations
in asset values rather than to borrow or lend funds.  At present,  the Bank does
not invest in such  derivative  instruments for trading,  investing,  hedging or
other purposes.


                                       13

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



Loans Receivable

Loans receivable are stated at unpaid principal balances, less the allowance for
loan losses and net deferred loan-origination fees.

Loan origination fees, as well as certain direct origination costs, are deferred
and  amortized as a yield  adjustment  over the lives of the related loans using
the interest method.

Uncollected  interest  on  loans  is  periodically  reviewed.  An  allowance  is
established  based on  management's  periodic  evaluation  for  interest  deemed
uncollectible. The allowance is established by a charge to interest income equal
to all interest previously accrued,  and income is subsequently  recognized only
to the extent cash payments are received until, in  management's  judgment,  the
borrower  is  able  to make  periodic  interest  and  principal  repayments,  as
scheduled, in which case the loan is returned to accrual status.

The allowance for loan losses is increased by charges to income and decreased by
charge-offs  (net  of  recoveries).  Management's  periodic  evaluation  of  the
adequacy  of the  allowance  is based on the Bank's  past loan loss  experience,
known and inherent risks in the portfolio,  adverse  situations  that may affect
the  borrower's  ability  to  repay,  the  estimated  value  of  any  underlying
collateral,  and current economic conditions.  Allowances for impaired loans are
generally  determined  based  on  collateral  values  or the  present  value  of
estimated cash flows.  While  management  believes it uses the best  information
available to make  evaluations,  future  adjustments  to the  allowances  may be
necessary if  circumstances  differ  substantially  from the assumptions used in
making the evaluations.

Effective  July 1, 1995,  the Bank adopted  Statement  of  Financial  Accounting
Standards  No. 114,  "Accounting  by Creditors  for  Impairment  of a Loan",  as
amended by Statement No. 118,  "Accounting by Creditors for Impairment of a Loan
- Income Recognition and Disclosures."  These Statements  prescribe  recognition
criteria  for loan  impairment,  generally  related  to  commercial  loans,  and
multi-family  real estate loans,  and measurement  methods for certain  impaired
loans and all loans whose  terms are  modified  in trouble  debt  restructurings
subsequent to the adoption of these  Statements.  A loan is considered  impaired
when it is probable that the borrower  will not repay the loan  according to the
original contractual terms of the loan agreement.

Management  has  determined  that first  mortgage  loans on  one-to-four  family
properties, home equity, second mortgage loans, and all consumer loans are large
groups of  smaller-balance  homogenous  loans are to be collectively  evaluated.
Accordingly, such loans are outside the scope of Statement Nos. 114 and 118.

Management  considers an insignificant  delay, which is determined as 90 days by
the Bank,  will not cause a loan to be  classified  as  impaired.  A loan is not
impaired  during a period of delay in payment if the Bank expects to collect all
amounts due including interest accrued at the contractual  interest rate for the
period of delay. All loans identified as impaired are evaluated independently by
management.


                                       14

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997





Under this Standard, the Bank estimates credit losses in impaired loans based on
the  present  value of expected  cash flows or the fair value of the  underlying
collateral if the loan  repayment is expected to come from the sale or operation
of such  collateral.  Statement  No.  118 amends  Statement  No. 114 to permit a
creditor to use existing  methods for  recognizing  interest  income in impaired
loans eliminating the income recognition  provisions of Statement No. 114. Prior
to 1995,  the credit  losses  related to these  loans  were  estimated  based on
undiscounted  cash flows or the fair  value of the  underlying  collateral.  The
adoption  of the  statements  did  not  have a  material  effect  on the  Bank's
financial position or results of operations.

Real Estate Owned

Real estate  acquired by foreclosure or voluntary deed in lieu of foreclosure is
initially  carried at the lower of fair value minus estimated  disposal costs or
the  balance  of the  loan  on the  property  at the  date of  acquisition.  Any
write-downs  based on the asset's fair value at date of acquisition  are charged
to the  allowance  for loan losses.  Subsequent  costs  directly  related to the
development  or  improvement  of real  estate are  capitalized.  Other  costs of
maintaining  real  estate  ($ 0 and $ 8,014  in  fiscal  years  1997  and  1996,
respectively)  are  charged to income as  incurred  and are  reported  in "Other
Noninterest Expense."

Federal Home Loan Bank Stock

Investment  in stock of a Federal  Home Loan  Bank is  required  by law of every
federally insured savings and loan or savings bank. The investment is carried at
cost. No ready market exists for the stock, and it has no quoted market value.

Premises and Equipment

Land is carried  at cost.  Buildings,  leasehold  improvements,  and  furniture,
fixtures,  and equipment are carried at cost, less accumulated  depreciation and
amortization.  Buildings,  leasehold improvements,  and furniture, fixtures, and
equipment  are  depreciated  using the  straight-line  method over the estimated
useful lives of the assets (ranging from 5 to 70 years).


                                      15

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



Income Taxes

The Bank and its subsidiary  follow the practice of filing federal  consolidated
income tax returns.  Income taxes are  allocated to the Bank as though  separate
returns are being filed.

Income taxes are provided  for the tax effects of the  transactions  reported in
the financial  statements and consist of taxes currently due plus deferred taxes
related  primarily  to  differences  between  the  basis  of  available-for-sale
securities,  allowance  for loan losses,  estimated  losses on  foreclosed  real
estate, and accumulated depreciation for financial and income tax reporting. The
deferred tax assets and liabilities represent the future tax return consequences
of those differences, which will either be taxable or deductible when the assets
and  liabilities  are recovered or settled.  Deferred tax assets and liabilities
are reflected at income tax rates applicable to the period in which the deferred
tax assets or liabilities are expected to be realized or settled.  As changes in
tax laws or rates are enacted,  deferred tax assets and liabilities are adjusted
through the provision for income taxes.

Pension Plan

The Bank has a pension plan  covering  substantially  all  employees.  It is the
policy of the Bank to fund the maximum  amount that can be deducted  for federal
income tax purposes but in amounts not less than the minimum amounts required by
law.

Fair Values of Financial Instruments

Statement of Financial  Accounting  Standards No. 107,  "Disclosures  about Fair
Value of Financial  Instruments",  requires disclosure of fair value information
about  financial  instruments,  whether or not  recognized  in the  statement of
financial condition. In cases where quoted market prices are not available, fair
values are based on estimates using present value or other valuation techniques.
Those techniques are significantly  affected by the assumptions used,  including
the  discount  rate and  estimates  of future cash flows.  In that  regard,  the
derived  fair  value  estimates   cannot  be   substantiated  by  comparison  to
independent  markets  and,  in many cases,  could not be  realized in  immediate
settlement  of the  instruments.  Statement No. 107 excludes  certain  financial
instruments and all nonfinancial  instruments from its disclosure  requirements.
Accordingly,  the  aggregate  fair value  amounts  present do not  represent the
underlying value of the Bank.

The following  methods and  assumptions  were used by the Bank in estimating its
fair value disclosures for financial instruments:

Cash and cash  equivalents:  The carrying  amounts reported in the statements of
financial condition for cash and cash equivalents approximate those assets' fair
values.

Investment  and  mortgage-backed  securities:  Fair values for  investments  and
mortgage-backed  securities are based on quoted market prices,  where available.
If quoted  market  prices  are not  available,  fair  values are based on quoted
market prices of comparable instruments.


                                       16

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997





Loans:  The fair  values  for loans are  estimated  using  discounted  cash flow
analysis, based on interest rates currently being offered for loans with similar
terms to borrowers of similar credit quality.  Loan fair value estimates include
judgments  regarding  future expected loss experience and risk  characteristics.
Fair values for impaired loans are estimated using discounted cash flow analysis
or  underlying  collateral  values,  where  applicable.  The carrying  amount of
accrued interest receivable approximates its fair value.

Federal Home Loan Bank (FHLB)  Stock:  No ready market exists for this stock and
it  has  no  quoted  market  value.  However,   redemption  of  this  stock  has
historically been at par value. Accordingly, the carrying amount is deemed to be
a reasonable estimate of fair value.

Deposits:  The fair values  disclosed for demand  deposits  are, by  definition,
equal to the amount  payable  on demand at the  reporting  date (that is,  their
carrying  amounts).  Fair  values for  fixed-rate  certificates  of deposit  are
estimated using a discounted cash flow  calculation  that applies interest rates
currently  offered on certificates to a schedule of aggregated  expected monthly
maturities on time deposits.  The carrying  amount of accrued  interest  payable
approximates fair value.

Federal  Home Loan Bank  (FHLB)  advances:  Fair  values  of FHLB  advances  are
estimated  using  discounted  cash flow  analyses  based on the  Bank's  current
incremental borrowing rates for similar types of borrowing arrangements.

Advances from borrowers for taxes and insurance: The carrying amount of advances
from borrowers for taxes and insurance approximate fair value.

Off-Balance sheet items: Fair value of these items approximate their contractual
amounts.


                                       17

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997





NOTE B - SECURITIES HELD-TO-MATURITY

The amortized cost and estimated fair values of securities  held-to-maturity  as
of June 30, are as follows:
<TABLE>
<CAPTION>


                                                                              1997
                                           ------------------------------------------------------------------------
                                                                    GROSS             GROSS
                                            AMORTIZED             UNREALIZED        UNREALIZED             FAIR
                                              COST                  GAINS             LOSSES               VALUE
                                           ---------------  -------------------  ----------------  ----------------

<S>                                        <C>                    <C>               <C>                <C>         
U.S. Government and
   government agency
   obligations                             $ 11,882,290           $  22,193         $  (46,412)        $ 11,858,071

Collateralized mortgage
   obligations:
     Government agency                           73,843                -                (2,221)              73,443

     Private                                     51,323                -                  (400)              49,102
                                           ------------           ---------         ----------         ------------

                                           $ 12,007,456           $  22,193         $  (49,033)        $ 11,980,616
                                           ============           =========         ==========         ============
</TABLE>

<TABLE>
<CAPTION>
                                                                              1996
                                           ------------------------------------------------------------------------
                                                                   GROSS              GROSS
                                            AMORTIZED            UNREALIZED         UNREALIZED            FAIR
                                              COST                 GAINS              LOSSES              VALUE
                                           ---------------  -------------------  ----------------  ----------------

<S>                                        <C>                    <C>                <C>               <C>         
U.S. Government and
   government agency
   obligations                             $ 10,744,807           $   9,138          $ (116,383)       $ 10,637,562

Collateralized mortgage
   obligations                                 147,274                 -                 (2,776)            144,498
                                          ------------            ---------          ----------        ------------

                                          $ 10,892,081            $   9,138          $ (119,159)       $ 10,782,060
                                          ============            =========          ==========        ============
</TABLE>






                                       18

<PAGE>

                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997


The amortized cost and approximate fair values of securities held-to-maturity at
June 30, 1997, by contractual maturity are shown below.  Collateralized mortgage
obligations  are  not due at a  single  maturity  date;  periodic  payments  are
received on these  securities  based on the payment  patterns of the  underlying
collateral.
<TABLE>
<CAPTION>

                                                                                    AMORTIZED               FAIR
                                                                                       COST                 VALUE 
                                                                                  ------------         ------------
<S>                                                                               <C>                  <C>         
Due from one year to five years                                                   $  4,598,978         $  4,581,286
Due from five years to ten years                                                     5,586,816            5,566,669
Due after 10 years                                                                   1,696,496            1,710,116
                                                                                  ------------         ------------

                                                                                  $ 11,882,290         $ 11,858,071
                                                                                  ============         ============
</TABLE>

In November of 1995, the Financial  Accounting Standards Board allowed financial
institutions to perform a one-time  reassessment of the  appropriateness  of the
classifications  of all  securities  held at that time.  Any transfers  from the
held-to- maturity classification as a result of this one-time reassessment would
not  question  the Bank's  intent and ability to hold other debt  securities  to
maturity  in  the  future.   Accordingly,   the  Bank   transferred   securities
held-to-maturity   with  an  amortized   cost  of  $  2,564,286  to   securities
available-for-sale.

NOTE C - SECURITIES AVAILABLE-FOR-SALE

The amortized cost and estimated fair values of securities available-for-sale as
of June 30, are as follows:
<TABLE>
<CAPTION>

                                                                              1997
                                              --------------------------------------------------------------------
                                                                    GROSS             GROSS
                                               AMORTIZED          UNREALIZED        UNREALIZED
                                                 COST               GAINS             LOSSES            FAIR VALUE
                                              -----------         --------          ---------          -----------
<S>                                           <C>                 <C>               <C>                <C>        
Mortgage-backed securities:
   Federal Home Loan Mortgage
     Corporation                              $    90,610         $  1,281          $    -             $    91,891

   Government National Mortgage
     Association                                1,352,482           19,660             (2,407)           1,369,735

   Federal National Mortgage
     Association                                  456,103             -               (12,629)             443,474

FHLMC Preferred Stock                             256,750             -                (8,000)             248,750

Corporate Bonds/Notes                             499,267             -               (12,687)             486,580

Collateralized mortgage
   obligations:
     Government Agency                             58,146             -               (14,537)              43,609
                                              -----------         --------          ---------          -----------

                                              $ 2,713,358         $ 20,941          $ (50,260)         $ 2,684,039
                                              ===========         ========          =========          ===========
</TABLE>



                                       19

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997
<TABLE>
<CAPTION>
                                                                              1996
                                              --------------------------------------------------------------------

                                                                    GROSS             GROSS
                                               AMORTIZED          UNREALIZED        UNREALIZED
                                                 COST               GAINS             LOSSES            FAIR VALUE
                                              -----------         --------          ---------          -----------

<S>                                           <C>                 <C>               <C>                <C>        
Mortgage-backed securities:
   Federal Home Loan Mortgage
     Corporation                              $   235,181         $     -           $     (186)        $   234,995

   Government National
      Mortgage Association                      1,581,105             15,004            (6,849)          1,589,260

   Federal National
      Mortgage Association                        502,050               -              (22,559)            479,491

FHLMC Preferred Stock                             256,750              2,000            (3,750)            255,000

Municipal bonds                                   227,898               -               (2,683)            225,215

Corporate notes                                   499,181               -              (18,852)            480,329

Collateralized mortgage
   obligations                                     85,634               -              (32,113)             53,521
                                              -----------         ----------        ----------         -----------

                                              $ 3,387,799         $   17,004        $  (86,992)        $ 3,317,811
                                              ===========         ==========        ==========         ===========

</TABLE>

At June 30, 1997,  securities  available-for-sale  with  an  amortized  cost  of
$499,267 and  estimated  fair  values of $ 486,580  mature from one year to five
years.  Mortgage-backed  securities and collateralized  mortgage obligations are
not due at a single  maturity  date;  periodic  payments  are  received on these
securities  based on the payment  patterns of the underlying  collateral.  FHLMC
preferred stock shares do not have a maturity date, however, these shares may be
called at a future date.



                                       20

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997






NOTE D - LOANS AND REAL ESTATE

Loans and real estate at June 30, are summarized as follows:
<TABLE>
<CAPTION>

                                                                                       1997                   1996
                                                                                  ------------            ------------
<S>                                                                               <C>                     <C>         
   First mortgage loans:
     Secured by 1-to-4 family residences                                          $ 11,034,886            $ 10,482,481
     Secured by over 4 family units                                                  1,294,595               1,350,604
     Commercial                                                                        598,866                 665,797
  Home equity and second mortgage loans                                              1,213,212                 855,454
  Lease pools                                                                            4,043                   6,337
   Share loans                                                                         396,133                 172,527
   Consumer loans                                                                      267,773                 185,154
   Real estate owned                                                                      -                       -
                                                                                  ------------            ------------

                                                                                    14,809,508              13,718,354
   Allowance for loan losses                                                          (208,791)                (75,694)
   Deferred loan origination fees                                                       (9,721)                (13,936)
                                                                                  ------------            ------------

                                                                                  $ 14,590,996            $ 13,628,724
                                                                                  ============            ============
</TABLE>


The Bank  conducts  its  business  through  two offices  located in  Pittsburgh,
Pennsylvania. As of June 30, 1997, the majority of the Bank's loan portfolio was
secured by properties located in this region. The Bank evaluates each customer's
credit worthiness on a case-by-case basis. Collateral held includes mortgages on
residential and  income-producing  properties.  The Bank does not believe it has
significant concentration of credit risk to any one group of borrowers given its
underwriting and collateral requirements.

In accordance  with SFAS No. 114,  "Accounting  by Creditors for Impairment of a
Loan", no loans in non-homogenous  groups were determined to be impaired for the
year  ended  or as of  June  30,  1997.  Commercial  real  estate,  multi-family
residential and participation loans are included in the non-homogenous group.

First mortgage loans which are contractually  past due ninety days or more total
approximately  $ 743,000 at June 30, 1997.  The amount the Bank will  ultimately
realize  from these loans could  differ  materially  from their  carrying  value
because of unanticipated future developments affecting the underlying collateral
or the  borrower's  ability  to repay  the  loans.  If  collection  efforts  are
unsuccessful,  these  loans will be subject to  foreclosure  proceedings  in the
ordinary  course of  business.  Management  believes  that the Bank has adequate
collateral on these loans and additional losses are not expected to occur in the
event of foreclosure.



                                       21

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



Activity in the allowance for loan losses at June 30, is summarized as follows:
<TABLE>
<CAPTION>

                                                                                       1997                   1996
                                                                                   -----------            ------------

<S>                                                                                <C>                    <C>         
      Beginning balance                                                            $    75,694            $     89,010
      Provision for loan losses                                                        136,039                  35,142
      Charge-offs                                                                       (4,091)                (58,636)
      Recoveries                                                                         1,149                  10,178
                                                                                   -----------            ------------

      Ending balance                                                               $   208,791            $     75,694
                                                                                   ===========            ============
</TABLE>


In the ordinary course of business, the Bank has and expects to continue to have
transactions,  including  borrowings,  with its officers,  directors,  and their
affiliates  (totalling $ 74,397 at June 30, 1997). In the opinion of management,
such transactions were on substantially the same terms, including interest rates
and collateral,  as those prevailing at the time of comparable transactions with
other persons and did not involve more than a normal risk of  collectibility  or
present any other unfavorable features to the Bank.

NOTE E - ACCRUED INTEREST RECEIVABLE

Accrued interest receivable consists of the following at June 30:
<TABLE>
<CAPTION>
                                                                                       1997                   1996
                                                                                   -----------            ------------
<S>                                                                                <C>                    <C>         
Loans                                                                              $   156,714            $     88,352
Investments                                                                            217,602                 187,073
                                                                                   -----------            ------------

                                                                                       374,316                 275,425
Allowance for uncollectible
   interest                                                                            (74,847)                (39,991)
                                                                                   -----------            ------------

                                                                                   $   299,469            $    235,434
                                                                                   ===========            ============
</TABLE>

NOTE F - PREMISES AND EQUIPMENT

Premises and equipment at June 30, are summarized as follows:
<TABLE>
<CAPTION>

                                                                                       1997                   1996
                                                                                   -----------            -----------
<S>                                                                                <C>                    <C>        
   Cost:
      Land                                                                         $   121,027            $   121,027
      Buildings and improvements                                                       991,989                977,976
      Furniture, fixtures, and
        equipment                                                                      394,689                370,459
                                                                                   -----------            -----------

                                                                                     1,507,705              1,469,462
      Accumulated depreciation                                                        (450,038)              (396,868)
                                                                                   -----------            -----------

                                                                                   $ 1,057,667            $ 1,072,594
                                                                                   ===========            ===========
</TABLE>
In November of 1995,  the Bank opened the South Hills  branch  office at a total
cost including equipment of approximately $ 890,000.

                                       22
<PAGE>




                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997


NOTE G - DEPOSITS

Deposits at June 30, are summarized as follows:
<TABLE>
<CAPTION>

                                                                 1997                                    1996
                                                 -------------------------------------   -------------------------------------
                                                        WEIGHTED                               WEIGHTED
                                                        AVERAGE                                 AVERAGE
                                                          RATE                AMOUNT             RATE                 AMOUNT
                                                        ---------        -------------         ---------          ------------

<S>                                                        <C>            <C>                     <C>             <C>       
NOW accounts                                                 0.00%          $1,613,841              0.00  %         $1,440,445
Passbook savings                                             3.19           10,295,942              3.18             9,998,620
                                                         --------          -----------          --------           -----------
                                                             2.76%          11,909,783              2.77  %         11,439,065
                                                         --------          -----------          --------            ----------
Certificates of deposit:
   3.00% to 3.99%                                            3.00                3,675              0.00                     0
   4.00% to 4.99%                                            4.96            1,952,445              4.62             2,150,893
   5.00% to 5.99%                                            5.42            8,797,914              5.55            11,132,426
   6.00% to 6.99%                                            6.24            4,574,096              6.63             2,664,629
   7.00% to 7.99%                                            7.09            1,167,862               7.2               769,778
                                                         --------          -----------          --------           -----------
                                                             5.71%          16,495,992              5.68%           16,717,726
                                                         --------          -----------          --------           -----------

                                                             4.47%         $28,405,775               4.5%          $28,156,791
                                                         ========          ===========          ========           ===========
</TABLE>



At June 30, 1997, the aggregate  maturities of certificates of deposit in fiscal
years 1998 through 2002 is $ 11,180,988,  $ 1,914,225,  $ 1,529,209, $ 1,017,860
and  $  853,710,   respectively.   The  aggregate   amount  of  certificates  in
denominations of $ 100,000 or more totaled $ 1,766,018.

Deposits  in excess of $ 100,000  are not  insured  by the  Savings  Association
Insurance Fund (SAIF).

At June 30,  1997,  the Bank  had  deposits  from  its  officers  and  directors
totalling $ 335,841.  

Interest  expense and accrued  interest  payable on  deposits  consisted  of the
following at June 30:
<TABLE>
<CAPTION>

                                                       ACCRUED INTEREST PAYABLE                    INTEREST EXPENSE
                                                 -------------------------------------   -------------------------------------
                                                       1997                 1996              1997                  1996
                                                 ----------------      ---------------   ---------------      ----------------

<S>                                                 <C>                  <C>                <C>                    <C>        
Passbook savings                                    $       1,561        $       1,530      $    319,945           $   328,500
Certificate accounts                                       51,068               37,500           926,503               927,767
                                                   --------------        -------------     -------------         -------------

     Total interest on deposits                      $     52,629         $     39,030        $1,246,448            $1,256,267
                                                     ============         ============       ===========           ===========
</TABLE>



                                       23

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997




NOTE H - ADVANCES FROM FEDERAL HOME LOAN BANK

At June 30,  1997,  the Bank had the  following  outstanding  advances  from the
Federal Home Loan Bank (FHLB):
<TABLE>
<CAPTION>
                                ISSUE           MATURITY        INTEREST
                                 DATE             DATE            RATE              AMOUNT
                               -------------------------------------------------------------
<S>                            <C>              <C>               <C>            <C>        
                               10/25/96         10/25/01          5.78%          $ 1,000,000
                                3/19/97         12/19/01          5.86%            1,000,000
                                3/26/97          9/26/97          5.93%            1,000,000
                                                                                 -----------

                                                                                 $ 3,000,000
                                                                                 ===========
</TABLE>


Certain  mortgage loans are pledged as collateral on the  outstanding  advances.
The Bank had no outstanding advances at June 30, 1996.


NOTE I - PENSION PLAN

The  Bank has a  qualified,  noncontributory  defined  benefit  retirement  plan
covering  substantially  all of its  employees.  The  benefits are based on each
employee's  years of service up to a maximum of 25 years, and the average of the
highest  five  consecutive  annual  salaries  excluding  the four years prior to
retirement.  The benefits are reduced by a specified percentage for each year of
participation  less  than 25  years.  An  employee  becomes  fully  vested  upon
completion of six years of qualifying service.

The  following  table sets forth the plan's  funded  status as the latest  dates
valuations were prepared:
<TABLE>
<CAPTION>
                                                                           JUNE 30,          NOVEMBER
                                                                             1997            30, 1996
                                                                          ---------          ---------

<S>                                                                       <C>                <C>      
Vested accumulated benefit obligation                                     $ 230,341          $ 254,152
Nonvested accumulated benefit obligation                                      1,280              2,750
                                                                          ---------          ---------

Accumulated benefit obligation                                              231,621            256,902
Effect of projected salary increases                                             (1)            99,981
                                                                          ---------          ---------

Projected benefit obligation                                                231,620            356,883
Fair value of plan assets                                                   315,032            277,899
                                                                          ---------          ---------

Plan assets in excess of project benefit
   obligation (unfunded projected benefit
   obligation)                                                               83,412            (78,984)
Unrecognized net (gain) loss                                                (97,685)            58,294
Unrecognized net obligation                                                   1,310              1,432
                                                                          ---------          ---------

Prepaid pension cost (pension liability)                                  $ (12,963)         $ (19,258)
                                                                          =========          =========
</TABLE>


                                       24

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997





The  following  table  represents  certain   significant   assumptions  used  in
determining the actuarial present value of the projected benefit obligations and
the net periodic pension costs at June 30, 1997 and November 30, 1996:
<TABLE>
<CAPTION>

                                                                            1997               1996
                                                                          --------           --------
<S>                                                                        <C>                 <C>  
Weighted average discount rate used to
   calculate benefit obligations                                           7.00%               7.00%
Assumed rate of future compensation
   increases                                                               4.00%               4.00%
Expected long-term rate of return of
   plan assets                                                             7.50%               7.50%
</TABLE>

Components of net pension cost are as follows:

<TABLE>
<CAPTION>

                                                                             1997               1996
                                                                          ---------          ---------

<S>                                                                       <C>                <C>      
Service cost                                                              $  27,982          $  25,447
Interest cost                                                                25,378             22,543
Actual return on plan assets                                                (11,197)           (22,232)
Net amortization on deferrals                                                (5,766)             6,639
                                                                          ---------          ---------

Net periodic pension cost                                                 $  36,397          $  32,397
                                                                          =========          =========
</TABLE>



                                       25

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997




NOTE J - INCOME TAXES

Income tax  expense  (benefit)  for the years  ended June 30, is  summarized  as
follows:
<TABLE>
<CAPTION>
                                                                             1997                1996
                                                                          ---------          -----------
<S>                                                                       <C>                <C>        
   Federal:
      Current (benefit)                                                   $  (1,935)         $   (1,838)
      Deferred                                                              (65,193)              9,812
                                                                          ---------          ----------

                                                                          $ (67,128)         $    7,974
                                                                          =========          ==========

   State:
      Current                                                             $    -             $     -
                                                                          =========          ==========

   Totals:
      Current (benefit)                                                   $  (1,935)         $   (1,838)
      Deferred                                                              (65,193)              9,812
                                                                          ---------          ----------

                                                                          $ (67,128)         $    7,974
                                                                          =========          ==========
</TABLE>


The  differences  between  actual  income tax expense  (benefit)  and the amount
computed by  applying  the  federal  statutory  income tax rate of 34% to income
before income taxes for the years ended June 30, are reconciled as follows:
<TABLE>
<CAPTION>

                                                                             1997               1996
                                                                          ---------          ----------

<S>                                                                       <C>                <C>      
Computed income tax expense (benefit)                                     $ (44,740)         $  13,197
Increase (decrease) resulting in:
   Tax-exempt income                                                         (7,271)           (15,614)
   Other, net                                                               (15,117)            10,391
                                                                          ---------          ---------

Actual income tax
   expense (benefit)                                                      $ (67,128)         $   7,974
                                                                          =========          =========

   Effective tax (benefit) rate                                               (51.0)%             20.5%
                                                                          =========          =========

</TABLE>


                                       26

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



The  components  of net deferred tax assets and  liabilities  at June 30, are as
follows:

<TABLE>
<CAPTION>

                                                                1997                    1996
                                                             ---------               ---------
<S>                                                          <C>                     <C>      
Deferred tax assets:
   Loan origination fees, net                                $   2,873               $   2,254
   Allowance for loan losses                                    61,712                  12,245
   Accrued pension expense                                       3,831                   2,408
   Net operating loss carryforward                               8,768                    -
   State net operating loss carryforward                        39,000                  16,000
   Unrealized loss on securities
      available-for-sale                                         9,124                  28,695
                                                             ---------               ---------

                                                               125,308                  61,602
                                                             ---------               ---------


Deferred tax liabilities:
   Premises and equipment                                      (12,748)                 (3,218)
   Accrued interest receivable                                 (21,134)                (31,182)
   Section 481(a) adjustment - loan fees                          -                     (2,114)
                                                             ---------               ---------

                                                               (33,882)                (36,514)
                                                             ---------               ---------

                                                                91,426                  25,088
                                                             ---------               ---------

Valuation allowance                                            (39,000)                (16,000)
                                                             ---------               ---------

Net deferred asset                                           $  52,426               $   9,088
                                                             =========               =========

</TABLE>

The Bank's  annual  addition  to its  reserve  for bad debts  allowed  under the
Internal  Revenue Code may differ  significantly  from the bad debt expense used
for  financial  statement  purposes.  Such bad debt  deductions  for  income tax
purposes  are  included  in taxable  income of later  years only if the bad debt
reserves are used for purposes  other than to absorb bad debt losses.  Since the
Bank does not  intend  to use the  reserve  for  purposes  other  than to absorb
losses,  no deferred  income taxes have been  provided on the amount of bad debt
reserves for tax purposes that arose in tax years beginning  before December 31,
1987, in accordance with SFAS No. 109. Therefore,  retained earnings at June 30,
1997 and 1996,  includes  approximately  $ 143,000,  representing  such bad debt
deductions for which no deferred income taxes have been provided.

The use of the reserve  method of  accounting  for thrift bad debt  reserves has
been repealed for the tax year  beginning  after June 30, 1996. The law provides
that all thrifts must  recapture  into taxable  income  their  post-1987  excess
reserves over a six-year period. Since the Bank has no such excess reserves,  no
provision  for income tax was needed to be recorded  for the year ended June 30,
1997.

The  Bank  has  available  Pennsylvania  net  operating  loss  carryforwards  of
approximately $ 340,000.  This carryforward can be utilized in fiscal years 1998
through 2000. The deferred tax benefit associated with this loss carryforward is
approximately $ 39,000.  This benefit has been fully reserved.


                                       27

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997






NOTE K - INTEREST AND DIVIDEND INCOME ON INVESTMENTS

Interest and dividend  income on investments  consisted of the following at June
30:
<TABLE>
<CAPTION>

                                                                      1997                   1996
                                                                  -----------             ---------

<S>                                                               <C>                     <C>      
   Taxable interest income                                        $   997,135             $ 724,332
   Nontaxable interest income                                           5,120                37,075
   Dividends                                                           19,698                19,698
                                                                  -----------             ---------

                                                                  $ 1,021,953             $ 781,105
                                                                  ===========             =========

</TABLE>


NOTE L - OTHER NONINTEREST INCOME AND EXPENSE

Other noninterest income and expense amounts are summarized as follows:
<TABLE>
<CAPTION>

                                                                            YEARS ENDED
                                                                              JUNE 30,
                                                                  ---------------------------------
                                                                     1997                    1996
                                                                  ---------               ---------
<S>                                                               <C>                     <C>      
   Service charges and other fees:
      Bank service charges and fees                               $  69,344               $  55,344
      Loan late charges                                              13,621                  16,512
      Insurance commissions                                             365                     585
                                                                  ---------               ---------

                                                                  $  83,330               $  72,441
                                                                  =========               =========

   Other noninterest expense:
      Service bureau expense                                      $  63,949               $  58,972
      FHLB bank account expense                                      44,144                  41,235
      Advertising and promotion                                      12,644                  28,284
      Loan expenses                                                  15,939                  17,266
      Real estate owned expense                                           -                   8,014
      Dues and subscriptions                                          7,019                   8,331
      ATM expense                                                    18,974                   7,478
      Professional and supervisory fees                              29,308                  31,790
      Printing, stationery, and supplies                             15,519                  19,096
      Telephone and postage                                          16,376                  15,956
      Seminars and training                                           1,037                   1,994
      Other insurance                                                16,376                  17,839
      Miscellaneous                                                   8,701                  17,701
                                                                  ---------               ---------

                                                                  $ 249,986               $ 273,956
                                                                  =========               =========
</TABLE>


                                       28

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997




NOTE M - COMMITMENTS AND CONTINGENCIES

In the normal course of business,  the Bank has various outstanding  commitments
and contingent  liabilities that are not reflected in the accompanying financial
statements. The financial commitments of the Bank are as follows:

The Bank has outstanding commitments to originate loans as follows:
<TABLE>
<CAPTION>

                                                                     1997                    1996
                                                                  ---------               ---------

<S>                                                               <C>                     <C>      
First mortgage loans                                              $ 106,000               $ 158,000
Secured consumer (unused
  lines of credit) loans                                          $ 386,000               $ 323,000

</TABLE>

The range of interest  rates on fixed rate first mortgage loan  commitments  was
8.00% to 8.25% at June 30, 1997.

NOTE N - FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

The Bank is a party to financial instruments with  off-balance-sheet risk in the
normal course of business to meet the financing  needs of its  customers.  These
financial  instruments include  commitments to extend credit.  These instruments
involve, to varying degrees, elements of credit and interest rate risk in excess
of the amounts recognized in the statements of financial condition.

The Bank's exposure to credit loss in the event of  nonperformance  by the other
party  to  the  financial  instruments  for  commitments  to  extend  credit  is
represented by the contractual  notional amount of those  instruments  (See Note
M). The Bank uses the same credit policies in making commitments and conditional
obligations as it does for on- balance-sheet instruments.

Commitments  to extend  credit are  agreements  to lend to a customer as long as
there is no violation of any condition established in the contract.  Commitments
generally  have fixed  expiration  dates or other  termination  clauses  and may
require  payment of a fee. Since many of the  commitments are expected to expire
without  being  drawn  upon,  the total  commitment  amounts do not  necessarily
represent  future  cash   requirements.   The  Bank  evaluates  each  customer's
creditworthiness  on a  case-by-case  basis.  The amount and type of  collateral
obtained,  upon extension of credit,  varies and is based on management's credit
evaluation of the counterparty.

NOTE O - DEPOSIT INSURANCE ASSESSMENT

The Bank  incurred an expense for the year ended June 30, 1997 for the  one-time
special assessment levied by the omnibus  appropriation bill to recapitalize the
SAIF insurance fund. The special  assessment for deposit insurance  premiums was
approximately  $ 161,000,  with an after tax impact of  approximately $ 108,000.
Effective January 1, 1997, the Bank began paying reduced premium  assessments in
accordance with the new SAIF assessment rates.


                                       29

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997



NOTE P - FAIR VALUES OF FINANCIAL INSTRUMENTS

The estimated fair values of the Bank's financial instruments as of June 30, are
as follows:
<TABLE>
<CAPTION>

                                                       1997                                   1996
                                        --------------------------------        -------------------------------
                                          CARRYING              FAIR              CARRYING              FAIR
                                           AMOUNT              VALUE               AMOUNT              VALUE
                                        ------------        ------------        ------------       ------------
<S>                                     <C>                 <C>                 <C>                <C>         
Financial assets:
   Cash and cash
   equivalents                          $  2,804,804        $  2,804,804        $  1,206,031       $  1,206,031

   Investment and mortgage-
     backed securities                    14,691,495          14,664,657          14,209,892         14,099,871

   Loans                                  14,590,996          14,794,171          13,628,724         14,333,010

   FHLB stock                                153,300             153,300             133,200            133,200

   Accrued interest
     receivable                              299,469             299,469             235,434            235,434

Financial liabilities:
   Deposits                               28,405,775          28,445,929          28,156,791         28,192,010

   FHLB advances                           3,000,000           3,000,000               -                   -

   Advances from borrowers
     for taxes and
     insurance                               233,818             233,818             278,488            278,488
</TABLE>

NOTE Q - REGULATORY MATTERS

The Bank is subject to various regulatory capital  requirements  administered by
its primary regulator,  The Office of Thrift Supervision (OTS).  Failure to meet
minimum  capital  requirements  can  initiate  certain  mandatory,  and possibly
additional discretionary,  actions by regulators that, if undertaken, could have
a direct  material  effect on the Bank's  financial  statements.  Under  capital
adequacy  guidelines and the regulatory  framework for prompt corrective action,
the Bank must meet specific capital guidelines that involve quantitative measure
of the  Bank's  assets,  liabilities,  and  certain  off-balance-sheet  items as
calculated under regulatory accounting practices. The Bank's capital amounts and
classification are also subject to qualitative judgments by the regulators about
components, risk weightings, and other factors.

Quantitative  measures  established  by  regulation to ensure  capital  adequacy
require  the Bank to  maintain  minimum  amounts  and  ratios  (set forth in the
following  table) of total and Tier I capital (as defined in the regulations) to
risk-weighted assets (as defined), and of Tier I capital (as defined) to average
assets (as defined).  Management  believes,  as of June 30, 1997,  that the Bank
meets all capital adequacy requirements to which it is subject.

As of June 30, 1997, the most recent  notification  from the OTS categorized the
Bank as "well  capitalized".  To be categorized as "well  capitalized"  the Bank
must maintain minimum total risk-based,  Tier I risk-based,  and Tier I leverage
ratios as set forth in the table.  There are no  conditions or events since that
notification that management believes have changed the institution's category.

                                       30

<PAGE>



                          WORKINGMENS SAVINGS BANK, FSB
                          NOTES TO FINANCIAL STATEMENTS
                                  June 30, 1997
<TABLE>
<CAPTION>

                                                                                   FOR CAPITAL                TO BE WELL
                                                      ACTUAL                   ADEQUACY PURPOSES:             CAPITALIZED
                                           -------------------------       ------------------------- ---------------------------
                                            AMOUNT            RATIO          AMOUNT           RATIO       AMOUNT         RATIO
                                           ---------         -------       ---------          ------ ----------------  ---------

<S>                                        <C>                <C>          <C>                 <C>    <C>                 <C>  
As of June 30, 1997

  Total Risk-Based Capital
     (to Risk-Weighted Assets)             2,240,315          15.88        1,128,480           8.00   1,410,600           10.00

  Tier I Capital
     (to Risk-Weighted Assets)             2,063,990          14.63          564,240           4.00     846,360            6.00

  Tier I Capital
     (to Adjusted Total Assets)            2,063,990           6.11        1,351,886           4.00   1,689,833            5.00

  Tangible Capital
     (to Adjusted Total Assets)            2,063,990           6.11          506,950           1.50     506,950            1.50

As of June 30, 1996

  Total Risk-Based Capital
     (to Risk-Weighted Assets)             2,204,144          17.26        1,021,360           8.00   1,276,700           10.00

  Tier I Capital
     (to Risk-Weighted Assets)             2,128,450          16.67          510,680           4.00     766,020            6.00

  Tier I Capital
     (to Adjusted Total Assets)            2,128,450           6.96        1,223,275           4.00   1,529,094            5.00

  Tangible Capital
     (to Adjusted Total Assets)            2,128,450           6.96          458,728           1.50     458,728            1.50
</TABLE>

Under the framework,  the Association's  capital levels do not allow the Bank to
accept brokered deposits without prior approval from regulators.

                                       31

<PAGE>



                 WORKINGMENS SAVINGS BANK, F.S.B. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  June 30, 1997





NOTE R - SUBSEQUENT EVENT - CONVERSION

On August 27, 1997, the Bank converted from a federally-chartered mutual savings
bank to a federally-chartered stock savings bank. As part of the conversion, the
Bank became and was renamed  Workingmens  Bank, a wholly owned subsidiary of WSB
Holding  Company which was formed in June 1997. WSB Holding  Company offered and
sold to various parties in a subscription  offering 330,600 shares of its common
stock. Net proceeds from the stock offering was approximately $ 3,000,000.


NOTE S - PREVIOUSLY ISSUED FINANCIAL STATEMENTS

Subsequent  to the  issuance of the Bank's June 30, 1996  financial  statements,
management became aware that the Bank's defined benefit pension plan expense was
understated.  This  understatement  was due to the  Bank's  method of  recording
pension expense without the use of a current  actuarial  valuation in accordance
with SFAS No. 87.

The effect on net  income of  adjustments  to the  previously  issued  financial
statements for the year ending June 30, 1996 is, as follows:
<TABLE>
<CAPTION>

<S>                                                                                              <C>     
      Net income as previously reported                                                          $ 34,651
      Adjustments:
         Pension expense                                                                           (6,217)
         Income tax expense                                                                         2,408
                                                                                                 --------

             Net income as restated                                                              $ 30,842
                                                                                                 ========
</TABLE>



                                       32

<PAGE>



Item 8.          Changes in and Disagreements with Accountants on Accounting and
                 Financial Disclosure.
--------------------------------------------------------------------------------

         Not applicable.


                                    PART III

Item 9.          Directors, Executive Officers, Promoters and Control Persons: 
                 Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------------------------------------

         Section  16(a) of the 1934 Act  requires  the  Company's  officers  and
directors,  and persons who own more than ten  percent of the Common  Stock,  to
file reports of ownership and changes in ownership of the Common Stock, on Forms
3, 4 and 5, with the Securities and Exchange  Commission  ("SEC") and to provide
copies of those Forms 3, 4 and 5 to the Company. The Company is not aware of any
beneficial  owner of more than ten  percent  of its Common  Stock.  Based upon a
review  of the  copies  of  the  forms  furnished  to the  Company,  or  written
representations  from certain  reporting  persons that no Forms 5 were required,
the Company  believes that all Section 16(a) filing  requirements  applicable to
its officers and directors were complied with during the 1997 fiscal year.

Item 10.          Executive Compensation
----------------------------------------

         The  following  table  sets  forth the cash and  non-cash  compensation
awarded to or earned by the chief executive officer.  No other executive officer
of either the Bank or the Company had a salary and bonus  during the years ended
June 30,  1997 and 1996 that  exceeded  $100,000  for  services  rendered in all
capacities to the Bank or the Company.

                                               Annual Compensation
                                               -------------------
<TABLE>
<CAPTION>

Name and                     Fiscal                                       Other Annual
Principal Position            Year         Salary         Bonus          Compensation(1)
------------------            ----         ------         -----          ---------------

<S>                           <C>         <C>            <C>                 <C>   
Robert Neudorfer              1997        $61,000        $4,000              $   --
President                     1996         61,000         2,750                  --

</TABLE>

1)   Aggregate  value  does not  exceed  the  lesser  of  $50,000  or 10% of Mr.
     Neudorfer's salary.


                                       33

<PAGE>



Item 11.          Security Ownership of Certain Beneficial Owners and Management
                  as of August 27, 1997
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                                                    Percent of Shares of
                                                                      Amount and Nature of              Common Stock
Name and Address of Beneficial Owner                                  Beneficial Ownership              Outstanding
------------------------------------                                  --------------------              -----------
<S>                                                                           <C>                         <C> 
Workingmens Bank
Employee Stock Ownership Plan ("ESOP")
807 Middle St.
Pittsburgh, Pennsylvania 15212 (1)                                            26,448                        8.0%

Jeffrey L. Gendell
Tontine Partners, L.P.
31 West 52nd Street, 17th Floor
New York, New York 10019 (2)                                                  33,050                        9.9%

All directors and officers of the Company as a group (7                       70,894                       21.4%
persons) (3)
</TABLE>

 -------------------------------------
(1)      The ESOP  purchased  such  shares  for the  exclusive  benefit  of plan
         participants  with funds  borrowed  from the Company.  These shares are
         held  in  a  suspense   account  and  will  be  allocated   among  ESOP
         participants  annually on the basis of compensation as the ESOP debt is
         repaid. The ESOP Committee consisting of certain non-employee directors
         or the Board  instructs the ESOP Trustee  regarding  investment of ESOP
         plan  assets.  The ESOP  Trustee  must  vote all  shares  allocated  to
         participant  accounts  under  the  ESOP as  directed  by  participants.
         Unallocated  shares and shares for which no timely voting  direction is
         received,  will be voted by the ESOP  Trustee as  directed  by the ESOP
         Committee.

(2)      Based  upon a Schedule  13D filed  with  the  Securities  and  Exchange
         Commission,  dated  September  2, 1997, for  which  shared  voting  and
         and dispositive power is shown with respect to 33,050 shares.

(3)      Includes  shares of Common Stock held directly as well as by spouses or
         minor  children,  in trust and other  indirect  ownership,  over  which
         shares the individuals  effectively exercise sole voting and investment
         power, unless otherwise  indicated.  Excludes 26,448 shares held by the
         ESOP over which  certain  non-employee  directors,  as  trustees to the
         ESOP,  exercise shared voting and investment  power.  Such  individuals
         disclaim  beneficial  ownership with respect to such shares held by the
         ESOP.


                                       34

<PAGE>



Item 12.          Certain Relationships and Related Transactions
----------------------------------------------------------------

         The Bank,  like many financial  institutions,  has followed a policy of
granting various types of loans to officers, directors, and employees. The loans
have been made in the ordinary course of business and on substantially  the same
terms, including interest rates and collateral,  as those prevailing at the time
for comparable transactions with the Bank's other customers,  and do not involve
more than the  normal  risk of  collectibility,  or  present  other  unfavorable
features.


Item 13.          Exhibits, List, and Reports on Form 8-K
---------------------------------------------------------


          (a)(3) List of Exhibits:

          3(i)   Restated Articles of Incorporation of WSB Holding Company *
          3(ii)  Bylaws of WSB Holding Company **
           4     Specimen Stock Certificate **
          10     Employment Agreement between the Bank and Robert Neudorfer **
          21     Subsidiaries of the Registrant (See "General")
          27     Financial Data Schedule (electronic filing only)

----------------------------
*    Incorporated  by  reference  to the Form 8A  (File  No.  0-22997)  declared
     effective by the SEC on August 21, 1997.

**   Incorporated by reference to the registration  statement on Form SB-2 (File
     No. 333- 29389) declared effective by the SEC on July 15, 1997.

     (b)  Not applicable.



                                       35

<PAGE>


                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its  behalf  by  the  undersigned, thereunto duly authorized as of September 26,
1997.

                             WSB HOLDING COMPANY



                             By: /s/Robert Neudorfer
                                 -----------------------------------------------
                                 Robert Neudorfer
                                 President, Chief Executive Officer and Director
                                 (Duly Authorized Representative)


         Pursuant to the  requirement  of the  Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
registrant and in the capacities indicated as of September 26, 1997.

/s/Robert Neudorfer                               /s/Joseph J. Manfred
-----------------------------------------------   ------------------------------
Robert Neudorfer                                  Joseph J. Manfred
President, Chief Executive Officer and Director   Chairman of the Board
(Principal Executive and Financial Officer)

/s/Ronald W. Moreschi                             /s/Stanford H. Rosenberg
-----------------------------------------------   ------------------------------
Ronald W. Moreschi                                Stanford H. Rosenberg
Treasurer and Chief Financial Officer             Vice President and Director
(Principal Accounting Officer)

/s/John P. Mueller                                /s/Johanna C. Guehl
-----------------------------------------------   ------------------------------
John P. Mueller                                   Johanna C. Guehl
Director                                          Director

/s/John T. Ringland
-----------------------------------------------   
John T. Ringland
Director