SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF

                       THE SECURITIES EXCHANGE ACT OF 1934


        For the Quarter Ended March 31, 2001 Commission File No. 1-12811
                                 --------------


                            U.S.B. HOLDING CO., INC.
                            ------------------------
             (Exact name of registrant as specified in its charter)

           DELAWARE                                              36-3197969
           --------                                              ----------
(State or other jurisdiction of                               (I.R.S. Employer
 incorporation or organization)                              Identification No.)


                 100 DUTCH HILL ROAD, ORANGEBURG, NEW YORK 10962
                 -----------------------------------------------
              (Address of principal executive office with zip code)


                                  845-365-4600
                                  ------------
               (Registrant's telephone number including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months and (2) has been subject to such filing requirements for
the past 90 days.

                                YES  X    NO
                                    ---      ---

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

                  CLASS                     OUTSTANDING AT MAY 3, 2001
                  -----                     --------------------------
         Common stock, par value                    16,721,198
             $0.01 per share



<PAGE>

                            U.S.B. HOLDING CO., INC.

                                TABLE OF CONTENTS

                                                                        PAGE NO.
                                                                        --------
PART I.  FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS

          CONDENSED CONSOLIDATED STATEMENTS OF
          CONDITION AS OF MARCH 31, 2001 AND
          DECEMBER 31, 2000 (UNAUDITED)                                   1

          CONDENSED CONSOLIDATED STATEMENTS OF
          INCOME FOR THE THREE MONTHS ENDED
          MARCH 31, 2001 AND 2000 (UNAUDITED)                             2

          CONDENSED CONSOLIDATED STATEMENTS OF
          CASH FLOWS FOR THE THREE MONTHS ENDED
          MARCH 31, 2001 AND 2000 (UNAUDITED)                             3

          CONDENSED CONSOLIDATED STATEMENTS OF
          CHANGES IN STOCKHOLDERS' EQUITY FOR
          THE THREE MONTHS ENDED MARCH 31, 2001
          AND 2000 (UNAUDITED)                                            5

          NOTES TO CONDENSED CONSOLIDATED FINANCIAL
          STATEMENTS (UNAUDITED)                                          7

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS                  16

ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES
          ABOUT MARKET RISK                                              23

PART II.  OTHER INFORMATION AND SIGNATURES

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K                               24




                                      - i -

<PAGE>

ITEM 1.  PART I - FINANCIAL INFORMATION

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                   MARCH 31,            DECEMBER 31,
                                                                                                      2001                 2000
                                                                                                  -----------           -----------
                                                                                                     (000'S, EXCEPT SHARE DATA)
<S>                                                                                               <C>                   <C>
ASSETS
Cash and due from banks                                                                           $    34,337           $    37,691
Federal funds sold                                                                                     36,500                37,200
                                                                                                  -----------           -----------
Cash and cash equivalents                                                                              70,837                74,891
Interest bearing deposits in other banks                                                                  212                    21
Securities:
    Available for sale (at estimated fair value)                                                      489,711               426,909
    Held to maturity (estimated fair value of
       $162,265 in 2001 and $225,088 in 2000)                                                         160,659               225,590
Loans, net of allowance for loan losses of
    $11,446 in 2001 and $11,338 in 2000                                                             1,068,614             1,075,443
Premises and equipment, net                                                                            11,962                11,999
Accrued interest receivable                                                                            12,783                14,042
Other real estate owned (OREO)                                                                             34                    34
Federal Home Loan Bank of New York stock                                                               34,139                34,139
Other assets                                                                                           22,901                23,197
                                                                                                  -----------           -----------
TOTAL ASSETS                                                                                      $ 1,871,852           $ 1,886,265
                                                                                                  ===========           ===========
LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:
Non-interest bearing deposits                                                                     $   179,607           $   189,417
Interest bearing deposits:
    NOW accounts                                                                                       75,634                85,761
    Money market accounts                                                                              68,832                69,924
    Savings deposits                                                                                  404,550               380,539
    Time deposits                                                                                     709,538               763,846
                                                                                                  -----------           -----------
TOTAL DEPOSITS                                                                                      1,438,161             1,489,487
Accrued interest payable                                                                                6,389                 7,710
Accrued expenses and other liabilities                                                                 12,021                 7,815
Securities sold under agreements to repurchase                                                        225,023               225,514
Federal Home Loan Bank of New York advances                                                            46,718                17,730
                                                                                                  -----------           -----------
TOTAL                                                                                               1,728,312             1,748,256
Corporation-Obligated mandatory redeemable capital
     securities of subsidiary trust                                                                    20,000                20,000
Minority interest-junior preferred stock of consolidated subsidiary                                       132                   132
Commitments and contingencies (Note 11)

STOCKHOLDERS' EQUITY:
    Common stock, $0.01 par value; authorized shares 50,000,000;
     issued shares of 17,690,785 in 2001 and 17,464,455 in 2000                                           177                   175
    Additional paid-in capital                                                                        113,300               111,942
    Retained earnings                                                                                  20,850                17,116
    Treasury stock at cost; 983,712 common shares in 2001 and
       873,344 in 2000                                                                                (12,470)              (11,158)
    Common stock held for benefit plans                                                                (1,563)               (1,431)
    Deferred compensation obligation                                                                    1,030                   856
    Accumulated other comprehensive income                                                              2,084                   377
                                                                                                  -----------           -----------
TOTAL STOCKHOLDERS' EQUITY                                                                            123,408               117,877
                                                                                                  -----------           -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                        $ 1,871,852           $ 1,886,265
                                                                                                  ===========           ===========
</TABLE>

See notes to condensed consolidated financial statements.


                                       1
<PAGE>

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                            THREE MONTHS ENDED
                                                                                                                 MARCH 31,
                                                                                                        2001                  2000
                                                                                                       -------               -------
                                                                                                         (000'S, EXCEPT SHARE DATA)
<S>                                                                                                    <C>                   <C>
INTEREST INCOME:
Interest and fees on loans                                                                             $22,401               $19,915
Interest on federal funds sold                                                                             607                   345
Interest and dividends on securities:
         Mortgage-backed securities                                                                      6,229                 6,479
         U.S. Treasury and government agencies                                                           3,641                 3,259
         Obligations of states and political subdivisions                                                  810                   757
         Corporate securities and other                                                                     10                     7
Interest on deposits in other banks                                                                         --                     2
Dividends on Federal Home Loan Bank of New York stock                                                      628                   573
                                                                                                       -------               -------
TOTAL INTEREST INCOME                                                                                   34,326                31,337
                                                                                                       -------               -------

INTEREST EXPENSE:
Interest on deposits                                                                                    15,814                11,079
Interest on borrowings                                                                                   3,560                 4,883
Interest on Corporation - Obligated mandatory redeemable
         capital securities of subsidiary trust                                                            488                   488
                                                                                                       -------               -------
TOTAL INTEREST EXPENSE                                                                                  19,862                16,450
                                                                                                       -------               -------

NET INTEREST INCOME                                                                                     14,464                14,887
Provision for loan losses                                                                                  200                   450
                                                                                                       -------               -------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                                                     14,264                14,437
                                                                                                       -------               -------

NON-INTEREST INCOME:
Service charges and fees                                                                                   838                   897
Other income                                                                                               544                   392
Gains on securities transactions - net                                                                     682                    --
                                                                                                       -------               -------
TOTAL NON-INTEREST INCOME                                                                                2,064                 1,289
                                                                                                       -------               -------

NON-INTEREST EXPENSES:
Salaries and employee benefits                                                                           5,046                 4,696
Occupancy and equipment expense                                                                          1,543                 1,478
Advertising and business development                                                                       354                   387
Professional fees                                                                                          183                   270
Communications                                                                                             262                   246
Stationery and printing                                                                                    223                   190
FDIC insurance                                                                                              70                    60
Amortization of intangibles                                                                                226                     3
Other expenses                                                                                             685                   611
                                                                                                       -------               -------
TOTAL NON-INTEREST EXPENSES                                                                              8,592                 7,941
                                                                                                       -------               -------
Income before income taxes                                                                               7,736                 7,785
Provision for income taxes                                                                               2,665                 2,725
                                                                                                       -------               -------
NET INCOME                                                                                             $ 5,071               $ 5,060
                                                                                                       =======               =======

BASIC EARNINGS PER COMMON SHARE                                                                        $  0.31               $  0.31
                                                                                                       =======               =======

DILUTED EARNINGS PER COMMON SHARE                                                                      $  0.30               $  0.29
                                                                                                       =======               =======
</TABLE>

See notes to condensed consolidated financial statements.


                                       2
<PAGE>

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                                           THREE MONTHS ENDED
                                                                                                                MARCH 31,
                                                                                                        2001                 2000
                                                                                                      ---------           ---------
                                                                                                                 (000'S)
<S>                                                                                                   <C>                 <C>
OPERATING ACTIVITIES:
Net income                                                                                            $   5,071           $   5,060
Adjustments to reconcile net income to net cash
   provided by operating activities:
   Provision for loan losses                                                                                200                 450
   Depreciation and amortization                                                                            711                 507
   Amortization of premiums on securities - net                                                             285                 247
   Noncash benefit plan expense                                                                              61                  69
   Deferred income tax provision (benefit) - net                                                          2,396                (154)
   Gains on securities transactions - net                                                                  (682)                 --
Decrease (increase) in accrued interest receivable                                                        1,259              (1,589)
Decrease in accrued interest payable                                                                     (1,321)               (229)
Other - net                                                                                                 651               1,104
                                                                                                      ---------           ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES                                                                 8,631               5,465
                                                                                                      =========           =========
INVESTING ACTIVITIES:
Proceeds from sales of securities available for sale                                                    141,535                  94
Proceeds from principal paydowns, redemptions and maturities of:
   Securities available for sale                                                                         12,785               7,577
   Securities held to maturity                                                                           56,350               1,590
Purchases of securities available for sale                                                             (204,188)            (34,621)
Purchases of securities held to maturity                                                                 (1,020)            (10,315)
Net increase in interest bearing deposits in other banks                                                   (191)                (52)
Decrease (increase) in loans outstanding                                                                  6,629             (32,943)
Purchases of premises and equipment - net                                                                  (448)               (906)
                                                                                                      ---------           ---------
NET CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES                                                     11,452             (69,576)
                                                                                                      ---------           ---------
FINANCING ACTIVITIES:
Net increase (decrease) in non-interest bearing deposits,
   NOW, money market and savings accounts                                                                 2,982             (24,370)
(Decrease) increase in time deposits, net of withdrawals and maturities                                 (54,308)            121,840
Net decrease in securities sold under agreements
   to repurchase -  short-term                                                                             (491)            (30,000)
Net decrease in Federal Home Loan Bank of New York
   advances - short-term                                                                                     --              (6,355)
Repayment of securities sold under agreements to
   repurchase - long-term                                                                                    --             (10,000)
Proceeds from Federal Home Loan Bank of New York
   advances - long-term                                                                                  30,000                  --
Repayment of Federal Home Loan Bank of New York
    advances - long-term                                                                                 (1,012)               (957)
Cash dividends paid                                                                                      (1,337)             (1,091)
Proceeds from redemption of junior preferred stock of
    consolidated subsidiary, net                                                                             --                  (1)
Proceeds from issuance of common stock and related tax benefit
    of stock options                                                                                      1,341                 183
Purchases of treasury stock                                                                              (1,312)             (2,302)
                                                                                                      ---------           ---------
NET CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES                                                  $ (24,137)          $  46,947
                                                                                                      ---------           ---------
<FN>
         (Continued)
</FN>
</TABLE>


                                       3
<PAGE>

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (CONT'D)

<TABLE>
<CAPTION>
                                                                                                            THREE MONTHS ENDED
                                                                                                                 MARCH 31,
                                                                                                          2001               2000
                                                                                                        --------           --------
                                                                                                                  (000'S)
<S>                                                                                                     <C>                <C>
DECREASE IN CASH AND CASH EQUIVALENTS                                                                   $ (4,054)          $(17,164)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                            74,891             68,311
                                                                                                        --------           --------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                                                $ 70,837           $ 51,147
                                                                                                        ========           ========

Supplemental Disclosures:
   Interest paid                                                                                        $ 21,183           $ 16,679
                                                                                                        --------           --------
   Income tax payments                                                                                  $     30           $  1,367
                                                                                                        --------           --------
   Transfer of held to maturity securities to available for sale securities                             $  9,592           $     --
                                                                                                        --------           --------
   Change in shares held in trust for deferred compensation                                             $   (174)          $    (62)
                                                                                                        --------           --------
   Change in deferred compensation obligation                                                           $    174           $     62
                                                                                                        --------           --------
   Change in accumulated other comprehensive income (loss)                                              $  1,707           $   (531)
                                                                                                        --------           --------
</TABLE>


See notes to condensed consolidated financial statements.



                                       4
<PAGE>

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED)

                    FOR THE THREE MONTHS ENDED MARCH 31, 2001
                           (000'S, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                                                 COMMON
                                                                                  STOCK                  ACCUMULATED
                                COMMON STOCK     ADDITIONAL                     HELD FOR    DEFERRED        OTHER          TOTAL
                               SHARES      PAR    PAID-IN   RETAINED   TREASURY  BENEFIT  COMPENSATION  COMPREHENSIVE  STOCKHOLDERS'
                             OUTSTANDING  VALUE   CAPITAL   EARNINGS    STOCK     PLANS    OBLIGATION      INCOME         EQUITY
                             -----------  -----   -------   --------    -----     -----    ----------      ------         ------
<S>                          <C>          <C>    <C>        <C>       <C>        <C>         <C>           <C>           <C>
Balance at January 1, 2001   16,591,111   $175   $111,942   $17,116   $(11,158)  $(1,431)    $  856        $  377        $117,877

Net income                                                    5,071                                                         5,071

Other comprehensive income:
   Net unrealized securities
     gains arising during
     the period, net of
     taxes of $1,754                                                                                        2,438           2,438
   Reclassification
     adjustment of net gains
     for securities sold,
     net of taxes of $526                                                                                    (731)           (731)
                                                                                                           ------        --------
   Other comprehensive income                                                                               1,707           1,707
                                                                                                                         --------
Total comprehensive income                                                                                                  6,778

Cash dividends:
   Common ($0.08 per share)                                  (1,337)                                                       (1,337)

Common stock options
   exercised and related
   tax benefit                  226,330      2      1,339                                                                   1,341

Purchases of treasury stock    (110,368)                                (1,312)                                            (1,312)

Amortization of RRP awards                                                             9                                        9

ESOP shares committed to
   be released                                         19                             33                                       52

Deferred compensation
   obligation                                                                       (174)       174                            --
                             ----------   ----   --------   -------   --------   -------     ------        ------        --------

BALANCE AT MARCH 31, 2001    16,707,073   $177   $113,300   $20,850   $(12,470)  $(1,563)    $1,030        $2,084        $123,408
                             ==========   ====   ========   =======   ========   =======     ======        ======        ========
</TABLE>


See notes to condensed consolidated financial statements.


                                       5
<PAGE>

U.S.B. HOLDING CO., INC.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES  IN STOCKHOLDERS' EQUITY (UNAUDITED)

                    FOR THE THREE MONTHS ENDED MARCH 31, 2000
                           (000'S, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
                                                                                 COMMON
                                                                                  STOCK                  ACCUMULATED
                                COMMON STOCK     ADDITIONAL                     HELD FOR    DEFERRED        OTHER          TOTAL
                               SHARES      PAR    PAID-IN   RETAINED   TREASURY  BENEFIT  COMPENSATION  COMPREHENSIVE  STOCKHOLDERS'
                             OUTSTANDING  VALUE   CAPITAL   EARNINGS    STOCK     PLANS    OBLIGATION      INCOME         EQUITY
                             -----------  -----   -------   --------    -----     -----    ----------      ------         ------
<S>                          <C>          <C>    <C>        <C>       <C>        <C>         <C>           <C>           <C>
Balance at  January 1, 2000  15,884,273   $164   $ 98,926   $13,875   $ (6,464)  $(1,490)    $  748       $(9,348)       $ 96,411

Net income                                                    5,060                                                         5,060

Other comprehensive loss:
   Net unrealized securities
   loss arising during the
   period, net of taxes of $382                                                                              (531)           (531)
                                                                                                          -------        --------
   Other comprehensive loss                                                                                  (531)           (531)
                                                                                                                         --------
Total comprehensive income                                                                                                  4,529

Cash dividends:
   Common ($0.07 per share)                                  (1,091)                                                       (1,091)

Common stock options exercised
   and related tax benefit       26,420               183                                                                     183

Purchases of treasury stock    (155,554)                                (2,302)                                            (2,302)

Amortization of RRP awards                                                            10                                       10

ESOP shares committed to
   be released                                         27                             32                                       59

Deferred compensation obligation                                                     (62)        62                            --
                             ----------   ----   --------   -------   --------   -------     ------       -------        --------

BALANCE AT MARCH 31, 2000    15,755,139   $164   $ 99,136   $17,844   $ (8,766)  $(1,510)    $  810       $(9,879)       $ 97,799
                             ==========   ====   ========   =======   ========   =======     ======       =======        ========
</TABLE>

See notes to condensed consolidated financial statements.



                                       6
<PAGE>

U.S.B HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.       PRINCIPLES OF CONSOLIDATION

         The condensed consolidated financial statements include the accounts of
         U.S.B. Holding Co., Inc. and its wholly-owned subsidiaries (the
         "Company"), Union State Bank (the "Bank") [including its wholly-owned
         subsidiaries, Dutch Hill Realty Corp., U.S.B. Financial Services, Inc,
         and TPNZ Preferred Funding Corporation ("TPNZ")], Union State Capital
         Trust I and Ad Con, Inc. All significant intercompany accounts and
         transactions are eliminated in consolidation.

2.       ACQUISITION OF LA JOLLA BANK BRANCHES

         On December 1, 2000, the Bank completed the acquisition of the
         Stamford, Connecticut, and Manhattan, New York City, branches of La
         Jolla Bank ("La Jolla"). The two branches acquired had approximately
         $108.6 million in deposits that were assumed by the Bank. The Bank paid
         a premium of $7.1 million for the deposits assumed, which was recorded
         as an intangible asset. The premium is being amortized on a
         straight-line basis over an eight year period, which is the estimated
         average life of the core deposits assumed in the transaction. The Bank
         also acquired premises and equipment for $0.2 million and certain other
         assets totaling $0.1 million, and leased the branch offices from a
         related party of La Jolla. La Jolla retained its loan portfolio and
         lending operations in the New York area. Upon completion of the
         transaction, both branches began operating as Bank branches.

3.       BASIS OF PRESENTATION

         In the opinion of management, the accompanying unaudited interim
         condensed consolidated financial statements include all adjustments
         (comprising of only normal recurring accruals) necessary to present
         fairly the financial position of the Company as of March 31, 2001, and
         its operations, cash flows and changes in stockholders' equity for the
         three months ended March 31, 2001 and 2000. A summary of the Company's
         significant accounting policies is set forth in Note 4 to the
         consolidated financial statements included in the Company's 2000 Annual
         Report to Stockholders.

         The condensed consolidated financial statements have been prepared in
         accordance with accounting principles generally accepted in the United
         States of America and predominant practices used within the banking
         industry. In preparing such financial statements, management is
         required to make estimates and assumptions that affect the reported
         amounts of actual and contingent assets and liabilities as of the dates
         of the condensed consolidated statements of condition and the revenues
         and expenses for the periods reported. Actual results could differ
         significantly from those estimates.

         Estimates that are particularly susceptible to significant change
         relate to the determination of the allowance for loan losses and the
         valuation of other real



                                       7
<PAGE>

U.S.B. HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT'D)

         estate acquired in connection with foreclosures ("OREO") or in
         satisfaction of loan receivables. In connection with the determination
         of the allowance for loan losses and OREO, management obtains
         independent appraisals for significant properties.

4.       RECLASSIFICATIONS

         Certain reclassifications have been made to prior period accounts to
         conform to the current period's presentation.

5.       ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

         In June 1998, the Financial Accounting Standards Board ("FASB") issued
         Statement of Financial Accounting Standards ("SFAS") No. 133,
         "Accounting for Derivative Instruments and Hedging Activities," as
         amended in June 1999 by SFAS No. 137, "Accounting for Derivative
         Instruments and Hedging Activities -- Deferral of the Effective Date of
         FASB Statement No. 133" and SFAS No. 138, "Accounting for Derivative
         Instruments and Hedging Activities, an Amendment of FASB Statement No.
         133 (collectively, "SFAS No. 133"). SFAS No. 133 establishes accounting
         and reporting standards for derivative instruments and hedging
         activities. It requires that all derivatives be recognized in the
         statement of condition, either as assets or as liabilities, and be
         measured at fair value. This statement requires that changes in a
         derivative's fair value be recognized in current earnings unless
         specific hedge accounting criteria are met. Hedge accounting for
         qualifying hedges permits changes in fair value of derivatives to be
         either offset against the changes in fair value of the hedged item
         through earnings or recognized in other comprehensive income until the
         hedged item is recognized in earnings. An entity that elects to apply
         hedge accounting is required to establish at the inception of the hedge
         the method it will use for assessing the effectiveness of the hedging
         derivative and the measurement approach for determining the ineffective
         aspect of the hedge. Those methods must be consistent with the entity's
         approach to managing risk.

         The Company adopted SFAS No. 133 on January 1, 2001. The Company was
         not required to record a transition adjustment upon adoption of this
         statement because no derivative financial instruments were outstanding
         as of that date.

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

         In September 2000, the FASB issued SFAS No. 140, "Accounting for
         Transfers and Servicing of Financial Assets and Extinguishments of
         Liabilities," ("SFAS No. 140") replacing SFAS No. 125. SFAS No. 140
         provides consistent application of a financial-components approach that
         recognizes the financial and servicing assets it controls and the
         liabilities it has incurred, derecognizes financial assets when control
         has been surrendered and derecognizes liabilities when extinguished.
         SFAS No. 140 provides consistent guidelines for distinguishing
         transfers of financial assets that are sales from transfers that are
         secured borrowings. SFAS No. 140 is effective for transfers, servicing,
         or extinguishments occurring after March 31, 2001, except for certain
         provisions relating to the accounting and disclosure for secured
         borrowings and collateral for



                                       8
<PAGE>

U.S.B. HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT'D)


         which the effective date was December 15, 2000. The adoption of the
         effective provisions of this statement as of December 15, 2000 and the
         remaining provisions effective as of April 1, 2001 did not have a
         material impact on the Company's consolidated financial statements.

7.       EARNINGS PER COMMON SHARE ("EPS")

         The Company computes EPS based upon the provisions of SFAS No. 128,
         "Earnings per Share" ("SFAS No. 128"). SFAS No. 128 establishes
         standards for computing and presenting "Basic" and "Diluted" EPS. Basic
         EPS excludes dilution and is computed by dividing net income available
         to common stockholders (net income after preferred stock dividend
         requirements) by the weighted-average number of common shares
         outstanding for the period. Diluted EPS reflects the potential dilution
         that could occur if securities or other contracts to issue common stock
         were exercised or converted into common stock or resulted in the
         issuance of common stock that would then share in the earnings of the
         entity, reduced by common stock that could be repurchased by the
         Company with the assumed proceeds of such exercise or conversion.
         Diluted EPS is based on net income available to common stockholders
         divided by the weighted average number of common shares outstanding and
         common equivalent shares ("adjusted weighted average shares"). Stock
         options granted, but not yet exercised under the Company's stock option
         plans and restricted stock issued under the Company's recognition and
         retention stock plans but not yet vested, are considered common stock
         equivalents for Diluted EPS calculations.

<TABLE>
<CAPTION>
                                                                                                 THREE MONTHS ENDED
                                                                                                       MARCH 31,
                                                                                               2001                 2000
                                                                                            -----------         -----------
                                                                                               (000's, except share data)
<S>                                                                                         <C>                 <C>
         NUMERATOR:
           Net income for basic and diluted earnings per
                 common share - net income available to
                 common stockholders                                                        $     5,071         $     5,060
                                                                                            ===========         ===========

         DENOMINATOR:
          Denominator for basic earnings per common share -
              weighted average shares                                                        16,549,499          16,570,436
          Effects of dilutive securities:
              Director and employee stock options                                               405,243             637,280
              Restricted stock not vested                                                         2,701               3,577
                                                                                            -----------         -----------
           Total effects of dilutive securities                                                 407,944             640,857
                                                                                            -----------         -----------
               Denominator for diluted earnings per common share -
               adjusted weighted average shares                                              16,957,443          17,211,293
                                                                                            ===========         ===========

         Basic earnings per common share                                                    $      0.31         $      0.31
                                                                                            ===========         ===========
         Diluted earnings per common share                                                  $      0.30         $      0.29
                                                                                            ===========         ===========
</TABLE>




                                       9
<PAGE>

U.S.B. HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT'D)


8.       SECURITIES

         In accordance with SFAS No. 115 "Accounting for Certain Investments in
         Debt and Equity Securities," the Company's investment policies include
         a determination of the appropriate classification of securities at the
         time of purchase. Securities that may be sold as part of the Company's
         asset/liability or liquidity management, or in response to or in
         anticipation of changes in interest rates and resulting prepayment
         risk, or for similar factors, are classified as available for sale.
         Securities that the Company has the ability and positive intent to hold
         to maturity are classified as held to maturity and carried at amortized
         cost. Realized gains and losses on the sales of all securities,
         determined by using the specific identification method, are reported in
         earnings. Securities available for sale are shown in the Consolidated
         Statements of Condition at estimated fair value and the resulting net
         unrealized gains and losses, net of tax, are shown in accumulated other
         comprehensive income.

         The decision to sell available for sale securities is based on
         management's assessment of changes in economic or financial market
         conditions, interest rate risk, and the Company's financial position
         and liquidity. Estimated fair values for securities are based on quoted
         market prices, where available. If quoted market prices are not
         available, estimated fair values are based on quoted market prices of
         comparable instruments. The Company does not acquire securities for the
         purpose of engaging in trading activities.

         For the three month period ended March 31, 2001, the Company had gross
         gains and losses of $685,000 and $3,000, respectively, on sales of
         securities. The Company did not sell any securities in the three month
         period ended March 31, 2000.




                                       10
<PAGE>

U.S.B. HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT'D)


        Upon adoption of SFAS No. 133 on January 1, 2001, the Company classified
        certain held to maturity securities with a carrying value and fair value
        of approximately $9.6 million to available for sale securities. There
        was no effect on accumulated other comprehensive income as a result of
        the reclassification.

        A summary of the amortized cost, estimated fair values, and related
        gross unrealized gains and losses of securities at March 31, 2001 and
        December 31, 2000 is as follows:



<TABLE>
<CAPTION>
                                                                                    GROSS           GROSS         ESTIMATED
                                                                  AMORTIZED       UNREALIZED      UNREALIZED         FAIR
         MARCH 31, 2001:                                             COST           GAINS           LOSSES           VALUE
                                                                   --------        --------        --------        --------
                                                                                            (000'S)
<S>                                                                <C>             <C>             <C>             <C>
         AVAILABLE FOR SALE:
         U.S. government agencies                                  $101,456        $  2,859        $     28        $104,287
         Mortgage-backed securities                                 382,779           2,026           1,377         383,428
         Obligations of states and
             political subdivisions                                   1,532              77              --           1,609
         Other                                                          361              30               4             387
                                                                   --------        --------        --------        --------
         TOTAL SECURITIES AVAILABLE FOR SALE                       $486,128        $  4,992        $  1,409        $489,711
                                                                   ========        ========        ========        ========

         HELD TO MATURITY:
         U.S. government agencies                                  $ 65,750        $     12        $     48        $ 65,714
         Mortgage-backed securities                                  34,765              --             720          34,045
         Obligations of states and
             political subdivisions                                  60,144           2,367               5          62,506
                                                                   --------        --------        --------        --------
         TOTAL SECURITIES HELD TO MATURITY                         $160,659        $  2,379        $    773        $162,265
                                                                   ========        ========        ========        ========
</TABLE>
<TABLE>
<CAPTION>
                                                                                    GROSS           GROSS         ESTIMATED
                                                                  AMORTIZED      UNREALIZED       UNREALIZED        FAIR
        DECEMBER 31, 2000:                                           COST           GAINS           LOSSES          VALUE
                                                                   --------        --------        --------        --------
                                                                                            (000'S)
<S>                                                                <C>             <C>             <C>             <C>
         AVAILABLE FOR SALE:
         U.S. government agencies                                  $101,451        $  2,031        $    752        $102,730
         Mortgage-backed securities                                 322,712           1,097           1,845         321,964
         Obligations of states and
             political subdivisions                                   1,535              55              --           1,590
         Other                                                          564              75              14             625
                                                                   --------        --------        --------        --------
         TOTAL SECURITIES AVAILABLE FOR SALE                       $426,262        $  3,258        $  2,611        $426,909
                                                                   ========        ========        ========        ========

         HELD TO MATURITY:
         U.S. government agencies                                  $120,743        $      9        $  1,273        $119,479
         Mortgage-backed securities                                  44,358              50           1,081          43,327
         Obligations of states and
             political subdivisions                                  60,489           1,800               7          62,282
                                                                   --------        --------        --------        --------
         TOTAL SECURITIES HELD TO MATURITY                         $225,590        $  1,859        $  2,361        $225,088
                                                                   ========        ========        ========        ========
</TABLE>




                                       11
<PAGE>

U.S.B. HOLDING CO., INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (CONT'D)


9.       LOANS

         Nonaccrual loans were $19.4 million at March 31, 2001 and $19.7 million
         at December 31, 2000. Restructured loans were $0.2 million at both
         March 31, 2001 and December 31, 2000.

         Substantially all of the nonaccruing and restructured loans are
         collateralized by real estate. At March 31, 2001, the Company has no
         commitments to lend additional funds to any customers with nonaccrual
         or restructured loan balances.

         At March 31, 2001, there are loans aggregating approximately $0.7
         million, which are not on nonaccrual status, that were potential
         problem loans which may result in their being placed on nonaccrual
         status in the future.

         At March 31, 2001 and December 31, 2000, the recorded investment in
         loans that are considered to be impaired under SFAS No. 114,
         "Accounting for Impairment of a Loan" ("SFAS No. 114"), approximated
         $19.6 million and $19.7 million, respectively, of which $19.4 million
         and $19.5 million at March 31, 2001 and December 31, 2000,
         respectively, were in nonaccrual status. Where warranted, each impaired
         loan has a related allowance for loan losses determined in accordance
         with SFAS No. 114. The total allowance for loan losses related to
         impaired loans was $1.3 million and $1.4 million at March 31, 2001 and
         December 31, 2000, respectively. The average recorded investment in
         impaired loans for the three months ended March 31, 2001 and year ended
         December 31, 2000 was approximately $19.0 million and $5.8 million,
         respectively. For the three months ended March 31, 2001 and 2000,
         interest income recognized by the Company on impaired loans was not
         material.

         Restructured loans in the amounts of $0.2 million for both March 31,
         2001 and December 31, 2000, respectively, that are considered to be
         impaired due to a reduction in the contractual interest rate, are on
         accrual status because the collateral securing these loans is
         sufficient to protect the contractual principal and interest of the
         restructured loans. These loans have been performing for a reasonable
         period of time. Interest accrued on these loans as of March 31, 2001 is
         immaterial.

         At March 31, 2001, the Bank had $0.3 million of outstanding loans,
         collateralized by cash and lease receivables, to Bennett, which filed
         for bankruptcy protection during the first quarter of 1996. Collection
         of the Bank's loans continues to be delayed by the bankruptcy
         proceedings. However, as a result of a favorable ruling in the second
         quarter of 1998 by the Bankruptcy Court, the Bank has collected
         payments of $2.6 million, reducing the original balance of $3.3 million
         to $0.7 million. A total of $0.4 million was charged-off in 1999 and
         1998, further reducing the recorded balance of the loans to $0.3
         million as of March 31, 2001. The ruling by the Bankruptcy Court was
         appealed by the Trustee, and in November 2000, the District Court
         reaffirmed the lower Court ruling. The Trustee has appealed the
         decision further to the U.S. Circuit Court of Appeals for the Second
         Circuit. The Bennett loans are on nonaccrual status and a specific
         allocation is included in the allowance for loan losses of $0.3
         million. In addition, the Trustee contends that the Bank received
         payments from Bennett under the theory of fraudulent conveyance. If the
         Trustee is successful, the Bank would be liable for loan payments
         aggregating $9.5 million received from Bennett for the six year period
         preceding the bankruptcy filing date of March




                                       12
<PAGE>

         1996. The Bankruptcy Court dismissed a significant portion of the
         Trustee's fraudulent conveyance claims. The Company believes, based on
         advice of legal counsel, that it will prevail with regard to the
         remaining fraudulent conveyance claims.

         On November 9, 2000, the Company reclassified a real estate
         construction loan in the amount of $19.7 million as a non-performing
         asset and placed the loan on nonaccrual status. As a result of the
         impairment of this loan, $2.2 million was charged-off in the fourth
         quarter of 2000, reducing the loan balance to $17.5 million. During the
         first quarter of 2001, "protective advances" of $0.4 million were made
         in connection with payments of real estate taxes and common charges,
         which increased the loan balance to $17.9 million as of March 31, 2001.
         In addition, in accordance with SFAS No. 114, the Company has provided
         a specific allocation of the allowance for loan losses of $1.1 million
         for this loan as of March 31, 2001. The Bank is currently proceeding
         with a foreclosure action on 35 unsold condominium units, which
         collateralizes the loan, as well as other real estate that provides
         additional security for the loan. The loan is also personally
         guaranteed by the principals, and such guarantees will be pursued to
         recover any losses that may be incurred in connection with the loan.
         The personal guarantees have not been considered in determining the
         amount of the charge-off or allowance for loan losses applicable to the
         loan.

10.      BORROWINGS AND STOCKHOLDERS' EQUITY

         The Company utilizes borrowings primarily to meet the funding
         requirements for its asset growth and to manage its interest rate risk.
         Borrowings include securities sold under agreements to repurchase,
         federal funds purchased, and Federal Home Loan Bank of New York
         ("FHLB") advances.

         Short-term securities sold under agreements to repurchase generally
         mature between one and 365 days. The Bank may borrow up to $50.0
         million from two primary investment firms under master security sale
         and repurchase agreements. There were no outstanding borrowings under
         these agreements at March 31, 2001. In addition, the Bank has the
         ability to borrow from the FHLB under similar master security sale and
         repurchase agreements and, to a lesser extent, its customers. At March
         31, 2001 and December 31, 2000, the Bank had short-term repurchase
         agreements of $23,000 at an interest rate of 4.86 percent and $0.5
         million at an interest rate of 6.02 percent, respectively. At March 31,
         2001 and December 31, 2000, these borrowings were collateralized by
         securities with an aggregate amortized cost and estimated fair value of
         $24,000 and $0.5 million, respectively.

         Federal funds purchased represent overnight funds. The Bank has federal
         funds purchase lines available with five financial institutions for a
         total of $48.0 million. At March 31, 2001 and December 31, 2000, the
         Bank had no federal funds purchased balances outstanding.

         Short-term FHLB advances are borrowings with original maturities
         between one and 365 days. At March 31, 2001 and December 31, 2000, the
         Bank had no such short-term FHLB advances outstanding.

         Additional information with respect to short-term borrowings as of and
         for the three months ended March 31, 2001 and 2000 is presented in the
         table below.


        SHORT-TERM BORROWINGS                  2001           2000
        ---------------------               --------------------------
                                            (000's except percentages)
         Balance at March 31                   $  23       $141,000
         Average balance outstanding             359        161,897
         Weighted-average interest rate
              As of March 31                    4.86%          5.97%
            Paid during period                  5.53           5.78


         The Bank had long-term borrowings, which have original maturities of
         over one year, of $225.0 million in securities sold under agreements to
         repurchase as of March 31, 2001 and December 31, 2000. At March 31,
         2001 and December 31, 2000, these borrowings have an original term of
         ten years at interest rates between 4.52 percent and 6.08 percent that
         are callable on certain dates after an initial noncall period at the
         option of the counter party to the repurchase agreement. As of March
         31, 2001 and December 31, 2000, these borrowings are collateralized by
         securities with an aggregate amortized cost of $251.7 million and
         $257.1 million and estimated fair value of $254.5 million and $254.8
         million, respectively.

         At March 31, 2001 and December 31, 2000, long-term FHLB advances
         totaled $46.7 million and $17.7 million, respectively, at interest
         rates of between 4.55 percent and 6.72 percent and 5.12 percent to 6.72
         percent for March 31, 2001 and December 31, 2000, respectively. At
         March 31, 2001, borrowings totaling $16.7 million are amortizing
         advances having scheduled payments and may not be repaid in full prior
         to maturity without penalty. Other borrowings totaling $30.0 million
         have an original term of ten years that are callable on certain dates
         after an initial noncall period at the option of the counter party to
         the advance. At March 31, 2001 and December 31, 2000, these borrowings
         were collateralized by a pledge to the FHLB of a security interest in
         certain mortgage-related assets having an aggregate book value of $52.1
         million and $19.8 million, respectively.

         A summary of long-term, fixed-rate borrowings distributed based upon
         remaining contractual payment date and expected option call date at
         March 31, 2001, with comparative totals for December 31, 2000, is as
         follows:


<TABLE>
<CAPTION>
                                                                 AFTER 1
                                                    WITHIN      BUT WITHIN       AFTER           2001            2000
         LONG-TERM DEBT                             1 YEAR        5 YEARS       5 YEARS          TOTAL           TOTAL
         ------------------------------------------------------------------------------------------------------------------
         Contractual Payment Date:                            (000's, except percentages)
<S>                                               <C>           <C>            <C>             <C>             <C>
         Total long-term debt                     $     3,259   $    11,636    $   256,823     $   271,718     $   242,730
         Weighted-average interest rate                  5.76%         5.62%          5.40%           5.41%           5.51%
         Expected Call Date:
         Total long-term debt                     $     3,259   $    41,636    $   226,823     $   271,718     $   242,730
         Weighted-average interest rate                  5.76%         4.85%          5.51%           5.41%           5.51%
</TABLE>




                                       13
<PAGE>

         At March 31, 2001 and December 31, 2000, the Bank held 341,395 shares
         of capital stock of the FHLB with a carrying value of $34.1 million,
         which is required in order to borrow under the short- and long-term
         advance and securities sold under agreements to repurchase programs
         from the FHLB. The FHLB generally limits borrowings up to an aggregate
         of 30 percent of total assets, excluding securities sold under
         agreements to repurchase, upon the prerequisite purchase of shares of
         FHLB stock. Any advances made from the FHLB are required to be
         collateralized by the FHLB stock and certain other assets of the Bank.

         The ability of the Company and Bank to pay cash dividends in the future
         is restricted by various regulatory requirements. The Company's ability
         to pay cash dividends to its stockholders is primarily dependent upon
         the receipt of dividends from the Bank. The Bank's dividends to the
         Company may not exceed the sum of the Bank's net income for that year
         and its undistributed net income for the preceding two years, less any
         required transfers to additional paid-in capital. At March 31, 2001,
         the Bank could pay dividends of $24.1 million to the Company without
         having to obtain prior regulatory approval.

         On April 13, 2000, the Company's Board of Directors authorized a five
         percent common stock dividend, which was distributed on May 15, 2000 to
         stockholders of record as of May 1, 2000. The weighted average common
         shares outstanding and per common share amounts for the three months
         ended March 31, 2000 have been adjusted to reflect the five percent
         stock dividend.

         On September 27, 2000, the Company's Board of Directors authorized the
         repurchase of up to 300,000 common shares, or approximately 1.8%, of
         the Company's outstanding common stock at that date. Repurchases of
         common stock are authorized to be made from time to time in open-market
         and private transactions throughout 2001 as, in the opinion of
         management, market conditions may warrant. During the three month
         period ended March 31, 2001, the Company purchased 22,000 shares under
         the repurchase plan at an aggregate cost of approximately $263,000. The
         repurchased common shares will be held as treasury stock and will be
         available for general corporate purposes.

11.      COMMITMENTS AND CONTINGENCIES

         In the normal course of business, various commitments to extend credit
         are made which are not reflected in the accompanying condensed
         consolidated financial statements. At March 31, 2001, formal credit
         line and loan commitments, which are primarily loans collateralized by
         real estate and credit card lines, approximated $316.7 million and
         outstanding letters of credit totaled $39.9 million. Such amounts
         represent the maximum risk of loss on these commitments.

         The Company, from time to time, enters into forward commitments to sell
         residential first mortgage loans to reduce market risk associated with
         originating and holding loans for sale. A risk associated with these
         commitments arises from the Company's potential inability to generate
         loans to fulfill the contracts. To control the risk associated with
         changes in interest rates, the Company may also use options to hedge
         loans closed and expected to close. No such contracts were outstanding
         at March 31, 2001 and December 31, 2000.




                                       14
<PAGE>

         Other commitments are described in Note 17 to the consolidated
         financial statements of the Company for the year ended December 31,
         2000, which is included in the Company's 2000 Annual Report on Form
         10-K.

         In the ordinary course of business, the Company is party to various
         legal proceedings, none of which, in the opinion of management, based
         on advise from legal counsel, will have a material adverse effect on
         the Company's consolidated financial position or results of operations.

12.      SEGMENT INFORMATION

         The Company has one reportable segment, "Community Banking." All of the
         Company's activities are interrelated, and each activity is dependent
         and assessed based on how each of the activities of the Company
         supports the others. For example, commercial lending is dependent upon
         the ability of the Bank to fund itself with deposits and other
         borrowings and to manage interest rate and credit risk. This situation
         is also similar for consumer and residential mortgage lending.
         Accordingly, all significant operating decisions are based upon
         analysis of the Company as one operating segment or unit.

         General information required by SFAS No. 131, "Disclosure about
         Segments of an Enterprise and Related Information" ("SFAS No. 131") is
         disclosed in the consolidated financial statements and accompanying
         notes. The Company operates only in the U.S. domestic market,
         specifically the lower Hudson Valley, which includes the counties of
         Rockland, Westchester, Orange, Putnam and Dutchess, New York, as well
         as New York City and Long Island, New York, northern New Jersey and
         southern Connecticut. For the three months ended March 31, 2001 and
         2000, there is no customer that accounted for more than ten percent of
         the Company's revenue.




                                       15
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION

FORWARD-LOOKING STATEMENTS

The Company has made, and may continue to make, various forward-looking
statements with respect to earnings, credit quality and other financial and
business matters for periods subsequent to March 31, 2001. The Company cautions
that these forward-looking statements are subject to numerous assumptions, risks
and uncertainties, and that statements relating to subsequent periods
increasingly are subject to greater uncertainty because of the increased
likelihood of changes in underlying factors and assumptions. ___ Actual results
could differ materially from forward-looking statements.

In addition to those factors previously disclosed by the Company and those
factors identified elsewhere herein, the following factors could cause actual
results to differ materially from such forward-looking statements: competitive
pressures on loan and deposit product pricing; other actions of competitors;
changes in economic conditions, including changes in interest rates and the
shape of the U.S. Treasury yield curve; changes in the credit quality of
borrowers; the extent and timing of actions of the Federal Reserve Board;
customer deposit disintermediation; changes in customers' acceptance of the
Company's products and services; increase in Federal and state income taxes
and/or the Company's effective income tax rate; and the extent and timing of
legislative and regulatory actions and reform, including the Gramm-Leach Bliley
Act enacted in 1999.

The Company's forward-looking statements are only as of the date on which such
statements are made. By making any forward-looking statements, the Company
assumes no duty to update them to reflect new, changing or unanticipated events
or circumstances.

FINANCIAL CONDITION

At March 31, 2001, the Company had total assets of $1,871.9 million, a decrease
of $14.4 million or 0.8 percent from December 31, 2000.

The securities portfolio, including investments in Federal Home Loan Bank of New
York ("FHLB") stock, of $684.5 million and $686.6 million at March 31, 2001 and
December 31, 2000, respectively, consists of securities held to maturity at
amortized cost of $160.7 million and $225.6 million, securities available for
sale at estimated fair value totaling $489.7 million and $426.9 million, at
March 31, 2001 and December 31, 2000, respectively, and FHLB stock of $34.1
million for both periods.

During the three months ended March 31, 2001, U.S. government agency obligations
decreased $53.4 million due primarily to the redemption of $55.0 million in
callable bonds, offset by a net increase in the estimated fair value of
available for sale securities of $1.6 million. Mortgage-backed securities
increased by $51.9 million primarily due to purchases totaling $204.2 million
and a net increase in the estimated fair value of available for sale securities
of $1.4 million, offset by sales of $140.6 million, principal paydowns of $12.8
million, and net premium amortizations of $0.3 million. Mortgage-backed
securities purchased are fixed-rate securities totaling $149.7 million and
having expected weighted-average lives of less than ten years at the time of
purchase and adjustable rate securities totaling $54.5 million. The Bank's
investment in obligations of states and political subdivisions, or municipal
securities, decreased by $0.3 million primarily due to maturities of $1.3
million that were partially offset by purchases of $1.0 million during the three
month period ended March 31, 2001. Municipal securities are considered core
investments having favorable tax equivalent yields and diversified maturities.
Purchases of municipal securities are dependent upon their availability in the
marketplace and the comparative tax equivalent yields of such securities to
other securities of comparable credit risk and maturity.

The Company currently has $0.4 million of holdings in corporate debt and equity
securities. Medium-term corporate debt securities which are rated investment
grade by nationally recognized credit




                                       16
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)

rating organizations and equity investments of other publicly traded financial
institutions will continue to be evaluated for investment in the future. The
Company continues to exercise its conservative approach to investing by
purchasing high credit quality investments and controlling interest rate risk by
purchasing both fixed and floating rate securities and through the averaging of
investments in medium-term maturities.

At March 31, 2001, loans outstanding were $1,080.1 million, a net decrease of
$6.7 million or 0.6 percent compared to December 31, 2000. The decline in
outstanding loan balances reflects decreases of: $4.8 million in time unsecured
loans; $3.9 million in residential mortgages; $1.0 million in commercial
mortgages; $0.8 million in personal installment loans; $0.8 million in credit
card loans; and $0.7 million in commercial installment loans; partially offset
by increases in land, acquisition and construction loans of $3.6 million; time
secured loans of $1.0 million; home equity loans of $0.3 million and other loan
categories of $0.4 million. The Company had approximately $316.7 million in
formal credit lines and loan commitments outstanding. Management considers its
liquid resources to be adequate to fund loans in the foreseeable future,
principally by utilizing excess funds temporarily placed in federal funds sold,
increases in deposits and borrowings, loan repayments and maturing securities.

The Company's allowance for loan losses increased $0.1 million or 1.0 percent to
$11.4 million at March 31, 2001, from $11.3 million at December 31, 2000. The
allowance for loan losses represents 1.06 percent of gross loans outstanding at
March 31, 2001, compared to 1.04 percent at December 31, 2000. The allowance
reflects a provision of $200,000 and net charge-offs of $92,000 recorded for the
first quarter 2001.

Management believes that allowance for loan losses at March 31, 2001
appropriately reflects the risk elements inherent in the total loan portfolio at
that time. In management's judgment, the allowance is considered adequate to
absorb losses inherent in the loan portfolio. There is no assurance that the
Company will not be required to make future adjustments to the allowance in
response to changing economic conditions or regulatory examinations.

Total deposits decreased $51.3 million for the three month period ended March
31, 2001 to $1,438.2 million, which represents a 3.4 percent decrease from
December 31, 2000. Demand deposits, NOW, money market and time deposits
decreased $75.3 million, offset by an increase in savings deposits of $24.0
million. Demand accounts decreased $9.8 million due to normal fluctuations in
these transaction type accounts. NOW and money market accounts decreased $11.2
million due to transfers of accounts to higher rate retail




                                       17
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)


savings products, as well as a decrease in municipal NOW accounts of $3.8
million. Retail time deposits less than $100,000, and IRA and KEOGH time
deposits increased $2.5 million and $1.4 million, respectively, and savings
deposits increased $24.0 million, due to money transferred from lower yielding
NOW and money market products, as well as due to attractive yields and safety of
principal as compared to alternative investments. Both time deposits greater
than $100,000 from local municipalities, which are obtained on a bidding basis
with maturities of 30 to 180 days, and personal time deposits over $100,000
decreased $57.4 million and $0.8 million, respectively, during the three month
period ended March 31, 2001. Depending on rate and term, the Bank utilizes
municipal and large time deposits as an alternative to borrowed funds.

During the three months ended March 31, 2001, the Company increased the amount
of outstanding short and long-term advances with the Federal Home Loan Bank of
New York by $29.0 million and slightly decreased borrowings under repurchase
agreements by $0.5 million, as the Bank replaced municipal time deposits with
Federal Home Loan Bank borrowings at attractive rates with longer terms.

Stockholders' equity increased to $123.4 million at March 31, 2001 from the
December 31, 2000 balance of $117.9 million, an increase of 4.7 percent. The
increase primarily results from: $5.1 million of net income for the three month
period ended March 31, 2001; $1.3 million of stock options exercised and the
related tax benefit; an increase of $1.7 million in accumulated other
comprehensive income; partially offset by common stock dividends paid of $1.3
million and treasury stock purchases of $1.3 million.

The Company's leverage ratio at March 31, 2001 was 7.15 percent, compared to
7.12 percent at December 31, 2000. The Company's Tier I and total capital ratios
under the risk-based capital guidelines were 11.63 percent and 12.62 percent at
March 31, 2001, and 10.97 percent and 11.93 percent at December 31, 2000,
respectively. In addition, the Bank exceeds all current regulatory capital
requirements and was in the "well-capitalized" category at March 31, 2001 and
December 31, 2000.

RESULTS OF OPERATIONS

EARNINGS

The Company's net income of $5.1 million for the three month period ended March
31, 2001 was slightly higher than that for the comparable period in 2000. Basic
and diluted earnings per common share were $0.31 and $0.30 for the three month
period ended March 31, 2001, compared to $0.31 and $0.29 for the three month
period ended March 31, 2000, respectively. The increase in diluted earnings per
common share of 3.4% for the three month period ended March 31, 2001, compared
to the prior year period, reflects lower adjusted weighted average shares due to
the Company's stock repurchase program and a lower level of dilutive shares.

The increase in net income for the three month period ended March 31, 2001,
compared to the prior year period, reflects higher non-interest income, a lower
provision for loan losses, net security gains (compared to none in the 2000
period) and a lower effective




                                       18
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)


income tax rate. This increase was partially offset by lower net interest income
and higher non-interest expenses. A discussion of the factors impacting the
changes in the various components of net income follows.

NET INTEREST INCOME

Net interest income, the difference between interest income and interest
expense, is a significant component of the Company's consolidated earnings. For
the three month period ended March 31, 2001, net interest income decreased 2.8
percent to $14.5 million from $14.9 million recorded for the three months ended
March 31, 2000. Net interest income decreased in the current year period
primarily due to decreases in the net interest spread and margin, partially
offset by increases in average interest earning assets.

For the three months ended March 31, 2001, the net interest spread on a tax
equivalent basis (yield on earning assets less cost of funds, including demand
deposits) was 3.18 percent, compared to 3.64 percent. The net interest margin on
a tax equivalent basis (net interest income on a tax equivalent basis divided by
average interest earning assets) for the three month period ended March 31, 2001
was 3.34 percent compared to 3.78 percent for the same period in 2000. The
decline in the net interest spread and margin reflects an increase in cost of
funds which is a continuation from the higher rate environment of 2000, while
yields on interest earning assets declined compared to the prior year,
reflecting a 200 basis point reduction in short term interest rates by the
Federal Reserve Board in the first quarter of 2001.

The decrease in yield on average interest earning assets on a tax equivalent
basis from 7.84 percent for the three month period ended March 2000 to 7.79
percent for the same period in 2001 consisted primarily of a decrease in the
yield on average net loans from 8.54 percent to 8.37 percent, and average
federal funds sold from 5.66 percent to 5.49 percent. The decrease in yields
resulting in a reduction of interest income was partially offset by volume
increases on average interest earning assets of $172.9 million, or 10.7 percent,
from $1,620.5 million to $1,793.4 million for the three month period ended March
31, 2001, as compared to the prior year period. The increase in volume was
primarily from net increases in real estate secured land acquisition and
construction loans, commercial mortgages, time secured loans, and investment in
U.S. government agencies and mortgage-backed securities.

Yields on interest bearing liabilities increased during the three month period
ended March 31, 2001, as compared to the same period in the prior year. The
increase in yield on average interest bearing liabilities (including demand
deposit accounts) from 4.20 percent for the three month period ended March 31,
2000 to 4.61 percent for the same period in 2001 resulted primarily from an
increase in the yield on interest bearing deposits from 4.32 percent for the
three month period ended March 31, 2000 to 4.98 percent for the three month
period ended March 31, 2001. The increase in yield on interest bearing deposits
is also partly due to higher yields on deposits assumed in December 2000 from
the two La Jolla Bank branches. The assumed deposits with higher yields
consisted primarily of time deposits and money market accounts.




                                       19
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)


The Company continues a leverage strategy of purchasing government securities
funded by borrowings. Although the leverage strategy results in tighter net
interest spreads, the strategy increases net interest income while managing
interest rate risk. The Company has also taken advantage of opportunities during
the first quarter of 2001 to restructure the "available for sale" security
portfolio resulting in increased yields, while slightly increasing the weighted
average life of the portfolio. The increased yields will partially offset a
reduction in yield resulting from the repayment of higher yielding callable U.S.
government agency securities, which were called during the first quarter of
2001.

PROVISION FOR LOAN LOSSES

The provision for loan losses decreased $250,000 to $200,000 for the three month
period ended March 31, 2001, compared to the same period in 2000. The decrease
primarily reflects a decrease in loans of 0.6 percent as compared to an increase
in the prior year period of 3.5 percent over the respective year end balances.
During the three month period ended March 31, 2001, net charge-offs totaled
$92,000, compared to net charge-offs of $40,000 for the three month period ended
March 31, 2000. The net charge-offs primarily relate to commercial loans and
credit card loans in 2001 and credit card loans in 2000. Nonaccrual loans were
$19.4 million and $2.4 million, respectively, at March 31, 2001 and 2000,
compared to $19.7 million at December 31, 2000. It is the Company's policy to
discontinue the accrual of interest on loans when, in the opinion of management,
doubt exists as to the timely collectibility of the amounts due. Net income is
adversely impacted by the level of non-performing assets of the Company since,
in addition to foregone revenue, the Company must increase the level of
provision for loan losses, and incur other costs associated with collections of
past due balances.

An evaluation of the quality of the loan portfolio is performed by management on
a quarterly basis as an integral part of the credit administration function,
which includes the identification of past due loans, non-performing loans and
impaired loans, assessments of the expected effects of the current economic
environment and industry, geographic and customer concentrations in the loan
portfolio, and review of the historical loan loss experience. Management takes a
prudent and cautious position in evaluating various business and economic
uncertainties in relation to the Company's loan portfolio. In Management's
judgment, the allowance for loan losses at March 31, 2001 reflects the risk
elements inherent in the total loan portfolio and is considered adequate to
absorb losses inherent in the portfolio at that time. The amount of the
provision charged to income and changes in the allowance for loan losses
reflects net charge-offs and losses incurred with respect to real estate, time
and demand loans, installment, credit card and other loans, and the effect of
the real estate market and general economic conditions of the New York
Metropolitan area on the loan portfolio. There is no assurance that the Company
will not be required to make future adjustments to the allowance in response to
changing economic conditions or regulatory examinations.

NON-INTEREST INCOME

Non-interest income for the three months ended March 31, 2001 increased by
$775,000 (60.1 percent) to $2,064,000 as compared to the same period in 2000.
The increase for



                                       20
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)


the three month period ended March 31, 2001 reflects net securities gains of
$682,000, higher letter of credit fees of $156,000, and higher credit card fee
income of $24,000, partially offset by lower service charges on deposit accounts
and other income.

NON-INTEREST EXPENSES

Non-interest expenses increased $651,000 (8.2 percent) to $8,592,000 for the
three month period ended March 31, 2001 from the comparable period in 2000. The
primary reason for this increase results from higher levels of salaries and
benefits, occupancy and equipment expense, stationery and printing, amortization
of intangibles, and other expenses necessary to expand and support increased
business volume and balance sheet growth.

Salaries and employee benefits, the largest component of non-interest expenses,
increased by $350,000, or 7.5 percent, during the three month period ended March
31, 2001 compared to the prior year period. The increase occurred due to
additional personnel employed by the Company to accommodate the increases in
deposits and loans and their related services, including the addition of
personnel in connection with the acquisition of the two La Jolla Bank branches,
merit increases, and increases in the cost of employee benefit programs such as
retirement and stock plans, medical coverage, and tuition reimbursement.

Significant changes in the other components of non-interest expenses for the
three month period ended March 31, 2001 compared to March 31, 2000, were due to
the following:

         Increase of $65,000 (4.4%) in occupancy and equipment expense. This
         increase is primarily due to costs related to the La Jolla branches,
         including rental and depreciation expense, as well as higher
         maintenance expenses relating to the Company's branch and computer
         related equipment, and increased utility expenses due to added
         corporate space combined with higher gas and electric rates.

         Decrease of $33,000 (8.5%) in advertising and business development. The
         decrease reflects a reduction in deposit promotions during the first
         quarter of 2001 because of the addition of the La Jolla branch
         deposits, offset by an increase in business development efforts.

         Decrease of $87,000 (32.2%) in professional fees. The decrease relates
         to lower legal, auditing, and examination fees and a decrease in
         Director fees due to the retirement of one of the Company's Directors
         in the second quarter of 2000.

         Increase of $16,000 (6.5%) in communications expense. The increase
         relates to greater telephone usage as a result of increased employees,
         corporate office space and data lines usage and the new La Jolla
         branches.

         Increase of $33,000 (17.4%) in stationery and printing. The increase
         reflects an increase in office supplies and equipment necessary to
         support the continuing growth of the business volume, stationery and
         supplies necessary for new branches



                                       21
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 2.  MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
         RESULTS OF OPERATION (cont'd)


         opened/acquired in the second and fourth quarters of 2000, and a change
         in the structure of commissions received as a result of a change in the
         Bank's primary checkbook vendor in the second quarter of 2000.

         Increase of $10,000 (16.7%) in FDIC insurance. The increase is related
         to the higher level of total deposits in the first quarter of 2001
         compared to the prior year period.

         Increase of $223,000 in amortization of intangibles. The increase is
         due to the amortization of the premium paid for the deposits assumed in
         the La Jolla Bank branch acquisition in December 2000.

         Increase of $74,000 (12.1%) in other expenses. The increase is
         primarily due to a lower allocation of other expenses to loan
         origination expenses, which is netted against deferred loan fees and
         consequently interest income, and an increase in courier fees due to
         added branch locations and customer deposit pick-ups.

INCOME TAXES

The effective income tax rates for the three month periods ended March 31, 2001
and 2000 were 34.4% and 35.0%. The lower effective tax rate for the three month
period ended March 31, 2001 primarily reflects lower state income taxes.



                                       22
<PAGE>

U.S.B. HOLDING CO., INC.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Quantitative and qualitative disclosures about market risk at December 31, 2000
were reported in the Company's 2000 Annual Report on Form 10-K. There have been
no material changes in the Company's market risk exposures at March 31, 2001
compared to December 31, 2000. Interest rate risk continues to be the Company's
primary market risk exposure since all Company transactions are denominated in
U.S. dollars with no direct foreign currency exchange or changes in commodity
price exposures. All market risk sensitive instruments continue to be held to
maturity or available for sale with no financial instruments entered into for
trading purposes. The Company does not use derivative financial instruments such
as interest rate swaps and caps extensively and has not been party to any
derivative financial instruments during the three months ended March 31, 2001.

The Company continues to use two methods to evaluate its market risk to changes
in interest rates, a "Static Gap" evaluation and a simulation analysis of the
impact of changes in interest rates on the Company's net interest income and
cash flow. There have been no changes in the Company's policy limit of
acceptable variances to net interest income at March 31, 2001 as compared to
December 31, 2000. The Company's "Static Gap" at March 31, 2001 was a negative
cumulative $187.0 million in the one year time frame compared to a negative
cumulative $181.7 million at December 31, 2000. If interest rates were to
gradually ramp up or down 200 basis points from current rates, the percentage
change in estimated net interest income for the subsequent three month
measurement period continues to be within the Company's policy limit of not
declining by more than 5.0 percent.



                                       23
<PAGE>

                           PART II - OTHER INFORMATION

U.S.B. HOLDING CO., INC.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(A)     EXHIBITS

Exhibit No.  Exhibit
-----------  -------

(3)(a)       Amended and Restated Certificate of Incorporation of Registrant
             (incorporated herein by reference to Registrant's Quarterly Report
             on Form 10-Q for the quarter ended June 30, 1998, Exhibit (3)(a)).

(3)(b)       Bylaws of Registrant (incorporated herein by reference from
             Registrant's Registration Statement on Form S-14 (file no.
             2-79734), Exhibit 3(b)).

(4)(a)       Junior Subordinated Indenture, dated February 5, 1997, between
             Registrant and The Chase Manhattan Bank, as trustee (incorporated
             herein by reference to Registrant's Annual Report on Form 10-K for
             the year ended December 31, 1996 ("1996 10-K"), Exhibit (4)(a)).

(4)(b)       Guarantee Agreement, dated February 5, 1997, by and between
             Registrant and The Chase Manhattan Bank, as trustee for the holders
             of 9.58% Capital Securities of Union State Capital Trust I
             (incorporated herein by reference to Registrant's 1996 10-K,
             Exhibit (4)(b)).

(4)(c)       Amended and Restated Declaration of Trust of Union State Capital
             Trust I (incorporated herein by reference to Registrant's 1996
             10-K, Exhibit (4)(c)).

(10)(a)      Agreement of Employment dated as of November 16, 1998, and as
             amended November 8, 2000, between the Company and the Bank and
             Thomas E. Hales (incorporated herein by reference to Registrant's
             Annual Report on Form 10-Q for the quarter ended September 30, 2000
             ("2000 Third Quarter 10-Q", Exhibit (10)(a)).

(10)(b)      Agreement of Employment dated as of November 16, 1998, and as
             amended November 8, 2000, between the Company and the Bank and
             Raymond J. Crotty (incorporated herein by reference to Registrant's
             2000 Third Quarter 10-Q, Exhibit (10)(b)).

(10)(c)      Agreement of Employment dated as of November 16, 1998, and as
             amended November 8, 2000, between the Company and the Bank and
             Steven T. Sabatini (incorporated herein by reference to
             Registrant's 2000 Third Quarter 10-Q, Exhibit (10)(c)).

(10)(d)      Registrant's 1984 Incentive Stock Option Plan (incorporated herein
             by reference from Form S-8 Registration Statement (file No.
             2-90674), Exhibit 28 (b)).



                                       24
<PAGE>

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K (CONT'D)

(A)   EXHIBITS (CONT'D)

Exhibit No.  Exhibit
-----------  -------

(10)(e)      Registrant's 1993 Incentive Stock Option Plan (incorporated herein
             by reference from Registrant's Quarterly Report on Form 10-Q for
             the quarter ended September 30, 1999 ("1999 Third Quarter 10-Q"),
             Exhibit (10)(e)).

(10)(f)      Registrant's Employee Stock Ownership Plan (With Code Section
             401(k) Provisions) (incorporated herein by reference from
             Registrant's Annual Report on Form 10-K for the year ended December
             31, 1993, Exhibit (10)(d )).

(10)(g)      Registrant's Dividend Reinvestment and Stock Purchase Plan
             (incorporated herein by reference from Registrant's Form S-3
             Registration Statement (file No. 33-72788).

(10)(h)      Registrant's Director Stock Option Plan (incorporated herein by
             reference to Registrant's 1996 10-K, Exhibit (10)(f)).

(10)(i)      Registrant's 1998 Director Stock Option Plan (incorporated herein
             by reference to Registrant's Form S-8 Registration Statement, filed
             June 5, 1998, Exhibit (10)(d)).

(10)(j)      Registrant's Key Employees' Supplemental Investment Plan, as
             amended July 1, 1997 and September 1, 1998 (incorporated herein by
             reference to the Plan's Annual Report on Form 11-K for the year
             ended December 31, 1998).

(10)(k)      Registrant's Key Employees' Supplemental Diversified Investment
             Plan dated September 1, 1998 (incorporated herein by reference to
             the Plan's Annual Report on Form 11-K for the year ended December
             31, 1998).

(10)(l)      Registrant's 1997 Employee Stock Option Plan (incorporated herein
             by reference to Registrant's Proxy Statement filed April 18, 1997).

(10)(m)      Agreement and Plan of Merger, dated as of March 6, 1998, between
             U.S.B. Holding Co., Inc. and Tappan Zee Financial, Inc.
             (incorporated herein by reference to Registrant's Current Report on
             Form 8-K dated as of March 6, 1998).

(10)(n)      Tappan Zee Financial, Inc. 1996 Stock Option Plan for Officers and
             Employees ("Employee Stock Option Plan") (incorporated herein by
             reference to Exhibit B to Tappan Zee Financial, Inc.'s Proxy
             Statement for use in connection with its 1996 Annual Meeting of
             Shareholders ("Tappan Zee 1996 Proxy Statement")).

(10)(o)      Amendment No. 1 to the Employee Stock Option Plan (incorporated
             herein by reference to Tappan Zee Financial, Inc.'s Annual Report
             on



                                       25
<PAGE>

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K (CONT'D)

(A)   EXHIBITS (CONT'D)

Exhibit No.  Exhibit
-----------  -------

             Form 10-K for the fiscal year ended March 31, 1997 ("Tappan Zee
             1997 10-K"), Exhibit 10.1.1).

(10)(p)      Amendment No. 2 to the Employee Stock Option Plan (incorporated
             herein by reference to Exhibit A to Tappan Zee Financial, Inc.'s
             Proxy Statement for use in connection with its 1997 Annual Meeting
             of Shareholders ("Tappan Zee 1997 Proxy Statement")).

(10)(q)      Tappan Zee Financial, Inc. 1996 Stock Option Plan for Outside
             Directors ("Outside Director Option Plan") (incorporated herein by
             reference to Exhibit B to the Tappan Zee 1997 Proxy Statement).

(10)(r)      Amendment No. 1 to the Outside Director Option Plan (incorporated
             herein by reference to the Tappan Zee 1997 10-K, Exhibit 10.2.1).

(10)(s)      Amendment No. 2 to the Outside Director Option Plan (incorporated
             herein by reference to Exhibit B to the Tappan Zee 1997 Proxy
             Statement).

(10)(t)      Tappan Zee Financial, Inc. 1996 Recognition and Retention Plan for
             Officers and Employees ("Employee RRP") (incorporated herein by
             reference to Exhibit B to the Tappan Zee 1996 Proxy Statement).

(10)(u)      Amendment No. 1 to the Employee RRP (incorporated herein by
             reference to the Tappan Zee 1997 10-K, Exhibit 10.3.1 ).

(10)(v)      Amendment No. 2 to the Employee RRP (incorporated herein by
             reference to Exhibit C to the Tappan Zee 1997 Proxy Statement).

(10)(w)      Tappan Zee Financial, Inc. 1996 Recognition and Retention Plan for
             Outside Directors ("Outside Director RRP") (incorporated herein by
             reference to Exhibit D to the Tappan Zee 1997 Proxy Statement).

(10)(x)      Amendment No. 1 to the Outside Director RRP (incorporated herein by
             reference to the Tappan Zee 1997 10-K, Exhibit 10.4.1).

(10)(y)      Amendment No. 2 to the Outside Director RRP (incorporated herein by
             reference to Exhibit D to the Tappan Zee 1997 Proxy Statement).

(10)(z)      Loan Agreement to the Employee Stock Ownership Plan Trust of Tappan
             Zee Financial, Inc. and Certain Affiliates (incorporated herein by
             reference to the Tappan Zee Financial, Inc.'s Annual Report on Form
             10-K for the fiscal year ended March 31, 1996 ("Tappan Zee 1996
             10-K"), Exhibit 10.7).

10)(aa)      Deferred Compensation Plan for Directors of Tarrytowns Bank, FSB
             (Incorporated herein by reference to the Registration Statement on
             Form S-1



                                       26
<PAGE>

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K (CONT'D)

(A)   EXHIBITS (CONT'D)

Exhibit No.  Exhibit
-----------  -------

             (file No. 33-94128), filed on June 30, 1995, as amended ("Tappan
             Zee Registration Statement"), Exhibit 10.7).

(10)(bb)     Consulting Agreement by and between Tarrytowns Bank, FSB and
             Stephen C. Byelick, dated effective as of August 31, 1998
             (incorporated herein by reference to the Registrant's Quarterly
             Report on Form 10-Q for the quarter ended September 30, 1998
             ("September 30, 1998 10-Q"), Exhibit (10)(dd)).

(10)(cc)     Employment Agreement by and between Tarrytowns Bank, FSB and Harry
             G. Murphy, dated effective as of August 31, 1998 (incorporated
             herein by reference to the 1998 Third Quarter 10-Q, Exhibit
             (10)(cc)).

(10)(dd)     Forms of Stock Option Agreement by and between Tappan Zee
             Financial, Inc. and recipients of stock options granted pursuant to
             the Employee Option Plan and the Outside Director Option Plan
             (incorporated herein by reference to the Tappan Zee 1997 10-K,
             Exhibit 10.16).

(10)(ee)     Forms of Restricted Stock Award Notices to award recipients,
             pursuant to the Employee RRP and the Outside Director RRP
             (incorporated herein by reference to the Tappan Zee 1997 10-K,
             Exhibit 10.17).

(10)(ff)     Registrant's Retirement Plan for Non-Employee Directors of U.S.B.
             Holding Co., Inc. and Certain Affiliates dated effective as of May
             19, 1999 (incorporated herein by reference to the Registrant's
             Quarterly Report on Form 10-Q for the quarter ended June 30, 1999,
             (Exhibit (10)(ll)).

(10)(gg)     Amendment Number 1 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) dated January 27, 1995
             (incorporated herein by reference to the Registrant's Annual Report
             on Form 10-K for the year ended December 31, 1999 ("1999 10-K"),
             Exhibit (10)(jj)).

(10)(hh)     Amendment Number 2 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) dated May 17, 1995
             (incorporated herein by reference to the Registrant's 1999 10-K,
             Exhibit (10)(kk)).

(10)(ii)     Amendment Number 3 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) dated January 1, 1996
             (incorporated herein by reference to the Registrant's 1999 10-K,
             Exhibit (10)(ll)).

(10)(jj)     Amendment Number 4 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) dated November 20, 1996
             (incorporated herein by reference to the Registrant's 1999 10-K,
             Exhibit (10)(mm)).



                                       27
<PAGE>

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K (CONT'D)

(A)   EXHIBITS (CONT'D)

Exhibit No.  Exhibit
-----------  -------

(10)(kk)     Amendment Number 5 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) effective as of September 30,
             1999 (incorporated herein by reference to the Registrant's 1999
             10-K, Exhibit (10)(nn)).

(10)(ll)     Amendment Number 6 to Registrant's Employee Stock Ownership Plan
             (with Code Section 401(k) Provisions) dated August 24, 1999
             (incorporated herein by reference to the Registrant's 1999 10-K,
             Exhibit (10)(oo)).

(10)(mm)     Asset Purchase and Account Assumption Agreement by and between
             Union State Bank and La Jolla Bank dated May 25, 2000 (incorporated
             herein by reference to the Registrant's Quarterly Report on Form
             10-Q for the six months ended June 30, 2000 Exhibit (10)(oo).

(11)         Computation of earnings per share.*

*Filed Herewith.

(B)      REPORTS ON FORM 8-K

         No reports on Form 8-K were filed during the quarter ended March 31,
         2001.



                                       28
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized, on May 10, 2001.


                            U.S.B. HOLDING CO., INC.



/s/ Thomas E. Hales                             /s/ Steven T. Sabatini
------------------------------------            --------------------------------
Thomas E. Hales                                 Steven T. Sabatini
Chairman of the Board, President,               Senior Executive Vice President,
Chief Executive Officer and Director            Chief Financial Officer and
                                                Assistant Secretary
                                                (Principal Financial and
                                                Accounting Officer)


                                       29