<PAGE>1

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC  20549

                                   FORM 10-Q


(Mark One)

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

              For the quarterly period ended September 30, 1996

                                     or

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

For the transition period from                       to 
                               --------------------      ----------------------

                         Commission File Number 0-28162

                                LENOX BANCORP, INC.
-------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

         OHIO                                                  31-1445959
-------------------------------------------------------------------------------
(State or other jurisdiction of incorporation or             (IRS Employer
 organization)                                             Identification No.)

5255 Beech Street, St. Bernard, Ohio                              45217
-------------------------------------------------------------------------------
(Address of principal executive offices)                       (Zip Code)

                                  (513) 242-4690
-------------------------------------------------------------------------------
                (Registrant's telephone number, including area code)

                                   Not Applicable
-------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last 
 report)


         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days. |X| Yes | | No
                                                   
                         APPLICABLE ONLY TO CORPORATE ISSUERS:

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest  practicable  date:  425,677 shares of
common stock,  without par value per share,  were outstanding as of November 10,
1996.



<PAGE>2

                                LENOX BANCORP, INC.
                                     FORM 10-Q

                                       INDEX

                                                                           PAGE

PART I        FINANCIAL INFORMATION

     Item 1   Consolidated Balance Sheets as of September 30, 1996
              and December 31, 1995.........................................2

              Consolidated Statements of Operations for the
              Three and Nine Months Ended September 30, 1996 and 1995.......3

              Consolidated Statements of Cash Flows for the Three and
              Nine Months Ended September 30, 1996 and 1995.................4

              Notes to Consolidated Financial Statements....................5

     Item 2   Management's Discussion and Analysis of
              Financial Condition and Results of Operations.................6


PART II       OTHER INFORMATION

     Item 1   Legal Proceedings.............................................11

     Item 2   Changes in Securities.........................................11

     Item 3   Defaults Upon Senior Securities...............................11

     Item 4   Submission of Matters to a Vote of Security Holders...........11

     Item 5   Other Information.............................................11

     Item 6   Exhibits and Reports on Form 8-K..............................11


SIGNATURES



<PAGE>3
                           PART I--FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                               LENOX BANCORP, INC.
                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

                                                                                      SEPTEMBER 30,          DECEMBER 31,
                                                                                           1996                  1995
                                                                                    ------------------    -------------------
                                                                                       (UNAUDITED)
<S>                                                                                       <C>                    <C>    
ASSETS
Cash and due from banks.......................................................            $  1324                $ 1,249
Certificates of deposit.......................................................                160                    152

Investment securities - available for sale, at fair value (amortized  cost of
$7,284 at September 30, 1996 and amortized cost of $6,022 at
December 31, 1996.............................................................              7,439                  6,021

Mortgage-backed securities - available for sale, at fair value (amortized cost
of $877 at September 30, 1996 and amortized cost of $1,083 at
December 31, 1995)............................................................                875                  1,023

Loans receivable, net.........................................................             36,630                 33,384

Accrued interest receivable:
  Loans......................................................................                 142                    124
  Mortgage-backed securities.................................................                   6                      7
  Investments and certificates of deposit....................................                 120                    104
Property and equipment, net...................................................                263                    288
Federal Home Loan Bank Stock-at cost..........................................                428                    407
Prepaid federal income tax....................................................                  -                     19
Prepaid expenses and other assets.............................................                 99                    253
                                                                                          -------                -------

     Total assets.............................................................            $47,332                $43,149
                                                                                          =======                =======

LIABILITIES AND RETAINED EARNINGS
Liabilities:
  Deposits:
    Savings, club and other accounts.........................................           $  5,565                $ 5,683
    Money market and NOW accounts............................................              4,893                  5,529
    Certificate accounts.....................................................             23,643                 22,466
                                                                                         -------                 ------
      Total deposits.........................................................             34,101                 33,669
Advances from Federal Home Loan Bank..........................................             5,662                  5,327
Capitalized lease obligations.................................................                 6                     16
Advances by borrowers for taxes and insurance.................................                50                     95
Deferred tax liability........................................................                15                    106
Accrued federal income taxes..................................................                11                     --
Accrued expenses and other liabilities........................................               149                     87
SAIF assessment...............................................................               227                     --
                                                                                       ---------              ---------
    Total liabilities........................................................             40,222                 39,301
Stockholders' equity Common Stock, no par value;
2,00,000 shares authorized; 425,677 issued and outstanding....................             3,850                  3,768
Additional paid in capital:
Stockholder's equity - substantially restricted...............................              (104)                    81
                                                                                        --------               --------
Unrealized gain (loss) on available for sale securities,                                                       
  net of tax of $53,550 and $37,024 for September 30
  and December 31, respectively..............................................           (184,432)                80,511
                                                                     
    Total stockholders' equity...............................................              7,110                  3,848
                                                                                          ------                -------
Total liabilities and stockholders' equity....................................           $47,332                $43,149
                                                                                         =======                =======
</TABLE>
See accompanying notes to consolidated financial statements.



                                                      2

<PAGE>4


<TABLE>
<CAPTION>
                                            LENOX SAVINGS BANK
                                   CONSOLIDATED STATEMENTS OF OPERATIONS
                                            SEPTEMBER 30, 1996


                                                                  FOR THE THREE MONTHS             FOR THE NINE MONTHS
                                                                   ENDED SEPTEMBER 30,             ENDED SEPTEMBER 30,
                                                              -----------------------------  -------------------------------
                                                                  1996            1995            1996             1995
                                                              -------------   -------------  --------------   --------------
<S>                                                                <C>             <C>           <C>              <C>  
INTEREST AND DIVIDEND INCOME
   Loans................................................           681             621           1,977            1,810
   Mortgage-backed securities...........................            15              19              62               53
   Investments and interest bearing deposits............           140             131             368              327
   FHLB stock dividends.................................             8               7              22               20
                                                                   ---             ---           -----            -----
       Total............................................           844             777           2,429            2,209
                                                                   ---             ---           -----            -----

INTEREST EXPENSE
   Deposits.............................................           406             415           1,209            1,240
   Borrowed money and capitalized leases................            81              63             250              108
                                                                   ---             ---           -----            -----
       Total............................................           487             477           1,459            1,347
                                                                   ---             ---           -----            -----

   Net interest income before provision for loan losses.           357             300             970              862

Provision (credit) for loan losses......................            --              (3)              --              (6)
                                                                   ---             ---            ----              ---

   Net interest income after provision for loan losses..           357             303             970              868
                                                                   ---             ---             ---              ---

OTHER INCOME
   Service fee income...................................            29              24              82               69
   Gain on sale of investments..........................           (--)             --              29               --
                                                                   ---             ---             ---               --
       Total............................................            29              24             110               69
                                                                   ---             ---             ---               --

GENERAL AND ADMINISTRATIVE EXPENSES
   Compensation and employee benefits...................            81             103             291              321
   Occupancy and equipment..............................            42              66             126              143
   Federal insurance premiums...........................           247              20             285               60
   Franchise taxes......................................            13              16              39               43
   Other expenses.......................................            94             110             227              300
                                                                   ---             ---             ---              ---
       Total............................................           477             314             968              866
                                                                   ---             ---             ---              ---

   Income before provision for income taxes.............           (91)             12             112               70

Provision for income taxes..............................           (38)             --              30               15
                                                                   ---             ---             ---               --

   Net income...........................................           (53)             12              82               55
                                                                   ===              ==              ==               ==

   Earnings per share...................................          (.12)            N/A             N/A              N/A
                                                                  =====            ===             ===              ===
</TABLE>

See accompanying notes to consolidated financial statements.



                                                             3

<PAGE>5

<TABLE>
<CAPTION>

                                                        LENOX BANCORP, INC.
                                               CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                        SEPTEMBER 30, 1996

                                                                         FOR THE THREE MONTHS            FOR THE NINE MONTHS
                                                                         ENDED SEPTEMBER 30,             ENDED SEPTEMBER 30,
                                                                     ----------------------------   -----------------------------
                                                                         1996           1995            1996             1995
                                                                     ------------   -------------   -------------    ------------
                                                                                           (IN THOUSANDS)
<S>                                                                      <C>            <C>             <C>             <C>    
                                                           
CASH FLOWS FROM OPERATING ACTIVITIES
   Net income....................................................           (27)             12              82              56
   Adjustments to reconcile net income to net cash provided
      by operating activities:
   Depreciation and amortization.................................            18              19              49              44
   Provision (credit) for losses on loans........................            --              (3)             --              (6)
   Amortization of deferred loan fees............................            (5)            (10)             (7)            (17)
   Deferred loan origination fees (costs)........................             3              10               5               5
   FHLB stock dividends..........................................            (8)             (7)            (22)            (19)
   Gain on sale of investments and mortgage-backed securities....            --              --             (29)             --
   Gain on sale of equipment.....................................            --              (2)                             (2)
   Effect of change in operating assets and liabilities:
       Accrued interest receivable...............................             3             (39)            (34)            (75)
       Prepaid expenses..........................................           131            (114)              1            (142)
       Advances by borrowers for taxes and insurance.............            31              31             (45)            (20)
       Accrued expenses..........................................           316              52             288              45
       Accrued federal income taxes..............................           (38)             --              11              --
       Deferred federal income taxes.............................            --              (5)             --               6
                                                                         ------           -----          ------         -------
            Net cash provided (used) by operating activities.....           424             (56)            299            (126)
                                                                         ------           -----          ------         -------
CASH FLOWS FROM INVESTING ACTIVITIES
   Property and equipment additions..............................           (12)            (65)            (13)            (72)
   Proceeds from sale of equipment...............................            --               4              --               4
   Purchase of mortgage-backed securities - AFS..................            --              --            (653)             --
   Purchase of mortgage-backed securities - HTM..................            --            (164)             --            (164)
   Repayment of mortgage-backed securities.......................            52              26             183              50
   Proceeds from sale of mortgage-backed securities - AFS........            --              --             646              --
   Purchase of certificates of deposit...........................            (3)            (--)             (8)             --
   Redemption of certificates of deposits........................            --              (2)             --              76
   Loan disbursements............................................        (4,173)         (3,339)         (9,832)         (8,049)
   Loan principal repayments.....................................         2,668           2,234           6,552           4,705
   Purchase of investments - AFS.................................        (2,000)             --          (6,150)             --
   Purchase of investments - HTM.................................            --          (1,019)             --          (4,727)
   Maturity of investments - HTM.................................            --           1,300              --           2,500
   Maturity of investments - AFS.................................           400              --           2,220              --
   Proceeds from sale of investments - AFS.......................           149              --           2,501              --
                                                                        -------        --------         -------        --------
       Net cash used in investing activities.....................        (2,919)         (1,025)         (4,554)         (3,667)
                                                                        -------        --------        --------        --------
CASH FLOWS FROM FINANCING ACTIVITIES
   Net increase (decrease) in deposits...........................        (3,597)         (1,196)            432          (1,907)
   Borrowings from FHLB..........................................           (50)          2,625             600           5,225
   Repayment of FHLB advances....................................          (123)             (5)           (265)            (18)
   Payments on capitalized lease obligations.....................            (3)            (10)             (9)            (29)
   Proceeds from issuance of common stock........................         3,572              --           3,572              --
                                                                         ------         -------          ------         -------
       Net cash provided by financing activities.................          (201)          1,414           4,330           3,271
                                                                         ------          ------          ------          ------

Increase (decrease) in cash and cash equivalents.................        (2,696)            333              75            (522)
Cash and cash equivalents, beginning of period...................         4,020           1,124           1,249           1,979
                                                                         ------          ------          ------          ------

Cash and cash equivalents at end of period.......................       $ 1,324         $ 1,457         $ 1,324         $ 1,457
                                                                        =======         =======         =======         =======
SUPPLEMENTAL DISCLOSURE
   Cash paid for:
       Interest expense..........................................          $487            $477          $1,445          $1,347
       Income taxes..............................................          $ --           $  --        $     --         $    24

</TABLE>

See accompanying notes to consolidated financial statements.

                                                            4
<PAGE>6

                                  LENOX BANCORP, INC.
                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 FOR NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995


1.       PRINCIPLES OF CONSOLIDATION
         ---------------------------

         The  consolidated  financial  statements  include the accounts of Lenox
Bancorp,  Inc. ("Lenox" or the "Company") and its wholly-owned  subsidiary Lenox
Savings Bank (the "Bank"). All significant  intercompany  transactions have been
eliminated in  consolidation.  The  investment in the Bank on Lenox's  financial
statements  is carried  at the parent  company's  equity in the  underlying  net
assets.

         The  consolidated  balance  sheet as of September  30, 1996 and related
consolidated  statements  of  income,  cash flows and  changes in  stockholder's
equity  for the three and nine  months  ended  September  30,  1996 and 1995 are
unaudited.  In the opinion of management,  all adjustments  necessary for a fair
presentation of such financial  statements have been included.  Such adjustments
consisted  of  normal  recurring  items.  Interim  results  are not  necessarily
indicative of results for a full year.

         The financial  statements  and notes are presented as permitted by Form
10-Q.  The interim  statements  are unaudited and should be read in  conjunction
with the financial  statements and notes thereto  contained in the Bank's annual
report as presented in Lenox's prospectus dated May 13, 1996.

2.       CONVERSION TO CAPITAL STOCK FORM OF OWNERSHIP
         ---------------------------------------------

         The Board of Directors  of Lenox  Savings  Bank,  FSB adopted a plan of
conversion,  pursuant  to which the Bank would  convert  from an Ohio  chartered
mutual  savings bank to an Ohio chartered  capital stock savings bank,  with the
concurrent  formation of the holding  company,  Lenox Bancorp,  Inc. On July 14,
1996,  the  conversion  from a  mutual  form of  ownership  to a stock  form was
finalized.  Lenox was capitalized  through the initial sale of 425,677 shares of
common stock to eligible account holders,  an employee benefit plan of the Bank,
supplemental  eligible  account  holders,  other  members  of the Bank,  and the
general  public.  Lenox  then used a portion  of the  proceeds  from the sale to
purchase  all of the  outstanding  shares  of the  Bank.  This  transaction  was
accounted for in a manner similar to the pooling of interests method.

         The Bank may not declare or pay cash  dividends on or repurchase any of
its  shares of common  stock if the  effect  thereof  would  cause  equity to be
reduced below applicable regulatory capital maintenance  requirements or if such
declaration and payment would otherwise violate regulatory requirements.



                                        5

<PAGE>7



3.       EARNINGS PER SHARE
         ------------------

         The initial public offering was completed July 14, 1996. Net income for
the nine months  ended  September  30, 1996 was $82,000 and the net loss for the
quarter ended  September 30, 1996 was $53,000 or $(.12) per share.  Earnings per
share  information  for the nine month period ended  September 30, 1996 and 1995
and the quarter  ended  September 30, 1995 are not  applicable  since the Bank's
mutual to stock conversion was not consummated until July 14, 1996.

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

Comparison of Financial Condition at September 30, 1996 and December 31, 1995.
-----------------------------------------------------------------------------

         ASSETS.  Total  assets  increased  by $4.2  million,  or 9.7% to  $47.3
million at September  30,  1996,  from $43.1  million at December 31, 1995.  The
increase in total assets was  primarily  attributable  to the Bank's  conversion
from the  mutual  to stock  form of  ownership  and the  receipt  of  conversion
proceeds upon the issuance of common stock by the Company. Net proceeds from the
issuance of Common Stock  totalled $3.6 million,  and were invested in loans and
investment securities. Loans increased by $3.2 million, or 9.7% to $36.6 million
at  September  30, 1996 from $33.4  million at  December  31,  1995.  Investment
securities  increased by $1.2 million or 19.8% to $7.3 million at September  30,
1996 from $6.1 million at December 31, 1995.

         LIABILITIES. Total liabilities increased by 900,000, from $39.3 million
at December 31, 1995 to $40.2  million at September  30, 1996  primarily  due to
$227,131  accrued for the required  SAIF  assessment  which  contributed  to the
increase in accrued  expenses  and other  liabilities  to $458,455  for the nine
months  ended  September  30, 1996 from  $304,441 at December  31,  1996.  Total
liabilities also increased due to an increase in total deposits.  Total deposits
at  September  30, 1996 were $34.1  million,  representing  a $432,193,  or 1.3%
increase  over the  December  31,  1995  balance of $33.7  million.  Certificate
accounts increased $1.1 million, or 5.2%, while savings, club and other accounts
decreased  $25,460,  or 0.4% and money  market and NOW accounts  increased  $1.3
million,  or 51.6%  during  the first  nine  months  of 1996.  The  increase  in
certificate  accounts was due mainly to favorable rates offered by the Bank. The
increase in money  market and NOW accounts was due to the deposit by the Company
of proceeds from the  conversion  in Lenox Savings Bank.  Federal Home Loan Bank
("FHLB")  advances  increased by $335,292,  or 6.3% to $5.7 million at September
30, 1996 from $5.3 million at December 31, 1995.

         CAPITAL.  Stockholders' equity increased $3.2 million, or 84.8% to $7.1
million at  September  30, 1996 from $3.8  million at  December  31,  1995.  The
increase was due to the Bank's  conversion  to a stock from of ownership and the
subsequent  issuance of common stock which netted the Company $3.6 million.  The
increase  was also due to a net  income of $82,165  earned  for the nine  months
ended September 30, 1996.

         LIQUIDITY AND CAPITAL RESOURCES. The Company's primary sources of funds
are deposits and principal and interest payments on loans.  While maturities and
scheduled amortization of 

                                        6

<PAGE>8



loans are predictable sources of funds,  deposit flows and mortgage  prepayments
are  strongly  influenced  by  changes  in  general  interest  rates,   economic
conditions, and competition.

         The  primary  investment  activity  of the  Company for the nine months
ended  September 30, 1996 was the  origination of mortgage and consumer loans in
the amount of $9.8 million.  The most  significant  source of funds for the nine
months ended  September  30, 1996 were the proceeds  from the issuance of common
stock of $3.6 million and borrowings from the FHLB of $600,000.

         The Bank is  required  to maintain a minimum  level of  liquidity  (net
cash, short term and marketable  assets divided by total deposits and short term
liabilities),  as defined by the Federal Deposit Insurance Corporation ("FDIC"),
of at least 15%.  The Bank's  liquidity  at  September  30, 1996 was 25.0%.  The
Bank's  most  liquid  assets  are  cash,  federal  funds  sold,  and  marketable
securities.  The levels of the Bank's  liquid assets are dependent on the Bank's
operating,  financing, lending and investing activities during any given period.
At September 30, 1996,  assets  qualifying for short term  liquidity,  including
cash and short term investments, totalled $9.7 million.

         At September 30, 1996, the Bank's  capital  exceeded all of the capital
requirements  of the FDIC.  The  Bank's  tier 1  leverage  and total  capital to
risk-weighted capital ratios were 15.2% and 31.4%, respectively.

RECENT DEVELOPMENTS
-------------------

         On  September  30,  1996,  the  President  signed  into law the Deposit
Insurance Funds Act of 1996 (the "Funds Act") which, among other things, imposes
a  special  one-time  assessment  on SAIF  member  institutions,  including  the
Association,  to  recapitalize  the SAIF. As required by the Funds Act, the FDIC
imposed a special  assessment of 65.7 basis points on SAIF  assessable  deposits
held as of March 31, 1995, payable November 27, 1996. The special assessment was
recognized as an expense in the third quarter of 1996 and is tax deductible. The
Association  took  a  charge  of  $227,000  as a  result  of  the  FDIC  special
assessment.

         The Funds Act also spreads the obligations for payment of the Financing
Corporation ("FICO") bonds across all SAIF and BIF members. Beginning on January
1, 1997, BIF deposits will be assessed for FICO payments at a rate of 20% of the
rate  assessed on SAIF  deposits.  Based on current  estimates by the FDIC,  BIF
deposits  will be  assessed  a FICO  payment  of 1.3 basis  points,  while  SAIF
deposits will pay an estimated 6.5 basis points on the FICO bonds. Full pro rata
sharing of the FICO  payments  between  BIF and SAIF  members  will occur on the
earlier of January  1, 2000 or the date the BIF and SAIF are  merged.  The Funds
Act  specifies  that the BIF and SAIF will be merged on January 1, 1999 provided
no savings associations remain as of that time.

         As a result of the Funds Act, the FDIC recently  proposed to lower SAIF
assessments  to 0 to  27  basis  points  effective  January  1,  1997,  a  range
comparable to that of BIF members.  However,  SAIF members will continue to make
the higher FICO payments described above.


                                          7

<PAGE>9


Management cannot predict the level of FDIC insurance assessments on an on-going
basis whether the savings  association charter will be eliminated or whether the
BIF and SAIF will eventually be merged.

Comparison  of Results of  Operations  for the Three months ended  September 30,
--------------------------------------------------------------------------------
1996 and 1995.
-------------

         GENERAL.  Net income for the three  months  ended  September  30,  1996
decreased by $65,000,  or 542%,  to $(53,000)  from $12,000 for the three months
ended September 30, 1995. This decrease was primarily due to the contribution of
$227,000 for the  recapitalization  of the Savings  Association  Insurance  Fund
(SAIF).

         INTEREST  INCOME.  Interest income for the three months ended September
30, 1996 was $844,000  compared to $777,000 for the three months ended September
30, 1995,  an increase of $67,000 or 8.6%.  Interest  earned on loans  increased
$60,000,  or 9.7% to $681,000 for the three months ended September 30, 1996 from
$621,000  for the three  months  ended  September  30,  1995 and was the primary
reason for the increase in interest  income.  The increase in interest earned on
loans  was due to an  increase  in the  average  balance  of loans for the three
months ended September 30, 1996 from the comparable  1995 period.  Adding to the
increase  in  interest  income was an  increase  of $9,000,  or 6.9% in interest
earned on investments and interest bearing deposits. This increase was primarily
due to the average balance of investments and interest  bearing deposits for the
three  months ended  September  30, 1996  increasing  as compared to the average
balance for the three months ended September 30, 1995.

         INTEREST EXPENSE. Interest expense for the three months ended September
30, 1996 was $487,000  compared to $477,000 for the three months ended September
30,  1995,  an increase  of $10,000 or 2.1%.  Interest  expense on deposits  was
$406,000 for the three months ended  September  30, 1996 as compared to $415,000
for the three months ended  September  30,  1995.  Interest  expense on borrowed
money and  capitalized  leases was $81,000 for the three months ended  September
30, 1996 as compared to $63,000 for the three months ended  September  30, 1995,
an  increase  of $18,00 or 28.6%.  The  increase  was due to a larger  amount of
outstanding  Federal Home Loan Bank advances for the period ended  September 30,
1996.

         NET INTEREST INCOME. Net interest income increased for the three months
ended  September  30, 1996  increased  to $357,000  from  $303,000 for the three
months ended  September  30,  1995.  This  increase  was due to interest  income
increasing by $67,000 or 8.6% compared to interest  expense for the three months
ended September 30, 1996 increasing $10,000 or 2.0%

         GENERAL AND ADMINISTRATIVE  EXPENSES.  Other expenses increased for the
three months ended  September  30, 1996 to $477,000  from $314,000 for the three
months ended  September 30, 1995.  This increase was primarily due to the Bank's
contribution  of $227,000 for the  recapitalization  of the Savings  Association
Insurance Fund (SAIF),  implementation of the Bank Employee Stock Ownership Plan
(ESOP) and additional expenses associated with becoming a public company.



                                         8

<PAGE>10



         INCOME  TAXES.  Income taxes for the three months ended  September  30,
1996  decreased  $38,000  to  $(38,000),  from $0 for  the  three  months  ended
September 30, 1995. This was the result of an decrease in income before taxes of
$103,000  for the three months ended  September  30, 1996,  compared to the same
period of the prior year.

Comparison of Results of Operations for the Nine months ended September 30, 1996
--------------------------------------------------------------------------------
and 1995.
--------

         GENERAL.  Net income  for the nine  months  ended  September  30,  1996
increased  by $27,092,  or 33.0%,  to $82,165  from  $55,073 for the nine months
ended  September 30, 1995. This increase was due primarily to an increase in net
interest  income of  $102,044,  offset by an increase in taxes of $14,841 and an
increase  of  $138,506  in  general  and   administrative   expenses   resulting
exclusively from the Bank's contribution of $227,000 for the recapitalization of
the SAIF.

         INTEREST  INCOME.  Interest  income for the nine months ended September
30, 1996 was $2.4  million  compared to $2.2  million for the nine months  ended
September 30, 1995. Interest earned on loans increased $167,069, or 9.2% to $2.0
million for the nine months ended  September  30, 1996 from $1.8 million for the
nine months ended September 30, 1995 and was the primary reason for the increase
in interest  income.  The increase in loans was  primarily due to an increase of
$2.7 million, or 8.3%, in the average balance of conventional mortgage loans for
the nine months ended September 30, 1996 from the comparable 1995 period. Adding
to the  increase in  interest  income,  was an increase of $50,300,  or 13.4% in
interest earned on investments and interest bearing deposits.

         INTEREST EXPENSE.  Interest expense for the nine months ended September
30, 1996 was $1.5  million  compared to $1.3  million for the same period  ended
September  30,  1995,  and  increase  of  112,000 or 8.3%.  Interest  expense on
deposits  decreased  $31,000 or 2.5% to $1.2  million for the nine months  ended
September 30, 1996  compared to the balance for the nine months ended  September
30, 1995, which decrease was primarily due to a larger  percentage of the Bank's
deposits being composed of lower costing money market and NOW accounts. Interest
expense on borrowed money and capitalized  leases increased $135,000 to $243,000
for the nine months ended  September  30, 1996 compared to $108,000 for the nine
months ended  September 30, 1995.  The increase was primarily due to an increase
in borrowed funds.

         NET INTEREST INCOME.  Net interest income increased for the nine months
ended  September  30, 1996 to $970,000  from  $867,000 for the nine months ended
September  30, 1995.  This  increase was due to interest  income  increasing  by
$219,663,  or 9.9% to $2.4  million  from $2.2 million for the nine months ended
September 30, 1996 and 1995, respectively.  Interest expense increased only 8.2%
to $1.5 million for the nine months ended  September  30, 1996  compared to $1.3
million for the same time period in 1995.

         PROVISION FOR LOAN LOSSES. There were no provisions recorded during the
period ended September 30, 1996. As of September 30, 1996,  nonperforming assets
totalled  $65,068  representing  a $24,720  decrease  from the December 31, 1996
balance of $89,788. At September

                                           9

<PAGE>11



30, 1996, the allowance for loan losses  equalled 92.2% of total  non-performing
assets, as compared to 66.8% as of December 31, 1995.

         For the nine months ended  September  30, 1996 and 1995,  loans with an
aggregate  balance of $1.241 were  charged off and loans  totalling  $1,621 were
recovered.  Management  believes  that the current level of loan loss reserve is
adequate to cover losses inherent in the portfolio as of such date. There can be
no  assurance,  however,  that Lenox will not sustain  losses in future  periods
which could be substantial in relation to the size of the allowance at September
30, 1996.

         OTHER INCOME. Other income increased by $78,397 or 114% to $147,213 for
the nine months ended  September 30, 1996 from $68,816 for the nine months ended
September 30, 1995.  The increase was primarily due to an increase of $49,891 in
service fee income and a gain on the sale of  investments  of $29,506 during the
nine months ended September 30, 1996.

         GENERAL AND ADMINISTRATIVE  EXPENSES.  Other expenses increased for the
nine months ended  September 30, 1996 to $1.0 million from $866,374 for the nine
months  ended  September  30,  1995.  This  increase  was the result of the Bank
accruing $227,000 for the recapitalization of the SAIF and the implementation of
the Bank's  Employee  Stock  Ownership  Plan  ("ESOP") and  additional  expenses
associated with becoming a public company.

         INCOME TAXES. Income taxes for the nine months ended September 30, 1996
increased  $14,841 to $29,860,  from $15,019 for the nine months ended September
30, 1995.  This was the result of an increase in income  before taxes of $41,933
for the nine months ended September 30, 1996, compared to the same period of the
prior year.  The  annualized  effective  income tax rate for the  periods  ended
September 30, 1996 and 1995 were 35.4% and 21.4%, respectively.



                                        10

<PAGE>12



                           PART II -- OTHER INFORMATION


ITEM 1.  LEGAL PROCEEDINGS.

         There  are  various  claims  and  lawsuits  in  which  the  Company  is
         periodically  involved incidental to the Company's  business,  which in
         the  aggregate  involve  amounts which are believed by management to be
         immaterial to the financial  condition and results of operations of the
         Company.

ITEM 2.  CHANGES IN SECURITIES.

         Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

         Not applicable.

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

         None

ITEM 5.  OTHER INFORMATION.

         None

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

          (a)  The following exhibits are filed as part of this report.

               Exhibit 3.1 - Certificate of Incorporation of Lenox Bancorp,Inc.*
               Exhibit 3.2 - Bylaws of Lenox Bancorp, Inc.* 
               Exhibit 11  - Computation of Earnings Per Share (filed herewith)
               Exhibit 27  - Financial Data Schedule (filed herewith)

          (b)  Reports on Form 8-K

               None


-----------------------
*   Incorporated  herein by reference  into this  document  from the Exhibits to
    Form S-1,  Registration  Statement,  filed on August 28,  1996,  as amended,
    Registration No. 33-96248.


                                          11

<PAGE>13



                                     SIGNATURES
                                     ----------


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


                                           LENOX BANCORP, INC.
                                           (Registrant)




Date:  November 14, 1996                   /s/ Virginia M. Porowski
                                           ------------------------
                                           Virginia M. Porowski
                                           President and Chief Executive Officer




Date:  November 14, 1996                   /s/ William T. Bird
                                           -------------------
                                           William T. Bird
                                           Treasurer and Chief Financial Officer
                                           (Principal Accounting Officer)