UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                    FORM 10-Q



(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
ACT 1934. For the quarterly period ended March 31, 1998
                                         -------------- 
                                       or

[ ] TRANSITION  REPORT  PURSUANT TO  SECTION 13 OR 15(d) OF THE  SECURITIES  AND
EXCHANGE ACT OF 1934 For the transition period from              to            .
                                                     -----------    -----------
Commission File Number:  0-27036
                         -------

                            Ambanc Holding Co., Inc.
          -----------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Delaware                                  14-1783770
-------------------------------------     --------------------------------------
  (State or other jurisdiction of         (I.R.S. Employer Identification No.)
   incorporation or organization)

11 Division Street, Amsterdam, New York                          12010-4303
--------------------------------------------------------------------------------
(Address of principal executive offices)                         (Zip Code)

Registrant's telephone number, including area code:       (518)842-7200
                                                    -----------------------

     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

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


           Class                                Outstanding at May 13, 1998
-----------------------------                -----------------------------------
Common Stock, $.01 Par Value                             4,258,418

<PAGE>


AMBANC HOLDING CO., INC. AND SUBSIDIARIES
FORM 10-Q
March 31, 1998



                                      Table of Contents


Part I.   FINANCIAL INFORMATION

Item 1.        Consolidated Interim Financial Statements (unaudited):

               Consolidated Interim Statements of Income for the three months
               ended March 31, 1998 and 1997.................................. 3

               Consolidated Interim Statements of Financial Condition at
               March 31, 1998 and December 31, 1997........................... 4

               Consolidated Interim Statements of Cash Flows for the three
               months ended March 31, 1998 and 1997........................... 5

               Summarized Notes to Consolidated Interim Financial Statements.. 7

Item 2.        Management's Discussion and Analysis of Financial Condition
               and Results of Operations......................................10

Item 3.        Quantitative and Qualitative Disclosures About Market Risk.....17

Part II.   OTHER INFORMATION..................................................17

Item 6.    Exhibits and Reports on Form 8-K...................................17

SIGNATURES....................................................................18


EXHIBITS INDEX................................................................19


<PAGE>
Part I.   Financial Information

Item 1.  Financial Statements
AMBANC HOLDING CO., INC. AND SUBSIDIARIES
Consolidated Interim Statements of Income (unaudited)
(dollars in thousands, except per share amounts)
                                                               The Three Months
                                                                Ended March 31,
                                                                1998      1997
                                                              -------    -------
Interest and dividend income:
   Loans ..................................................   $ 5,506   $ 4,891
   Securities available for sale ..........................     3,405     3,659
   Federal Funds Sold .....................................        35        88
   Federal Home Loan Bank stock ...........................        63        37
                                                              -------   -------
     Total interest income ................................     9,009     8,675
                                                              -------   -------
Interest Expense:
   Deposits ...............................................     3,466     3,103
   Borrowings .............................................     1,681     1,552
                                                              -------   -------
     Total interest expense ...............................     5,147     4,655
                                                              -------   -------
     Net interest income ..................................     3,862     4,020

Provision for loan losses .................................       225       363
                                                              -------   -------
     Net interest income after provision
       for loan losses ....................................     3,637     3,657
                                                              -------   -------
Non-interest income:
   Service charges on deposit accounts ....................       212       181
   Net gains (losses) on securities transactions ..........         7        (1)
   Other ..................................................       106        54
                                                              -------   -------
     Total non-interest income ............................       325       234
                                                              -------   -------
Non-interest expense:
   Salaries, wages and benefits ...........................     1,585     1,346
   Occupancy and equipment ................................       413       334
   Data processing ........................................       251       232
   Federal deposit insurance premium ......................        10         9
   Correspondent bank processing fees .....................        30        34
   Real estate owned and repossessed assets expenses, net .         8       110
   Professional fees ......................................       138       109
   Other ..................................................       719       641
                                                              -------   -------
     Total non-interest expenses ..........................     3,154     2,815
                                                              -------   -------

Income  before taxes ......................................       808     1,076
Income tax expense ........................................       362       424
                                                              -------   -------
     Net income ...........................................    $  446   $   652
                                                              =======   =======
Net income per common share - basic .......................     $0.12     $0.16
Net income per common share - diluted .....................     $0.11     $0.16

See accompanying notes to consolidated interim financial statements.

                                       3
<PAGE>
AMBANC HOLDING CO., INC. AND SUBSIDIARIES
Consolidated Interim Statements of Financial Condition (unaudited)
(dollars in thousands)                                     March 31     Dec. 31,
                                                             1998         1997
                                                          ---------    ---------
                           Assets

Cash and due from banks ...............................  $   6,831    $  10,225
Federal funds sold ....................................      9,000         --
                                                         ---------    ---------
     Cash and cash equivalents ........................     15,831       10,225

Securities available for sale, at fair value ..........    204,640      205,842
Loans receivable, net of unamortized fees .............    287,668      284,930
     Allowance for loan losses ........................     (3,952)      (3,807)
                                                         ---------    ---------
     Loans receivable, net ............................    283,716      281,123
Accrued interest receivable ...........................      3,015        3,734
Premises and equipment, net ...........................      3,021        3,121
Federal Home Loan Bank of New York stock, at cost .....      3,498        3,291
Real estate owned and repossessed assets ..............        140          143
Other assets ..........................................      2,968        2,965
Due from brokers ......................................      3,002         --
                                                         ---------    ---------
     Total assets .....................................  $ 519,831    $ 510,444
                                                         =========    =========

               Liabilities and Shareholders' Equity

Liabilities:
   Deposits ...........................................  $ 324,448    $ 333,265
   Advances from borrowers for taxes and insurance ....      1,319        1,902
   Advances from FHLB .................................          0       12,300
   Other borrowed funds ...............................    116,650       99,250
   Accrued interest payable ...........................        907          819
   Accrued expenses and other liabilities .............      1,722        1,706
   Due to brokers .....................................     14,031         --
                                                         ---------    ---------
     Total liabilities ................................    459,077      449,242

Shareholders' equity:
   Preferred stock $.01 par value. Authorized 5,000,000
    shares; none outstanding at March 31, 1998 and
    December 31, 1997 .................................         --          --
   Common stock $.01 par value. Authorized 15,000,000
    shares; 5,422,250  shares issued  at  March 31,
    1998 and December 31, 1997 ........................         54           54
   Additional paid in capital .........................     52,482       52,385
   Retained earnings, substantially restricted .........    26,648       26,458
   Treasury Stock, at cost (1,163,832 shares at March
    31, 1998  and  1,115,832 at December 31, 1997) ....    (13,461)     (12,585)
   Common stock acquired by ESOP ......................     (3,180)      (3,303)
   Unearned RRP shares issued .........................     (1,420)      (1,533)
   Accumulated other comprehensive income .............       (369)        (274)
                                                         ---------    ---------
     Total shareholders' equity .......................     60,754       61,202

     Total liabilities and shareholders' equity .......  $ 519,831    $ 510,444
                                                         =========    =========

See accompanying notes to consolidated interim financial statements.

                                       4
<PAGE>
AMBANC HOLDING CO., INC. AND SUBSIDIARIES
Consolidated Interim Statements of Cash Flows (unaudited)
(dollars in thousands)                                     For the Three months
                                                               ended March 31
                                                              1998        1997
                                                            --------    --------
Increase (decrease) in cash and cash equivalents:
Cash flows provided by operating activities:
    Net income .......................................   $    446    $    652
    Adjustments to reconcile net income  to net
    cash provided by operating activities:
     Depreciation and Amortization ...................        177         129
     Provision for loan losses .......................        225         363
     Provision for losses and writedowns on
      real estate owned and repossessed assets .......          3          58
     ESOP compensation expense .......................        219         170
     RRP Expense .....................................        113         --
     Net gains (losses) on securities transactions ...         (7)          1
     Net loss on sale of other real estate
      owned and other repossessed assets .............        --            7
     Net amortization on  securities .................        242          86
     Increase) decrease in accrued interest
      receivable and other assets ....................        771         180
     Increase (decrease) in accrued expenses
      and other liabilities ..........................        104          68
     Increase (decrease)  in advances from
      borrowers for taxes and insurance ..............       (583)       (592)
                                                         --------    --------
        Net cash provided by
         operating activities ........................      1,710       1,122

Cash flows from investing activities:
    Proceeds from sales and redemptions of
     securities available for sale ...................     41,041       2,467
    Purchases of securities available for sale .......    (41,749)    (12,529)
    Proceeds from principal paydowns and
     maturities of securities available for sale .....     12,546       5,232
    Purchase of FHLB stock ...........................       (207)     (1,262)
    Net (increase) decrease in loans made to customers     (2,895)       (424)
    Capital Expenditures .............................        (68)       (166)
    Proceeds from Sale of other real estate owned and
     other repossessed assets .......................          77          62
                                                         --------    ---------
  Net cash used by investing activities                     8,745      (6,620)

                                                                 (Continued)


                                       5
<PAGE>
AMBANC HOLDING CO., INC. AND SUBSIDIARIES
Consolidated Interim Statements of Cash Flows, Continued (unaudited)
(dollars in thousands)                                     

                                                            For the Three months
                                                               ended March 31
                                                              1998        1997
                                                            --------    --------
     Cash flows from financing activities:
         Purchase of Treasury Stock .....................      (876)       --
         Dividends paid .................................      (256)       --
         Net increase (decrease) in deposits ............    (8,817)     13,389
         Advances from (repayments on)
          FHLB borrowings, net ..........................   (12,300)     (6,000)
         Increase (decrease) in other borrowed funds ....    17,400        (470)
                                                           --------    --------
         Net cash provided (used) by financing 
          activities ....................................    (4,849)      6,919

     Net increase in cash and cash equivalents ...........    5,606       1,421
     Cash and cash equivalents at beginning of year .....    10,225      10,887
                                                           --------    --------
     Cash and cash equivalents at end of period .........  $ 15,831    $ 12,308
                                                           ========    ========


Supplemental disclosures of cash flow information-
   cash paid during the year for:

                Interest ................................  $  5,061    $  4,698
                                                           ========    ========

                Income Taxes ............................  $    267    $    270
                                                           ========    ========
    
Noncash investing activity:
   Net reduction in loans receivable
   resulting from the transfer to real
   estate owned and other repossessed assets ............  $     77    $     75
                                                           ========    ========
  
   Due from/(to) Brokers, Net............................  $(11,029)       ---
                                                           ========    ======== 

   Net decrease in unrealized loss on securities 
   available for sale, net of deferred tax effect ....... ($     95)  ($  1,521)
                                                           ========    ========

      See accompanying notes to consolidated interim financial statements.

                                       6
<PAGE>

     SUMMARIZED NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS


(1)  In  management's opinion,  the financial  information,  which is unaudited,
reflects all adjustments,  consisting  solely of normal  recurring  adjustments,
necessary for a fair presentation of the financial information as of and for the
three month periods  ended March 31, 1998 and March 31, 1997 in conformity  with
generally  accepted   accounting   principles.   These  consolidated   financial
statements  should be read in conjunction  with Ambanc Holding Co., Inc.'s ("the
Company"  herein) 1997 Annual Report on Form 10-K. The results of operations for
the interim periods are not necessarily  indicative of the results of operations
to be expected for the full fiscal year ended December 31, 1998.

(2)  Amounts in the prior periods' consolidated interim financial statements are
reclassified whenever necessary to conform to current period presentations.

(3)  Earnings per Share

     On December 31, 1997,  the Company  adopted the provisions of SFAS No. 128,
"Earnings  Per Share".  The statement  supersedes  Accounting  Principles  Board
Opinion No. 15, "Earnings Per Share" and related  interpretations.  SFAS No. 128
requires  dual  presentation  of Basic  EPS and  Diluted  EPS on the face of the
consolidated  income statement for all entities with complex capital  structures
and  specifies  additional  disclosure  requirements.  Basic  earnings per share
excludes  dilution and is calculated by dividing net income  available to common
shareholders  by the weighted  average number of shares  outstanding  during the
period.  Unvested  restricted  stock awards are  considered  outstanding  common
shares and included in the computation of basic EPS as of the date that they are
fully vested.  Diluted EPS reflects the  potential  dilution that could occur if
securities or other  contracts to issue common stock were  exercised into common
stock or resulted in the issuance of common stock. All prior period EPS data has
been restated to conform to the  provisions of this  Statement.  The adoption of
this  Statement  did not have a material  effect on the  Company's  consolidated
financial position or results of operations.

     Calculations  of basic earnings per share (basic EPS) and diluted  earnings
per share (diluted EPS) are as follows:

For the quarter ended March 31, 1998
------------------------------------

Basic EPS
---------
Income available to common shareholder           $446        3,828,636     $0.12


Effect of Dilutive Securities
----------------------------
Stock Options                                                   62,499         
RRP shares                                                      36,769 
                                                             ---------

Diluted EPS
-----------
Income available to common shareholders          
 plus assumed conversions                        $446        3,927,904     $0.11
                                                 ====        =========     =====

                                       7
<PAGE>

For the quarter ended March 31, 1997
------------------------------------


Basic EPS
---------
Income available to common shareholders          $652        4,011,349     $0.16


Effect of Dilutive Securities
-----------------------------
Stock Options                                                    ---
RRP                                                              ---

                                                             ---------
Diluted EPS
-----------
Income available to common shareholders
 plus assumed conversions                        $652        4,011,349     $0.16
                                                 ====        =========     =====

(4)  Comprehensive Income

     On January 1, 1998,  the Company  adopted the  provisions  of  Statement of
Financial Accounting Standards No. 130, "Reporting  Comprehensive  Income." This
statement  establishes  standards  for  reporting  and display of  comprehensive
income and its components. Comprehensive income includes the reported net income
of a company  adjusted  for items  that are  currently  accounted  for as direct
entries to equity, such as the mark to market adjustment on securities available
for sale, foreign currency items and minimum pension liability  adjustments.  At
the Company, comprehensive income represents net income plus other comprehensive
income,  which  consists  of the net  change  in  unrealized  gains or losses on
securities  available for sale for the period.  Accumulated other  comprehensive
income represents the net unrealized gains or losses on securities available for
sale as of the balance sheet dates.

     Comprehensive  income  (loss) for the  three-month  periods ended March 31,
1998  and  1997  was  $351,000  and  ($869,000),   respectively.  The  following
summarizes the components of other comprehensive income:

Unrealized Gains (Losses) on Securities:
                                                          (Dollars in thousands)
     Unrealized holding gains (losses) arising during three 
       months ended March 31, 1997, net of tax 
       (pre-tax amount of ($2,536,000)                                  ($1,522)
     Reclassification adjustment for losses realized
       in net income during the three months ended
       March 31, 1997, net of tax (pre-tax amount of $1,000)                  1
                                                                        -------
Other comprehensive income (loss)- three months ended March 31, 1997    ($1,521)
                                                                        =======
     Unrealized holding gains (losses) arising during three months
       ended March 31, 1998, net of tax 
       (pre-tax amount of ($152,000)                                    ($   91)
     Reclassification adjustment for gains realized in net
       income during the three months ended March 31, 1998,
       net of tax (pre-tax amount of $7,000)                            (     4)
                                                                        -------
Other comprehensive income (loss)- three months ended March 31, 1998    ($   95)
                                                                        =======

                                       8
<PAGE>

(5)  SFAS 125

     Effective  January 1, 1998 the Company adopted the remaining  provisions of
SFAS No. 125,  "Accounting  for Transfers and Servicing of Financial  Assets and
Extinguishments  of Liabilities,"  which relate to the accounting for securities
lending,  repurchase agreements,  and other secured financing activities.  These
provisions,  which were  delayed for  implementation  by SFAS No.  127,  are not
expected to have a material  impact on the  Company.  In  addition,  the FASB is
considering  certain  amendments and  interpretations  of SFAS No. 125 which, if
enacted in the future, could affect the accounting for transactions within their
scope.

(6)  SFAS 131

     In June 1997, the FASB issued SFAS No. 131,  "Disclosure  about Segments of
an Enterprise and Related  Information".  SFAS No. 131 establishes standards for
reporting  by  public  companies  of  operation  segments  within  the  company,
disclosures  about products and services,  geographic areas and major customers.
This statements is effective for the Company's 1998 annual financial  reporting.
Management believes that the adoption of SFAS No. 131 will not have an impact on
the Company's consolidated financial statements.

(7)  SFAS 132

     In February  1998,  the FASB issued SFAS No. 132,  "Employers'  Disclosures
about Pension and Other  Postretirement  Benefits,"  which amends the disclosure
requirements of SFAS No. 87, "Employers' Accounting for Pensions,  "SFAS No. 88,
"Employers'  Accounting for  Settlements  and  Curtailments  of Defined  Benefit
Pension  Plans and for  Termination  Benefits,"  and SFAS No.  106,  "Employers'
Accounting for Postretirement  Benefits Other Than Pensions."  Statement No. 132
standardizes the disclosure requirements of Statements No. 87 and No. 106 to the
extent  practicable and recommends a parallel format for presenting  information
about pensions and other postretirement  benefits.  This statement is applicable
to all entities and addresses disclosure only. The Statement does not change any
of the measurement or recognition  provisions  provided for in Statement No. 87,
No. 88, or No. 106. The Statement is effective for fiscal years  beginning after
December 15, 1997. Management  anticipates providing the required disclosures in
the December 31, 1998 consolidated financial statements.

(8)  Acquisition

     On April 23, 1998, the Company signed an agreement to merge AFSALA Bancorp,
Inc.  (AFSALA) with the Company.  Under the terms of the agreement,  each AFSALA
share will be converted  into 1.07 shares of the Company in a tax-free stock for
stock exchange,  for a total value of approximately $30 million. The acquisition
is  expected to be  completed  in the fourth  quarter of 1998.  AFSALA had total
assets of $166 million and  deposits of $139  million as of March 31, 1998.  The
acquisition  will be  accounted  for under the  purchase  method of  accounting.
Accordingly,  the results of  operations  of AFSALA  will be  included  with the
Company's, beginning with the date of acquisition. Consummation of the merger is
subject to  satisfaction  of a number of  conditions,  including,  amoung  other
things, stockholders' and regulatory approval.

                                       9
<PAGE>

Item 2

   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
                                   OPERATIONS

     The following  discussion and analysis  should be read in conjunction  with
the unaudited  consolidated  interim financial  statements and related notes and
with the statistical  information and  consolidated  financial data appearing in
this report as well as the Company's 1997 Annual Report on Form 10-K.


Forward Looking Statements

     When used in this quarterly Report on Form 10-Q, the words or phrases "will
likely   result,"  "are  expected  to,"  "will   continue,"  "is   anticipated,"
"estimate,"   "project"  or  similar   expressions   are  intended  to  identify
"forward-looking  statements"  within  the  meaning  of the  Private  Securities
Litigation  Reform Act of 1995. Such statements are subject to certain risks and
uncertainties  --  including,  changes in economic  conditions  in the Company's
market  area,  changes in  policies  by  regulatory  agencies,  fluctuations  in
interest rates,  demand for loans in the Company's  market area and competition,
that could cause actual results to differ materially from historical earnings or
losses and those  presently  anticipated  or  projected.  The Company  wishes to
caution  readers  not  to  place  undue  reliance  on any  such  forward-looking
statements,  which speak only as of the date made.  The Company wishes to advise
readers  that the factors  listed  above could  affect the  Company's  financial
performance  and could cause the Company's  actual results for future periods to
differ  materially  from any opinions or  statements  expressed  with respect to
future periods in any current statements.

     The Company does not undertake -- and specifically disclaims any obligation
-- to  publicly  release  the result of any  revisions  which may be made to any
forward-looking  statements to reflect events or circumstances after the date of
such  statements or to reflect the occurrence of  anticipated  or  unanticipated
events.


Year 2000

     The Company has established a committee (the "Y2K  Committee") to conduct a
comprehensive  review of its computer systems to identify the systems that could
be  affected  by the "Year 2000"  problem.  Since  December  31,  1997,  the Y2K
Committee has not reported any significant  non-compliance  issues pertaining to
the Company, its vendors or its customers.

     Based on the Company's current knowledge and investigations, the expense of
the Year 2000 problem,  as well as the related potential effect on the Company's
earnings,  is not expected to have a material effect on the Company's  financial
position  or  results  of  operations.  Furthermore,  the  Company  expects  any
corrective  measures required to be prepared for the Year 2000 to be implemented
on a timely basis.


General

     The results of operations of the  Company's  subsidiary  Bank are dependent
primarily on net interest  income,  which is the  difference  between the income
earned on its  loans and  securities  and its cost of funds,  consisting  of the
interest  paid on  deposits  and  borrowings.  Results  of  operations  are also


                                       10
<PAGE>

affected by the Bank's  provision  for loan losses,  net expenses on  foreclosed
assets and by general economic and competitive conditions,  particularly changes
in interest rates,  government  policies and actions of regulatory  authorities.
Future  changes in  applicable  law,  regulations  or  government  policies  may
materially  impact the  financial  condition  and results of  operations  of the
Company and the Bank.

     Ambanc  recorded net income of $446,000,  or $0.12 per basic common  share,
for the quarter  ended March 31, 1998.  These  results  compare to net income of
$652,000,  or $0.16 per basic common share,  for the comparable  period in 1997.
Diluted  earnings  per share for the quarter  ended March 31, 1998 were $0.11 as
compared to $0.16 for the corresponding period in 1997.

     Non-performing assets improved to $3.2 million at March 31, 1998, from $3.4
million at December 31,  1997.  At March 31,  1998,  non-performing  assets were
0.62% of total assets as compared to 0.67% at December 31, 1997.  The  Company's
allowance  for loan losses to  non-performing  loans and to total loans at March
31,  1998,  were  127.81%  and 1.37%,  respectively,  as compared to 117.07% and
1.34%, respectively, at December 31, 1997. See "Asset Quality" herein.


                             RESULTS OF OPERATIONS

Net Interest Income

     Net interest  income before  provision for loan losses for the three months
ended March 31, 1998 was $3.9  million,  a decline of $158,000,  or 3.93%,  when
compared to the comparable  period in 1997.  Total interest and dividend  income
increased by $334,000 while total interest expense increased by $492,000.

     The increase in total  interest and  dividend  income was due  primarily to
growth of $34.5 million, or 13.75%, in the average volume of loans for the three
months  ended March 31, 1998 as compared to the like 1997  period.  The positive
effect derived from the increase in the average loan volume was offset  slightly
by a decrease  of 9 basis  points to 7.82% in the  average  rate earned on loans
resulting  in a net  increase in interest  income  from loans of  $615,000.  The
increase  in loan  interest  was  partially  offset by a decrease of $254,000 in
interest income earned on securities  available for sale  ("securities")  mainly
due to a decline of 47 basis  points in the average  rate  earned to 6.79%,  the
result of the general  decline in market  interest  rates from March 31, 1997 to
March 31, 1998. The lower rate environment  produced an acceleration in mortgage
prepayments on mortgage backed securities (which represent  approximately 71% of
the total securities  portfolio) and call redemptions on other  securities.  The
reinvestments of the cash flows generated from securities were made at the lower
interest rates that were in effect at the date of reinvestment.

     The increase in total interest expense was due mainly to an increase in the
interest  paid on  certificates  of deposits of $380,000,  the result of a $22.3
million increase in the average volume of certificates of deposit accompanied by
an increase in the average  rate paid to 5.77%,  an increase of 16 basis  points
over the rate paid in the quarter ended March 31, 1997.  Additionally,  the cost
of borrowed funds increased by $129,000,  primarily the result of an increase in
the average volume of $8.5 million.
 
     Ambanc Holding Co., Inc. operates in an environment of intense  competition
for  deposits  and  loans and due to this  heightened  level of  competition  to
attract and retain  customers,  the Company must  continue to offer  competitive
interest  rates on loans and  deposits.  As a consequence  of these  competitive
pressures, from time-to-time, the relative spreads between interest rates earned


                                       11
<PAGE>

and interest rates paid will tighten, exerting downward pressure on net interest
income.  However,  management  does not want to curtail  growth in the Company's
customer  base for loans and deposits  and the  positive  benefits to be derived
from them by offering  non-competitive  interest rates. Management believes that
the  longer-term  benefits  that  should be  realized  from this  strategy  will
outweigh the shorter-term  costs associated with attracting,  cross-selling  and
retaining an expanding customer base.

     Between  March  31,  1997 and 1998,  the  number  of  transaction  accounts
(comprised of commercial and retail  checking  accounts,  NOW accounts and money
market fund accounts) grew by 5.81% to approximately 24,000 accounts with retail
checking accounts increasing by 6.29% and commercial checking account increasing
by  11.05%.  The  Company's  growing  customer  base  provides  Ambanc  with the
potential for future,  profitable customer relationships,  which should increase
shareholder value.


Provision for loan losses

     Provision for loan losses declined by $138,000,  or 38.02%, to $225,000 for
the three months ended March 31, 1998,  from $363,000 in 1997.  The reduction in
the provision expense was primarily attributable to the continued improvement in
the  quality  of  the  loan   portfolio  as   evidenced  by  the   reduction  in
non-performing loans.


Non-interest income

     Total non-interest income increased by $91,000, or 38.89%, to $325,000 from
$234,000. Service charges on deposit accounts increased by $31,000 due mainly to
an increase in certain service charges.

     Other non-interest  income increased by $52,000, or 96.3%, to $106,000 from
$54,000.  Included in the increase is $41,000 of residual  rental income related
to  an  other  real  estate  owned  property  that  was  previously  sold.  


Non-interest expense

     Total  non-interest  expense  for the three  months  ended  March 31,  1998
increased to $3.1 million  compared to $2.8 million for the same period in 1997,
an increase  of $339,000 or 12.0%.  This  increase  resulted  primarily  from an
increase  in  salaries,  wages and  benefits  of  $239,000,  or 17.76%,  to $1.6
million.

     Salaries  and wages  increased  by $183,000 to $1.0 million and the related
payroll  taxes  increased  by $8,000.  Salaries  and wages  related to the three
branch  offices opened in May 1997  accounted for  approximately  $50,000 of the
total  increase  in  salaries  and wages.  The  remainder  of the  increase  was
attributable  to  other  additions  to  staff,   salary  increases   related  to
promotions, and normal merit and cost of living adjustments.

     Expenses related to employee benefits  increased by $45,000,  or 11.01%, to
$454,000  for the three  months  ended  March  31,  1998  when  compared  to the
corresponding  period in 1997. This increase was primarily  related to increased
costs associated with stock based  compensation  plans partially offset by a net
decline in all other employee benefit costs.

                                       12
<PAGE>

                               FINANCIAL CONDITION

     The  Company's  total assets at March 31,  1998,  were $519.8  million,  an
increase of $9.4 million, or 1.8%, compared to total assets of $510.4 million at
December 31,  1997.  The growth in total assets was  primarily  attributable  to
increases in loans and federal funds sold,  which  increased by $2.7 million and
$9.0 million, respectively.

     Total deposits at March 31, 1998, were $324.4  million,  a decrease of $8.8
million,  or 2.65%,  from $333.3  million at December 31, 1997.  The decrease in
total deposits was attributable  primarily to a $9.3 million,  or 5.1%, decrease
in certificates of deposit.

     Total shareholders'  equity decreased $448,000 to $60.8 million,  primarily
due to the repurchase of common stock shares  totaling  $876,000 and the payment
of a cash dividend of $256,000,  partially  offset by net income from operations
of $446,000 for the three months ended March 31, 1998. Including unreleased ESOP
and restricted RRP shares as outstanding, the book value per share was $14.27 at
March  31,  1998  compared  to  $14.21  at  December  31,  1997.  Excluding  the
tax-effected  unrealized losses on securities available for sale, the book value
per share at March 31, 1998, was $14.35 compared to $14.28 at December 31, 1997.


Liquidity and Funding

     The Company's primary sources of funds for operations are deposits from its
market area,  principal and interest payments on loans and securities  available
for sale, proceeds from the sale and maturity of securities  available for sale,
advances  from the FHLB of New York,  and  securities  sold under  agreements to
repurchase.  While maturities and scheduled amortization of loans and securities
are  predictable  sources of funds,  deposit flows and mortgage  prepayments are
greatly  influenced  by  general  interest  rates,   economic  conditions,   and
competition.

     The primary  investing  activities  of the Company are the  origination  of
loans and the purchase of  securities.  During the quarter ended March 31, 1998,
the Bank's loan  originations  totaled  $13.0  million.  The  Company  purchased
securities available for sale during the same quarter of $55.8 million.

     The primary  financing  activity of the Bank is the attraction of deposits.
However,  during the quarter ended March 31, 1998, the Bank's deposits decreased
by $8.8 million from December 31, 1997, primarily certificates of deposit, which
decreased $9.3 million.  Management believes that the decrease in CDs during the
three  months  ended  March 31,  1998,  resulted  primarily  from the holders of
maturing  certificates  of deposit  pursuing  alternative  investments to obtain
better returns.

     The Bank is required to maintain minimum levels of liquid assets as defined
by OTS regulations.  This requirement,  which may be varied by the OTS depending
upon  economic  conditions  and deposit  flows,  is based upon a  percentage  of
deposits and short-term  borrowings.  The required  minimum  liquidity  ratio is
currently 4%. The Bank's  average daily  liquidity  ratio for the month of March
1998 was 20.4%.

     The Bank's most liquid assets are cash and cash equivalents,  which include
federal funds sold and bank deposits.  The level of these assets is dependent on
the Bank's  operating,  financing,  and  investing  activities  during any given


                                       13
<PAGE>

period.  At March 31, 1998,  cash and cash  equivalents  totaled $15.8  million,
compared to $10.2  million at December 31, 1997.  The increase  resulted from an
increase of $9.0 million in federal funds sold, partially offset by a decline in
cash and bank deposits.

     The Bank  anticipates  that it will have sufficient funds available to meet
its  current  commitments.  At March  31,  1998,  the Bank  had  commitments  to
originate  loans of $5.6 million as well as undrawn  commitments of $6.5 million
on home  equity and other  lines of  credit.  Certificates  of deposit  that are
scheduled  to  mature  in one year or less at March  31,  1998,  totaled  $115.7
million.  Management  believes that a significant  portion of such deposits will
remain  with  the  Bank.  However,  if the  Bank  is not  able to  maintain  its
historical  retention rate on maturing  certificates of deposit, it may consider
employing one or more of the following  strategies:  increase its borrowed funds
position to compensate for the deposit outflows; increase the rates it offers on
these  deposits in order to maintain or increase the retention  rate on maturing
CDs and/or to attract new  deposits;  or,  attempt to increase  certificates  of
deposit  through the use of deposit  brokers.  Depending  on the level of market
interest  rates  at  the  CD  renewal  dates,  the  implementation  of  one or a
combination  of these  strategies  could result in higher or lower levels of net
interest income and net earnings.

     The Company  also has a need for, and sources of,  liquidity.  Liquidity is
required  to fund its  operating  expenses,  as well as for the  payment  of any
dividends to  stockholders.  The primary source of liquidity on an ongoing basis
is dividends from the Bank. The Bank paid its first cash dividend to the Company
on March 31, 1998, in the amount of $5.0 million.


Capital

     Federally  insured savings  institutions are required to maintain a minimum
level  of  regulatory  capital.  The  OTS  has  established  capital  standards,
including a tangible  capital  requirement,  a leverage  ratio (or core capital)
requirement  and a risk-based  capital  requirement  applicable  to such savings
associations.  These capital  requirements must be generally as stringent as the
comparable  capital  requirements for national banks. The OTS is also authorized
to  impose  capital  requirements  in excess of these  standards  on  individual
associations on a case-by-case basis.

     At March 31, 1998, the Bank had $45.4 million of tangible and core capital,
respectively,  or 8.8% of adjusted total assets,  which was approximately  $37.7
million  and $30.0  million  above the  minimum  requirements  of 1.5% and 3.0%,
respectively,  of the adjusted total assets in effect on that date. On March 31,
1998, the Bank had risk-based  capital of $48.1 million (including $45.4 million
in core capital and $2.7 million in qualifying  supplementary  capital) or 22.1%
of risk-weighted assets of $218.4 million. The Bank's risk-weighted  capital was
$30.6 million above the 8.0% requirement in effect on that date.


ASSET QUALITY

Non-Performing Assets

     The table  below sets forth the amounts and  categories  of  non-performing
assets at the dates indicated. Generally, loans are placed on non-accrual status
when the loan is 90 days or more  delinquent or when  management  has determined
that the collection of principal  and/or  interest in full has become  doubtful.


                                       14
<PAGE>

When loans are  designated as  non-accrual,  all accrued but unpaid  interest is
reversed  against  current  period  income and,  as long as the loan  remains on
non-accrual  status,  interest is recognized only when received.  Accruing loans
delinquent 90 days or more include FHA insured loans, VA guaranteed  loans,  and
loans that are in the  process of  negotiating  a  restructuring  with the Bank,
excluding troubled debt  restructurings  (TDRs), or where the Bank believes that
the  outstanding  loan  balance  plus  accrued  interest  and late  fees will be
paid-in-full  within a  relatively  short  period  of time from the date of such
notification. Foreclosed assets include assets acquired in settlement of loans.
    
                                               March 31   Dec.31
                                                 1998      1997
                                                ------    ------
                                                 (In thousands)
Non-accruing loans:
   One-to four-family ......................   $  809    $  843
   Multi-family ............................       28        28
   Commercial real estate ..................      232       265
   Consumer ................................      223       293
   Commercial Business .....................      193       447
                                               ------    ------
     Total .................................    1,485     1,876
                                               ------    ------
Accruing loans delinquent more than 90 days:
   One-to four-family ......................      366       280
   Multi-family ............................      --        --
   Commercial real estate ..................       20        13
   Consumer ................................        0         2
   Commercial Business .....................       34       156
                                               ------    ------
     Total .................................      420       451
                                               ------    ------
Troubled debt restructured loans:
   One-to four-family ......................       86        86
   Multi-family ............................      --         34
   Commercial real estate ..................      757       761
   Consumer ................................      --        --
   Commercial Business .....................      344        50
                                               ------    ------
     Total .................................    1,187       931
                                               ------    ------
Total non-performing loans .................    3,092     3,258
                                               ------    ------
Foreclosed assets:
   One-to four-family ......................       69        69
   Multi-family ............................      --        --
   Commercial real estate ..................      --        --
   Consumer ................................       71        74
   Commercial Business .....................      --        --
                                               ------    ------
     Total .................................      140       143
                                               ------    ------

Total non-performing assets ................   $3,232    $3,401
                                               ======    ======
Total as a percentage of total assets ......     0.62%     0.67%

     There were no material changes in non-performing  assets since December 31,
1997.


                                       15
<PAGE>

Allowance for Loan Losses

     The allowance for loan losses is  established  through a provision for loan
losses  based on  management's  evaluation  of the  risks  inherent  in its loan
portfolio and changes in the nature and volume of its loan  activity,  including
those  loans  that  are  being  specifically   monitored  by  management.   Such
evaluation,  which includes a review of loans for which full  collectibility may
not be reasonably assured,  considers,  among other matters,  the estimated fair
value of the  underlying  collateral  for collateral  dependent  loans,  the net
present  value of  estimated  future  cash  flows if the loan is not  collateral
dependent,  economic  conditions,  historical  loan loss  experience,  and other
factors  that  warrant  recognition  in  providing  for an  adequate  loan  loss
allowance. The following table sets forth an analysis of the Company's allowance
for loan losses.


                                                       For the Three months
                                                           ended March 31,
                                                          1998       1997
                                                         ------     ------
                                                           (In thousands)

Balance at beginning of period .....................   $ 3,807     $ 3,438

Charge-offs:
     One- to four-family ...........................        (6)        --
     Multi Family ..................................       --          --
     Commercial Real Estate ........................       --          --
     Consumer ......................................       (92)       (108)
     Commercial Business ...........................       --          --
                                                       -------     -------
        Total Charge offs ..........................       (98)       (108)

Recoveries:
     One- to four-family ...........................         1         --
     Multi Family ..................................       --          --
     Commercial Real Estate ........................       --            4
     Consumer ......................................        13           9
     Commercial Business ...........................         4           6
                                                       -------     -------
        Total Recoveries ...........................        18          19

Net Charge-offs ....................................       (80)        (89)
Provisions charged to operations....................       225         363
                                                       -------     -------
Balance at end of period ...........................     3,952       3,712
                                                       =======     =======

Ratio of net charge-offs during
the period to average loans
outstanding during period .........................       0.03%       0.04%

Ratio of net charge-offs during
the period to average
non-performing assets .............................       1.12%       1.68%

                                                                   

                                       16
<PAGE>

Item 3.

     Quantitative And Qualitative Disclosures About Market Risk

     There have been no material  changes in the  Company's  interest  rate risk
position  since December 31, 1997.  Other types of market risk,  such as foreign
exchange rate risk and  commodity  price risk, do not arise in the normal course
of the Company's business activities.


Part II - Other Information

Item 1.  Exhibits and Reports on Form 8-K

      (a)   Exhibits as required by Item 601 of Regulation S-K.

            Financial data schedule, Exhibit #27

      (b)   Reports on Form 8-K

            Current reports on  Form 8-K were filed  February 19, 1998, March 2,
            1998 and April 23, 1998.
            
      (i)   February 19, 1998 press release  regarding Ambanc  Holding Co., Inc.
            Stock Repurchase Program.

      (ii)  March 2, 1998  press  release  regarding Ambanc  Holding  Co., Inc.,
            Quarterly Cash Dividend.

      (iii) April 23, 1998  press  release  regarding  Ambanc  Holding Co., Inc.
            Merger Announcement
       
               


                                       17
<PAGE>



                                   SIGNATURES


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

AMBANC HOLDING CO., INC.





Robert J. Brittain
President and Chief Executive Officer
(Principal Executive Officer)
Date:  May 13, 1998




Harold A. Baylor, Jr.
Vice President, CFO and Treasurer
(Principal Financial and Accounting Officer)
Date:  May 13, 1998

                                       18
<PAGE>