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 OF 1934

For the quarterly period ended                June 30, 1997
                               ---------------------------------------------

                                       OR

[X]      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      0-27010
                                                 ---------------

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


           New Jersey                                    22-3402073
--------------------------------------------------------------------------------
(State or other jurisdiction of             (I.R.S. employer identification no.)
incorporation or organization)           

86 Main Street, Little Falls, New Jersey                          07424
--------------------------------------------------------------------------------
(Address of principal executive offices)                        (Zip Code)

Registrant's telephone number, including area code  (201) 256-6100
                                                  ------------------------------

                                       N/A
--------------------------------------------------------------------------------
Former name,  former address and former fiscal year, if changed
since last report.

         Indicate by check [X] 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. Yes X 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 August 8, 1997.

           Class                                              Outstanding
---------------------------                                 ----------------
$.10 par value common stock                                 2,684,680 shares


<PAGE>



                           LITTLE FALLS BANCORP, INC.
                                    FORM 10-Q
                       FOR THE QUARTER ENDED JUNE 30, 1997

                                      INDEX

                                                                    Page
                                                                   Number

PART I - CONSOLIDATED FINANCIAL INFORMATION OF LITTLE FALLS
         BANCORP, INC.

Item 1.  Financial Statements and Notes Thereto....................  1
Item 2.  Management's Discussion and Analysis of Financial
                  Condition and Results of Operations..............  6

PART II - OTHER INFORMATION

Item 1.  Legal Proceedings......................................... 12
Item 2.  Changes in Securities..................................... 12
Item 3.  Defaults upon Senior Securities........................... 12
Item 4.  Submission of Matters to a Vote of Security Holders....... 12
Item 5.  Other Materially Important Events......................... 12
Item 6.  Exhibits and Reports on Form 8-K.......................... 12

SIGNATURES


<PAGE>



                           LITTLE FALLS BANCORP, INC.
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                     June 30,              December 31,
                                                                                       1997                    1996
<S>                                                                               <C>                     <C>         
ASSETS
Cash and due from banks................................................           $  3,332,106            $  1,746,743
Interest-bearing deposits in other banks...............................              6,570,723               3,627,221
Federal funds sold.....................................................              1,000,000               5,000,000
                                                                                   -----------             -----------
     Total cash and cash equivalents...................................             10,902,829              10,373,964
Investment securities held-to-maturity net
  (estimated fair values $46,643,000
  and $51,204,000).....................................................             47,015,754              51,370,297
Mortgage-backed securities held to maturity, net
  (estimated fair values $102,229,000
  and $112,426,000)....................................................            102,430,729             112,473,144
Loans receivable, net..................................................            128,132,218             117,115,784
Premises and equipment, net............................................              2,627,241               2,659,239
Investment in real estate, net.........................................                532,512                 683,054
Foreclosed real estate, net............................................                453,757                 857,157
Interest receivable, net...............................................              1,710,662               1,735,291
Federal Home Loan Bank of New York stock, at cost......................              2,222,000               2,075,700
Excess of cost over assets acquired....................................              3,036,623               3,217,017
Other assets...........................................................                924,383                 957,091
                                                                                   -----------             -----------
      TOTAL ASSETS.....................................................           $299,988,708            $303,517,738
                                                                                   ===========             ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
  Deposits.............................................................           $225,385,268            $228,311,543
  Securities sold under agreements
    to repurchase......................................................             33,499,500              33,623,500
  Accounts payable and other liabilities...............................              1,274,066               1,134,397
                                                                                   -----------             -----------
      Total liabilities................................................            260,158,834             263,069,440
                                                                                   -----------             -----------
Stockholders' Equity:
  Preferred stock; 5,000,000 authorized shares;
    none outstanding...................................................                     --                      --
  Common stock, par value $.10; 10,000,000
     authorized shares; shares issued 3,041,750;
     shares outstanding 2,745,180......................................               304,175                  304,175
  Additional paid-in-capital...........................................            29,002,621               28,974,799
  Retained earnings....................................................            17,565,378               16,802,056
  Unearned ESOP shares.................................................            (2,190,060)              (2,271,173)
  Unearned restricted MSBP stock at cost...............................            (1,490,681)                      --
  Minimum pension liability net of deferred taxes......................               (84,555)                 (84,555)
  Treasury stock, at cost; 296,570 shares..............................            (3,277,004)              (3,277,004)
                                                                                  -----------              -----------
      Total stockholders' equity.......................................            39,829,874               40,448,298
                                                                                  ------------             -----------
      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.......................          $299,988,708             $303,517,738
                                                                                  ============             ===========
</TABLE>

---------------------
*    The consolidated balance sheet at December 31, 1996 has been taken from the
     audited balance sheet at that date.

See notes to unaudited consolidated financial statements.

                                        1

<PAGE>



                           LITTLE FALLS BANCORP, INC.
                        CONSOLIDATED STATEMENTS OF INCOME
                                   (Unaudited)


<TABLE>
<CAPTION>

                                                             For the Three Months                 For the Six Months
                                                                Ended June 30,                      Ended June 30,
                                                              1997           1996               1997              1996
                                                           ---------       ---------         ---------         ---------
<S>                                                       <C>             <C>               <C>               <C>       
Interest income:
  Loans receivable..................................      $2,289,973      $2,003,363        $4,495,497        $3,908,187
  Mortgage-backed securities........................       1,744,190       1,973,706         3,558,358         4,058,215
  Investment securities and other interest earning
  assets............................................         937,017         693,180         1,898,440         1,414,642
                                                           ---------       ---------         ---------         ---------
    Total interest income...........................       4,971,180       4,670,249         9,952,295         9,381.044
                                                           ---------       ---------         ---------         ---------
Interest expense:                                          
  Deposits..........................................       2,546,884       2,751,379         5,068,671         5,663,675
  Borrowings........................................         487,199              --           960,895                --
                                                           ---------       ---------         ---------         ---------
    Total interest expense..........................       3,034,083       2,751,379         6,029,566         5,663,675
                                                           ---------       ---------         ---------         ---------
Net interest income before provision for loan
losses..............................................       1,937,097       1,918,870         3,922,729         3,717,369
Provision for loan losses...........................          60,000              --           120,000            30,000
                                                           ---------       ---------        ----------        ----------
  Net interest income after provisions for loan
  losses............................................       1,877,097       1,918,870         3,802,729         3,687,369
                                                           ---------       ---------         ---------         ---------
Total non-interest income...........................         188,651          83,414           257,554           155,499
                                                           ---------       ---------         ---------         ---------
                                                      
Non-interest expense:
  Compensation and employee benefits................         618,040         595,401         1,253,640         1,210,165
  Occupancy, net....................................          72,961          94,592           150,951           209,833
  Equipment.........................................         108,514          82,082           221,735           193,942
  Deposit insurance premiums........................          35,041         136,234            66,014           245,439
  Amortization of deposit premium...................          90,196          90,197           180,393           180,390
  Miscellaneous expense.............................         356,042         298,502           687,243           614,094
                                                           ---------       ---------         ---------         ---------
    Total non-interest expenses.....................       1,280,794       1,297,008         2,559,976         2,653,863
                                                           ---------       ---------         ---------         ---------
                                                           
Income before provision for income taxes............         784,954         705,276         1,500,307         1,189,005
Provision for income taxes..........................         316,000         282,149           586,000           453,500
                                                           ---------       ---------         ---------         ---------
    Net income......................................      $  468,954      $  423,127        $  914,307        $  735,505
                                                           =========       =========         =========         =========

Weighted average number of
  common shares and common
  stock equivalents outstanding.....................       2,572,019       2,804,494         2,570,405         2,802,466
                                                           =========       =========         =========         =========
                                                      
Primary earnings per share..........................           $0.18           $0.15             $0.36             $0.26
                                                                ====            ====              ====              ====
                                                      
</TABLE>

See notes to unaudited consolidated financial statements.



                                        2

<PAGE>





                           LITTLE FALLS BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                                                           For the Six Months
                                                                                             Ended June 30,
                                                                                          1997              1996
                                                                                        --------          --------
<S>                                                                                 <C>               <C>         
Cash flows from operating activities:                                                
  Net income..............................................................          $    914,307      $    735,505
  Adjustments to reconcile net income to net cash                                    
    provided by operating activities:                                                
    Depreciation..........................................................                67,701            73,830
    Provision for loan losses.............................................               120,000            30,000
    Amortization of intangibles...........................................               180,394           180,390
    Amortization (accretion) of deferred fees, premiums and discounts, net                70,578            40,350
    Amortization of unearned ESOP shares..................................               108,935            85,777
    Amortization of unearned restricted MSBP stock, at cost...............               109,587                --
    Gain (loss) on sale of foreclosed real estate.........................                39,067           (31,249)
    Gain on sale of real estate held for investment.......................              (106,318)               --
    Decrease (increase) in other assets...................................                32,708           (89,553)
    Increase (decrease) in interest receivable, net.......................                24,629          (102,700)
    Increase in interest payable..........................................               166,943           159,713
    Increase in accounts payable and other liabilities....................               106,648            89,005
                                                                                      ----------        ----------
      Net cash provided by operating activities...........................             1,835,179         1,171,068
                                                                                      ----------        ----------
Cash flows from investing activities:                                                                 
    Purchase of mortgage-backed securities held to maturity...............                    --       (16,073,205)
    Principal collections on mortgage-backed securities held to maturity..             9,998,843        13,030,948
    Net (increase) decrease in loans receivable...........................           (11,150,897)      (12,514,725)
    Maturity of investments held to maturity..............................             6,342,000         5,000,000
    Purchase of investments held to maturity..............................            (2,000,000)       (5,342,000)
    Purchases of premises and equipment...................................               (27,221)          (90,790)
    Proceeds from sale of real estate held for investment.................               248,378                --
    Proceeds from sale of foreclosed real estate..........................               364,333           205,196
    Purchases of Federal Home Loan Bank of New York stock.................              (146,300)         (712,939)
                                                                                      ----------        ----------
      Net cash provided by (used in) investing activities.................             3,629,136       (16,497,515)
                                                                                      ----------        ----------
 Cash flows from financing activities:                                               
   Net decrease in deposits...............................................            (2,998,735)       (7,636,383)
   Net decrease in borrowed funds.........................................              (124,000)               --
   Increase (decrease) in advances from borrowers.........................                26,441          (709,860)
   Purchase of MSBP stock.................................................            (1,688,171)               --
   Refund of oversubscribed stock subscription............................                    --       (19,706,653)
   Costs of issuance of common stock......................................                    --          (717,311)
   Cash dividends paid....................................................              (150,985)               --
                                                                                      ----------        ----------
     Net cash used in financing activities................................            (4,935,450)      (28,770,207)
                                                                                      ----------        ----------
     Increase (decrease) in cash and cash equivalents.....................               528,865       (44,096,654)
Cash and cash equivalents:                                                           
  Beginning of period.....................................................          $ 10,373,964        53,419,088
                                                                                      ----------        ----------
  End of period...........................................................          $ 10,902,829      $  9,322,434
                                                                                      ==========       ===========
Supplemental disclosures:                                                                           
Cash paid during the year for:                                                       
  Interest................................................................          $  5,862,623      $  5,503,962
  Income taxes............................................................               595,000           223,000
Loans receivable transferred to foreclosed real estate....................                    --           308,728
Issuance of common stock:                                                                             
  Deposits used for stock purchase........................................                    --         2,859,458
  Stock subscriptions used for stock purchase.............................                    --        25,124,458
  Deferred costs..........................................................                    --         (422,630)
                                                                                                     
</TABLE>

      See notes to unaudited consolidated financial statements.

                                        3

<PAGE>



                           LITTLE FALLS BANCORP, INC.
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - PRINCIPLES OF CONSOLIDATION

         The consolidated  financial  statements as of and for the three and six
         month  periods  ended June 30, 1997 and 1996  include  the  accounts of
         Little Falls Bancorp,  Inc. (the "Company") and its subsidiary,  Little
         Falls Bank (the  "Bank")  which,  as  discussed  in Note 3,  became the
         wholly  owned  subsidiary  of the  Company  on  January  5,  1996.  The
         Company's  business is  conducted  principally  through  the Bank.  All
         significant intercompany accounts and transactions have been eliminated
         in consolidation.

NOTE 2 - BASIS OF PRESENTATION

         The  accompanying  consolidated  financial  statements were prepared in
         accordance  with  instructions  for Form  10-Q and,  therefore,  do not
         include  all  information  necessary  for a  complete  presentation  of
         consolidated financial condition, results of operations, and cash flows
         in conformity with generally accepted accounting  principles.  However,
         all adjustments, consisting of normal recurring accruals, which, in the
         opinion of  management,  are necessary for a fair  presentation  of the
         consolidated  financial  statements have been included.  The results of
         operations  for the  periods  ended  June  30,  1997  and  1996 are not
         necessarily  indicative  of the results  which may be expected  for the
         entire fiscal year or any other period.

         These  statements  should be read in conjunction  with the consolidated
         financial  statements  and  related  notes  which are  incorporated  by
         reference  in the  Company's  Annual  Report  on Form 10-K for the year
         ended December 31, 1996.

NOTE 3 - CONVERSION FROM MUTUAL SAVINGS BANK TO STOCK SAVINGS BANK AND
             FORMATION OF SAVINGS AND LOAN HOLDING COMPANY

         On  January  5,  1996,  the  Bank  consummated  its  conversion  from a
         federally  chartered  mutual  savings  bank  to a  stock  savings  bank
         pursuant to a Plan of Conversion (the "Conversion") via the issuance of
         common  stock.  In  connection  with the  Conversion,  the Company sold
         3,041,750 shares of common stock which, after giving effect to offering
         expenses  of $1.1  million  and  243,340  shares  issued to the  Bank's
         Employee Stock  Ownership  Plan  ("ESOP"),  resulted in net proceeds of
         $26.8 million. Pursuant to the Conversion,  the Bank transferred all of
         its outstanding  shares to a newly organized  holding  company,  Little
         Falls Bancorp, Inc., in exchange for 50% of the net proceeds.

         Upon consummation of the Conversion, the preexisting liquidation rights
         of the depositors of the Bank were unchanged. Specifically, such rights
         were  retained and will be accounted for by the Bank for the benefit of
         such depositors in proportion to their liquidation  interests as of the
         eligibility and  supplemental  eligibility  record dates as required by
         Office of Thrift Supervision ("OTS") regulations.

NOTE 4 - MANAGEMENT STOCK BONUS PLAN ("MSBP")

         On July 9,  1996,  the  Bank  established  a MSBP to  provide  both key
         employees  and outside  directors  with a  proprietary  interest in the
         Company in a manner  designed to encourage  such persons to remain with
         the Bank. The Bank, effective March 26, 1997, committed to contribute

                                        4

<PAGE>



         $1,688,171  to the MSBP to purchase  121,670  shares of common stock of
         the Company in the open market.  The common stock purchase  transaction
         was effected on March 26, 1997 and funded on April 1, 1997.

NOTE 5 - EARNINGS PER SHARE

         Earnings  per share for the three  and six  month  periods  herein  are
         calculated  by dividing net  earnings for the periods,  by the weighted
         average number of shares  outstanding  during these same periods (as if
         the  Conversion  had taken place on January 1, 1996) of  2,572,019  and
         2,570,405,  and 2,804,494  and  2,802,466  shares for the 1997 and 1996
         periods,  respectively.  The weighted  average  number of common shares
         outstanding is adjusted for the  unallocated  portion of shares held by
         the ESOP and for common stock  equivalents.  The Company's common stock
         equivalents are based on the exercise of outstanding stock options that
         are determined to have a dilutive effect.

NOTE 6 - RECENT ACCOUNTING PRONOUNCEMENTS

              Accounting  for Transfers  and  Servicing of Financial  Assets and
         Extinguishments   of  Liabilities.   The  FASB  issued  SFAS  No.  125,
         Accounting  for  Transfers  and  Servicing  of  Financial   Assets  and
         Extinguishments  of  Liabilities  (SFAS  No.  125) and  SFAS  No.  127,
         Deferral of the Effective Date of Certain  Provisions of FASB Statement
         No. 125 (SFAS No. 127) in June and December  1996,  respectively.  SFAS
         No. 125 provides  accounting and reporting  standards for transfers and
         servicing of financial assets and  extinguishments  of liabilities.  It
         requires entities to recognize servicing assets and liabilities for all
         contracts  to  service   financial   assets,   unless  the  assets  are
         securitized and all servicing is retained. The servicing assets will be
         measured  initially  at fair  value,  and  will be  amortized  over the
         estimated  useful  lives of the  servicing  assets.  In  addition,  the
         impairment of servicing  assets will be recognized  through a valuation
         allowance.  SFAS No. 125 also  addresses the  accounting  and reporting
         standards for securities lending,  dollar-rolls,  repurchase agreements
         and similar  transactions.  The Company has prospectively  adopted SFAS
         No. 125 on January 1, 1997.  However,  in accordance with SFAS No. 127,
         the  Company  will  defer  adoption  of the  standard  as it relates to
         securities  lending,  dollar-rolls,  repurchase  agreements and similar
         transactions  until  January 1, 1998.  The Company  does not expect the
         adoption of SFAS No. 125 to have a material impact on its  consolidated
         financial statements.

              Earnings  per Share.  On March 3, 1997,  the FASB  issued SFAS No.
         128, Earnings per Share (SFAS No. 128) which is effective for financial
         statements  issued for periods ending after December 15, 1997. SFAS No.
         128 replaces APB Opinion 15,  Earnings per Share,  and  simplifies  the
         computation  of earnings per share (EPS) by replacing the  presentation
         of primary  EPS with a  presentation  of basic EPS.  In  addition,  the
         Statement  requires  dual  presentation  of basic  and  diluted  EPS by
         entities  with  complex  capital  structures.  Basic  EPS  includes  no
         dilution  and is  computed  by  dividing  income  available  to  common
         stockholders   by  the   weighted-average   number  of  common   shares
         outstanding for the period. Diluted EPS reflects the potential dilution
         of securities that could share in the earnings of an entity, similar to
         fully  diluted  EPS. The  computation  of EPS will be  compatible  with
         international  standards,  as the  International  Accounting  Standards
         Committee recently issued a comparable standard.

                                        5

<PAGE>



                           LITTLE FALLS BANCORP, INC.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS
                  ---------------------------------------------

General

         The Company is a New Jersey corporation organized in August 1995 at the
direction  of the Board of  Directors  of the Bank to acquire all of the capital
stock of the Bank issued in the Conversion. The Company is a unitary savings and
loan holding company which, under existing laws,  generally is not restricted in
the types of business  activities in which it may engage  provided that the Bank
retains a specified amount of its assets in housing-related investments.

         The Bank is a federally  chartered stock savings bank  headquartered in
Little  Falls,  New Jersey.  The Bank was founded in 1887 and its  deposits  are
federally  insured by the Savings  Association  Insurance  Fund ("SAIF") and the
Bank is a member of the Federal Home Loan Bank  ("FHLB")  System.  The Bank is a
community oriented, full service retail savings institution offering traditional
mortgage  loan  products.  It is the  Bank's  intent to  remain  an  independent
community savings bank serving the local banking needs of its community.

         The Bank attracts deposits from the general public and has historically
used such deposits  primarily to originate  loans secured by first  mortgages on
owner-occupied one- to four-family residences in its market area and to purchase
mortgage-backed  securities.  The Bank  also  originates  a  limited  number  of
commercial real estate,  residential  construction,  and consumer  loans,  which
mainly consist of home equity lines of credit.

         The  largest  components  of the Bank's  net  income  are net  interest
income,  which is the difference  between interest income and interest  expense,
and noninterest  income derived  primarily from fees.  Consequently,  the Bank's
earnings are dependent on its ability to originate  loans,  net interest income,
and  the  relative  amounts  of  interest-earning  assets  and  interest-bearing
liabilities.  The Bank's net income is also  affected by its  provision for loan
losses  and  foreclosed  real  estate  as well  as the  amount  of  non-interest
expenses,  such as  compensation  and benefit  expense,  occupancy and equipment
expense and deposit insurance  premium  expenses.  Earnings of the Bank also are
affected   significantly  by  general   economic  and  competitive   conditions,
particularly  changes in market interest rates,  government policies and actions
of regulatory authorities.

Comparison of Financial Condition

         Total  assets  decreased  $3.5  million at June 30, 1997 as compared to
December 31, 1996. Net loans  increased by $11.0 million due to  originations of
$16.8 million offset  somewhat by loan  repayments.  Mortgage-backed  securities
decreased by $10.0 million due to repayments  and no new  purchases.  Investment
securities decreased by $4.4 million primarily due to maturities of $6.3 million
and new purchases of $2.0 million.  Foreclosed real estate decreased by $403,000
due to the sale of three properties.

         Total deposits decreased, after interest credited, by $2.9 million.

         Total stockholders' equity decreased by $618,000,  primarily due to the
purchase of 121,670  shares of Company  stock at an average price of $13.875 per
share.  The total  price was  approximately  $1.7  million.  These  shares  were
purchased for future distribution through the Management Stock Bonus

                                        6

<PAGE>



Plan. The trade date for this transaction was March 26, 1997, and the settlement
date was April 1,  1997.  Equity  was also  reduced  $82,000  due to a  dividend
declared  on March 11,  and paid on May 1,  1997.  Such  decreases  were  offset
somewhat by earnings during the period.

Non-performing Assets

         The following  table sets forth  information  regarding  non-performing
loans and real estate owned.

                                                     At                 At
                                                  June 30,        December 31,
                                                  --------        ------------
                                                    1997              1996
                                                    ----              ----
                                                    (Dollars in Thousands)

Total non-performing loans...................     $2,671            $1,901
Real estate owned............................        454               857
                                                   -----             -----
Total non-performing assets..................     $3,125            $2,758
                                                   =====             =====
Total non-performing loans to                                     
  net loans..................................       2.08%             1.62%
                                                   =====             =====
Total non-performing loans to                                     
  total assets...............................        .89%              .63%
                                                   =====             =====
Total non-performing assets to                                    
  total assets...............................       1.04%              .91%
                                                   =====             =====
                                                                 

Comparison of Earnings for the Three Months Ended June 30, 1997 and 1996

         Net Income. Net income for the three and six months ended June 30, 1997
increased  $46,000 or 10.8% and $179,000 or 24.3%,  respectively,  over the same
periods in 1996. These increases were due primarily to increases in net interest
and  non-interest  income and decreases in deposit  insurance  premiums,  offset
somewhat by  increases in the  provision  for loan  losses,  other  expenses and
income tax expenses.

         Total Interest  Income.  Interest income  increased by $301,000 or 6.4%
and  $571,000  or 6.1%  for the  three  and six  months  ended  June  30,  1997,
respectively, as compared to the three and six months ended June 30, 1996. These
increases  were due in most part to increases of $18.8 million and $15.3 million
in the average  balances of interest  earning assets for the three and six month
periods ended June 30, 1997 as compared to the same periods in 1996.

         Total Interest Expense.  Interest expense  increased  $283,000 or 10.3%
and  $366,000  or 6.5% for the  quarter  and six  months  ended  June 30,  1997,
respectively,  as compared to the  quarter and six months  ended June 30,  1996.
These  increases  were primarily due to the increases of $19.2 million and $18.6
million in the average balance of interest bearing liabilities for the three and
six months ended June 30, 1997 as compared to the same  periods in 1996,  and to
an  increase  of 9  basis  points  in  the  average  cost  of  interest  bearing
liabilities  for the three  months  ended June 30, 1997 as compared to the three
months ended June 30, 1996, and a decrease of 5 basis points in the average rate
on  interest  bearing  liabilities  for the six months  ended  June 30,  1997 as
compared to the same period in 1996.


                                        7

<PAGE>



         Net Interest Income.  Net interest income increased $18,000 or 1.0% and
$205,000 or 5.5%, due to the reasons discussed in the two previous sections.  In
addition,  the net  interest  spread,  the  difference  between the average rate
earned and the average rate paid,  decreased by 12 basis points to 2.22% for the
quarter  ended June 30, 1997 and  increased 7 basis  points to 2.21% for the six
months ended June 30, 1997.

         Provisions  for Loan Losses.  A provision for loan losses is charged to
operations based on management's  evaluation of the potential losses that may be
incurred in the Bank's loan portfolio. Such evaluation,  which includes a review
of certain loans of which full  collectibility of interest and principal may not
be reasonably assured, considers the Bank's past loan loss experience, known and
inherent  risks  in the  portfolio,  adverse  situations  that  may  affect  the
borrower's  ability to repay,  estimated value of any underlying  collateral and
current economic conditions. The provision for loan losses increased $60,000 and
$90,000 in the  quarter and six months  ended June 30,  1997,  respectively,  as
compared to the same  periods in 1996.  The primary  cause for the  increase for
both periods was the increase in the balance of the loan portfolio.

         As a result of the declines in regional  real estate  market values and
the significant  losses  experienced by many financial  institutions,  there has
been a  greater  level  of  scrutiny  by  regulatory  authorities  of  the  loan
portfolios of financial  institutions  undertaken as part of the  examination of
the institution by the FDIC, OTS or other federal or state  regulators.  Results
of recent  examinations  indicate  that these  regulators  may be applying  more
conservative  criteria  in  evaluating  real  estate  market  values,  requiring
significantly  increased  provisions for potential  loan losses.  While the Bank
believes it has established an adequate allowance for loan losses,  there can be
no assurance that regulators,  in reviewing the Bank's loan portfolio,  will not
request  the Bank to  significantly  increase  its  allowance  for loan  losses,
thereby negatively affecting the Bank's financial condition and earnings or that
the Bank may not have to  increase  its  level  of loan  loss  allowance  in the
future.

         Management  will continue to review its loan portfolio to determine the
extent,  if any,  to which  further  additional  loss  provisions  may be deemed
necessary.  There can be no  assurance  that the  allowance  for losses  will be
adequate  to cover  losses  which may in fact be realized in the future and that
additional provisions for losses will not be required.

         An analysis of the allowance for loan losses follows:
                                                       Three Months
                                                      Ended June 30,
                                                     ----------------
                                                     1997        1996
                                                     ----        ----
                                                       (In thousands)

Balance - beginning                                 $1,008       $931
Provisions charged to operations...............         60         --
Loans charged off, net of recoveries...........         (8)        --
                                                     -----        ---
Balance-ending.................................     $1,060       $931
                                                     =====        ===
                                                   



                                        8

<PAGE>



         Impaired loans and related  amounts  recorded in the allowance for loan
losses at June 30, 1997 are summarized as follows (in thousands):

         With recorded allowances............................      $1,509
         Without recorded allowances.........................          --
                                                                    -----
         Total impaired loans................................       1,509
         Related allowance for loan losses...................         208
                                                                    -----
         Net impaired loans..................................      $1,301
                                                                    =====


         Non-interest  Income.  Non-interest  income  increased  by $105,000 and
$102,000  for the  three  and six  months  ended  June 30,  1997,  respectively,
primarily due to a $125,000 gain recorded on the sale of the Bank's  Frenchtown,
NJ branch  office in June  1997.  The office  had been  closed  during the third
quarter of 1996 and deposits were transferred to other Bank's offices.

         Non-interest Expense. Non-interest expense decreased somewhat primarily
due to a decrease in deposit insurance premiums due to the  recapitalization  of
the SAIF in  September  1996,  offset  somewhat by an increase in  miscellaneous
expenses due to a loss on the sale of an office building of a previously  closed
branch office and stock compensation expenses due to the implementation of stock
benefit plans adopted by stockholders in July 1996.  Further,  occupancy expense
decreased  $22,000 and $59,000  respectively  due in most part to the closing of
two  branch  offices  in the  second  half of 1996.  Compensation  and  employee
benefits increased by $23,000 and $43,000,  respectively due in most part to the
adoption of the Management Stock Bonus Plan ("MSBP") in the second half of 1996.
The MSBP  expense  for the three and six months  ended June 30, 1997 was $37,000
and  $62,000,  respectively.  This was  partially  offset  with a  reduction  in
personnel  costs  associated  with the closing of two branch offices  previously
discussed. Miscellaneous expense increased $58,000 and $73,000, primarily due to
the MSBP expense for the  directors of $27,000 and $48,000 for the three and six
months  ended  June 30,  1997,  and a loss of  $19,000  on the sale of an office
building of a previously closed branch in June, 1997.

         Income Tax Expense. Income tax expense increased due to the increase of
pre-tax income for the same periods.

Liquidity and Capital Resources

         On June 30, 1997, the Bank was in compliance with its three  regulatory
capital requirements as follows:

<TABLE>
<CAPTION>

                                                                      Amount             Percent
                                                                      ------             -------
                                                                       (Dollars in thousands)

<S>                                                                  <C>                  <C>  
Tangible capital................................................     $26,747               9.00%
Tangible capital requirement....................................       4,457               1.50
                                                                      ------               ----
Excess over requirement.........................................     $22,290               7.50%
                                                                      ======               ====

Core capital....................................................     $26,747               9.00%
Core capital requirement........................................       8,914               3.00%
                                                                      ------               ----
Excess over requirement.........................................     $17,833               6.00%
                                                                      ======               ====

Risk based capital..............................................     $27,263              27.17%
Risk based capital requirement..................................       8,026               8.00%
                                                                      ------              -----
Excess over requirement.........................................     $19,237              19.17%
                                                                      ======              =====

</TABLE>


                                        9

<PAGE>



         Management  believes  that  under  current  regulations,  the Bank will
continue to meet its minimum capital  requirements  in the  foreseeable  future.
Events  beyond the control of the Bank,  such as increased  interest  rates or a
downturn  in the  economy in areas in which the Bank  operates  could  adversely
affect  future  earnings  and as a result,  the  ability of the Bank to meet its
future Company's requirements.

         The Company's  liquidity is a measure of its ability to fund loans, pay
withdrawals of deposits, and other cash outflows in an efficient, cost effective
manner.  The  Company's  primary  sources of funds are  deposits  and  scheduled
amortization and prepayment of loan and  mortgage-backed  principal.  During the
past several years,  the Company has used such funds  primarily to fund maturing
time deposits, pay savings withdrawals,  fund lending commitments,  purchase new
investments,  and increase liquidity.  The Company is currently able to fund its
operations  internally.  Additionally,  sources of funds  include the ability to
utilize  Federal  Home Loan Bank of New York  advances and the ability to borrow
against  mortgage-backed  and  investment  securities.  As of June 30, 1997, the
Company had $33.5 million of borrowed funds. Loan payments, maturing investments
and  mortgage-backed  security  prepayments  are greatly  influenced  by general
interest rates, economic conditions and competition.

         The Company anticipates that it will have sufficient funds available to
meet its current  commitments.  As of June 30,  1997,  the Company had  mortgage
commitments  to fund loans of $3.1 million.  Also, at June 30, 1997,  there were
commitments  on unused  lines of credit  relating to home  equity  loans of $3.1
million and  commitments  to purchase  investment  securities  of $6.0  million.
Certificates of deposit scheduled to mature in one year or less at June 30, 1997
totaled $115.8 million.  Based on historical  deposit  withdrawals and outflows,
and on internal  monthly  deposit  reports  monitored by management,  management
believes that a majority of such deposits will remain with the Company.
As a result, no adverse liquidity effects are expected.

         The Bank is required  under  federal  regulations  to maintain  certain
specified  levels of "liquid  investments,"  which include certain United States
government  obligations  and other  approved  investments.  Current  regulations
require  the Bank to  maintain  liquid  assets  of not  less  than 5% of its net
withdrawable accounts plus short term borrowings.  Short term liquid assets must
consist of not less than 1% of such  accounts  and  borrowings,  which amount is
also included within the 5%  requirement.  Those levels may be changed from time
to time by the regulators to reflect current economic  conditions.  The Bank has
maintained liquidity in excess of regulatory requirements.

Impact of Inflation and Changing Prices

         The consolidated financial statements of the Company and notes thereto,
presented  elsewhere  herein,  have been prepared in accordance with GAAP, which
require the measurement of financial  position and operating results in terms of
historical  dollars without  considering  the change in the relative  purchasing
power of money over time due to inflation.  The impact of inflation is reflected
in the  increased  cost of the  Company's  operations.  Unlike  most  industrial
companies,  nearly all the assets and  liabilities of the Company are financial.
As a result,  interest rates have a greater impact on the Company's  performance
than do the  effects  of  general  levels of  inflation.  Interest  rates do not
necessarily  move in the same  direction  or to the same extent as the prices of
goods and services.



                                       10

<PAGE>



Additional Key Operating Ratios

<TABLE>
<CAPTION>


                                                   For the                 For the
                                             Three Months Ended       Six Months Ended
                                                  June 30,                June 30,
                                           ----------------------  -----------------------
                                            1997(1)     1996(1)     1997(1)      1996(1)
                                            -------     -------     -------      -------

<S>                                            <C>         <C>         <C>          <C>  
Return on average assets................       0.63%       0.60%       0.61%        0.51%
Return on average equity................       4.75%       3.88%       4.59%        3.39%
Interest rate spread....................       2.22%       2.34%       2.21%        2.14%
Net interest margin.....................       2.70%       2.86%       2.71%        2.72%
Noninterest expense to average
  assets................................       1.71%       1.82%       1.70%        1.83%
Net charge-offs to average
  outstanding loans.....................       0.01%         --        0.12%        0.03%

</TABLE>

<TABLE>
<CAPTION>

                                                                            At June 30,              At December 31,
                                                                               1997                        1996
                                                                            -----------              ---------------

<S>                                                                           <C>                         <C>   
Tangible book value per share......................................           $13.41                      $13.56

</TABLE>


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

(1)      The ratios for the three and six month period are annualized.



                                       11

<PAGE>



                    LITTLE FALLS BANCORP, INC. AND SUBSIDIARY

                                     PART II

ITEM 1.   LEGAL PROCEEDINGS

          Neither the  Company nor the Bank was engaged in any legal  proceeding
          of a material  nature at June 30, 1997. From time to time, the Company
          is a party to routine  legal  proceedings  in the  ordinary  course of
          business, such as claims to enforce liens, condemnation proceedings on
          properties  in which the  Company  holds  security  interests,  claims
          involving the making and servicing of real property  loans,  and other
          issues incident to the business of the Company. There were no lawsuits
          pending or known to be  contemplated  against  the Company at June 30,
          1997 that would have a material  effect on the operations or income of
          the Company or the Bank, taken as a whole.

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

          On April  17,  1997,  the  Company  held its  Annual  Meeting.  At the
          Meeting, C. Evan Daniels, Norman A. Parker and Edward J. Seugling were
          elected  as  directors,  each  for a  three-year  term.  In  addition,
          stockholders  also  ratified the  appointment  of Radics & Co., LLC as
          auditors for the Company for the fiscal year ending December 31, 1997.

ITEM 5.   OTHER MATERIALLY IMPORTANT EVENTS

          On August 1, 1997, the Company purchased  approximately  $15.1 million
          of participations in multi-family loans from an unaffiliated financial
          institution.  The loans are all on properties located in New York City
          and New Jersey.  The funding for this  transaction was obtained with a
          one-year FHLB advance for $15 million.  While multi-family real estate
          lending  affords the  Company an  opportunity  to receive  interest at
          rates higher than those  generally  available from one- to four-family
          residential  lending,  loans secured by such  properties are generally
          greater in amount, more difficult to evaluate and monitor and are more
          susceptible to default as a result of general economic conditions and,
          therefore,  involve a greater  degree of risk than one- to four-family
          residential  mortgage  loans.  Because  payments  on loans  secured by
          multi-family   properties  are  often   dependent  on  the  successful
          operation and  management of the  properties,  repayment of such loans
          may be impacted by adverse conditions in the real estate market or the
          economy.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)     Exhibits:
                  Exhibit 11 - Earnings Per Share Calculation
                  Exhibit 27  Financial  Data  Schedule  (in  electronic
                              filing only) 
          (b)     Reports on Form 8-K - None.


                                       12

<PAGE>



                    LITTLE FALLS BANCORP, INC. AND SUBSIDIARY

                                   SIGNATURES


         Pursuant to the  requirements  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.


                                    LITTLE FALLS BANCORP, INC.




Date: August 13, 1997               By:   /s/Leondard G. Romaine
                                          -------------------------------------
                                          Leonard G. Romaine
                                          President and Chief Executive Officer
                                          (Principal Executive Officer)



Date: August 13, 1997               By:   /s/Richard Capone
                                          -------------------------------------
                                          Richard Capone
                                          Senior Vice President and
                                          Chief Financial Officer
                                          (Principal Officer)