UNITED STATES
                     SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C.  20549

                                  FORM 10-Q

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

                   For the quarter ended December 31, 2000

                                     OR

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

          For the transition period from ___________ To ___________

                       Commission file number 0-23533

                           MYSTIC FINANCIAL, INC.
           (Exact name of registrant as specified in its charter)

          DELAWARE                                       04-3401049
------------------------------------                  -------------------
(State or other jurisdiction                           (I.R.S. Employer
   of incorporation or organization)                  Identification No.)

                60 HIGH STREET
            MEDFORD, MASSACHUSETTS                           02155
----------------------------------------              -------------------
(Address of principal executive offices)                  (Zip Code)

Registrant's telephone number, including area code    (781) 395-2800
                                                      -------------------

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.

                  YES    [X]    NO    [.]

As of February 9, 2001, 1,932,604 shares of the registrant's common stock
were outstanding.

                    MYSTIC FINANCIAL, INC. AND SUBSIDIARY

                                    INDEX

PART I     FINANCIAL INFORMATION                                       Page

Item 1     Financial Statements:

           Consolidated Balance Sheets - December 31, 2000
           and June 30, 2000                                             3

           Consolidated Statements of Income - Three and Six Months
           Ended December 31, 2000 and 1999                              4

           Consolidated Statements of Changes in Stockholders'
           Equity - Six Months Ended December 31, 2000 and 1999          5

           Consolidated Statements of Cash Flows - Six Months
           Ended December 31, 2000 and 1999                              6

           Notes to Unaudited Consolidated Financial Statements -
           December 31, 2000                                             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                                                  22

PART II    OTHER INFORMATION

Item 6     Exhibits and Reports on Form 8-K                             22

           SIGNATURES                                                   22

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
                         Consolidated Balance Sheets
                               (In Thousands)
<TABLE>
<CAPTION>


                                                               December 31, 2000    June 30, 2000
                                                               -----------------    -------------
                                                                          (Unaudited)
<S>                                                               <C>                  <C>
Assets
  Cash and due from banks                                         $  8,336             $ 10,842
  Federal funds sold                                                 8,742               17,181
  Short-term investments                                             9,865                3,308
                                                                  -----------------------------
      Total cash and cash equivalents                               26,943               31,331

  Securities available for sale, at fair value                      24,215               32,452
  Federal Home Loan Bank stock, at cost                              2,438                2,438
  Loans, net of allowance for loan losses of $1,632
   and $1,531, respectively                                        205,925              189,200
  Mortgage loans held for sale, net                                     51                  543
  Bank premises and equipment, net                                   2,645                2,805
  Real estate held for investment, net                               1,655                1,673
  Accrued interest receivable                                        1,375                1,324
  Due from Co-operative Central Bank                                   929                  929
  Other assets                                                       1,338                1,193
                                                                  -----------------------------
      Total assets                                                $267,514             $263,888
                                                                  =============================
Liabilities and stockholders' equity
  Deposits                                                        $190,614             $194,135
  Federal Home Loan Bank borrowings                                 45,634               38,750
  Mortgagors' escrow accounts                                          786                  672
  Accrued expenses and other liabilities                             1,271                1,142
                                                                  -----------------------------
      Total liabilities                                            238,305              234,699
                                                                  -----------------------------

Stockholders' equity
  Preferred stock, $.01 par value, 1,000,000 shares
   authorized; none issued                                               -                    -
  Common stock, $.01 par value, 5,000,000 shares
   authorized, 2,716,125 and 2,711,125 issued, respectively             27                   27
  Additional paid-in capital                                        25,641               25,601
  Retained earnings                                                 15,954               15,295
  Treasury stock, at cost - 783,521 and 702,427 shares
   at December 31, 2000 and June 30, 2000, respectively             (9,495)              (8,424)
  Accumulated other comprehensive income (loss)                         31                  (55)
  Unearned ESOP shares                                              (2,139)              (2,324)
  Unearned RRP stock                                                  (810)                (931)
                                                                  -----------------------------
      Total stockholders' equity                                    29,209               29,189
                                                                  -----------------------------
                                                                  $267,514             $263,888
                                                                  =============================
</TABLE>


See accompanying notes to unaudited consolidated financial statements.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
                      Consolidated Statements of Income
                    (In Thousands, Except Per Share Data)
<TABLE>
<CAPTION>

                                                        Three Months Ended        Six Months Ended
                                                        --------------------    --------------------
                                                        December    December    December    December
                                                        31, 2000    31, 1999    31, 2000    31, 1999
                                                        --------    --------    --------    --------
                                                                        (Unaudited)
<S>                                                      <C>         <C>         <C>         <C>
Interest and dividend income:
  Interest and fees on loans                             $4,155      $3,382      $8,139      $6,505
  Interest and dividends on securities                      467         462       1,063         937
  Other interest                                            251          94         393         220
                                                         ------------------------------------------

      Total interest and dividend income                  4,873       3,938       9,595       7,662
                                                         ------------------------------------------

Interest expense:
  Deposits                                                1,760       1,345       3,469       2,637
  Federal Home Loan Bank borrowings                         737         431       1,376         742
                                                         ------------------------------------------

      Total interest expense                              2,497       1,776       4,845       3,379
                                                         ------------------------------------------

Net interest income                                       2,376       2,162       4,750       4,283
                                                         ------------------------------------------
Provision for loan losses                                    50          75         100         115
                                                         ------------------------------------------

Net interest income, after provision for loan losses      2,326       2,087       4,650       4,168
                                                         ------------------------------------------

Other income:
  Customer service fees                                     203         150         400         291
  Gain on sales of securities available for
   sale, net                                                140          36         197          67
  Miscellaneous                                              18          85          55         129
                                                         ------------------------------------------

      Total other income                                    361         271         652         487
                                                         ------------------------------------------

Operating expenses:
  Salaries and employee benefits                          1,174       1,035       2,272       1,971
  Occupancy and equipment expenses                          236         164         462         328
  Data processing expenses                                   86          77         165         143
  Other general and administrative expenses                 505         430         907         757
                                                         ------------------------------------------

      Total operating expenses                            2,001       1,706       3,806       3,199
                                                         ------------------------------------------

Income before income taxes                                  686         652       1,496       1,456
Provision for income taxes                                  266         255         580         572
                                                         ------------------------------------------

Net income                                               $  420      $  397      $  916      $  884
                                                         ==========================================

Earnings per share basic and diluted                     $ 0.24      $ 0.19      $ 0.52      $ 0.41
                                                         ==========================================

Weighted average shares outstanding - basic               1,733       2,094       1,751       2,155
                                                         ==========================================

Weighted average shares outstanding - diluted             1,760       2,094       1,769       2,155
                                                         ==========================================
</TABLE>


See accompanying notes to unaudited consolidated financial statements.


                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
         Consolidated Statements of Changes in Stockholders' Equity
                 Six Months Ended December 31, 2000 and 1999
                               (In Thousands)
                                 (Unaudited)
<TABLE>
<CAPTION>


                                                                           Accumulated
                                          Additional                          Other      Unearned  Unearned     Total'
                                  Common    Paid-In   Retained  Treasury  Comprehensive    ESOP       RRP    Stockholders
                                  Stock     Capital   Earnings    Stock   Income (Loss)   Shares     Stock      Equity
                                  ------  ----------  --------  --------  -------------  --------  --------  ------------
<S>                                 <C>     <C>       <C>       <C>          <C>         <C>       <C>         <C>
Balance at June 30, 2000            $27     $25,601   $15,295   $(8,424)     $(55)       $(2,324)  $  (931)    $29,189
                                                                                                               -------
Comprehensive income:
  Net income                          -           -       916         -         -              -         -         916
  Change in net unrealized gain
   on securities available for
   sale, net of tax effects           -           -         -         -        86              -         -          86
                                                                                                               -------
      Total comprehensive income      -           -         -         -         -              -         -       1,002
                                                                                                               -------
Dividend paid ($0.15 per share)       -           -      (257)        -         -              -         -        (257)
Stock options exercised
 (5,000 shares)                       -          60         -         -         -              -         -          60
Purchase of treasury stock            -           -         -    (1,071)        -              -         -      (1,071)
Decrease in unearned ESOP shares      -         (20)        -         -         -            185         -         165
Decrease in unearned RRP stock        -           -         -         -         -              -       121         121
                                    ----------------------------------------------------------------------------------
Balance at December 31, 2000        $27     $25,641   $15,954   $(9,495)     $ 31        $(2,139)  $  (810)    $29,209
                                    ==================================================================================

Balance at June 30, 1999            $27     $25,688   $14,128   $(3,485)     $394        $(2,700)  $     -     $34,052
                                                                                                               -------
Comprehensive income:
  Net income                          -           -       884         -         -              -         -         884
  Change in net unrealized gain
   on securities available for
   sale, net of tax effects           -           -         -         -      (270)             -                  (270)
                                                                                                               -------
      Total comprehensive income      -           -         -         -         -              -         -         614
                                                                                                               -------
Dividend paid ($.12 per share)        -           -      (262)        -         -              -         -        (262)
Purchase of RRP stock                 -           -         -         -         -              -    (1,295)     (1,295)
Purchase of treasury stock            -           -         -    (1,452)        -              -         -      (1,452)
Decrease in unearned RRP stock        -           -         -         -         -              -       243         243
Decrease in unearned ESOP shares      -         (37)        -         -         -            192         -         155
                                    ----------------------------------------------------------------------------------
Balance at December 31, 1999        $27     $25,651   $14,750   $(4,937)     $124        $(2,508)   (1,052)    $32,055
                                    ==================================================================================
</TABLE>


See accompanying notes to unaudited consolidated financial statements.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
                    Consolidated Statements of Cash Flows
                               (In Thousands)
<TABLE>
<CAPTION>

                                                                     Six Months Ended
                                                          December 31, 2000    December 31, 1999
                                                          -----------------    -----------------
                                                                       (Unaudited)

<S>                                                            <C>                    <C>
Cash flows from operating activities:
  Net income                                                   $   916                $   884
  Adjustments to reconcile net income to net cash
   provided by operating activities:
    Provision for loan losses                                      100                    115
    Net amortization (accretion) of securities                     (45)                    (8)
    Gain on sales of securities available for sale                (197)                   (67)
    Recognition of expired covered call options                     (4)                     -
    Amortization of unearned ESOP shares                           165                    155
    Amortization of unearned RRP stock                             121                    243
    Depreciation expense                                           211                    186
    Net change in mortgage loans held for sale                     492                    (27)
    (Increase)/decrease in accrued interest receivable             (51)                    55
    Increase in other assets                                      (100)                  (567)
    Increase in accrued expenses and other liabilities             129                    173
                                                               ------------------------------

      Net cash provided by operating activities                  1,737                  1,142
                                                               ------------------------------

Cash flows from investing activities:
  Maturities of securities held to maturity                          -                  1,500
  Proceeds from sales of securities available for sale          15,848                  3,707
  Maturities/calls of securities available for sale                200                      -
  Principal pay downs on mortgage-backed securities                289                    110
  Purchase of securities available for sale                     (7,813)                (2,933)
  Purchase of Federal Home Loan Bank Stock                           -                   (618)
  Loans originated, net of payments received                   (16,825)               (20,887)
  Purchases of banking premises and equipment                      (33)                   (59)
                                                               ------------------------------

      Net cash (used) by investing activities                   (8,334)               (19,180)
                                                               ------------------------------

Cash flows from financing activities:
  Net (decrease) in deposits                                    (3,521)                (1,058)
  Proceeds from borrowings                                       9,900                 24,702
  Repayment of borrowings                                       (3,016)                (9,716)
  Net increase in mortgagors' escrow accounts                      114                    155
  Proceeds from exercise of stock options                           60                      -
  Dividends paid                                                  (257)                  (262)
  Purchase of treasury stock                                    (1,071)                (1,452)
  Purchase of RRP stock                                              -                 (1,295)
                                                               ------------------------------

      Net cash provided by financing activities                  2,209                 11,074
                                                               ------------------------------

Net change in cash and cash equivalents                         (4,388)                (6,964)
Cash and cash equivalents at beginning of period                31,331                 18,721
                                                               ------------------------------

Cash and cash equivalents at end of period                     $26,943                $11,757
                                                               ==============================

Supplemental cash flow information:
  Interest paid                                                $ 4,810                $ 3,313
  Income taxes paid                                                736                    835

</TABLE>

See accompanying notes to unaudited consolidated financial statements.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
            Notes to Unaudited Consolidated Financial Statements
                              December 31, 2000

1)    Basis of Presentation and Consolidation

The unaudited consolidated interim financial statements of Mystic Financial,
Inc. and subsidiary ("Mystic" or the "Company") presented herein should be
read in conjunction with the consolidated financial statements for the year
ended June 30, 2000, included in the annual report on Form 10-K of Mystic
Financial, Inc., the holding company for Medford Co-operative Bank (the
"Bank").

The unaudited consolidated interim financial statements herein have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X.  Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.

In the opinion of management, the consolidated financial statements reflect
all adjustments (consisting solely of normal recurring accruals) necessary
for a fair presentation of such information. Interim results are not
necessarily indicative of results to be expected for the entire year.

2)    Commitments and Contingencies

At December 31, 2000, the Bank had outstanding commitments to originate
loans amounting to approximately $9.8 million, and unadvanced funds on
construction loans and lines of credit amounting to approximately $8.3
million and $14.5 million, respectively.

3)    Earnings Per Share

Basic earnings per share represents income available to common stock divided
by the weighted-average number of common shares outstanding during the
period.  In calculating basic earnings per share, the number of shares of
common stock outstanding is reduced by the number of shares held by Mystic's
Employee Stock Ownership Plan (the "ESOP") and its 1999 Recognition and
Retention Plan (the "RRP") that have not been allocated or are not committed
for release to participants' individual accounts.  Diluted earnings per
share reflects additional common shares that would have been outstanding if
dilutive potential common shares had been issued, as well as any adjustment
to income that would result from the assumed conversion.  Potential common
shares that may be issued by the Company relate solely to outstanding stock
options and unearned RRP shares and are determined using the treasury stock
method.

4)    Book Value Per Share

Book value per share was $16.95 as of December 31, 2000 and $15.50 as of
December 31, 1999.  In calculating book value per share, the number of
shares of common stock outstanding is reduced by the number of shares held
by the ESOP that have not been allocated or are not committed to be released
to participants' individual accounts, unearned RRP shares and treasury
stock.  There were 1,722,926 and 2,068,649 shares of common stock
outstanding as of December 31, 2000 and December 31, 1999, respectively, for
purposes of calculating the Company's book value per share.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
            Notes to Unaudited Consolidated Financial Statements
                              December 31, 2000

5)    1999 Recognition and Retention Plan

On March 24, 1999, the Company's stockholders approved the Company's
adoption of the RRP, which allows the Company to grant restricted stock
awards ("Awards") to certain officers, employees and outside directors.  As
of September 30, 1999 the Company's RRP Trust had completed the purchase of
the authorized 102,942 shares in the open market at a cost of $1.3 million.
 Shares vest at a rate of 20% per year.  The first vesting occurred December
31, 1999.  At December 31, 2000, Awards were granted with respect to 96,342
shares.  The aggregate purchase price of all shares acquired by the RRP will
be reflected as a reduction of stockholders' equity and amortized to
compensation expense as the Company's employees and directors become vested
in their stock awards.

6)    Stock Repurchases

On August 30, 2000, the Company announced a repurchase program to acquire
99,555 shares of its common stock or 5% of its then 1,991,104 outstanding
shares of common stock.  This repurchase program has been partially
completed as 63,500 shares of common stock have been repurchased at a cost
of approximately $856,000.

7)    Securities

The following table sets forth the Company's securities at the dates
indicated.

<TABLE>
<CAPTION>

                                   December 31, 2000         June 30, 2000
                                   -----------------         -------------
                                  Amortized     Fair      Amortized     Fair
                                     Cost       Value        Cost       Value
                                  ---------     -----     ---------     -----
                                                (In Thousands)
<S>                                <C>         <C>         <C>         <C>
Securities available for sale:
  U.S. Government & federal
   agency obligations              $14,566     $14,497     $18,821     $18,337
  Mortgage-backed securities           298         304       8,709       8,668
  Other bonds & obligations          6,367       5,929       2,547       2,393
  Marketable equity securities       3,026       3,485       2,459       3,054
                                   -------------------------------------------
      Total                        $24,257     $24,215     $32,536     $32,452
                                   ===========================================
</TABLE>


                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
            Notes to Unaudited Consolidated Financial Statements
                              December 31, 2000

8)    Loans

The following table presents selected data relating to the composition of
the Company's loan portfolio by type of loan on the dates indicated.

<TABLE>
<CAPTION>

                                     December 31, 2000        June 30, 2000
                                     -----------------        ----------------
                                     Amount     Percent     Amount     Percent
                                     ------     -------     ------     -------
                                              (Dollars in Thousands)

<S>                                 <C>           <C>      <C>           <C>
Residential mortgage loans          $134,194      65.2%    $127,862      67.6%
Commercial real estate loans          47,795      23.2%      41,294      21.8%
Commercial loans                      14,757       7.2%      10,881       5.8%
Consumer loans                         1,670       0.8%       1,526       0.8%
Home equity loans                      3,629       1.7%       3,470       1.8%
Construction loans                    15,692       7.6%      12,762       6.7%
                                    -----------------------------------------
      Total loans                    217,737     105.7%     197,795     104.5%

Less:
  Deferred loan origination fees          (9)     (0.0%)        (12)     (0.0%)
  Unadvanced principal                10,189       4.9%       7,076       3.7%
  Allowance for loan losses            1,632       0.8%       1,531       0.8%
                                    -----------------------------------------
      Loans, net                    $205,925     100.0%    $189,200     100.0%
                                    =========================================
</TABLE>

9)    Allowance for Loan Losses

The following table analyzes activity in the Company's allowance for loan
losses for the periods indicated.

<TABLE>
<CAPTION>

                                                    Six Months Ended     Six Months Ended
                                                    December 31, 2000    December 31, 1999
                                                    -----------------    -----------------
                                                            (Dollars in Thousands)

<S>                                                     <C>                  <C>
Average loans, net                                      $199,888             $165,227
                                                        =============================
Period-end net loans                                    $205,925             $175,461
                                                        =============================

Allowance for loan losses at beginning of period        $  1,531             $  1,348
Provision for loan losses                                    100                  115
Plus recoveries                                                5                    1
Loans charged-off                                             (4)                  (8)
                                                        -----------------------------
Allowance for loan losses at end of period              $  1,632             $  1,456
                                                        =============================

Non-performing loans                                    $     17             $     14
                                                        =============================

Ratios:
  Allowance for loan losses to period-end net loans         0.79%               0.83%
  Net charge-offs to average loans, net                      0.0%               0.01%

</TABLE>

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
                        Item 1 - Financial Statements
            Notes to Unaudited Consolidated Financial Statements
                              December 31, 2000

10)   Deposits and Borrowed Funds

The following tables set forth the various types of deposit accounts at the
Company and the balances in these accounts as well as the borrowings of the
Company at the dates indicated.


<TABLE>
<CAPTION>
                                                      December 31, 2000         June 30, 2000
                                                      -----------------         -------------
                                                      Amount     Percent     Amount     Percent
                                                      ------     -------     ------     -------
                                                               (Dollars in Thousands)


<S>                                                  <C>           <C>      <C>           <C>
Deposits:
  Savings deposits                                   $ 42,971      22.5%    $ 42,413      21.9%
  NOW accounts                                         30,446      16.0%      33,927      17.5%
  Money market deposits                                 9,949       5.2%       8,370       4.3%
  Demand deposits                                      18,634       9.8%      16,346       8.4%
  Certificates of deposit                              88,614      46.5%      93,079      47.9%
                                                     -----------------------------------------
      Total deposits                                 $190,614     100.0%    $194,135     100.0%
                                                     =========================================

Borrowed funds:
  Advances from Federal Home Loan Bank of Boston:
  Maturities less than one year                      $ 11,000      24.1%    $  3,000       7.7%
  Maturities greater than one year                     34,634      75.9%      35,750      92.3%
                                                     -----------------------------------------
      Total borrowed funds                           $ 45,634     100.0%    $ 38,750     100.0%
                                                     =========================================
</TABLE>

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

Forward-looking Statements

The Company and the Bank may from time to time make written or oral
"forward-looking statements." These forward-looking statements may be
contained in this quarterly filing with the Securities and Exchange
Commission (the "SEC"), the Annual Report to Shareholders, other filings
with the SEC, and in other communications by the Company and the Bank, which
are made in good faith pursuant to the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995. The words "may," "could,"
"should," "would," "believe," "anticipate," "estimate," "expect," "intend,"
"plan" and similar expressions are intended to identify forward-looking
statements.

Forward-looking statements include statements with respect to the Company's
beliefs, plans, objectives, goals, expectations, anticipations, estimates
and intentions, that are subject to significant risks and uncertainties.
The following factors, many of which are subject to change based on various
other factors beyond the Company's control, and other factors discussed in
this Form 10-Q, as well as other factors identified in the Company's filings
with the SEC and those presented elsewhere by management from time to time,
could cause its financial performance to differ materially from the plans,
objectives, expectations, estimates and intentions expressed in such
forward-looking statements:

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

*     the strength of the United  States economy in general and the strength
      of the local economies in which the Company and the Bank conduct
      operations;
*     the effects of, and changes in, trade, monetary and fiscal policies
      and laws, including interest rate policies of the Federal Reserve
      Board;
*     inflation, interest rate, market and monetary fluctuations;
*     the timely development of and acceptance of new products and services
      and the  perceived overall value of these products and services by
      users, including the features, pricing and quality compared to
      competitors' products and services;
*     the willingness of users to substitute competitors' products and
      services for the Company's and the Bank's products and services;
*     the Company's and the Bank's success in gaining regulatory approval of
      their products and services, when required;
*     the impact of changes in financial services' laws and regulations
      (including laws concerning taxes, banking, securities and insurance);
*     the impact of technological changes;
*     acquisitions;
*     changes in consumer spending and saving habits; and
*     the Company's and the Bank's success at managing the risks involved in
      their business.

This list of important factors is not exclusive.  The Company or the Bank
does not undertake to update any forward-looking statement, whether written
or oral, that may be made from time to time by or on behalf of the Company
or the Bank.

General

The Bank completed its conversion from a mutual to a stock institution and
was simultaneously acquired by the Company on January 8, 1998.  The
Company's principal business activity consists of the ownership of the Bank.
 The Company also invests in short-term investment grade marketable
securities and other liquid investments.

The Bank is a Massachusetts chartered stock co-operative bank founded in
1886 with three full-service offices and one educational branch office in
Medford, Massachusetts and other full-service offices in Lexington and
Arlington, Massachusetts.  The business of the Bank consists of attracting
deposits from the general public and using these funds to originate various
types of loans primarily in eastern Middlesex County, Massachusetts,
including mortgage loans secured by one- to four-family residences,
commercial loans secured by general business assets and commercial real
estate loans secured by commercial property, and to invest in U.S.
Government and Federal Agency and other securities.  To a lesser extent, the
Bank engages in various forms of consumer and home equity lending.

The Bank has one active subsidiary, Mystic Securities Corporation, which was
established for the sole purpose of acquiring and holding securities.  All
securities held by Mystic Securities Corporation are securities which are
permissible for banks to hold under Massachusetts law.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

The Company's profitability depends primarily on its net interest income,
which is the difference between the interest income it earns on its loans
and investment portfolio and its cost of funds, which consists mainly of
interest paid on deposits and on borrowings from the Federal Home Loan Bank
of Boston.  Net interest income is affected by the relative amounts of
interest-earning assets and interest-bearing liabilities and the interest
rates earned or paid on these balances.  When interest-earning assets
approximate or exceed interest-bearing liabilities, any positive interest
rate spread will generate net interest income.

The level of other income and operating expenses also affects the Company's
profitability.  Other income consists primarily of service fees, loan
servicing and other loan fees, and gains on sales of securities available
for sale.  Operating expenses consist of salaries and benefits, occupancy
related expenses, and other general operating expenses.

Average Balances, Interest and Average Yields

The following tables set forth certain information relating to the Company's
average balance sheet and reflect the interest earned on assets and interest
cost of liabilities for the periods indicated and the average yields earned
and rates paid for the periods indicated.  Such yields and costs are derived
by dividing income or expense by the average monthly balances of assets and
liabilities, respectively, for the periods presented.  Average balances are
derived from daily balances.  Loans on nonaccrual status are included in the
average balances of loans shown in the tables.  The securities in the
following tables are presented at amortized cost.

                    MYSTIC FINANCIAL, INC. AND SUBSIDIARY
                AVERAGE BALANCES, INTEREST AND AVERAGE YIELDS
                THREE MONTHS ENDED DECEMBER 31, 2000 AND 1999
<TABLE>
<CAPTION>

                                                    Three Months Ending December 31, 2000  Three Months Ending December 31, 1999
                                                    -------------------------------------  -------------------------------------
                                                    Average        Interest       Yield/    Average        Interest       Yield/
                                                    Balance     Income/Expense     Rate     Balance     Income/Expense     Rate
                                                    -------     --------------    ------    -------     --------------    ------
                                                                              (Dollars in Thousands)

<S>                                                 <C>             <C>            <C>      <C>             <C>           <C>
INTEREST-EARNING ASSETS:
  Total loans, net                                  $203,263        $4,155         8.18%    $171,450        $3,382        7.89%
  Securities                                          30,100           467         6.21%      31,872           462        5.80%
  Other earning assets                                16,082           251         6.24%       7,408            94        5.08%
                                                    --------        ------                  --------        ------
      Total interest-earning assets                  249,445         4,873         7.81%     210,730         3,938        7.48%
                                                                    ------                                  ------
  Cash and due from banks                              5,798                                   5,053
  Other assets                                         6,953                                   6,736
                                                    --------                                --------
      Total assets                                  $262,196                                $222,519
                                                    ========                                ========
INTEREST-BEARING LIABILITIES:
  Regular and other deposits                        $ 42,589           247         2.32%    $ 40,552           237        2.34%
  NOW accounts                                        28,154            70         0.99%      22,994            88        1.53%
  Money market deposits                                8,474           108         5.10%       6,755            39        2.31%
  Certificates of deposit                             90,403         1,335         5.91%      77,696           981        5.05%
                                                    --------        ------                  --------        ------

      Total interest-bearing deposits                169,620         1,760         4.15%     147,997         1,345        3.64%
FHLB borrowings                                       45,639           737         6.46%      29,262           431        5.89%
                                                    --------        ------                  --------        ------

    Total interest-bearing liabilities               215,259         2,497         4.64%     177,259         1,776        4.01%
                                                                    ------                                  ------

Demand deposit accounts                               16,076                                  11,351
Other liabilities                                      1,643                                   1,465
                                                    --------                                --------

      Total liabilities                              232,978                                 190,075
Stockholders' equity                                  29,218                                  32,444
                                                    --------                                --------

      Total liabilities and stockholders' equity    $262,196                                $222,519
                                                    ========                                ========

Net interest income                                                 $2,376                                  $2,162
                                                                    ======                                  ======

Interest rate spread                                                               3.17%                                  3.47%

Net interest margin                                                                3.81%                                  4.10%

Interest-earning assets/interest-bearing
 liabilities                                                                       1.16x                                  1.19x

</TABLE>

                    MYSTIC FINANCIAL, INC. AND SUBSIDIARY
                AVERAGE BALANCES, INTEREST AND AVERAGE YIELDS
                 SIX MONTHS ENDED DECEMBER 31, 2000 AND 1999

<TABLE>
<CAPTION>
                                                        Six Months Ending December 31, 2000  Six Months Ending December 31, 1999
                                                        -----------------------------------  -----------------------------------
                                                        Average       Interest      Yield/    Average       Interest      Yield/
                                                        Balance    Income/Expense    Rate     Balance    Income/Expense    Rate
                                                        -------    --------------   ------    -------    --------------   ------
                                                                              (Dollars in Thousands)

<S>                                                     <C>            <C>          <C>      <C>            <C>           <C>
INTEREST-EARNING ASSETS:
  Total loans, net                                      $199,888       $8,139       8.14%    $165,227       $6,505        7.87%
  Securities                                              33,521        1,063       6.34%      32,262          937        5.81%
  Other earning assets                                    12,490          393       6.29%       8,550          220        5.15%
                                                        ---------------------                ---------------------

      Total interest-earning assets                      245,899        9,595       7.80%     206,039        7,662        7.44%
                                                                       ------                               ------

Cash and due from banks                                    5,492                                4,673
Other assets                                               6,892                                6,544
                                                        --------                             --------

      Total assets                                      $258,283                             $217,256
                                                        ========                             ========

INTEREST-BEARING LIABILITIES:
  Regular and other deposits                            $ 42,409          482       2.27%    $ 41,000          473        2.31%
  NOW accounts                                            28,062          227       1.62%      23,516          177        1.51%
  Money market deposits                                    8,162          116       2.84%       6,643           77        2.32%
  Certificates of deposit                                 90,517        2,644       5.84%      76,039        1,910        5.02%
                                                        ---------------------                ---------------------

      Total interest-bearing deposits                    169,150        3,469       4.10%     147,198        2,637        3.58%
FHLB borrowings                                           42,899        1,376       6.42%      25,209          742        5.89%
                                                        ---------------------                ---------------------

      Total interest-bearing liabilities                 212,049        4,845       4.57%     172,407        3,379        3.92%
                                                                       ------                               ------

Demand deposit accounts                                   15,381                               10,540
Other liabilities                                          1,616                                1,340
                                                        --------                             --------

      Total liabilities                                  229,046                              184,287
Stockholders' equity                                      29,237                               32,969
                                                        --------                             --------

      Total liabilities and stockholders' equity        $258,283                             $217,256
                                                        ========                             ========

Net interest income                                                    $4,750                               $4,283
                                                                       ======                               ======

Interest rate spread                                                              3.23%                                   3.52%

Net interest margin                                                               3.86%                                   4.16%

Interest-earning assets/interest-bearing liabilities                              1.16x                                   1.20x

</TABLE>


                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Rate/Volume Analysis

The following table sets forth certain information regarding changes in
interest income and interest expense of the Company for the periods
indicated.  For each category of interest-earning asset and interest-bearing
liability, information is provided on changes attributable to: (i) changes
in volume (changes in volume multiplied by old rate); and (ii) changes in
rates (change in rate multiplied by old volume).  Changes in rate-volume
(changes in rate multiplied by the changes in volume) are allocated between
changes in rate and changes in volume.

<TABLE>
<CAPTION>

                                 Three Months Ended December 31,
                                           2000 vs 1999
                                       Increase (decrease)
                                 -------------------------------
                                       Due To
                                  -----------------
                                  Rate       Volume      Total
                                  ----       ------      -----
                                          (In Thousands)

<S>                               <C>         <C>         <C>
Interest and dividend income:
  Loans, net                      $126        $647        $773
  Securities                        32         (27)          5
  Other earning assets              25         132         157
                                  ----------------------------

      Total                        183         752         935
                                  ----------------------------

Interest expense:
  Deposits                         204         211         415
  Borrowed funds                    45         261         306
                                  ----------------------------

      Total                        249         472         721
                                  ----------------------------

Change in net interest income     $(66)       $280        $214
                                  ============================
</TABLE>

<TABLE>
<CAPTION>

                                 Six Months Ended December 31,
                                           2000 vs 1999
                                       Increase (decrease)
                                 -----------------------------
                                       Due To
                                  -----------------
                                  Rate       Volume      Total
                                  ----       ------      -----
                                          (In Thousands)

<S>                               <C>         <C>         <C>
Interest and dividend income:
  Loans, net                      $ 229       $1,405      $1,634
  Securities                         88           38         126
  Other earning assets               56          117         173
                                  ------------------------------

      Total                         373        1,560       1,933
                                  ------------------------------

Interest expense:
  Deposits                          410          422         832
  Borrowed funds                     72          562         634
                                  ------------------------------

      Total                         482          984       1,466
                                  ------------------------------

Change in net interest income     $(109)      $  576      $  467
                                  ==============================
</TABLE>

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Financial Condition and Results of Operations

Comparison of Financial Condition at December 31, 2000 and at June 30, 2000

Total assets increased to $267.5 million at December 31, 2000 from $263.9
million at June 30, 2000, an increase of $3.6 million or 1.4%.  The increase
in total assets is principally due to continued loan growth, partially
offset by a decrease in short-term investments and securities available for
sale.

Cash and cash equivalents decreased to $26.9 million at December 31, 2000
from $31.3 million at June 30, 2000, a decrease of $4.4 million or 14.0%.
Securities available for sale decreased to $24.2 million at December 31,
2000 from $32.5 million at December 31, 1999, a decrease of $8.3 million or
25.4%.  The decreases in cash and cash equivalents and securities available
for sale occurred to fund the Company's increase in net loans.

Net loans increased by $16.7 million or 8.8% to $205.9 million or 77.0% of
total assets at December 31, 2000 as compared to $189.2 million or 71.7% of
total assets at June 30, 2000 as the Company continued its emphasis on
originating and retaining residential mortgage loans and commercial and
commercial real estate loans.

Total deposits decreased by $3.5 million or 1.8% to $190.6 million at
December 31, 2000 from $194.1 million at June 30, 2000.  The decrease in
deposits occurred primarily as a result of normal volatility in the
Company's transaction accounts and a decrease in certificates of deposit.

Total borrowings increased by $6.9 million to $45.6 million at December 31,
2000 from $38.8 million at June 30, 2000.  The Company's continued use of
borrowed funds reflects additional funding needed to support its growth in
net loans. In addition, the Company has secured longer-term borrowed funds
in order to improve its interest rate risk and fund longer-term assets
including fixed-rate residential mortgage loans held for portfolio.  All
borrowed funds were from the Federal Home Loan Bank of Boston (the "FHLB").

Stockholders' equity increased by $20,000 to $29.2 million at December 31,
2000 from $29.2 million at June 30, 2000 as a result of the repurchase of
81,094 shares of common stock held in treasury at a cost of $1.1 million and
dividends paid of $257,000, offset by an increase in the net unrealized gain
on securities available for sale of $86,000, net income of $916,000, a
reduction in unearned ESOP shares of $165,000, a reduction in unearned RRP
stock of $121,000, and proceeds from the exercise of stock options of
$60,000.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Comparison of the Operating Results for the Three and Six Months Ended
December 31, 2000 and 1999

Net Income.  Net income was $420,000 and $916,000 for the three and six
months ended December 31, 2000, respectively, compared to $397,000 and
$884,000 for the three and six months ended December 31, 1999, respectively.
Return on average assets was .64% and .71% for the three and six months
ended December 31, 2000, respectively, compared to .71% and .81% for the
three and six months ended December 31, 1999, respectively.  Return on
average equity was 5.75% and 6.27% for the three and six months ended
December 31, 2000, respectively, compared to 4.89% and 5.36% for the three
and six months ended December 31, 1999, respectively. The decrease in the
return on average assets is due to higher operating expenses while the
increase in the return on average equity resulted from achieving an increase
in net income on a smaller average balance of stockholders' equity,
principally caused by repurchases of common stock.

The increase in income before income taxes for the three months ended
December 31, 2000 compared to the three months ended December 31, 1999 was
attributable to an increase in net interest income of $214,000, a decrease
in the provision for loan losses of $25,000, and an increase in other income
of $90,000, which were partially offset by an increase in operating expenses
of $295,000 and an increase in provision for income taxes of $11,000.

The increase in income before income taxes for the six months ended December
31, 2000 compared to the six months ended December 31, 1999 was attributable
to an increase in net interest income of $467,000, a decrease in the
provision for loan losses of $15,000, and an increase in other income of
$165,000, which were partially offset by an increase in operating expenses
of $607,000 and an increase in provision for income taxes of $8,000.

Interest and Dividend Income.  Total interest and dividend income increased
by $935,000 or 23.7% to $4.9 million for the three months ended December 31,
2000 from $3.9 million for the three months ended December 31, 1999.  The
increase in interest income was a result of an increase in the average
balance of net loans and other earning assets, partially offset by a
decrease in the average balance of securities.  The average balance of net
loans for the three months ended December 31, 2000 was $203.3 million
compared to $171.5 million for the three months ended December 31, 1999.
The average yield on net loans was 8.18% for the three months ended December
31, 2000 compared to 7.89% for the three months ended December 31, 1999.

The average balance of securities for the three months ended December 31,
2000 was $30.1 million compared to $31.9 million for the three months ended
December 31, 1999.  The average yield on securities was 6.21% for the three
months ended December 31, 2000 compared to 5.80% for the three months ended
December 31, 1999.   The average balance of other earning assets for the
three months ended December 31, 2000 was $16.1 million compared to $7.4
million for the three months ended December 31, 1999.  The average yield on
other earning assets was 6.24% for the three months ended December 31, 2000
compared to 5.08% for the three months ended December 31, 1999.  The
increase in the average yield on securities and other earning assets
reflects the general increase in market interest rates since the prior
period.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Total interest and dividend income increased by $1.9 million or 25.2% to
$9.6 million for the six months ended December 31, 2000 from $7.7 million
for the six months ended December 31, 1999.  The increase in interest income
was a result of an increase in the average balance of net loans and other
earning assets.  The average balance of net loans for the six months ended
December 31, 2000 was $199.9 million compared to $165.2 million for the six
months ended December 31, 1999.  The average yield on net loans was 8.14%
for the six months ended December 31, 2000 compared to 7.87% for the six
months ended December 31, 1999.

The average balance of securities for the six months ended December 31, 2000
was $33.5 million compared to $32.3 million for the six months ended
December 31, 1999.  The average yield on securities was 6.34% for the six
months ended December 31, 2000 compared to 5.81% for the six months ended
December 31, 1999.   The average balance of other earning assets for the six
months ended December 31, 2000 was $12.5 million compared to $8.6 million
for the six months ended December 31, 1999.  The average yield on other
earning assets was 6.29% for the six months ended December 31, 2000 compared
to 5.15% for the six months ended December 31, 1999. The increase in the
average yield on securities and other earning assets reflects the general
increase in market interest rates since the prior period.

Interest Expense.  Total interest expense increased by $721,000 or 40.6% to
$2.5 million for the three months ended December 31, 2000 from $1.8 million
for the three months ended December 31, 1999. Interest expense increased
primarily due to an increase in certificates of deposit balances and an
increase in FHLB borrowings combined with a general increase in market
interest rates since the prior period.  Average interest-bearing deposits
increased by $21.6 million or 14.6% to $169.6 million while the average rate
increased 51 basis points to 4.15% from 3.64% for the three months ended
December 31, 2000 versus the three months ended December 31, 1999.  Average
borrowings increased by $16.4 million to $45.6 million for the three months
ended December 31, 2000 from $29.3 million for the three months ended
December 31, 1999, while the average rate increased 57 basis points to 6.46%
for the three months ended December 31, 2000 from 5.89% for the three months
ended December 31, 1999.

Total interest expense increased by $1.5 million to $4.8 million for the six
months ended December 31, 2000 from $3.4 million for the six months ended
December 31, 1999.  Interest expense increased primarily due to an increase
in certificates of deposit and an increase in FHLB borrowings combined with
a general increase in market interest rates since the prior period.  Average
interest-bearing deposits increased by $22.0 million or 14.9% to $169.2
million while the average rate increased 52 basis points to 4.10% from 3.58%
for the six months ended December 31, 2000 versus the six months ended
December 31, 1999.  Average borrowings increased by $17.7 million to $42.9
million for the six months ended December 31, 2000 from $25.2 million for
the six months ended December 31, 1999, while the average rate increased 53
basis points to 6.42% for the six months ended December 31, 2000 from 5.89%
for the six months ended December 31, 1999.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Net Interest Income.  Net interest income for the three months ended
December 31, 2000 was $2.4 million as compared to $2.2 million for the three
months ended December 31, 1999.  The $214,000 or 9.9% increase can be
attributed to a combination of the $935,000 increase in interest and
dividend income offset by the $721,000 increase in interest expense on
deposits and borrowed funds.  The average yield on interest earning assets
increased 33 basis points to 7.81% for the three months ended December 31,
2000 from 7.48% for the three months ended December 31, 1999, while the
average cost on interest-bearing liabilities increased by 63 basis points to
4.64% for the three months ended December 31, 2000 from 4.01% for the three
months ended December 31, 1999.  As a result, the interest rate spread
decreased to 3.17% for the three months ended December 31, 2000 from 3.47%
for the three months ended December 31, 1999.

Net interest income for the six months ended December 31, 2000 was $4.8
million as compared to $4.3 million for the six months ended December 31,
1999.  The $467,000 or 10.9% increase can be attributed to a combination of
the $1.9 million increase in interest and dividend income offset by the $1.5
million increase in interest expense on deposits and borrowed funds.  The
average yield on interest earning assets increased 36 basis points to 7.80%
for the six months ended December 31, 2000 from 7.44% for the six months
ended December 31, 1999, while the average cost on interest-bearing
liabilities increased by 65 basis points to 4.57% for the six months ended
December 31, 2000 from 3.92% for the six months ended December 31, 1999.  As
a result, the interest rate spread decreased to 3.23% for the six months
ended December 31, 2000 from 3.52% for the six months ended December 31,
1999.

Provision for Loan Losses.  The provision for loan losses for the three and
six months ended December 31, 2000 was $50,000 and $100,000, respectively,
compared to $75,000 and $115,000 for the three and six months ended December
31, 1999, respectively.  At December 31, 2000, the balance of the allowance
for loan losses was $1.6 million or .79% of net loans.  At December 31,
1999, the balance of the allowance for loan losses was $1.5 million or .83%
of net loans.

Other Income.  Other income was $361,000 for the three months ended December
31, 2000 compared to $271,000 for the three months ended December 31, 1999.
 The $90,000 or 33.2% increase was primarily the result of an increase in
service fees on loans and deposit accounts of $53,000, and an increase in
the gain on sales of securities available for sale of $104,000.  Other
income was $652,000 for the six months ended December 31, 2000 compared to
$487,000 for the six months ended December 31, 1999.  The $165,000 increase
was primarily the result of an increase in service fees on loans and deposit
accounts of $109,000 and an increase in the gain on the sales of securities
available for sale of $130,000, partially offset by a decrease in
miscellaneous income of $74,000.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Operating Expenses.  Operating expenses increased by $295,000 or 17.3% to
$2.0 million for the three months ended December 31, 2000 from $1.7 million
for the three months ended December 31, 1999.  Salaries and employee
benefits increased by $139,000.  This increase was primarily due to staff
hired for the opening of a new branch office in Arlington, Massachusetts, in
May 2000, and normal salary increases.  In addition, the Company accrued
$100,000 for a Directors Retirement Program adopted in November 2000.
Occupancy and equipment expenses increased by $72,000 primarily due to the
opening of the Arlington branch.  An increase in other general and
administrative expenses of $75,000 was caused by higher professional fees,
liability insurance costs, and additional operating costs from operating as
a publicly held stock institution.

Operating expenses increased by $607,000 or 19.0% to $3.8 million for the
six months ended December 31, 2000 from $3.2 million for the six months
ended December 31, 1999.  Salaries and employee benefits increased by
$301,000.  This increase was primarily due to the opening of a new branch
office in Arlington, Massachusetts, in May 2000, and general salary
increases.  In addition, the Company accrued $100,000 for a Directors
Retirement Program adopted in November 2000.  Occupancy and equipment
expenses increased by $134,000 primarily due to the opening of the Arlington
Branch.  An increase in other general and administrative expenses of
$150,000 was caused by higher professional fees, liability insurance costs,
and additional operating costs from operating as a publicly held stock
institution.

Asset/Liability Management

A principal operating objective of the Company is to produce stable earnings
by achieving a favorable interest rate spread that can be sustained during
fluctuations in prevailing interest rates.  Since the Company's principal
interest-earning assets have longer terms to maturity than its primary
source of funds, i.e. deposit liabilities, increases in general interest
rates will generally result in an increase in the Company's cost of funds
before the yield on its asset portfolio adjusts upward.  Banking
institutions have generally sought to reduce their exposure to adverse
changes in interest rates by attempting to achieve a closer match between
the periods in which their interest-bearing liabilities and interest-earning
assets can be expected to reprice through the origination of adjustable-rate
mortgages and loans with shorter terms and the purchase of other shorter
term interest-earning assets.

The term "interest rate sensitivity" refers to those assets and liabilities,
which mature and reprice periodically in response to fluctuations in market
rates and yields.  Thrift institutions have historically operated in a
mismatched position with interest-sensitive liabilities exceeding interest-
sensitive assets in the short-term time periods.  As noted above, one of the
principal goals of the Bank's asset/liability program is to more closely
match the interest rate sensitivity characteristics of the asset and
liability portfolios.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

In order to properly manage interest rate risk, the Board of Directors has
established an Asset/Liability Management Committee ("ALCO") made up of
members of management to monitor the difference between the Company's
maturing and repricing assets and liabilities and to develop and implement
strategies to decrease the "negative gap" between the two.  The primary
responsibilities of the committee are to assess the Company's
asset/liability mix, recommend strategies to the Board that will enhance
income while managing the Company's vulnerability to changes in interest
rates and report to the Board the results of the strategies used.

Since the early 1980s, the Bank has stressed the origination of adjustable-
rate residential mortgage loans and adjustable-rate home equity loans.
Historically, the Bank has attempted to sell fixed-rate loans with terms in
excess of 15 years.  However, following the conversion, the Bank has
retained a greater portion of its fixed rate loans, funded in part with
borrowings from the FHLB.  Since 1995, the Bank has also emphasized
commercial loans with short-term maturities or repricing intervals as well
as commercial real estate mortgages with short-term repricing intervals.  In
addition, the Company has used borrowings from the FHLB to fund the maturity
or repricing interval of certain commercial real estate mortgages.

Liquidity and Capital Resources

The Company's primary sources of funds consist of deposits, borrowings,
repayment and prepayment of loans, sales and participations of loans,
maturities of securities and interest-bearing deposits, and funds provided
from operations.  While scheduled repayments of loans and maturities of
securities are predictable sources of funds, deposit flows and loan
prepayments are greatly influenced by the general level of interest rates,
economic conditions, and competition.  The Company uses its liquidity
resources primarily to fund existing and future loan commitments, to fund
net deposit outflows, to invest in other interest-earning assets, to
maintain liquidity, and to meet operating expenses.

The Company is required to maintain adequate levels of liquid assets.  This
requirement, which may be varied depending upon economic conditions and
deposit flows, is based upon a percentage of deposits and short-term
borrowings.  The Company has historically maintained a level of liquid
assets in excess of regulatory requirements.  The Company's liquidity ratio
at December 31, 2000 was 66.4%, using the short-term assets to short-term
liabilities formula defined under the Federal Deposit Insurance
Corporation's Uniform Bank Performance Reports.

A major portion of the Company's liquidity consists of cash and cash
equivalents, short-term U.S. Government and Federal Agency Obligations, and
corporate bonds.  The level of these assets is dependent upon the Company's
operating, investing, lending and financing activities during any given
period.

                    Mystic Financial, Inc. and Subsidiary
                       Part I - Financial Information
    Item 2 - Management's Discussion and Analysis of Financial Condition
                          and Results of Operations
                              December 31, 2000

Liquidity management is both a daily and long-term function of management.
If the Company requires funds beyond its ability to generate them
internally, the Company believes it could borrow additional funds from the
FHLB.  At December 31, 2000, the Company had borrowings of $45.6 million
from the FHLB.

At December 31, 2000, the Company had $9.8 million in outstanding
commitments to originate loans.  The Company anticipates that it will have
sufficient funds available to meet its current loan origination commitments.
Certificates of deposit which are scheduled to mature in one year or less
totaled $65.1 million at December 31, 2000.  Based upon historical
experience, management believes that a significant portion of such deposits
will remain with the Bank.

At December 31, 2000, the Company and the Bank exceeded all of their
regulatory capital requirements.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk
In management's opinion, there has been no material change in market risk
since disclosed in Item 7A of the Company's Annual Report on Form 10-K for
the year ended June 30, 2000.

PART II.   OTHER INFORMATION

Item 6.    Exhibits and Reports on Form 8-K

(a)    Exhibits

           10.1 Amendatory Agreement between Mystic Financial, Inc. and
           Robert H. Surabian.
           10.2 Mystic Financial, Inc. Retirement Plan for Non-Employee
           Directors, as revised.

(b)        Reports on Form 8-K

           None

                                 SIGNATURES

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

                           MYSTIC FINANCIAL, INC.

Date: February 9, 2001          By:  /s/ Robert H. Surabian
      ----------------               -------------------------------------
                                     Robert H. Surabian
                                     President and Chief Executive Officer

Date: February 9, 2001          By:  /s/ Ralph W. Dunham
      ----------------               -------------------------------------
                                     Ralph W. Dunham
                                     Executive Vice-President, Chief
                                     Financial Officer, and Treasurer