U. S. SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   Form 10-QSB


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

                 For the quarterly period ended: March 31, 2001


          [ ] 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: 1-15513

                              PREMIER BANCORP, INC.
        (Exact name of small business issuer as specified in its charter)

         Pennsylvania                                            23-2921058
         ------------                                            ----------
(State or other jurisdiction of                              (IRS Employer
incorporation or organization)                               Identification No.)


                   379 North Main Street, Doylestown, PA 18901
                   -------------------------------------------
                    (Address of principal executive offices)

                                 (215) 345-5100
                           ---------------------------
                           (Issuer's telephone number)

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

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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

         State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 3,224,960 shares of $0.33
par value common stock issued and outstanding as of April 30, 2001.

     Transitional Small Business Disclosure format (check one):
Yes      No  X
    ---     ---


<PAGE>

                         PART I - FINANCIAL INFORMATION

Item 1 -- Financial Statements

                              PREMIER BANCORP, INC.
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                   March 31, 2001     December 31, 2000
                                                                                   --------------     -----------------
                                                                                (Dollars in thousands, except share data)
<S>                                                                                   <C>                <C>
Assets:
Cash and due from banks                                                               $   5,590          $   7,970
Federal funds sold                                                                        9,569                 --
Interest-bearing deposits                                                                   691                 56
                                                                                      ---------          ---------
Cash and cash equivalents                                                                15,850              8,026
Investment securities:
     Held to maturity (fair value $5,629 in 2001 and $5,912 in 2000)                      5,657              6,026
     Available for sale (amortized cost $92,481 in 2001 and $99,548 in 2000)             88,247             94,573
Loans receivable (net of allowance for loan losses of $3,128 in 2001
     and $3,032 in 2000)                                                                245,726            235,552
Loans held for sale                                                                         265                 --
Other real estate owned                                                                     252                252
Premises and equipment                                                                    4,814              4,853
Accrued interest receivable                                                               2,797              2,517
Deferred income taxes                                                                     2,451              2,703
Other assets                                                                              1,679                699
                                                                                      ---------          ---------

Total assets                                                                          $ 367,738          $ 355,201
                                                                                      =========          =========

Liabilities, minority interest in subsidiary and shareholders' equity:
Deposits                                                                              $ 314,411          $ 303,293
Borrowings                                                                               16,096             14,404
Accrued interest payable                                                                  4,500              4,127
Other liabilities                                                                         3,417              5,422
Subordinated debt                                                                         1,500              1,500
                                                                                      ---------          ---------

Total liabilities                                                                       339,924            328,746

Corporation-obligated mandatorily redeemable capital securities of subsidiary
     trust holding solely junior subordinated debentures of the corporation              10,000             10,000

Shareholders' equity:
Common stock- $0.33 par value; 30,000,000 shares authorized; issued and
     outstanding 3,215,908 at March 31, 2001 and 3,105,248 at December 31, 2000           1,061              1,025
Additional paid-in capital                                                               12,162             11,792
Retained earnings                                                                         7,385              6,921
Accumulated other comprehensive loss                                                     (2,794)            (3,283)
                                                                                      ---------          ---------

Total shareholders' equity                                                               17,814             16,455
                                                                                      ---------          ---------

Total liabilities, minority interest in subsidiary and shareholders' equity           $ 367,738          $ 355,201
                                                                                      =========          =========
</TABLE>


The accompanying notes are an integral part of the consolidated
financial statements.

                                       2
<PAGE>
                        PREMIER BANCORP, INC.
                CONSOLIDATED STATEMENTS OF OPERATIONS
                             (Unaudited)
<TABLE>
<CAPTION>



For the three months ended March 31,                                                   2001                  2000
-----------------------------------                                                -----------            -----------
                                                                            (Dollars in thousands, except per share data)
<S>                                                                                <C>                    <C>
Interest income:
   Loans                                                                           $     5,269            $     4,343
   Federal funds sold and interest-bearing deposits                                        143                    127
   Investments:
      Taxable                                                                            1,400                  1,606
      Tax-exempt                                                                           202                    221
                                                                                   -----------            -----------
 Total interest income                                                                   7,014                  6,297

Interest expense:
   Deposits                                                                              3,889                  2,647
   Borrowings                                                                              219                    833
                                                                                   -----------            -----------
 Total interest expense                                                                  4,108                  3,480
                                                                                   -----------            -----------

Net interest income                                                                      2,906                  2,817
Provision for loan losses                                                                  100                    150
                                                                                   -----------            -----------
Net interest income after loan loss provision                                            2,806                  2,667

Non-interest income:
   Service charges and other fees                                                          137                     51
   Loss, net, on sale of investment securities available for sale                          (36)                    --
   Gain on sale of loans held for sale                                                       5                      7
                                                                                   -----------            -----------
Total non-interest income                                                                  106                     58

Non-interest expense:
   Salaries and employee benefits                                                        1,075                  1,045
   Occupancy                                                                               196                    148
   Data processing                                                                         239                    231
   Professional services                                                                    80                    106
   Marketing                                                                               121                    161
   Minority interest in expense of subsidiary                                              218                    218
   Other                                                                                   364                    305
                                                                                   -----------            -----------
Total non-interest expense                                                               2,293                  2,214
                                                                                   -----------            -----------

Income before income tax                                                                   619                    511
Income tax expense                                                                         155                    108
                                                                                   -----------            -----------
Net income                                                                         $       464            $       403
                                                                                   ===========            ===========

Earnings per share:
   Basic                                                                           $      0.15            $      0.13
   Diluted                                                                         $      0.14            $      0.12

Weighted average number of shares outstanding:
   Basic                                                                             3,172,708              3,078,914
   Diluted                                                                           3,331,888              3,447,761

The accompanying notes are an integral part of the consolidated
financial statements.
</TABLE>

                                       3
<PAGE>

                              PREMIER BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)
<TABLE>
<CAPTION>



For the three months ended March 31,                                                  2001               2000
-----------------------------------                                                 --------            --------
                                                                                          (In thousands)
<S>                                                                                 <C>                 <C>
Operating activities:
      Net income                                                                    $    464            $    403
      Adjustments to reconcile net income to cash (used in)
        provided by operating activities:
           Depreciation expense                                                          134                 108
           Provision for loan losses                                                     100                 150
           Amortization of premiums and discounts on
              investment securities held to maturity                                      --                   2
           Amortization of premiums and discounts on
              investment securities available for sale                                    40                  28
           Loss on sale of investment securities available for sale                       36                  --
           Gain on sale of loans held for sale                                            (5)                 (7)
           Originations of loans held for sale                                        (1,087)             (1,188)
           Proceeds from sale of loans held for sale                                     827               1,195
           Increase in accrued interest receivable                                      (280)               (490)
           Increase in other assets                                                     (980)                (33)
           Increase in deferred loan fees                                                 48                  37
           Increase in accrued interest payable                                          373                 470
           Decrease in other liabilities                                              (1,840)               (388)
                                                                                    --------            --------
Net cash (used in) provided by operating activities                                   (2,170)                287
                                                                                    --------            --------

Investing activities:
      Proceeds from sale of investment securities available for sale                  11,243                  --
      Repayment of investment securities available for sale                            1,706                 872
      Purchase of investment securities available for sale                            (5,958)                (50)
      Repayment of investment securities held to maturity                                369                  80
      Net increase in loans receivable                                               (10,322)             (8,632)
      Purchases of premises and equipment                                                (95)               (420)
                                                                                    --------            --------
Net cash used in investing activities                                                 (3,057)             (8,150)
                                                                                    --------            --------

Financing activities:
      Net increase in deposits                                                        11,118              25,420
      Net increase in borrowings less than 90 days                                     1,692               2,318
      Repayment of borrowings greater than 90 days                                        --             (10,000)
      Proceeds from exercised stock options                                              241                  --
                                                                                    --------            --------
Net cash provided by financing activities                                             13,051              17,738
                                                                                    --------            --------

Increase in cash and cash equivalents                                                  7,824               9,875

Cash and cash equivalents:
      Beginning of period                                                              8,026               8,491
                                                                                    --------            --------
      End of period                                                                 $ 15,850            $ 18,366
                                                                                    ========            ========

Supplemental disclosures:
      Cash payments for:
           Interest expense                                                         $  3,735            $  3,010
           Taxes                                                                         207                 127

Supplemental disclosure of noncash activities:
      Change in the estimated fair value of investment securities
        available for sale                                                          $    741            $   (416)
      Change in the deferred tax asset related to investment securities
        available for sale                                                              (252)                142
      Tax effect of exercised stock options                                              165                  --
</TABLE>


               The accompanying notes are an integral part of the consolidated
financial statements.

                                       4
<PAGE>


                              PREMIER BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.   Organization

     Premier Bancorp, Inc. is a Pennsylvania business corporation and a
registered financial holding company headquartered in Doylestown, Bucks County,
Pennsylvania. We were incorporated on July 15, 1997 and reorganized on November
17, 1997 as the one-bank holding company of Premier Bank. Our primary business
is the operation of our wholly owned subsidiary, Premier Bank, which we manage
as a single business segment.

     Premier Bank provides a full range of banking services to individual and
corporate customers through its branch banking system located in Bucks,
Montgomery and Northampton Counties in Pennsylvania. The bank is a Pennsylvania
chartered commercial bank and member of the Federal Reserve Bank of Philadelphia
and the Federal Deposit Insurance Corporation. The bank competes with other
financial institutions and other financial services companies with respect to
services offered and customers.

     The company and bank are regulated by certain federal and state agencies
and are periodically examined by them.

2.   Basis of Financial Statement Presentation

     The accompanying interim unaudited consolidated financial statements were
prepared in accordance with accounting principles generally accepted in the
United States of America as applied to the banking industry and in accordance
with instructions for quarterly reports on Form 10-QSB. These statements do not
include information or footnotes necessary for a complete presentation of
financial condition, results of operations, shareholders' equity and cash flows.
The consolidated financial statements include the accounts of Premier Bancorp,
Inc. and our wholly owned subsidiaries: Premier Bank, PBI Capital Trust and
Lenders Abstract LLC. All significant intercompany accounts and transactions
have been eliminated in the consolidated financial statements. Certain
previously reported amounts have been reclassified to conform to current
presentation standards. These reclassifications had no effect on net income. The
results of operations for the three months ended March 31, 2001 and 2000 are not
necessarily indicative of the results that may be expected for the entire fiscal
year. These quarterly financial statements should be read in conjunction with
the audited consolidated financial statements on Form 10-KSB and notes thereto
for the year ended December 31, 2000.

3.       Use of Estimates

     In preparing the consolidated financial statements, management is required
to make estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from such estimates. Material estimates that are particularly susceptible to
significant change in the near term include the determination of the allowance
for loan losses and the carrying value of other real estate owned.

4.       Derivative Financial Instruments

      The company has limited involvement with derivative financial instruments
and currently uses them only in relation to the bank's Index Powered SM
Certificate of Deposit (IPCD) product, which was introduced in the first quarter
of 2001. Customer returns on this unique CD are tied to the performance of the
Standard & Poor's 500 (R) Index. This product allows customers to receive the
potential of stock market returns without all the risks because, like other
traditional certificates of deposits, the return of principal is guaranteed at
maturity and deposits are insured by the FDIC to the extent provided by law.

      To cover the variable cost of the IPCD, the bank has entered into a
derivative contract with the Federal Home Loan Bank of Pittsburgh (FHLB). For
this contract, the bank pays a premium. To date, the bank has financed this

                                       5
<PAGE>

                              PREMIER BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


4.   Derivative Financial Instruments (continued)

premium by paying a quarterly rate of interest based on an amount equal to the
balance of the IPCD. By purchasing the contract in this way, the bank has
converted the cost of the IPCD into a synthetic interest cost. Over the term of
the IPCD, this synthetic cost will be comparable to that paid for traditional CD
products.

     The bank accounts for its derivative contracts and the derivatives embedded
in the IPCD in accordance with Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities", as amended. Accordingly, the bank carries
these derivatives at fair value in the Consolidated Statements of Financial
Condition and recognizes any changes in fair value in current period earnings.
The fair value of derivatives was approximately $800,000 at March 31, 2001. The
Black Scholes model was used to estimate the fair value of our derivative
contracts.

5.   Stock Dividend

     On February 17, 2000, the company declared a 5% common stock dividend to
shareholders of record as of February 29, 2000 that was paid on March 10, 2000.
The number of shares and per share amounts have been restated to reflect this
event as of the earliest date presented in this Form 10-QSB.

6.   Earnings Per Share

     Basic earnings per share is calculated on the basis of the weighted average
number of shares outstanding after giving retroactive effect to the 5% common
stock dividend declared on February 17, 2000. Diluted earnings per common share
includes dilutive common stock equivalents as computed under the treasury stock
method using average common stock prices for the respective period. Options to
purchase 571,697 and 726,659 shares of common stock were outstanding at March
31, 2001 and 2000, respectively, and to the extent dilutive, were included in
the computation of earnings per diluted common share. Options to purchase 51,998
and 38,333 shares of common stock were anti-dilutive for the first quarter 2001
and 2000, respectively, and excluded from the calculation of earnings per
diluted common share for the respective periods.

     The following is a reconciliation of the numerators and denominators of the
basic and diluted earnings per share calculations.
<TABLE>
<CAPTION>
                                                     For the three months ended March 31, 2001
                                           -----------------------------------------------------------------
                                                    (Dollars in thousands, except per share data)
                                                                                             Per share
                                               Net income               Shares                Amount
                                           -------------------    -------------------   --------------------
<S>                                           <C>                     <C>                     <C>
Basic earnings per share                      $     464               3,172,708               $   0.15
Effect of dilutive stock options                     --                 159,180                  (0.01)
                                              ---------               ---------               --------
Earnings per diluted share                    $     464               3,331,888               $   0.14
                                              =========               =========               ========

                                                      For the three months ended March 31, 2000
                                           -----------------------------------------------------------------
                                                    (Dollars in thousands, except per share data)
                                                                                             Per share
                                               Net income               Shares                Amount
                                           -------------------    -------------------   --------------------

Basic earnings per share                      $     403               3,078,914               $   0.13
Effect of dilutive stock options                     --                 368,847                  (0.01)
                                              ---------               ---------               --------
Earnings per diluted share                    $     403               3,447,761               $   0.12
                                              =========               =========               ========
</TABLE>

                                       6
<PAGE>

                              PREMIER BANCORP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.   Comprehensive Income (Loss)

     The following table displays net income and the components of other
comprehensive income (loss) to arrive at total comprehensive income (loss). For
the company, the only component of other comprehensive income (loss) is the
change in the estimated fair value of investment securities available for sale.
<TABLE>
<CAPTION>

For the three months ended March 31,                                                    2001               2000
                                                                                       ------             -------
                                                                                          (Dollars in thousands)

<S>                                                                                    <C>                 <C>
Net income                                                                             $ 464               $ 403
Other comprehensive income (loss), net of tax:
  Unrealized gains (losses) on investment securities available for sale:
    Unrealized holding gains (losses) during the period                                  465                (274)
    Less: Reclassification adjustment for losses included in net income, net of tax       24                   -
                                                                                       ------             -------
Other comprehensive income (loss), net of tax                                            489                (274)
                                                                                       ------              ------
Comprehensive income                                                                   $ 953               $ 129
                                                                                       ======              ======
</TABLE>



                                       7
<PAGE>

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

General

     Premier Bancorp, Inc. is a Pennsylvania business corporation and a
registered financial holding company headquartered in Doylestown, Bucks County,
Pennsylvania. We were incorporated on July 15, 1997 and reorganized on November
17, 1997 as the one-bank holding company of Premier Bank. Our primary business
is the operation of our wholly owned subsidiary, Premier Bank, which we manage
as a single business segment.

     Premier Bank was organized in 1990 as a Pennsylvania chartered banking
institution and began operations on April 24, 1992. The bank is a
community-oriented financial services provider whose business primarily consists
of attracting retail deposits from the general public and small businesses and
originating commercial and consumer loans in its market area. The bank also
invests in securities such as mortgage-backed securities, obligations of U.S.
government agencies and government sponsored entities, corporate bonds and
municipal bonds.

     The bank's revenues are derived principally from interest on its loans and
securities portfolios. The bank's primary sources of funds are deposits,
repayments, prepayments and maturities of loans, repayments, prepayments and
maturities of mortgage-backed and investment securities and borrowed funds.
Currently, the bank has seven full-service Pennsylvania banking offices:
Doylestown, Easton, Southampton, Floral Vale, Bethlehem, Bensalem and
Montgomeryville and a limited service office in the Heritage Towers Retirement
Community in Doylestown. We opened our Bethlehem branch in December 17, 1999. We
opened our Bensalem and Montgomeryville branches in October 2000. The bank faces
significant competition from other financial services companies, many of which
are larger organizations with more resources and locations than the bank.

     Our consolidated results of operations are dependent primarily on net
interest income, which is the difference between the interest income earned on
interest-earning assets, such as loans and securities, and the interest expense
paid on interest-bearing liabilities, such as deposits and borrowed money. We
also generate non-interest income such as service charges and other fees. Our
non-interest expenses primarily consist of employee compensation and benefits,
occupancy expenses, marketing, data processing costs and other operating
expenses. We are subject to losses from our loan portfolio if borrowers fail to
meet their obligations. Our results of operations are also significantly
affected by general economic and competitive conditions, particularly changes in
market interest rates, government policies and actions of regulatory agencies.

     Overhead expenses in 2001 are expected to be higher than in 2000 due to a
full year of expenses for new branches opened in October 2000. In addition, we
are facing increased competition for deposits and loans in the current interest
rate environment. This may also impact our results of operations for 2001.

     The following is management's discussion and analysis of the significant
changes in the results of operations for the three months ended March 31, 2001
as compared to the same period in 2000 and changes in financial condition from
December 31, 2000 to March 31, 2001. Current performance may not be indicative
of future performance. This discussion should be read in conjunction with the
2000 Annual Report on Form 10-KSB.

     In addition to historical information, this management discussion and
analysis contains forward-looking statements. Forward-looking statements are
subject to certain risks and uncertainties that could cause actual results to
differ materially from those projected. We caution readers not to place undue
reliance on these forward-looking statements, which reflect management's
analysis only as of this date. We are not obligated to publicly revise or update
these forward-looking statements to reflect events or circumstances that arise
after this date. Readers should carefully review the risk factors described in
other documents we file from time to time with the Securities and Exchange
Commission, including annual reports on Form 10-KSB, quarterly reports on Form
10-QSB and any current reports on Form 8-K.


                                       8
<PAGE>

Management's Strategy

     Our lending activities are specialized towards small and medium sized
businesses, professionals and individuals. In order to fund our lending
activities and allow for increased contact with our customers, we are
establishing a branch network to develop a stable core deposit base catering
primarily to retail and business depositors. We have a strong commitment to
highly personalized customer service. To support our growth, without
compromising our personalized service, we have made significant investments in
experienced personnel and have incurred significant costs related to our branch
office expansion.

     Since the 1992 opening of Premier Bank, we have grown to seven full service
Pennsylvania banking offices. We opened our fifth office in Bethlehem,
Northampton County, in December 1999. We opened a limited service office in the
Heritage Towers Retirement Community in Doylestown in July 2000. We opened our
sixth and seventh Pennsylvania full service offices in Bensalem and
Montgomeryville in October 2000. New branches normally contribute positively to
earnings only after they mature and grow.

     In conjunction with our branch expansion, we added significantly to our
commercial lending staff in 1999 in order to grow our loan portfolio and shift
more of our assets towards loans and away from investments. We prefer loans to
investments because loans generally have a shorter duration and a superior yield
to comparable term investment securities with an acceptable risk as defined by
our investment policy. However, the development of a quality loan portfolio
takes considerable time versus investment securities, which can be added
quickly. Therefore, we may buy or sell investment securities from time to time
depending on market conditions, business trends, liquidity, and capital levels.

     In addition to the ongoing expansion of our traditional business, we
continuously review and consider new products and services to offer our
customers. These new products and services are largely intended to generate and
increase fee income. In December 2000, we formed Lenders Abstract, LLC to
generate fee income from the origination of title insurance policies.

     Recent changes to federal banking laws allow financial institutions to
engage in a broader range of activities than previously permitted. These
legislative changes may serve to increase both opportunity as well as
competition.


                                       9
<PAGE>

         The following table sets forth, for the periods indicated, certain
average balance sheet amounts and their corresponding earnings/expenses and
rates (which have been annualized).
<TABLE>
<CAPTION>

                          Average Balances, Rates and Interest Income and Expense Summary

For the three months ended March 31,                                2001                                  2000
-----------------------------------                  ------------------------------------  ------------------------------------
                                                       Average                  Average      Average                  Average
                                                       Balance     Interest      Rate        Balance      Interest     Rate
                                                     ------------- ----------  ----------  ------------- ----------- ----------
Assets:                                                                         (Dollars in thousands)
<S>                                                         <C>          <C>       <C>            <C>           <C>      <C>
    Interest-bearing deposits                               $ 398        $ 6       6.11%          $ 507         $ 7      5.55%
    Federal funds sold                                     10,239        137       5.43%          8,485         120      5.69%
    Investment securities available for sale
       Taxable (1)                                         74,911      1,305       7.07%         86,034       1,493      6.98%
       Tax-exempt (1) (2)                                  16,508        306       7.52%         17,860         335      7.54%
    Investment securities held to maturity                  5,749         95       6.73%          6,999         113      6.49%
                                                     ------------- ----------  ----------  ------------- ----------- ----------
       Total investment securities                         97,168      1,706       7.12%        110,893       1,941      7.04%
    Loans, net of unearned income (3) (4)                 243,282      5,278       8.80%        202,518       4,353      8.64%
                                                     ------------- ----------  ----------  ------------- ----------- ----------
    Total interest-earning assets                         351,087      7,127       8.23%        322,403       6,421      8.01%
    Cash and due from banks                                 6,283                                 5,411
    Allowance for loan losses                              (3,072)                               (2,577)
    Other assets (5)                                        9,304                                 7,702
                                                     -------------                         -------------
Total assets                                             $363,602                              $332,939
                                                     =============                         =============
Liabilities, minority interest in subsidiary
     and shareholders' equity:
    Interest checking accounts                           $ 25,214        157       2.53%       $ 21,063         134      2.56%
    Money market deposit accounts                          17,351        197       4.60%          1,030           6      2.34%
    Savings accounts                                       42,794        369       3.50%         52,303         453      3.48%
    Time deposits                                         199,216      3,166       6.45%        148,261       2,054      5.57%
                                                     ------------- ----------  ----------  ------------- ----------- ----------
       Total interest-bearing deposits                    284,575      3,889       5.54%        222,657       2,647      4.78%
    Borrowings                                             16,324        191       4.75%         55,309         801      5.82%
    Subordinated debt                                       1,500         28       7.57%          1,500          32      8.58%
                                                     ------------- ----------  ----------  ------------- ----------- ----------
      Total interest-bearing liabilities                  302,399      4,108       5.51%        279,466       3,480      5.01%
    Non interest-bearing deposits                          25,015                                21,205
    Other liabilities                                       6,053                                 4,512
    Capital securities                                     10,000                                10,000
    Shareholders' equity (6)                               20,135                                17,756
                                                     -------------                         -------------
 Total liabilities, minority interest in
     subsidiary and shareholders' equity                 $363,602                              $332,939
                                                     =============                         =============

    Net interest income/rate spread                                  $ 3,019       2.72%                    $ 2,941      3.00%
                                                                   ==========  ==========                =========== ==========

    Net interest margin (7)                                                        3.49%                                 3.67%

     Average interest-earning assets as a percentage
     of average interest-bearing liabilities              116.10%                               115.36%

</TABLE>
-------------
(1)  Excludes the SFAS 115 valuation allowance on investment securities
     available for sale.

(2)  Interest income on tax-exempt investment securities was presented on a
     tax-equivalent basis. Tax-exempt yields were adjusted to a tax equivalent
     basis using a 34% rate.

(3)  Includes non-accrual loans of $79,000 on average for the three months ended
     March 31, 2000. There were no non-accrual loans during the three months
     ended March 31, 2001.

(4)  Includes tax-exempt loans of $981,000 and $1,128,000 on average for the
     three months ended March 31, 2001 and 2000, respectively. Tax-exempt yields
     were adjusted to a tax-equivalent basis using a 34% rate.

(5)  Excludes the deferred tax asset related to the SFAS 115 valuation allowance
     on investment securities available for sale.

(6)  Excludes the SFAS 115 valuation allowance on investment securities
     available for sale, net of tax.

(7)  Net interest margin is calculated as net interest income divided by average
     interest-earning assets.

                                       10
<PAGE>

Results of Operations

     We reported net income of $464,000 or $.14 earnings per common share on a
diluted basis for the three months ended March 31, 2001. This represents an
increase of $61,000 or 15% from the net income of $403,000 or $.12 earnings per
common share on a diluted basis reported for the same period in 2000. While both
net income and net interest income were higher in 2001, growth in net interest
income was slowed by decreases in the prime lending rate during the first
quarter of 2001 which affected the rates on new loans and on adjustable/variable
rate loans already in our portfolio. Overhead expenses were $194,000 or 9%
higher for the three months ended March 31, 2001 compared to the same period in
2000, exclusive of $115,000 in one time charges in 2000. Overhead expenses were
higher due in part to the bank's opening of two new branches in October 2000 and
the overall growth of the company.

     Return on average assets and return on average shareholders' equity were
 .52% and 11.01%, respectively, for the three months ended March 31, 2001
compared to .50% and 13.03% for the same period in 2000. Return on average
shareholders' equity, exclusive of the unrealized loss on investment securities
available for sale was 9.35% for the three months ended March 31, 2001 compared
to 9.13% for the same period in 2000.

Net interest income

     Net interest income is the most significant component of our operating
income. Net interest income depends upon the levels of interest-earning assets
and interest-bearing liabilities and the difference or "spread" between the
respective yields earned and rates paid. The interest rate spread is influenced
by the overall interest rate environment and by competition. The interest rate
spread is also influenced by differences in the maturity and repricing of assets
versus the liabilities that fund them. During the past year, the bank has
aggressively grown its loan portfolio. Much of this growth was funded by deposit
generation. The bank continues to face strong competition for both loans and
deposits. This competition continues to put pressure on our net interest income.
During the first half of 2000, the national prime lending rate increased three
times for a total of 1.00%. As a result, the yield on average interest-earning
assets and rates on average interest-bearing liabilities trended higher in the
later part of 2000 and through the first quarter 2001.

     During the first quarter of 2001 the Federal Reserve cut the targeted
federal funds rate three times amounting to 1.50%. These cuts immediately
lowered the national prime lending rates and in turn reduced rates on a portion
of the bank's loan portfolio. In the short-term, these rate cuts will negatively
impact earnings until this effect is offset by lower rates on deposits. We
expect the impact of these rate cuts to lower yields on our interest-earning
assets in 2001. Similarly, we expect to lower our cost of funds in 2001. We
cannot predict to what extent the lower asset yields will be offset by lower
cost of funds. The targeted federal funds rate was cut an additional .50% in
April 2001.

     For the three months ended March 31, 2001, net interest income, on a
tax-equivalent basis, was $78,000 higher than the same period in 2000. This
increase was primarily a function of asset growth, a higher yield on average
interest-earning assets and a higher ratio of average interest-earning assets to
average interest-bearing liabilities. These favorable items were offset in part
by a higher rate on average interest-bearing liabilities.

     Average interest-earning assets grew $28,684,000 or 9% from $322,403,000 at
March 31, 2000 to $351,087,000 at March 31, 2001. Average loan balances
increased $40,764,000 while average investments decreased $13,725,000. The ratio
of average interest-earning assets to average interest-bearing liabilities
increased from 115.36% at March 31, 2000 to 116.10% at March 31, 2001. The yield
on average interest-earning assets and the rate on average interest-bearing
liabilities increased 22 basis points and 50 basis points, respectively, due to
the increase in overall interest rates in 2000. The increase in rate on average
interest-bearing liabilities is mostly due to the aggressive promotion of the
9-month and 23-month certificates of deposit and personal cash management money
market account in 2000. The majority of the deposits from these promotions were
generated after the first quarter of 2000. Borrowings and subordinated debt
repriced lower in 2001 and offset, in part, the increased rate on deposits. We
expect the yield on average interest-earning assets and rate on average
interest-bearing liabilities to trend downward in 2001 as a result of the recent
rate cuts.


                                       11
<PAGE>

     The net interest margin decreased 18 basis points from 3.67% at March 31,
2000 to 3.49% at March 31, 2001. The net interest rate spread decreased 28 basis
points from 3.00% at March 31, 2000 to 2.72% at March 31, 2001. The
maturity/repricing characteristics of our portfolios in combination with
increased competition for loans and deposits, has contributed to this margin
compression.

Non-interest income

     Non-interest income consists primarily of service charges on deposits and
gains (losses) on the sale of investment securities available for sale and loans
held for sale.

     Total non-interest income was $106,000 for the three months ended March 31,
2001 compared to $58,000 for the same period in 2000. Our service charges and
other fees were $86,000 higher due to a one-time fee of $50,000 related to a
loan pay-off, pricing changes and the introduction of new products and services.
Our new Visa/debit card, financial advisory services and title insurance
business collectively generated $28,000 in other fees in the first quarter of
2001. During the first quarter of 2001 we recorded $36,000 in net losses on the
sale of investment securities available for sale while there were no security
sales during the first quarter of 2000. The level of gains or losses on
investment sales is primarily dependent upon the volume of transactions, the
types of securities sold, timing and the interest rate environment among other
factors.

Non-interest expense

     For the three months ended March 31, 2001, non-interest expenses were
$2,293,000 or $79,000 higher than the $2,214,000 recorded during the same period
in 2000. First quarter 2000 results included one-time charges of $115,000 before
tax, related to two separate discontinued Internet banking initiatives.
Exclusive of these one-time charges, overhead expenses grew $194,000 or 9% in
2001. Overhead expenses increased principally due to the continued growth of our
franchise, namely the opening of our Bensalem and Montgomeryville offices in
October 2000.

     Salaries and benefits were $30,000 higher in 2001, an increase of 3%,
compared to 2000. This increase was principally due to an increase in the number
of employees and salary adjustments. The number of full-time equivalent
employees grew from 69 at March 31, 2000 to 78 at March 31, 2001. Occupancy
expenses were $48,000 higher due primarily to the additional rent, maintenance
and utility costs for new branches. Professional services and marketing expenses
were lower for the first quarter 2001 due in part to the one-time charges in
2000. Other expenses consist primarily of furniture and equipment expense,
employee travel, meals and entertainment, stationery, supplies, postage and
Board of Directors' fees. The $59,000 or 19% increase in other expenses is
principally attributed to the growth of the institution.

Provision for loan losses

     The provision for loan losses represents the amount necessary to be charged
to operations to bring the allowance for loan losses to a level that management
deems adequate to provide for known and inherent losses. The amount of the
provision for loan losses and the amount of the allowance for loan losses is
subject to ongoing analysis of the loan portfolio which considers current
economic conditions, actual loss experience, the current risk profile of the
portfolio, delinquency statistics, and the composition of loan types within the
portfolio. Net charge-offs were $4,000 and $6,000 for the three months ended
March 31, 2001 and March 31, 2000, respectively. The bank's loan portfolio is
relatively immature given its recent growth rates. Therefore, charge-off and
non-performing trends may not be indicative of future performance.

     The provision for loan losses was $100,000 and $150,000 for the three
months ended March 31, 2001 and March 31, 2000, respectively. The loan loss
allowance as a percentage of total loans was 1.25% at March 31, 2001 and 1.28%
at March 31, 2000.


                                       12
<PAGE>

Income tax expense

     We recorded a $155,000 or 25.0% tax provision for the three months ended
March 31, 2001 compared to $108,000 or 21.1% for the same period in 2000. The
effective tax rate for the three months ended March 31, 2001 was higher than the
comparable period in 2000 due principally to a lower ratio of tax-exempt
interest relative to total taxable income.

Financial Condition

     Consolidated assets grew $12,537,000 or 3.5% during the three months ended
March 31, 2001. Federal funds sold and total gross loans grew $9,569,000 and
$10,318,000, respectively. Asset growth was primarily funded by proceeds from
the sale of investment securities available for sale and an $11,118,000 increase
in deposits. Most of the deposit growth was in time deposits and money market
accounts and due in part to the promotion of our new Index Powered SM
Certificate of Deposit and personal cash management money market account.
Borrowings increased $1,692,000 from $14,404,000 at December 31, 2000 to
$16,096,000 at March 31, 2001. Shareholders' equity increased $1,359,000 from
$16,455,000 at December 31, 2000 to $17,814,000 at March 31, 2001. This increase
was attributable to $464,000 in earnings, a $489,000 improvement in the
estimated fair value of investment securities available for sale, net of tax,
and $406,000 from the exercise of common stock options.

Investment securities

     Our investment policies dictate permissible investment categories, credit
quality, maturity intervals and investment concentrations. Management is
responsible for making the specific investment purchases within these standards.
Total investments decreased by $6,695,000 from $100,599,000 at December 31, 2000
to $93,904,000 at March 31, 2001.

     Investment securities are classified at the time of purchase by one of
three purposes: trading, available for sale (AFS) or held to maturity (HTM). To
date, we have not purchased any securities for trading purposes. We classify
most of our securities as AFS even though we have no immediate intent to sell
them. The AFS designation affords management the flexibility to sell certain
securities and adjust our balance sheet in response to capital levels, liquidity
needs and/or changes in market conditions. AFS securities are marked to market
in the Consolidated Statements of Financial Condition with an adjustment to
equity, net of tax, and presented in the caption "Accumulated other
comprehensive income (loss)." The carrying values for AFS and HTM securities
were $88,247,000 and $5,657,000, respectively, as of March 31, 2001.

     The estimated fair value of our AFS securities improved $741,000 from an
unrealized loss of $4,975,000 at December 31, 2000 to an unrealized loss of
$4,234,000 at March 31, 2001. The estimated fair value of AFS securities
improved during the first quarter of 2001 principally due to lower interest
rates. At March 31, 2001, approximately 86% of the unrealized loss on AFS
securities related to our corporate bond portfolio. At this time we plan to hold
these investment positions realizing it may be some time before market
conditions improve.

     We buy and sell investment securities from time to time depending on market
conditions, liquidity and capital levels. Investment securities provide an
interim way to add to our assets quickly and generate additional earnings. While
loan growth is our ultimate goal, the development of a quality loan portfolio
requires significant time. We have earned a positive interest spread by assuming
interest rate risk in using deposits and short-term borrowings to purchase
securities with longer maturities. We then seek to reduce borrowings as a
percentage of assets by increasing deposits through our branch network.

     We were a net seller of securities during the first quarter of 2001. We
expect to add to our investment portfolio during the second quarter of 2001.
Investment balances should be higher than current levels for the remainder of
the year.


                                       13
<PAGE>

                              Investment Portfolio

<TABLE>
<CAPTION>

                                                                  March 31, 2001
                                           --------------------------------------------------------------
                                                  Held to Maturity              Available for Sale
                                              Amortized      Estimated       Amortized      Estimated
                                                Cost         Fair Value        Cost         Fair Value
                                                ----         ----------        ----         ----------
                                                                    (In thousands)

<S>                                          <C>              <C>            <C>             <C>
U.S. government agency obligations           $ 4,998          $ 4,970        $ 4,295         $ 4,305
Mortgage-backed securities                       159              159         40,408          40,238
Municipal securities                              --               --         16,215          15,794
Equity securities                                 --               --          1,933           1,933
Corporate bonds                                   --               --         29,515          25,862
Other debt securities                            500              500            115             115
                                             -------          -------        -------         -------
Total                                        $ 5,657          $ 5,629        $92,481         $88,247
                                             =======          =======        =======         =======

                                                                December 31, 2000
                                           --------------------------------------------------------------
                                                  Held to Maturity              Available for Sale
                                              Amortized      Estimated       Amortized      Estimated
                                                Cost         Fair Value        Cost         Fair Value
                                                ----         ----------        ----         ----------
                                                                    (In thousands)


U.S. government agency obligations           $ 4,997          $ 4,888        $ 4,344         $ 4,363
Mortgage-backed securities                       529              524         45,764          45,142
Municipal securities                              --               --         17,856          17,292
Equity securities                                 --               --          1,933           1,933
Corporate bonds                                   --               --         29,536          25,728
Other debt securities                            500              500            115             115
                                             -------          -------        -------         -------
Total                                        $ 6,026          $ 5,912        $99,548         $94,573
                                             =======          =======        =======         =======
</TABLE>


Loans

     We originate a wide variety of loans principally to small and medium size
businesses, professionals and individuals. Company policies and applicable laws
and regulations require risk analysis as well as ongoing portfolio and credit
management. We manage our credit risk through lending limit constraints, credit
review, approval policies, and ongoing internal monitoring. The majority of our
loan portfolio is collateralized, at least in part, by real estate in the
greater Lehigh and Delaware Valleys of Pennsylvania and New Jersey. Real estate
values are typically subject to risks associated with the general economy, among
other matters.

     In addition to credit risk, interest rate risk is inherent with the lending
function. We manage interest rate risk within our asset/liability framework
using various modeling techniques and analyses. Most of our loans are either
adjustable rate that reset in intervals of five years or fewer or variable rate.

     Gross loans increased $10,318,000 from $239,445,000 at December 31, 2000 to
$249,763,000 at March 31, 2001.


                                       14
<PAGE>

                                 Loan Portfolio

<TABLE>
<CAPTION>
                                    March 31, 2001      % of Total     December 31, 2000     % of Total
                                  -------------------  -------------   -------------------  --------------
                                                           (Dollars in thousands)
<S>                                <C>                       <C>            <C>                    <C>
Real estate-farmland                  $    226              0.09%          $    230               0.10%
Real estate-construction                 6,065              2.43%             4,395               1.83%
Real estate-residential                 26,522             10.62%            25,401              10.61%
Real estate-multifamily                 12,027              4.82%            13,667               5.71%
Real estate-commercial                 170,574             68.29%           161,675              67.52%
Commercial                              34,040             13.63%            32,295              13.49%
Consumer                                   309              0.12%             1,782               0.74%
                                      --------            ------           --------             ------
Total loans                            249,763            100.00%           239,445             100.00%
                                                         ========                               ======
Less:
    Unearned income                        909                                  861
    Allowance for loan losses            3,128                                3,032
                                      --------                             --------
Total loans, net                     $ 245,726                            $ 235,552
                                     =========                            =========
</TABLE>

Allowance for loan losses

     We maintain an allowance for loan losses and charge losses to this
allowance when losses are realized. The allowance for loan losses is maintained
at a level that management considers adequate to provide for known and inherent
losses in the loan portfolio. Management's evaluation includes such factors as
current economic conditions, actual loss experience and the current risk profile
of the loan portfolio. Each commercial loan is assigned a specific loan loss
reserve using a scoring system. This scoring system takes into consideration
collateral type and value, loan to value ratios, the borrower's risk rating,
delinquency statistics and other factors previously described. Loan officers
determine borrowers' risk ratings at the inception of each loan. These risk
ratings are subject to ongoing analysis and update by an independent loan
reviewer. Homogeneous loans, comprised primarily of home equity and non-real
estate secured consumer loans, are analyzed in the aggregate. Because the bank
is less than ten years old with a limited history for loan losses, management
also uses peer group analysis to gauge the overall reasonableness of its loan
loss allowance. While we calculate the allowance based on specific loans or loan
categories, we consider the total allowance available for losses in the entire
loan portfolio.

     While management believes it uses the best information available to
determine the allowance for loan losses, unforeseen market conditions could
result in adjustments to the allowance, and net income could be significantly
affected if circumstances differ substantially from the assumptions used in
determining the allowance.

     During the second quarter of 2000, we changed the scoring system used to
calculate loan loss reserves on commercial loans. This change placed more
reliance on borrower risk ratings, which have been subject to an independent
loan review for over a year. As a result, the specific loan loss reserves
allocated to individual commercial loans were lowered creating an unallocated
reserve.


                                       15
<PAGE>

                       Allowance for Loan Loss Allocation

<TABLE>
<CAPTION>
                                      March 31, 2001               December 31, 2000              March 31, 2000
                                   ----------------------        ----------------------        ----------------------
                                               % Loans to                    % Loans to                    % Loans to
                                   Amount     Total Loans        Amount     Total Loans        Amount     Total Loans
                                   ------     -----------        ------     -----------        ------     -----------
                                                                (Dollars in thousands)
<S>                                      <C>          <C>              <C>          <C>              <C>          <C>
Balance at end of period
   applicable to:
Real estate-farmland                     $ 2          0.09%            $ 2          0.10%            $ 2          0.11%
Real estate-construction                  38          2.43%             30          1.83%             40          2.05%
Real estate-residential                  236         10.62%            236         10.61%            318         11.10%
Real estate-multi-family                  69          4.82%             76          5.71%            136          6.07%
Real estate-commercial                 1,516         68.29%          1,419         67.52%          1,472         66.79%
Commercial                               687         13.63%            662         13.49%            670         12.96%
Consumer                                  13          0.12%             14          0.74%             17          0.92%
Unallocated                              567             -             593             -               -             -
                                    --------        ------        --------        ------        -------         ------
Total                               $ 3,128         100.00%       $ 3,032         100.00%        $ 2,655        100.00%
                                    =======         ======        =======         ======         =======        ======
</TABLE>


     Regulatory authorities, as an integral part of their examinations,
periodically review the allowance for loan losses. They may require additions to
the allowance based upon their judgment and information available to them at the
time of examination.

     At March 31, 2001, the allowance for loan losses totaled $3,128,000,
representing 1.25% of outstanding loans receivable as compared to 1.27% and
1.28% at December 31, 2000 and March 31, 2000, respectively.




                                       16
<PAGE>


     The following table sets forth the activity in the allowance for loan
losses and certain key ratios for the periods indicated. The bank's loan
portfolio is relatively immature given its recent growth rates. Therefore,
current charge-off and non-performing asset trends may not be indicative of
future performance.

                            Allowance for Loan Losses
<TABLE>
<CAPTION>

                                                 For the three           For the            For the three
                                                 months ended           year ended          months ended
                                                March 31, 2001      December 31, 2000      March 31, 2000
                                                --------------      -----------------      --------------
                                                                  (Dollars in thousands)
<S>                                                 <C>                   <C>                   <C>
Balance at beginning of period                      $  3,032              $  2,511              $  2,511

Charge-offs
   Real estate-residential                                --                     6                     6
   Commercial                                              4                     1                    --
   Consumer                                               --                    --                    --
                                                    --------              --------              --------
Total charge-offs                                          4                     7                     6

Recoveries                                                --                    --                    --
                                                    --------              --------              --------
Net charge-offs                                            4                     7                     6
Provision for loan losses                                100                   528                   150
                                                    --------              --------              --------
Balance at end of period                            $  3,128              $  3,032              $  2,655
                                                    ========              ========             =========
Total gross loans:
Average                                             $244,168              $217,128              $203,166
End of period                                       $249,763              $239,445              $207,851


Ratios:
Net charge-offs to:
   Average loans                                          --                    --                    --
   Loans at end of period                                 --                    --                    --
   Allowance for loan losses                            0.13%                 0.23%                 0.23%
   Provision for loan losses                            4.00%                 1.33%                 4.00%

Allowance for loan losses to:
   Total gross loans at end of period                   1.25%                 1.27%                 1.28%
   Non-performing loans (1)                              N/M                   N/M                   N/M

</TABLE>
---------------

(1)  Ratio is not meaningful because there were no non-performing loans at March
     31, 2001 and December 31, 2000 and only $1,000 in non-performing loans at
     March 31, 2000.



                                       17
<PAGE>

Non-performing assets

     Non-performing assets are defined as accruing loans past due 90 days or
more, non-accruing loans, restructured loans and other real estate owned. Our
non-performing assets at both March 31, 2001 and December 31, 2000 consisted
entirely of seven residential properties classified as other real estate owned.

                              Non-Performing Assets
<TABLE>
<CAPTION>
                                                            March 31, 2001       December 31, 2000
                                                            --------------       -----------------
                                                                   (Dollars in thousands)

<S>                                                             <C>                      <C>
Loans past due 90 days or more and accruing                     $ --                     $ --
Non-accrual loans                                                 --                       --
Other real estate owned                                          252                      252
                                                                ----                     ----
       Total non-performing assets                              $252                     $252
                                                                ====                     ====

Ratio of non-performing loans to total loans (1)                 N/M                      N/M

Ratio of non-performing assets to total assets                  0.07%                    0.07%
</TABLE>

----------------
(1)  Ratio is not meaningful because there were no non-performing loans at March
     31, 2001 and December 31, 2000.


Loans held for sale

     We use an outside company to originate and sell residential mortgages on
our behalf. The balance of our loans held for sale was $265,000 at March 31,
2001 compared to no loans held for sale at December 31, 2000. The increase in
loans held for sale relates to the timing of loan originations versus their
sale. Typically, these loans are sold within 30 days of their settlement.


Deferred taxes

     The $252,000 decrease in deferred taxes from $2,703,000 at December 31,
2000 to $2,451,000 at March 31, 2001 relates to the change in the estimated fair
value of investment securities available for sale.


Other assets

     The $980,000 increase in other assets from $699,000 at December 31, 2000 to
$1,679,000 at March 31, 2001 was primarily due to the recording of the
derivative contract associated with our Indexed Powered Certificate of Deposit
(IPCD). We introduced the IPCD product in the first quarter of 2001.



                                       18
<PAGE>

Deposits

     Premier Bank, a traditional community-based bank, is largely dependent upon
its base of competitively priced core deposits to provide a stable funding
source. The bank has retained and grown its customer base since inception
through a combination of price, quality service, convenience, and a stable and
experienced staff. During the three months ended March 31, 2001 total deposits
grew $11,118,000 or 4% to $314,411,000. Core deposits, which exclude time
deposits greater than $100,000 grew $4,436,000 or 2% during the three months
ended March 31, 2001 to $264,305,000. Most of our deposit growth occurred in
time deposits and money market accounts. During the first quarter of 2001 the
bank introduced the Index Powered SM Certificate of Deposit which totaled
$4,189,000 at March 31, 2001. Our personal cash management account, which has
been aggressively promoted since the second quarter of 2000, grew $2,928,000
during the first quarter of 2001. Total time deposits at March 31, 2001 were
$203,250,000 or 64.6% of total deposits, of which $53,118,000 mature after one
year.

     The growth of mutual funds over the past decade have made it increasingly
difficult for community-based financial institutions like Premier Bank to
attract deposits as many consumers in search of higher returns have shifted
their investment dollars into the stock market and away from traditional bank
deposit products.

     We expect to continue to grow our deposits through promotions, business
development programs, maturation of existing branches and branch expansion. We
opened our Bensalem and Montgomeryville branches in October 2000.

                        Deposits by Major Classification

<TABLE>
<CAPTION>

                                                    March 31, 2001                                December 31, 2000
                                      --------------------------------------------  --------------------------------------------
                                         Weighted                                      Weighted
                                         Average                                       Average
                                         Interest                        % of          Interest                        % of
                                           Rate           Amount         Total           Rate           Amount         Total
                                           ----           ------         -----           ----           ------         -----
                                                                       (Dollars in thousands)

<S>                                       <C>             <C>            <C>             <C>           <C>              <C>
Interest checking                         2.55%           $ 25,242       8.03%           2.53%         $ 25,690         8.47%
Money market                              3.82%             18,492       5.88%           5.37%           15,347         5.06%
Savings                                   3.38%             42,001      13.36%           3.50%           40,682        13.41%
Time                                      6.39%            203,250      64.64%           6.50%          193,736        63.88%
                                          ----           ---------     ------            ----         ---------       ------
     Total interest-bearing deposits      5.45%            288,985      91.91%           5.62%          275,455        90.82%
                                          ====                                           ====
Non interest-bearing deposits                               25,426       8.09%                           27,838         9.18%
                                                         ---------     ------                         ---------       ------
Total deposits                                           $ 314,411     100.00%                        $ 303,293       100.00%
                                                         =========     ======                         =========       ======
</TABLE>

Borrowings

     Borrowings increased $1,692,000 from $14,404,000 at December 31, 2000 to
$16,096,000 at March 31, 2001.

     At March 31, 2001 borrowings consisted entirely of overnight borrowings
from customers. At December 31, 2000 borrowings included $785,000 in overnight
federal funds purchased and $13,619,000 in overnight borrowings from customers.
The weighted average interest rate on borrowings was 4.00% and 5.59% at March
31, 2001 and December 31, 2000, respectively.

     Customer repurchase agreements are collateralized by investment securities
in an amount equal to or exceeding such borrowings. The company controls the
securities pledged as collateral for customer repurchase agreements.


                                       19
<PAGE>

Other liabilities

     Other liabilities decreased $2,005,000 from $5,422,000 at December 31, 2000
to $3,417,000 at March 31, 2001. This decrease relates principally to the
settlement of a $2,000,000 security purchase that was accrued at December 31,
2000. A $1,131,000 decrease in our official checking account was offset in part
by the recording of an estimated $800,000 for the embedded derivative associated
with our Index Powered SM Certificate of Deposit.

Capital Adequacy

     At March 31, 2001, we believe that the company was in compliance with all
applicable regulatory requirements to be classified as "well capitalized"
pursuant to FDIC regulations. We plan to remain well capitalized and manage the
bank accordingly.

     The tables below depict our capital components and ratios along with the
"adequately" and "well" capitalized criteria as defined by FDIC regulations. At
March 31, 2001, we exceeded all regulatory requirements and are classified as
"well capitalized".

                               Capital Components

<TABLE>
<CAPTION>

                                                                    March 31, 2001          December 31, 2000
                                                                 ----------------------   ----------------------
                                                                           (Dollars in thousands)
<S>                                                                     <C>                     <C>
Tier I
Shareholders' equity                                                    $ 17,814                $ 16,455
Allowable portion of minority interest in equity
   of subsidiary                                                           6,870                   6,580
Net unrealized security losses                                             2,794                   3,283
                                                                        --------                --------
Total Tier I Capital                                                    $ 27,478                $ 26,318
                                                                        ========                ========

Tier II
Allowable portion of minority interest in equity
   of subsidiary                                                        $  3,130                $  3,420
Allowable portion of the allowance for loan losses                         3,128                   3,032
Allowable portion of subordinated debt                                     1,500                   1,500
                                                                        --------                --------
Total Tier II Capital                                                   $  7,758                $  7,952
                                                                        ========                ========

Total Capital                                                           $ 35,236                $ 34,270

Risk-weighted assets                                                    $297,595                $284,544
</TABLE>


                                       20
<PAGE>


                                 Capital Ratios

<TABLE>
<CAPTION>
                                                                                              "Adequately        "Well
                                                                                               Capitalized"    Capitalized"
                                                      March 31, 2001      December 31, 2000       Ratios          Ratios
                                                    -------------------  -------------------- --------------- ---------------

<S>                                                       <C>                  <C>                <C>             <C>
Total risk-based capital/risk-weighted assets             11.84%               12.04%             8.00%           10.00%
Tier I capital/risk-weighted assets                       9.23%                 9.25%             4.00%           6.00%
Tier I capital/average assets (leverage ratio)            7.62%                 7.41%             4.00%           5.00%
</TABLE>

Liquidity

     Liquidity represents an institution's ability to generate cash or otherwise
obtain funds at reasonable rates to satisfy commitments to borrowers and demands
of depositors. Our primary sources of funds are deposits, proceeds from
principal and interest payments on loans, mortgage-backed securities and
investments and borrowings. While maturities and scheduled amortization of loans
and investments are a predictable source of funds, deposit flows, loan
prepayments and mortgage-backed securities prepayments are influenced by
interest rates, economic conditions and competition.

     For the three months ended March 31, 2001, operating and investing
activities used cash and cash equivalents of $2,170,000 and $3,057,000,
respectively, while financing activities provided $13,051,000. The cash provided
by financing activities was primarily from an increase in deposits and
borrowings. The $11,118,000 increase in deposits was primarily in time deposits
and money market accounts. Cash was also provided by the sale of fixed rate AFS
securities. Together, this cash was primarily used for loan originations and the
purchase of variable rate mortgage-backed securities. For the three months ended
March 31, 2001, loans grew $10,322,000 while investments decreased $7,360,000,
exclusive of the change in unrealized losses on AFS securities.

     For the three months ended March 31, 2000, operating and financing
activities provided cash and cash equivalents of $287,000 and $17,738,000,
respectively, while investing activities used $8,150,000. The cash provided by
financing activities was primarily from an increase in deposits. The $25,420,000
increase in deposits was mostly due to the promotion of 23-month certificates of
deposit. This cash was primarily used for loan originations and the repayment of
borrowings. For the three months ended March 31, 2000, loans grew $8,632,000
while investments decreased $902,000, exclusive of the change in unrealized
losses on AFS securities.

     The bank monitors its liquidity position on a daily basis. The bank uses
overnight federal funds and interest-bearing deposits in other banks to absorb
daily excess liquidity. Conversely, overnight federal funds may be purchased to
satisfy daily liquidity needs. Federal funds are sold or purchased through a
correspondent bank, which diversifies the holdings to an approved group of
commercial banks throughout the country. If the bank requires funds beyond its
ability to generate them internally, additional sources of funds are available
through use of one of the following: $6,000,000 unsecured federal funds line of
credit with the bank's correspondent bank, and the bank's $63,223,000 borrowing
limit at the Federal Home Loan Bank of Pittsburgh. The bank could also sell or
borrow against certain investment securities. At March 31, 2001, the bank had no
borrowings outstanding with its correspondent bank or the Federal Home Loan
Bank.

Derivative Financial Instruments

      The company has limited involvement with derivative financial instruments
and currently uses them only in relation to the bank's Index Powered SM
Certificate of Deposit (IPCD) product, which was introduced in the first quarter
of 2001. Customer returns on this unique CD are tied to the performance of the
Standard & Poor's (R) 500 Index. This product allows customers to receive the
potential of stock market returns without all the risks because, like other
traditional certificates of deposits, the return of principal is guaranteed at
maturity and deposits are insured by the FDIC to the extent provided by law.


                                       21
<PAGE>


Derivative Financial Instruments (continued)

      To cover the variable cost of the IPCD, the bank has entered into a
derivative contract with the Federal Home Loan Bank of Pittsburgh (FHLB). For
this contract, the bank pays a premium. To date, the bank has financed this
premium by paying a quarterly rate of interest based on an amount equal to the
balance of the IPCD. By purchasing the contract in this way, the bank has
converted the cost of the IPCD into a synthetic interest cost. Over the term of
the IPCD, this synthetic cost will be comparable to that paid for traditional CD
products.

     The bank accounts for its derivative contracts and the derivatives embedded
in the IPCD in accordance with Statement No. 133, "Accounting for Derivative
Instruments and Hedging Activities", as amended. Accordingly, the bank carries
these derivatives at fair value in the Consolidated Statements of Financial
Condition and recognizes any changes in fair value in current period earnings.
The fair value of derivatives was approximately $800,000 at March 31, 2001. The
Black Scholes model was used to estimate the fair value of our derivative
contracts.


Recent Accounting Pronouncements

Transfers and Servicing of Financial Assets and Extinguishments of Liabilities

     In September 2000, the FASB issued Statement No. 140, "Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of Liabilities."
The Statement supercedes and replaces the guidance in Statement No. 125. It
revises the standards for accounting for securitizations and other transfers of
financial assets and collateral and requires certain disclosures, although it
carries over most of Statement No. 125's provisions without reconsideration. The
Statement is effective for transfers and servicing of financial assets and
extinguishments of liabilities occurring after March 31, 2001 and for
recognition and reclassification of collateral and for disclosures relating to
securitization transactions and collateral for fiscal years ending after
December 15, 2000. This Statement is to be applied prospectively with certain
exceptions. Other than those exceptions, earlier or retroactive application of
its accounting provisions is not permitted. There was no impact on earnings,
financial condition, or equity upon adoption of Statement No. 140.




                                       22
<PAGE>


                          PART II -- OTHER INFORMATION

Item 1 -- Legal Proceedings

     At March 31, 2001, there were no material legal proceedings pending against
the company.

Item 2 -- Changes in Securities and Use of Proceeds

     None.

Item 3 -- Defaults Upon Senior Securities

     None.

Item 4 -- Submission of Matters to a Vote of Security Holders

     Our Annual Meeting of Shareholders was held on May 10, 2001 for the purpose
of electing six Class 3 Directors for a term of three years expiring in 2004
(Clark S. Frame, Barry J. Miles, Sr., Dr. Daniel A. Nesi, Thomas M. O'Mara,
Richard F. Ryon, and John C. Soffronoff).

     All nominees for Class 3 Director were elected by shareholders as follows:

                                       For            Against        Withheld
                                       ---            -------        --------
     Clark S. Frame                 2,383,117           --            5,090
     Barry J. Miles, Sr.            2,283,117           --            5,090
     Dr. Daniel A. Nesi             2,382,770           --            5,437
     Thomas M. O'Mara               2,383,400           --            4,807
     Richard F. Ryon                2,383,400           --            4,807
     John C. Soffronoff             2,383,400           --            4,807

Item 5 -- Other Information

     None.

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

(a) The following exhibits are incorporated by reference herein or attached to
this Form 10-QSB:

         3(i)     Articles of Incorporation (Incorporated by reference to
                  Exhibit 3(i) to our Quarterly Report on Form 10-QSB filed with
                  the SEC on November 14, 2000 and amended on December 19,
                  2000).

          3(ii)   By-Laws (Incorporated by reference to Exhibit 3(ii) to our
                  Quarterly Report on Form 10-QSB filed with the SEC on November
                  14, 2000 and amended on December 19, 2000).

          10.1    Premier Bank's 1995 Incentive Stock Option Plan
                  (Incorporated by reference to Exhibit 99.6 to the Company's
                  Registration Statement No. 333-34243 on Form S-4 filed with
                  the SEC on August 22,1997 and amended on September 9, 1997).

         10.2     Change of Control Agreement between Premier Bancorp, Inc.,
                  Premier Bank and John C. Soffronoff (Incorporated by
                  reference to Exhibit 10.2 to our Quarterly Report on Form
                  10-QSB filed with the SEC on November 13, 1998).

         10.3     Change of Control Agreement between Premier Bancorp, Inc.,
                  Premier Bank and John J. Ginley (Incorporated by reference
                  to Exhibit 10.3 to our Quarterly Report on Form 10-QSB filed
                  with the SEC on November 13, 1998).


                                       23
<PAGE>


Item 6 -- Exhibits and Reports on Form 8-K (continued)

         10.4     Change of Control Agreement between Premier Bancorp, Inc.,
                  Premier Bank and Bruce E. Sickel (Incorporated by reference
                  to Exhibit 10.4 to our Quarterly Report on Form 10-QSB filed
                  with the SEC on November 13, 1998).

(b)      Reports on Form 8-K

     None.


                                       24
<PAGE>


                                   Signatures

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


                                  Premier Bancorp, Inc.
                                  ---------------------
                                  Registrant



Date                              Signature
----                              ---------

May 14, 2001                      /s/ John C. Soffronoff
                                  ----------------------
                                  John C. Soffronoff
                                  President, Chief Executive Officer, Director
                                  (Principal Executive Officer)


May 14, 2001                      /s/ Bruce E. Sickel
                                  -------------------
                                  Bruce E. Sickel
                                  Chief Financial Officer, Director
                                  (Principal Financial Officer)



                                       25
<PAGE>


                                Index of Exhibits

<TABLE>
<CAPTION>

                                                                                                            Page

<S>                                                                                                        <C>
3(i)     Articles of Incorporation (Incorporated by reference to Exhibit 3(i) to                              *
         our Quarterly Report on Form 10-QSB filed with the SEC on November
         14, 2000 and amended on December 19, 2000).

3(ii)    By-Laws (Incorporated by reference to Exhibit 3(ii) to our Quarterly                                 *
         Report on Form 10-QSB filed with the SEC on November 14, 2000 and
         amended on December 19, 2000).

10.1     Premier Bank's 1995 Incentive Stock Option Plan (Incorporated by reference to                        *
         Exhibit 99.6 to the Company's Registration Statement No. 333-34243 on Form S-4
         filed with the SEC on August 22,1997 and amended on September 9, 1997).

10.2     Change of Control Agreement between Premier Bancorp, Inc., Premier Bank and                          *
         John C. Soffronoff (Incorporated by reference to Exhibit 10.2 to our Quarterly Report
         on Form 10-QSB filed with the SEC on November 13, 1998).

10.3     Change of Control Agreement between Premier Bancorp, Inc., Premier Bank and                          *
         John J. Ginley (Incorporated by reference to Exhibit 10.3 to our Quarterly Report
         on Form 10-QSB filed with the SEC on November 13, 1998).

10.4     Change of Control Agreement between Premier Bancorp, Inc., Premier Bank and                          *
         Bruce E. Sickel (Incorporated by reference to Exhibit 10.4 to our Quarterly Report
         on Form 10-QSB filed with the SEC on November 13, 1998).
</TABLE>


*   Incorporated by reference.


                                       26
<PAGE>