SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                 ---------------------------------------------

                                    FORM 10-Q

       QUARTERLY REPORT UNDER SECTION 13 OF THE SECURITIES EXCHANGE ACT OF
                    1934 FOR THE QUARTER ENDED MARCH 31, 2000


                         SEC Exchange Act No. 000-23601
                                              ---------

                            Pathfinder Bancorp, Inc.
                     ---------------------------------------
                (Exact name of bank as specified in its charter)


                                    New York
             ------------------------------------------------------
            (State or jurisdiction of incorporation or organization)


                                   16-1540137
                      -------------------------------------
                     (I.R.S. Employer Identification Number)


                 214 W. 1st Street
                  Oswego, New York                                13126
           ------------------------------                        ---------
      (Address of principal executive office)                    (Zip Code)


          Bank's telephone number, including area code: (315) 343-0057
                                                        --------------


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


     Indicate by check mark whether the Bank (1) has filed all reports  required
to be filed by  Section 13 of the  Securities  Exchange  Act of 1934  during the
preceding 12 months (or for such shorter period that the Registrant was required
to file such reports),  and (2) has been subject to such filing requirements for
the past 90 days. Yes  X  No
                     ----   ----

     Indicate the number of shares  outstanding of each of the issuer's  classes
of common stock, as of the latest  practicable date: There were 2,617,245 shares
of the Bank's common stock outstanding as of May 12, 2000.



<PAGE>



                            PATHFINDER BANCORP, INC.
                                      INDEX




PART 1        FINANCIAL INFORMATION                                        PAGE

Item 1.       Financial Statements

             o         Consolidated Balance Sheets                         1
             o         Consolidated Statements of Income                   2
             o         Consolidated Statements of Shareholders' Equity     3
             o         Consolidated Statements of Cash Flows               4
             o         Notes to Consolidated Financial Statements          5


Item 2.       Management's Discussion and Analysis of Financial         6 - 13
              Condition and Results of Operations


PART II                    OTHER INFORMATION                              14



SIGNATURES



<PAGE>


<TABLE>
<CAPTION>

                            PATHFINDER BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CONDITION
                March 31, 2000 (unaudited) and December 31, 1999

                                                                       March 31,              December 31,
                                                                          2000                     1999
                                                                       ------------           -----------
                             ASSETS

<S>                                                                   <C>                        <C>
Cash and due from banks                                               $3,513,692                 $4,280,255
Federal funds sold                                                        71,180                          -
                                                                     -----------           ----------------
         Total cash and cash equivalents                               3,584,872                  4,280,255

Investment securities                                                 63,103,783                 66,397,491
Mortgage loans held-for-sale                                             692,289                    697,405
Loans:
     Real estate                                                     118,781,046                119,167,708
     Consumer and other                                               12,605,351                 12,129,363
                                                                     -----------                -----------
       Total loans                                                   131,386,397                131,297,071
     Less: Allowance for loan losses                                   1,209,601                  1,149,677
             Unearned discounts and origination fees                      89,927                     84,453
                                                                   -------------              -------------
       Loans receivable, net                                         130,086,869                130,062,941

Premises and equipment, net                                            4,826,473                  4,869,553
Accrued interest receivable                                            1,485,945                  1,431,251
Other real estate                                                      1,191,719                    641,384
Intangible assets, net                                                 2,894,426                  2,973,365
Other assets                                                           4,961,512                  4,969,908
                                                                 ---------------             --------------
       Total assets                                                 $212,827,888               $216,323,553

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits:
     Interest bearing                                               $144,355,208               $142,690,583
     Non-interest bearing                                             10,038,594                  9,745,513
                                                                  --------------             --------------
       Total deposits                                                154,393,802                152,436,096
Borrowed funds                                                        38,083,500                 42,879,500
Other liabilities                                                      1,087,005                    933,345
                                                                 ---------------            ---------------
       Total liabilities                                             193,564,307                196,248,941

Shareholders' equity:
     Common stock, par value $.10 per share; authorized
      9,000,000 shares; issued 2,884,720 shares; and
      2,617,245 and 2,639,245 shares outstanding for
      2000 and 1999, respectively                                        288,472                    288,472
     Additional paid in capital                                        6,917,226                  6,912,580
     Retained earnings                                                17,333,705                 18,121,372
     Unearned stock based compensation                                  (595,599)                  (981,125)
     Unearned ESOP shares                                               (273,871)                  (287,609)
     Accumulated other comprehensive loss                             (1,143,418)                  (895,894)
     Treasury stock, at cost;
       267,475 and 245,475 shares, respectively                       (3,262,934)                (3,083,184)
                                                                      -----------                -----------
     Total shareholders' equity                                       19,263,581                 20,074,612
                                                                  --------------             --------------
     Total liabilities and shareholders' equity                     $212,827,888               $216,323,553
                                                                    ============               ============
</TABLE>

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



                                       -1-

<PAGE>





<TABLE>
<CAPTION>
                            PATHFINDER BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF INCOME For
            the three months ended March 31, 2000 and March 31, 1999
                                   (unaudited)
                                                                                March 31,            March 31,
                                                                                  2000                 1999
                                                                                --------           ----------
INTEREST INCOME:
<S>                                                                           <C>                    <C>
   Loans                                                                      $2,731,831             $2,665,329
   Interest and dividends on investments:
       U.S. Treasury and agencies                                                209,849                  7,586
       State and political subdivisions                                           91,912                 80,884
       Corporate                                                                 358,541                350,698
       Marketable equity securities                                               37,482                 19,765
       Mortgage-backed                                                           403,044                325,669
       Federal funds sold and interest-bearing deposits                              830                 35,728
                                                                           -------------            -----------
           Total interest income                                               3,833,489              3,485,659

INTEREST EXPENSE:
   Interest on deposits                                                        1,330,660              1,382,379
   Interest on borrowed funds                                                    628,827                273,083
                                                                              ----------             ----------
       Total interest expense                                                  1,959,487              1,655,462
                                                                               ---------              ---------
               Net interest income                                             1,874,002              1,830,197
   Provision for loan losses                                                     115,324                 97,129
                                                                              ----------            -----------
               Net interest income after provision for loan losses             1,758,678              1,733,068
                                                                               ---------              ---------

OTHER INCOME:
   Service charges on deposit accounts                                           114,107                109,680
   Mortgage servicing fees                                                        39,528                 16,235
   Cash surrender value                                                           41,322                 50,092
   Net securities (losses) gains                                                (207,494)                31,571
   Other charges, commission and fees                                             53,219                 82,643
                                                                              ----------                -------
       Total other income                                                         40,682                290,221
                                                                              ----------                -------

OTHER EXPENSES:
   Salaries and employee benefits                                                891,626                798,885
   Building occupancy                                                            204,282                178,470
   Data processing expenses                                                      189,959                160,116
   Professional and other services                                               154,134                160,881
   Amortization of intangible asset                                               78,939                 78,939
   Other expenses                                                                491,946                238,977
   Unusual items                                                                 578,176                      -
                                                                              ----------        ---------------
       Total other expenses                                                    2,589,062              1,616,268
                                                                               ---------              ---------
(Loss) income before income taxes                                               (789,702)               407,021
(Benefit) provision for income taxes                                            (156,293)               119,961
                                                                               ----------             ---------
Net (loss) income                                                              $(633,409)              $287,060
                                                                               ==========              ========
   Other comprehensive loss, net of taxes:
       Unrealized net gains on securities:
           Unrealized holding losses arising during period                      (208,406)              (753,615)
           Less: reclassification adjustment for (losses)  gains included
                  in net income                                                 (207,494)                31,571
                                                                              -----------           -----------
                                                                                (412,540)              (743,775)
    Income tax benefit                                                           165,016                297,510
                                                                            ------------             ----------
    Other comprensive loss, net of tax                                          (247,524)              (446,265)
                                                                              -----------              ---------
    Comprehensive loss                                                         $(880,933)              (159,205)
                                                                               ==========              =========
Net (loss) income per share - basic and diluted                                $(0.25)                 $   0.11
                                                                               =======                 ========
</TABLE>


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

                                       -2-

<PAGE>







                            PATHFINDER BANCORP, INC.
                  STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                        THREE MONTHS ENDED MARCH 31, 2000
                                   (unaudited)


<TABLE>
<CAPTION>


                                                                                      Accum.
                                                  Add't                Unearned       Other     Unearned
                              Common  Stock      Paid in    Retained  Stock-Based     Compr.      ESOP        Treasury
                            Shares     Amount    Capital    Earnings  Compensation    Income      Shares        Stock         Total
------------------------------------------------------------------------------------------------------------------------------------

<S>                         <C>         <C>      <C>        <C>         <C>         <C>         <C>        <C>           <C>
Balance, December 31, 1999  2,884,720   $288,472 $6,912,580 $18,121,372 $(981,125)  $(895,894)  $(287,609) $(3,083,184)  $20,074,612

Net Income                                                     (633,409)                                                   (633,409)

ESOP shares earned                                    4,646                                        13,738                     18,384

Treasury stock purchased                                                                                      (179,750)    (179,750)

Stock based compensation
earned                                                                    385,526                                            385,526

Change in unrealized net
 appreciation on investment
 securities                                                                         (247,524)                              (247,524)

Dividends declared
(.06 per share)                                                (154,258)                                                   (154,258)

Balance, March 31, 2000       2,884,720  $288,472 $6,917,226 $17,333,705 $(595,559) $(1,143,418) $(273,871) $(3,262,934) $19,263,581
                              =========  ======== ========== =========== =========  ===========  =========  ===========  ===========
</TABLE>



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








                                       -3-

<PAGE>


<TABLE>
<CAPTION>

                                                      PATHFINDER BANCORP, INC.
                                                      STATEMENTS OF CASH FLOWS
                                                 March 31, 2000 and March 31, 1999
                                                            (unaudited)

                                                                               March 31,                March 31,
                                                                                2000                      1999
                                                                             -----------                 -------
OPERATING ACTIVITIES:
<S>                                                                            <C>                       <C>
   Net (loss) income                                                           $(633,409)                $287,060
   Adjustments to reconcile net income to net cash
     provided by operating activities:
   Provision for loan losses                                                     115,324                   97,129
   ESOP and other stock-based compensation earned                                403,910                  193,654
   Loans held-for-sale                                                             5,116               (1,941,685)
   Realized loss/(gain) on available-for-sale investment securities              207,494                  (31,571)
   Depreciation                                                                  118,333                   86,558
   Amortization of intangibles                                                    78,939                   78,939
   Net (accretion)  amortization of premiums and discounts
      on investment securities                                                    (3,079)                  18,692
   Increase in interest receivable                                               (54,694)                 (92,510)
   Net change in other assets and liabilities                                    323,575                  131,282
                                                                           -------------             ------------
 Net cash provided by operating activities                                       561,509               (1,172,452)
                                                                           -------------              ------------

INVESTING ACTIVITIES
   Purchase of investment securities available-for-sale                       (3,098,123)              (5,043,225)
   Proceeds from maturities and principle reductions of
       investment securities held-to-maturity                                         --                4,552,098
   Proceeds from maturities and principle reductions of
       investment securities available-for-sale                                  477,550                       --
   Proceeds from sale:
       Real estate acquired through foreclosure                                       --                   50,912
       Available-for-sale investment securities                                5,297,325                       --
   Net (increase) decrease in loans                                             (689,587)               1,264,026
   Purchase of premises and equipment                                            (75,253)                (170,423)
   Decrease in surrender value of life insurance                                   4,678                  214,411
                                                                            ------------             ------------
 Net cash provided by investing activities                                     1,916,590                  867,799
                                                                               ---------             ------------

FINANCING ACTIVITIES
   Net increase  (decrease)  increase in demand  deposits,  NOW accounts savings
       accounts, money market deposit accounts
       and escrow deposits                                                       409,123               (4,089,492)
   Net increase  (decrease) increase in time deposits                          1,548,583                  (89,573)
   Net (payments) proceeds from borrowings, net                               (4,796,000)               3,333,000
   Cash dividends                                                               (155,438)                      --
   Treasury stock purchased                                                     (179,750)                (206,000)
                                                                             ------------             ------------
  Net cash used in financing activities                                       (3,173,482)              (1,052,065)
  Decrease in cash and cash equivalents                                         (695,383)              (1,356,718)
 Cash and cash equivalents at beginning of period                              4,280,255                6,516,238
                                                                             -----------              -----------
  Cash and cash equivalents at end of period                                  $3,584,872               $5,159,520
                                                                              ==========               ==========

CASH PAID DURING THE PERIOD FOR:
   Interest                                                                   $1,926,467               $1,576,135
   Income taxes paid                                                                  --                       --

NON-CASH INVESTING ACTIVITY:
   Transfer of loans to other real estate                                      $550,335              $         --
   Decrease (increase) in unrealized gains and losses on available
       for sale investment securities                                            412,540                  743,775

NON-CASH FINANCING ACTIVITY:
   Dividends declared and unpaid                                                $154,258                 $160,275
</TABLE>

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


                                       -4-

<PAGE>



                            Pathfinder Bancorp, Inc.

                          Notes to Financial Statements


(1) Basis of Presentation

     The accompanying unaudited financial statements were prepared in accordance
     with the instructions for Form 10-Q and Regulation S-X and,  therefore,  do
     not include information for footnotes necessary for a complete presentation
     of financial position,  results of operations, and cash flows in conformity
     with generally accepted accounting principles. The following material under
     the heading  "Management's  Discussion and Analysis of Financial  Condition
     and Results of Operations" is written with the  presumption  that the users
     of the  interim  financial  statements  have read,  or have  access to, the
     Bank's latest audited financial statements and notes thereto, together with
     Management's  Discussion and Analysis of Financial Condition and Results of
     Operations  as of  December  31,  1999 and for the three year  period  then
     ended. Therefore,  only material changes in financial condition and results
     of operations are discussed in the remainder of part 1.

     All adjustments  (consisting of only normal  recurring  accruals) which, in
     the opinion of  management,  are necessary for a fair  presentation  of the
     financial  statements  have been included in the results of operations  for
     the three months ended March 31, 2000 and 1999.

     Operating  results  for the  three  months  ended  March  31,  2000 are not
     necessarily  indicative  of the results  that may be expected  for the year
     ending December 31, 2000.

(2) Earnings per Share

     Basic  earnings per share have been  computed  based upon net (loss) income
     for the three months  ended March 31, 2000 and 1999,  using  2,575,073  and
     2,676,936 weighted average common shares outstanding.  Diluted earnings per
     share  for the three  month  period in 1999 was  computed  using  2,683,366
     weighted average common shares outstanding. Due to the loss incurred by the
     Company  during  the  first  three  months  of  2000,  the  impact  of  the
     outstanding options is anti-dilutive and,  therefore,  their impact has not
     been included in the diluted  earnings per share  disclosure  for the three
     months ended March 31, 2000.









                                       -5-

<PAGE>



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

This Quarterly Report contains certain  "forward-looking  statements" within the
meaning of the Private Securities Litigation Reform Act of 1995. Such statements
are subject to certain risks and uncertainties,  including,  among other things,
changes in economic conditions in the Company's market area, changes in policies
by regulatory agencies,  fluctuations in interest rates, demand for loans in the
Company's  market  areas and  competition,  that could cause  actual  results to
differ  materially from historical  earnings and those presently  anticipated or
projected.  The Company wishes to caution readers not to place undue reliance on
any such forward-looking  statements,  which speak only as of the date made. The
Company  wishes to advise readers that the factors listed above could affect the
Company's financial performance and could cause the Company's actual results for
future periods to differ  materially  from any opinions or statements  expressed
with respect to future periods in any current statements.

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

General

Throughout the  Management's  Discussion  and Analysis the term,  "the Company",
refers to the consolidated entity of Pathfinder Bancorp,  Inc., Pathfinder Bank,
Pathfinder REIT Inc., and Whispering Oaks  Development  Corp. At March 31, 2000,
Pathfinder  Bancorp,  Inc.'s only business was the 100%  ownership of Pathfinder
Bank,  which in turn owns Pathfinder  REIT, Inc. and Whispering Oaks Development
Corp.. At March 31, 2000,  1,552,500  shares,  or 59.3%, of the Company's common
stock was held by Pathfinder Bancorp,  MHC, the Company's mutual holding company
parent and 1,064,745 shares, or 40.7%, was held by the public.

The  Company's  net income is primarily  dependent  on its net interest  income,
which is the difference  between  interest  income earned on its  investments in
mortgage  loans,  investment  securities and other loans,  and its cost of funds
consisting  of interest paid on deposits and borrowed  funds.  The Company's net
income also is  affected by its  provision  for loan  losses,  as well as by the
amount of non interest  income,  including income from fees and service charges,
net gains and losses on sales of  securities,  and non interest  expense such as
employee  compensation  and  benefits,   occupancy  and  equipment  costs,  data
processing  and  income  taxes.  Earnings  of  the  Company  also  are  affected
significantly  by general  economic  and  competitive  conditions,  particularly
changes in market interest rates,  government policies and actions of regulatory
authorities,  which events are beyond the control of the Company. In particular,
the general level of market rates tends to be highly cyclical.

Management Succession
---------------------

On January  14, 2000 Chris C. Gagas  retired as  President  and Chief  Executive
Officer of Pathfinder  Bancorp,  MHC,  Pathfinder  Bancorp,  Inc. and Pathfinder
Bank. Mr. Gagas continues as Chairman of the Board of the Company and its mutual
holding company parent. Thomas W. Schneider succeeded Mr. Gagas as President and
Chief Executive Officer of the Mutual Holding Company, the Company and the Bank.
Mr.  Schneider has been employed by the Company and the Bank since 1988 and most
recently served as Executive Vice President and Chief Financial Officer.



                                       -6-

<PAGE>




Bank Name Change
----------------

On November  16, 1999,  Oswego City Savings Bank changed its name to  Pathfinder
Bank.

Trust Department
----------------

During the  fourth  quarter  of 1999,  the  Company  began  providing  trust and
custodial services. The Company incurred approximately $6,000 in expenses during
the first quarter of 2000 associated with trust  operations.  At March 31, 2000,
the  Company  has  $687,000  in  assets  under  trust  and  custodial   services
management.

Year 2000
---------

Prior to year-end  1999,  the Company had completed  the  assessment of its year
2000 risk, had implemented  all necessary  system  enhancements,  and tested all
systems and  equipment  to ensure  customer  service,  and minimize its business
risks  associated  with  the  century  date  rollover.   A  business  resumption
contingency  plan  along  with a  liquidity  contingency  plan  were in place to
provide for  problems  should they have  occurred.  The Company  experienced  no
significant  year 2000  related  deposit  declines  or cash  withdrawals  during
December of 1999. The month of January 2000 reflected a successful transition to
the year 2000 of all the Company's operating systems and equipment. All year end
processing was completed as scheduled and daily  processing  since year- end has
been  performed  without any year 2000  related  incidents.  During the month of
January,  the Company  reinvested its  contingency  cash balances.  Costs of the
Company's  efforts to prepare its data processing  systems for the impact of the
Year 2000 were approximately  $180,000 in non-capitalized costs. The majority of
expenditures  for software and hardware  upgrades were  capitalized,  consisting
primarily of maintenance costs of operating  parallel systems.  The total amount
capitalized  was  $575,000  and  is  being   depreciated   over  an  average  of
approximately  four  and  one-third  years.  The  depreciation  will  result  in
additional annual expenses of approximately $133,000 over this period.

To  date  there  has  been no  indication  that  the  quality  of the  Company's
commercial loan portfolio was negatively  impacted by the year 2000. The Company
believes  that its year 2000  related  business  risks  have been  significantly
reduced with the  successful  operation of its systems  during the early part of
the year 2000.

The following  discussion reviews the financial  condition at March 31, 2000 and
the results of  operations  of the Company for the three  months ended March 31,
2000.

Financial Condition

Assets
------

Total assets decreased approximately $3.5 million, or 1.6%, to $212.8 million at
March 31, 2000 from $216.3  million at December 31, 1999.  The decrease in total
assets was primarily due to the reduction in the Company's investment portfolio.
During  the first  quarter of 2000,  approximately  $3.6  million of  investment
securities were liquidated in connection with a balance sheet  reorganization in
an effort to reduce the  Company's  reliance on overnight  borrowings.  Cash and
cash equivalents  decreased $695,000, or 16.2% to $3.6 million from $4.3 million
at December 31, 1999,  reflecting the more normal liquidity  requirements of the
Bank following the year 2000.  These asset  decreases were offset by a $550,000,
or 85.8%,  increase in other real estate.  Loans receivable  remained relatively
consistent  increasing $78,000, or 0.1% to $132.0 million at March 31, 2000 from
$131.9

                                       -7-

<PAGE>



million at December 31, 1999.  The decline in asset base also  reflects the lack
of significant growth and economic development in the Company's market area.

Liabilities
-----------

Total liabilities decreased by $2.7 million, to $193.6 million at March 31, 2000
from $196.3 million at December 31, 1999. The decrease is primarily attributable
to a $4.8 million, or 11.2%, decrease in borrowed funds,  partially offset by an
increase in deposits of $2.0 million, or 1.3%. The decrease in borrowed funds is
a direct result of paydowns  facilitated by the proceeds  received from the sale
of securities during the first quarter of 2000. Intermediate term lower yielding
investment  securities were liquidated in order to reduce the Company's reliance
on short term borrowings in a rising interest rate environment.

Shareholders' Equity
--------------------

Shareholders' equity decreased $811,000,  or 4.0%, to $19.3 million at March 31,
2000 from $20.1  million at December  31, 1999.  The  decrease in  shareholders'
equity is primarily the result of a $788,000 reduction in retained  earnings,  a
$248,000  reduction  in  accumulated  and  other  comprehensive  income,  and an
increase in treasury  stock of $180,000  relating to the  acquisition  of 22,000
shares as part of the  Company's  share  repurchase  program.  The  decrease  in
retained earnings is a result of the net loss incurred by the Company during the
first three months of 2000,  combined with dividends declared during the period.
These decreases were partially offset by a $386,000  reduction in unearned stock
based compensation.

Liquidity and Capital Resources
-------------------------------

The Company's primary sources of funds are deposits, amortization and prepayment
of  loans  and  maturities  of  investment   securities  and  other   short-term
investments,  earnings and funds provided from operations and borrowings.  While
scheduled principal  repayments on loans are a relatively  predictable source of
funds,  deposit  flows and loan  prepayments  are greatly  influenced by general
interest rates,  economic  conditions and  competition.  The Company manages the
pricing of deposits to maintain a desired  deposit  balance.  In  addition,  the
Company  invests  excess funds in short-term  interest-bearing  instruments  and
other  assets,  which  provide  liquidity  to  meet  lending  requirements.  For
additional information about cash flows from the Company's operating, financing,
and investing activities, see Statements of Cash Flows included in the Financial
Statements.  The Company  adjusts its liquidity  levels in order to meet funding
needs of deposit  outflows,  payment of real estate taxes on mortgage  loans and
loan commitments.  The Company also adjusts liquidity as appropriate to meet its
assets and liability management objectives.

Results of Operations
---------------------

The Company recorded a net loss of  approximately  $633,000 for the three months
ended March 31, 2000,  as compared to net income of $287,000 for the same period
during 1999. The Company's  first quarter  earnings were  adversely  impacted by
certain  unusual  items,  totaling  approximately  $578,000,  and  non-recurring
charges  totaling  approximately  $270,000.  The unusual  items charge  consists
primarily of amounts relating to the early  retirement of certain  employees and
officers  of  $239,000,  the  acceleration  of stock  based  benefits to retired
officers  of  $314,000,   and  employee  relocation  charges  of  $25,000.   The
non-recurring  charges consist of one time expenses of $114,000  associated with
the  change  in name of the Bank and  other one time  expenses,  and other  real
estate owned  write-downs of approximately  $96,000.  Additionally,  the Company
incurred losses of approximately $195,000 on the sale of investment securities.

                                       -8-

<PAGE>




As a result of the  decrease  in net income  between  the  comparative  periods,
annualized return on average assets and return on average  shareholders'  equity
were (1.15%) and  (12.70%),  respectively,  for the three months ended March 31,
2000 compared to .57% and 5.14% for the first  quarter of 1999.  (Loss)/earnings
per share - basic was ($.25) for the first  quarter of 2000 compared to $.11 for
the same period in 1999.

Interest Income
---------------

Interest income, on a tax-equivalent basis, totaled $3.9 million for the quarter
ended March 31, 2000,  as compared to $3.5  million for the quarter  ended March
31, 1999, an increase of $347,000, or 9.9%. The increase resulted primarily from
an increase in the average balance of interest-earning  assets to $202.4 million
for the three months ended March 31, 2000 from $182.9  million in the prior year
period,  partially offset by a decrease in the yield on average interest-earning
assets to 7.64% from 7.70%.  The  increase  in the  average  balance of interest
earning assets was comprised of a $3.3 million  increase in the average  balance
of loans  receivable  and a $16.2  million  increase in the  average  balance of
investment  securities.  The increase in the average balance of interest earning
assets is primarily  the result of the continued  implementation  of a wholesale
growth  strategy by the Company  whereby the Company uses borrowings to fund the
purchase of  investments  and the  origination  of loans,  as well as offsetting
deposit  reductions.  The yield  reduction is principally the result of mortgage
loan  originations  occuring at rates below the  weighted  average  yield of the
existing loan portfolio which lowered the total portfolio yield.

Interest income on loans receivable  increased $67,000,  or 2.5% to $2.7 million
for the three  months ended March 31, 2000 as compared to the same period in the
prior year.  The increase in interest  income on loans occurred from an increase
in the average  balance of loans  receivable of $3.3 million,  or 2.6% to $132.4
million at March 31,  2000,  from $129.1  million at March 31,  1999,  partially
offset by a reduction  in the average  yield on loans  receivable  to 8.25% from
8.26%.  The  increase in the average  balance of loans  receivable  is primarily
comprised of originations of one-to-four  family adjustable rate mortgage loans.
The origination of adjustable rate mortgage loans is primarily comprised of "5/1
ARMS" which have interest rates which are fixed for the first five years and are
adjustable  annually  thereafter,  and amortize over 30 years.  The Company also
experienced  an  increase  in the  origination  of  commercial  real  estate and
business  loans.  The  decrease  in the yield on average  loans  receivable  was
attributable to the lower initial rates charged on 5/1 ARMS.

Interest  income  on  the  mortgage-backed  securities  portfolio  increased  by
$77,000,  or 23.8%,  to $403,000 for the three months ended March 31, 2000, from
$326,000 for the three  months  ended March 31,  1999.  The increase in interest
income on mortgage-backed  securities resulted generally from an increase in the
average balance on mortgage-backed  securities of $4.4 million, combined with an
increase in the average yield on mortgage-backed securities to 6.77% from 6.72%.

Interest income on investment  securities,  on a tax equivalent basis, increased
$238,000 or 48.2%,  for the three months  ended March 31, 2000 to $732,000  from
$494,000 for the same period in 1999.  The increase  resulted  primarily from an
increase in the average  balance of investment  securities of $14.5 million,  or
45.8%, to $46.1 million for the three months ended March 31, 2000, combined with
an increase in the tax  equivalent  yield of investment  securities to 6.36% for
the quarter ended March 31, 2000 from 6.25% for the first  quarter of 1999.  The
increase in average balance resulted from the purchase of investment  securities
in connection with the Company's wholesale growth strategy.


                                       -9-

<PAGE>



Interest income on  interest-earning  deposits decreased $35,000, to $1,000 from
$36,000 for the three  months ended March 31, 2000 and 1999,  respectively.  The
decrease was  primarily  the result of a decrease of $2.7 million in the average
balance of  interest-earning  deposits,  partially  offset by an increase in the
average yield on interest-earning  deposits to 5.56% from 5.12%. The increase in
the  average  yield on  interest-earning  deposits  was  principally  due to the
increase in the federal funds rate caused by the general rise in interest rates.

Interest Expense
----------------

Interest expense for the quarter ended March 31, 2000 increased by approximately
$304,000,  or 18.4%, to $2.0 million from $1.7 million when compared to the same
quarter  for  1999.  The  increase  in  interest  expense  for  the  period  was
principally  the result of an increase in the average  balance of borrowed funds
of $23.1  million,  or 115.5% to $43.1  million for the three months ended March
31, 2000 from $20.0 for the three months ended March 31, 1999,  combined with an
increase  in the  average  cost of  borrowed  funds to 5.84% from  5.47%.  These
increases were partially offset by a decrease in the average balance of interest
bearing deposits of $3.1 million,  or 2.1% to $143.7 million from $146.8 million
for the periods ending March 31, 2000 and 1999  respectively,  and a decrease in
the average cost of interest  bearing  deposits to 3.70% from 3.77% for the same
periods.  The increase in the average  balance of borrowed  funds is a result of
the continued  implementation  of the Company's  wholesale growth strategy.  The
increase in the average cost of borrowed  funds was caused by increases in short
term interest rates when comparing the first quarter of 2000 and 1999.

Net Interest Income
-------------------

Net interest  income totaled $1.9 million,  on a tax equivalent  basis,  for the
three months  ended March 31, 2000 and 1999.  The  relative  consistency  in net
interest  income for the  quarter  ended  March 31,  2000,  was the result of an
increase of $19.5 million,  or 10.7%, in the average balance of interest earning
assets,  offset by a decrease in the average yield on interest earning assets to
7.64% from  7.70%,  an  increase  in the  average  balance of  interest  bearing
liabilities of $20.0 million,  or 12.0%,  and an increase in the average cost of
interest bearing liabilities to 4.20% from 3.97%.

Provision for Loan Losses
-------------------------

The  Company  maintains  an  allowance  for loan  losses  based upon a quarterly
evaluation of known and inherent risks in the loan  portfolio,  which includes a
review  of the  balances  and  composition  of the  loan  portfolio  as  well as
analyzing the level of delinquencies in each segment of the loan portfolio. Loan
loss  provisions are based upon  management's  estimate of the fair value of the
collateral  and the  Company's  actual  loss  experience,  as well as  standards
applied by the FDIC.  The Company  established  a provision  for  possible  loan
losses for the three months  ended March 31, 2000 of $115,000,  as compared to a
provision of $97,000 for the three months ended March 31, 1999.  The increase in
provision for loan losses reflects higher net charge-offs for the period as well
as the increased risks associated with the Bank's expanded  commercial  lending.
The Company's  ratios of allowance for loan losses to total loans receivable and
to non-performing loans at March 31, 2000 were .92% and 81.32%, respectively.

Non-interest Income
-------------------

Non-interest  income consists of servicing  income,  fee income,  gain (loss) on
sales  of  loans  and  investment   securities  and  other   operating   income.
Non-interest income decreased  approximately  $250,000, to $41,000 for the three
months ended March 31, 2000 as compared to $290,000 for the prior year  quarter.
Non-interest

                                      -10-

<PAGE>



income,  exclusive of securities gains and losses,  decreased $11,000,  or 4.1%,
for the quarter ended March 31, 2000 as compared to the same period in the prior
year. The decrease in  non-interest  income,  exclusive of securities  gains and
losses,  is attributable to a reduction in the income recognized from investment
services and the cash value of bank owned life insurance policies. This decrease
was  partially  offset by  increases  in deposit  service  charges and  mortgage
servicing fees. Net securities gains (losses) decreased  $239,000,  from $32,000
to a net loss of $208,000 for the period ending March 31, 2000. These securities
losses were incurred in  conjunction  with the  reorganization  of the Company's
earning assets in an effort to improve future profitability.

Non-interest Expense
--------------------

Non-interest expense increased $973,000, or 60.2%, to $2.6 million for the three
months  ended  March  31,  2000,  as  compared  to  the  same  period  in  1999.
Non-interest  expenses for the first quarter of 2000 were adversely  impacted by
unusual items and non-recurring charges of approximately $789,000.  Exclusive of
the unusual and non-recurring charges, non-interest expenses increased $185,000,
or 11.4% to $1.8  million  for the three  months  ended March 31, 2000 from $1.6
million when  compared to the same period in the prior year.  This  increase was
comprised of a $96,000  increase in salaries and employee  benefits,  a $26,000
increase  in  building  occupancy,  and a $30,000  increase  in data  processing
expenses.

Income Taxes
------------

Income  taxes  decreased  $276,000 to a tax benefit of $156,000  for the quarter
ended March 31,  2000 as  compared  to the same  period in the prior year.  This
decrease  was  directly  attributable  to a decrease  in the  Company's  pre-tax
income.

Item 3 - Quantitative and Qualitative Disclosure about Market Risk

The Company's most significant form of market risk is interest rate risk, as the
majority of the  Company's  assets and  liabilities  are sensitive to changes in
interest rates. The Company's mortgage loan portfolio,  consisting  primarily of
loans on residential real property located in Oswego County, is subject to risks
associated with the local economy.  The Company's  interest rate risk management
program  focuses  primarily on evaluating  and managing the  composition  of the
Company's  assets  and  liabilities  in the  context of  various  interest  rate
scenarios.  Factors beyond management's  control,  such as market interest rates
and competition, also have an impact on interest income and interest expense.

The extent to which such assets and  liabilities  are "interest rate  sensitive"
can be measured by an institution's interest rate sensitivity "gap". An asset or
liability is said to be interest rate sensitive within a specific time period if
it will mature or reprice within that time period. The interest rate sensitivity
gap is defined as the difference between the amount of  interest-earning  assets
maturing  or  repricing  within  a  specific  time  period  and that  amount  of
interest-bearing  liabilities  maturing or repricing  within that time period. A
gap is considered  positive when the amount of interest  rate  sensitive  assets
exceeds the amount of interest rate sensitive  liabilities.  A gap is considered
negative  when the amount of interest  rate  sensitive  liabilities  exceeds the
amount of interest rate  sensitive  assets.  During a period of rising  interest
rates, a negative gap would tend to adversely affect net interest income while a
positive gap would tend to positively  affect net interest  income.  Conversely,
during a period  of  falling  interest  rates,  a  negative  gap  would  tend to
positively  affect  net  interest  income  while a  positive  gap would  tend to
adversely affect net interest income.


                                      -11-

<PAGE>



The Company does not  generally  maintain in its portfolio  fixed  interest rate
loans with terms exceeding 20 years. In addition,  ARM loans are originated with
terms that provide that the interest  rate on such loans cannot adjust below the
initial  rate.  Generally,  the  Company  tends to fund  longer-term  loans  and
mortgage-backed   securities  with   shorter-term   time  deposits,   repurchase
agreements,  and  advances.  The impact of this  asset/liability  mix creates an
inherent  risk to earnings in a rising  interest rate  environment.  In a rising
interest rate environment,  the Company's cost of shorter-term deposits may rise
faster than its earnings on longer-term loans and investments. Additionally, the
prepayment  of  principal on real estate  loans and  mortgage-backed  securities
tends to decrease as rates rise, providing less available funds to invest in the
higher rate environment.  Conversely, as interest rates decrease, the prepayment
of  principal  on  real-estate  loans and  mortgage-backed  securities  tends to
increase,  causing the Company to invest funds in a lower rate environment.  The
potential  impact on earnings  from this mismatch is mitigated to a large extent
by the size and stability of the Company's  savings  accounts.  Savings accounts
have  traditionally  provided a source of relatively  low cost funding that have
demonstrated  historically  a low  sensitivity  to interest  rate  changes.  The
Company generally matches a percentage of these,  which are deemed core, against
longer-term loans and investments. In addition, the Company has sought to extend
the terms of its time  deposits.  In this regard,  the Company has, on occasion,
offered  certificates  of  deposits  with three and four year terms  which allow
depositors  to make a  one-time  election,  at any time  during  the term of the
certificate of deposit,  to adjust the rate of the certificate of deposit to the
then  prevailing  rate for a  certificate  of deposit  with the same  term.  The
Company has further sought to reduce the term of a portion of its rate sensitive
assets by originating one year ARM loans, five year/one year ARM loans (mortgage
loans  which are fixed  rate for the first five  years and  adjustable  annually
thereafter),  and by maintaining a relatively  short term investment  securities
(original   maturities  of  three  to  five  years)   portfolio  with  staggered
maturities.

The  Company  manages its  interest  rate  sensitivity  by  monitoring  (through
simulation and net present value techniques) the impact on its GAP position, net
interest income, and the market value of portfolio equity to changes in interest
rates on its current and forecast mix of assets and liabilities. The Company has
an Asset- Liability  Management Committee which is responsible for reviewing the
Company's   assets  and  liability   policies,   setting  prices  and  terms  on
rate-sensitive  products,  and  monitoring  and measuring the impact of interest
rate changes on the Company's earnings.  The Committee meets monthly on a formal
basis and reports to the Board of Directors  on interest  rate risks and trends,
as well as liquidity and capital ratios and  requirements.  The Company does not
have a targeted gap range,  rather the Board of Directors has set  parameters of
percentage change by which net interest margin and the market value of portfolio
equity are affected by changing  interest  rates.  The Board and management deem
these  measures  to be a more  significant  and  realistic  means  of  measuring
interest rate risk.

Gap Analysis. At March 31, 2000, the total interest bearing liabilities maturing
or repricing within one year exceeded total interest-earning  assets maturing or
repricing  in the  same  period  by $21.7  million,  representing  a  cumulative
one-year gap ratio of a negative 10.11%.

Changes in Net Interest  Income and Net Portfolio  Value.  The  following  table
measures the Company's  interest  rate risk exposure in terms of the  percentage
change  in its net  interest  income  and net  portfolio  value as a  result  of
hypothetical  changes in 50 basis point increments in market interest rates. Net
portfolio  value  (also  referred  to  as  market  value  of  portfolio  equity)
represents  the fair value of net  assets  (determined  as the  market  value of
assets minus the market value of liabilities).  The table quantifies the changes
in net interest  income and net portfolio  value to parallel shifts in the yield
curve.  The column "Net Interest Income Percent  Change"  measures the change to
the next twelve months' projected net interest income, due to parallel shifts in
the yield  curve.  The column "Net  Portfolio  Value  Percent  Change"  measures
changes in the current net mark-to-market

                                      -12-

<PAGE>



value of assets and liabilities  due to parallel shifts in the yield curve.  The
base case  assumes  March 31,  2000  interest  rates.  The  Company  uses  these
percentage  changes  as a means to  measure  interest  rate  risk  exposure  and
quantifies  those changes  against  guidelines  set by the Board of Directors as
part of the Company's  Interest Rate Risk policy. The Company's current interest
rate risk exposure is within those guidelines set forth.





       Change in Interest Rates
          Increase(Decrease)
              Basis Points            Net Interest Income    Net Portfolio Value
              (Rate Shock)            Percentage Change       Percentage Change
              ------------            -------------------    -------------------
                      300                  -19.22%                 -22.53%
                      200                  -12.57%                 -14.92%
                      150                   -9.38%                 -11.21%
                      100                   -6.24%                  -7.54%
                       50                   -3.05%                  -3.71%
                  Base Case                      -                       -
                    ( 50)                    2.98%                   3.40%
                    (100)                    5.32%                   5.88%
                    (150)                    7.20%                   6.85%
                    (200)                    8.71%                   7.07%
                    (300)                    6.51%                   3.39%



















                                      -13-

<PAGE>



Part II - Other Information
---------------------------

Legal Proceedings
-----------------

From time to time,  the Bank is  involved as a plaintiff  or  defendant  in
various  legal  actions  incident to its  business.  None of these  actions
individually  or in  the  aggregate  is  believed  to be  material  to  the
financial condition of the Bank

Changes in Securities
---------------------

Not applicable

Defaults upon Senior Securities
-------------------------------

Not applicable

Other Information
-----------------

On March 21, 2000 the Board of Directors  declared a $.06 cash  dividend to
shareholders of record as of March 31, 2000, payable on April 17, 2000.

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

None



                                      -14-

<PAGE>


                                   SIGNATUARES





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




                                          PATHFINDER BANCORP, INC.


                                           /s/ Thomas W. Schneider
                                           ------------------------------------
     Date:  May 11, 2000                   Thomas W. Schneider
            ---------------                President, Chief Executive Officer

                                           /s/ James A. Dowd
                                           ------------------------------------
     Date:  May 11, 2000                   James A. Dowd
            ---------------                Vice President, Treasurer





















                                      -15-