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, 2001


                         SEC Exchange Act No. 000-23601


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


                                    Delaware
            (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)


         Company'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  Company  (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 2,601,495 shares
of the Company's common stock outstanding as of May 11, 2001.



<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 - 11
          Condition and Results of Operations


PART II                    OTHER INFORMATION                             12



SIGNATURES



<PAGE>


<TABLE>
<CAPTION>

                            PATHFINDER BANCORP, INC.
                      CONSOLIDATED STATEMENTS OF CONDITION
                March 31, 2001 (unaudited) and December 31, 2000

                                                                      March 31,               December 31,
                                                                        2001                      2000
                                                                  ----------------           ---------------
                             ASSETS

<S>                                                               <C>                        <C>
Cash and due from banks                                           $     4,392,871            $    3,969,370
Interest earning deposits                                                  91,100                   185,973
                                                                  ---------------            --------------
     Total cash and cash equivalents                                    4,483,971                 4,155,343

Investment securities                                                  64,054,788                63,758,011
Mortgage loans held-for-sale                                              765,395                   739,772
Loans:
     Real estate residential                                          107,811,700               106,506,162
     Real estate commercial                                            26,702,719                27,367,427
     Consumer                                                           2,904,422                 3,009,209
     Commercial                                                        13,020,175                12,873,143
                                                                  ---------------            --------------
     Total loans                                                      150,439,016               149,755,941
     Less: Allowance for loan losses                                    1,335,899                 1,273,707
       Unearned discounts and origination fees                            128,010                   120,203
                                                                  ---------------            --------------
       Loans receivable, net                                          148,975,107               148,362,031

Premises and equipment, net                                             4,529,829                 4,611,698
Accrued interest receivable                                             1,675,872                 1,678,589
Other real estate                                                         999,499                   884,320
Intangible assets, net                                                  2,578,670                 2,657,609
Other assets                                                            5,018,404                 4,999,729
                                                                  ---------------            --------------
       Total assets                                               $   233,081,535            $  231,847,102

LIABILITIES AND SHAREHOLDERS' EQUITY

Deposits:
     Interest bearing                                             $    155,109,082           $   151,563,551
     Non-interest bearing                                                9,951,413                 9,895,739
                                                                  ----------------           ---------------
       Total deposits                                                  165,060,495               161,459,290
Borrowed funds                                                          44,208,500                47,229,500
Other liabilities                                                        2,420,980                 2,195,837
                                                                  ----------------           ---------------
       Total liabilities                                               211,689,975               210,884,627

Shareholders' equity:
     Common stock, par value $.10 per share;
       authorized 9,000,000 shares; issued
       2,884,720 shares; and 2,601,495 shares
       outstanding for 2001 and 2000, respectively.                        288,472                   288,472
     Additional paid in capital                                          6,562,758                 6,562,085
     Retained earnings                                                  17,969,923                17,859,388
     Accumulated other comprehensive income                                334,767                    30,919
     Unearned ESOP shares                                                 (213,201)                 (227,230)
     Treasury stock, at cost;
       283,225 and 283,225 shares, respectively                         (3,551,159)               (3,551,159)
                                                                                             ---------------
     Total shareholders' equity                                         21,391,560                20,962,475
                                                                  ----------------           ---------------
     Total liabilities and shareholders' equity                   $    233,081,535           $   231,847,102
                                                                  ================           ===============


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

</TABLE>
                                       -1-

<PAGE>




<TABLE>
<CAPTION>


                                             PATHFINDER BANCORP, INC.
                                         CONSOLIDATED STATEMENTS OF INCOME For
                           the three months ended March 31, 2001 and March 31, 2000
                                                  (unaudited)
                                                                                March 31,             March 31,
                                                                                  2001                  2000
                                                                             -------------         -------------
INTEREST INCOME:
<S>                                                                          <C>                   <C>
   Loans                                                                     $  3,133,320          $  2,720,063
   Interest and dividends on investments:
       U.S. Treasury and agencies                                                 121,594               209,849
       State and political subdivisions                                            86,591                91,912
       Corporate obligations                                                      409,109               358,541
       Marketable equity securities                                                42,899                37,482
       Mortgage-backed                                                            362,572               403,044
       Federal funds sold and interest-bearing deposits                             1,375                   830
                                                                             ------------          ------------
           Total interest income                                                4,157,460             3,821,721

INTEREST EXPENSE:
   Interest on deposits                                                         1,617,788             1,330,660
   Interest on borrowed funds                                                     690,969               628,827
                                                                             ------------          ------------
       Total interest expense                                                   2,308,757             1,959,487
                                                                             ------------          ------------
               Net interest income                                              1,848,703             1,862,234
   Provision for loan losses                                                      121,183               115,324
                                                                             ------------          ------------
               Net interest income after provision for loan losses              1,727,520             1,746,910
                                                                             ------------          ------------

OTHER INCOME:
   Service charges on deposit accounts                                            116,739               114,107
   Loan servicing fees                                                             36,124                28,113
   Increase in value of Company owned life insurance                               39,322                41,322
   Net gain (loss) on securities and loans                                         69,306              (207,494)
   Other charges, commission and fees                                             102,018                76,402
                                                                             ------------          ------------
       Total other income                                                         363,509                52,450
                                                                             ------------          ------------

OTHER EXPENSES:
   Salaries and employee benefits                                                 759,562               891,626
   Building occupancy                                                             230,589               204,282
   Data processing expenses                                                       187,550               189,959
   Professional and other services                                                169,518               154,134
   Deposit insurance premiums                                                       7,910                 8,155
   Amortization of intangible asset                                                78,939                78,939
   Other expenses                                                                 276,602               483,791
   Unusual items                                                                       --               578,176
                                                                             ------------          ------------
       Total other expenses                                                      ,710,670             2,589,062
                                                                             ------------          ------------
Income (loss) before income taxes                                                 380,359              (789,702)
Provision (benefit) for income taxes                                              113,734              (156,293)
                                                                             ------------          ------------
Net income (loss)                                                            $    266,625          $   (633,409)
                                                                             ============          ============

Net income (loss) per share - basic                                          $       0.10          $      (0.25)
                                                                             ============          ============-
Net income (loss) per share - diluted                                        $       0.10          $      (0.25)
                                                                             ============          ============


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






                                       -2-

<PAGE>

<TABLE>
<CAPTION>


                            PATHFINDER BANCORP, INC.
                  STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                        THREE MONTHS ENDED MARCH 31, 2001
                                   (unaudited)





                                                            Add't
                                       Common  Stock       Paid in   Retained
                                    -------------------
                                    Shares     Amount     Capital    Earnings
--------------------------------------------------------------------------------



<S>                             <C>            <C>       <C>         <C>
Balance, December 31, 2000      $ 2,884,720    $288,472  $6,562,085  $17,859,388

Comprehensive income:
  Net Income                                                             266,625
  Other comprehensive income,
   net of tax
   Unealized gains on securities
   Unrealized holding gains
    arising during period
   Reclassification adjustment
    for gains
    Included in net income

  Other comprehensive income,
   before tax
  Income tax provision

  Other comprehensive income,
   net of tax

Comprehensive income:


ESOP shares earned                                              673

Dividends declared
 (.06 per share)                                                        (156,090)
                                     -----       ----         --          ------

Balance, March 31, 2001         $2,884,720    $288,472   $6,562,758  $17,969,923
                                ==========    ========   ==========  ===========
</TABLE>




<TABLE>
<CAPTION>


                                                                Accum.
                                                                Other     Unearned
                                 Comprehensive    Compr.        ESOP      Treasury
                                    Income        Income       Shares      Stock         Total
                                ---------------------------------------------------------------------



<S>                               <C>          <C>        <C>         <C>           <C>
Balance, December 31, 2000        $     --     $ 30,919   $(227,230)  $(3,551,159)  $20,962,475

Comprehensive income:
  Net Income                        266,625                                             266,625
  Other comprehensive income,
   net of tax
   Unealized gains on securities
   Unrealized holding gains
    arising during period           437,107
   Reclassification adjustment
    for gains
    Included in net income           69,306
                                  ---------
  Other comprehensive income,
   before tax                       506,413
  Income tax provision              202,565
                                  ---------
  Other comprehensive income,
   net of tax                       303,848      303,848                                303,848
                                  ---------
Comprehensive income:               570,473
                                  =========

ESOP shares earned                                             14,029        14,702

Dividends declared
 (.06 per share)                                                                       (156,090)
                                    --------   ---------   ----------     ---------   ----------

Balance, March 31, 2001            $      --     $334,767   $(213,201)  $(3,551,159) $21,391,560
                                   =========     ========   =========   ===========  ===========


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

                                       -3-

<PAGE>


<TABLE>
<CAPTION>

                                                      PATHFINDER BANCORP, INC.
                                                      STATEMENTS OF CASH FLOWS
                                                  March 31, 2001and March 31, 2000
                                                            (unaudited)
                                                                                  March 31,                        March 31,
                                                                                    2001                         2000
                                                                                -------------               -------------
OPERATING ACTIVITIES:
<S>                                                                           <C>                           <C>
   Net income (loss)                                                          $    266,625                  $  (633,409)
     Adjustments to reconcile net income to net cash
       provided by operating activities:
     Provision for loan losses                                                     121,183                      115,324
     ESOP and other stock-based compensation earned                                 14,702                      403,910
     Deferred income tax benefit                                                    62,633                       92,205
     Proceeds from sale of loans                                                   893,387                           --
     Originations of loans held-for-sale                                          (849,704)                          --
     Realized loss/(gain) on:
       Sale of real estate acquired through foreclosure                             15,060                           --
       Loans                                                                       (69,306)                          --
       Available-for-sale investment securities                                         --                      207,494
     Depreciation                                                                  120,401                      118,333
     Amortization of intangibles                                                    78,939                       78,939
     (Increase) decrease in surrender value of life insurance                      (39,322)                       4,678
     Net amortization of premiums and discounts
        on investment securities                                                    (4,480)                      (3,079)
     Decrease (increase) in interest receivable                                      2,717                      (54,694)
     Net change in other assets and liabilities                                    (20,785)                     231,370
                                                                              -------------                 -----------
 Net cash provided by operating activities                                         592,050                      561,071
                                                                              ------------                  -----------

INVESTING ACTIVITIES
     Purchase of investment securities available-for-sale                         (834,081)                  (3,098,123)
     Proceeds from maturities and principle reductions of
         investment securities available-for-sale                                1,048,198                      477,550
     Proceeds from sale of:
         Real estate acquired through foreclosure                                   64,178                           --
         Available-for-sale investment securities                                       --                    5,297,325
     Net increase in loans                                                        (928,676)                    (684,471)
     Purchase of premises and equipment                                            (38,532)                     (75,253)
                                                                              -------------                 ------------
 Net cash (used in) provided by investing activities                              (688,913)                   1,917,028
                                                                              -------------                 -----------

FINANCING ACTIVITIES
     Net increase in demand deposits, NOW accounts savings accounts, money
         market deposit accounts
         and escrow deposits                                                       424,150                      409,123
     Net increase in time deposits                                               3,177,055                    1,548,583
     Proceeds from borrowings, net                                              (3,021,000)                  (4,796,000)
     Cash dividends                                                               (154,714)                    (155,438)
     Treasury stock purchased                                                           --                     (179,750)
                                                                              ------------                  ------------
  Net cash provided by (used in) financing activities                              425,491                   (3,173,482)
  Increase (decrease) in cash and cash equivalents                                 328,628                     (695,383)
 Cash and cash equivalents at beginning of period                                4,155,343                    4,280,255
                                                                              ------------                  -----------
  Cash and cash equivalents at end of period                                  $  4,483,971                  $ 3,584,872
                                                                              ------------                  ===========

CASH PAID DURING THE PERIOD FOR:
     Interest                                                                 $  2,377,213                  $ 1,926,467
     Income taxes paid                                                                  --                           --
NON-CASH INVESTING ACTIVITY:
     Transfer of loans to other real estate                                   $    194,417                  $  550,335
     Decrease in unrealized gains and losses on available
         for sale investment securities                                            506,413                      412,540
NON-CASH FINANCING ACTIVITY:
     Dividends declared and unpaid                                            $    156,090                  $   154,258



The accompanying notes are an integral part of the consolidated financial statements
</TABLE>
                                                                -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
     Company'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, 2000 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, 2001 and 2000.

     Operating  results  for the  three  months  ended  March  31,  2001 are not
     necessarily  indicative  of the results  that may be expected  for the year
     ending December 31, 2001.

(2) Earnings per Share

     Basic  earnings per share have been  computed  based upon net income (loss)
     for the three months  ended March 31, 2001 and 2000,  using  2,562,825  and
     2,575,073 weighted average common shares outstanding.  For the three months
     ended  March 31,  2001,  the  calculation  of  diluted  earnings  per share
     excludes the effect of  incremental  common stock  equivalents  aggregating
     84,000  shares  since they would have been  anti-dilutive.  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, 2001,  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, 2001, 1,578,239 shares,
     or 60.7%,  of the Company's  common stock was held by  Pathfinder  Bancorp,
     MHC, the Company's mutual holding company parent and 1,023,256  shares,  or
     39.3%, 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.

     The following  discussion reviews the financial condition at March 31, 2001
     and the results of  operations  of the Company for the three  months  ended
     March 31, 2001.

      Financial Condition

     Assets

     Total  assets  increased  approximately  $1.2  million,  or .5%,  to $233.1
     million at March 31, 2001 from $231.9  million at December  31,  2000.  The
     increase in total  assets was  primarily  due to an increase in total loans
     receivable  of $613,000,  or .4%, to $149.0  million at March 31, 2001 from
     $148.4 million at December 31, 2000.  Cash and cash  equivalents  increased
     $329,000, or 7.9%, to $4.5 million at March 31, from $4.2 million at

                                                                -6-

<PAGE>



     December  31, 2000.  Investment  securities  increased  $297,000 or .5%, to
     $64.1 million at March 31, 2001 from $63.8 at December 31, 2000.

     Liabilities

     Total  liabilities  increased by $805,000,  to $211.7  million at March 31,
     2001 from $210.9  million at December 31,  2000.  The increase is primarily
     attributable to a $3.6 million, or 2.2%, increase in deposits,  offset by a
     decrease in borrowed funds of $3.0 million, or 6.4%.

     Shareholders' Equity

     Shareholders' equity increased $429,000, or 2.1%, to $21.4 million at March
     31,  2001 from  $21.0  million  at  December  31,  2000.  The  increase  in
     shareholders'  equity is  primarily  the result of a $304,000  increase  in
     accumulated other comprehensive  income and a $111,000 increase in retained
     earnings.  The  increase in retained  earnings is a result of net income of
     $267,000 offset by dividends  declared of $156,000,  during the first three
     months of 2001.

     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  net income of  approximately  $267,000 for the three
     months ended March 31, 2001,  as compared to a net loss of $633,000 for the
     same period  during  2000.  The  increase in the  Company's  first  quarter
     earnings  is  primarily  the  result of a loss  recorded  during  the first
     quarter of 2000 in connection with the reorganization of the Company's work
     force and  balance  sheet.  The prior  year  first  quarter  earnings  were
     adversely  impacted  by  certain  unusual  items,  totaling   approximately
     $578,000, and other non-recurring charges totaling approximately  $270,000.
     Additionally,  the Company incurred losses of approximately $195,000 on the
     sale  of  investment  securities.  The tax  benefit  of the  unusual  items
     charges,  non-recurring charges and securities losses totaled approximately
     $241,000 for the quarter ended March 31, 2000.

     As a result of the increase in net income between the comparative  periods,
     annualized  return on average  assets  and return on average  shareholders'
     equity were .46% and 5.00%, respectively,  for the three months ended March
     31, 2001  compared to (1.10)% and (12.11)%  for the first  quarter of 2000.
     Earnings/(loss)  per share - basic was $.10 for the first  quarter  of 2001
     compared to $(.25) for the same period in 2000.

     Interest Income

                                                                -7-

<PAGE>




     Interest income,  on a tax-equivalent  basis,  totaled $4.2 million for the
     quarter  ended March 31, 2001,  as compared to $3.9 million for the quarter
     ended March 31,  2000,  an  increase of  $335,000,  or 8.7%.  The  increase
     resulted   primarily   from  an  increase   in  the   average   balance  of
     interest-earning  assets to $214.2 million for the three months ended March
     31, 2001 from $202.4  million in the prior year  period,  combined  with an
     increase  in the yield on  average  interest-earning  assets to 7.85%  from
     7.65%.  The increase in the average balance of interest  earning assets was
     comprised  of an $18.7  million  increase in the  average  balance of loans
     receivable,  offset by a $6.8  million  decrease in the average  balance of
     investment  securities.  The  increase in the  average  balance of interest
     earning assets is primarily the result of strong demand for residential and
     commercial  real estate loans,  and commercial  business  loans.  The yield
     increase is principally  the result of the higher yields on commercial loan
     originations and general interest rate trends during 2000.

     Interest income on loans receivable  increased  $413,000,  or 15.2% to $3.1
     million for the three  months  ended March 31, 2001 as compared to the same
     period in the prior year. The increase in interest income on loans resulted
     from an  increase  in the  average  balance  of loans  receivable  of $18.7
     million,  or 14.1% to $151.1 million at March 31, 2001, from $132.4 million
     at March 31, 2000,  combined with an increase in the average yield on loans
     receivable  to 8.30% from 8.25%.  The  increase  in the average  balance of
     loans  receivable is primarily  comprised of  originations  of  one-to-four
     family residential mortgages and originations of commercial real estate and
     business loans.  The increase in the yield on average loans  receivable was
     attributable  to the  increase in the average  balance of  commercial  real
     estate and business loans which are typically  originated at yields greater
     than the residential mortgage portfolio.

     Interest income on the  mortgage-backed  securities  portfolio decreased by
     $40,000,  or 10.0%,  to $363,000 for the three months ended March 31, 2001,
     from  $403,000 for the three  months ended March 31, 2000.  The decrease in
     interest income on mortgage-backed  securities  resulted generally from the
     decrease  in the  average  balance on  mortgage-backed  securities  of $2.1
     million,  or  8.8%,  combined  with a  decrease  in the  average  yield  on
     mortgage-backed securities to 6.68% from 6.77%.

     Interest  income  on  investment  securities,  on a tax  equivalent  basis,
     decreased  $26,000,  or 3.6%,  for the three months ended March 31, 2001 to
     $706,000 from $732,000 for the same period in 2000.  The decrease  resulted
     primarily from the decrease in the average balance of investment securities
     of $4.7  million,  or 10.2%,  to $41.4  million for the three  months ended
     March  31,  2001,  offset by an  increase  in the tax  equivalent  yield of
     investment  securities  to 6.82% for the quarter  ended March 31, 2001 from
     6.36% for the first quarter of 2000. The decrease in the average balance of
     investment securities is a result of the Company's liquidity being utilized
     to fund loan portfolio growth. As investments are sold, redeemed or mature,
     the funds are not reinvested into the securities portfolio.

     Interest  income on  interest-earning  deposits  remained  constant for the
     three months ended March 31, 2001 and 2000, respectively. The average yield
     on interest-earning deposits increased to 7.33% from 5.56%.

     Interest Expense

     Interest  expense  for the  quarter  ended  March  31,  2001  increased  by
     approximately  $349,000,  or 17.8%,  to $2.3 million from $2.0 million when
     compared to the same quarter for 2000. The increase in interest expense for
     the period was principally the result of an increase in the average balance
     and average cost of time deposits and borrowings.  Time deposits  increased
     $9.5 million,  or 13.8%,  to $78.6 million for the three months ended March
     31,  2001,  from $69.1  million for the three  months ended March 31, 2000,
     combined  with an increase in the  average  cost of time  deposits to 6.06%
     from 5.32%. The average balance of borrowed funds increased $2.4

                                                                -8-

<PAGE>



     million,  or 5.7%,  to $45.5  million  from $43.0  million  for the periods
     ending March 31, 2001 and 2000  respectively,  combined with an increase in
     the average cost of borrowed funds to 6.08% from 5.84%. The increase in the
     average cost of interest  bearing  liabilities is principally the result of
     the shorter term  liabilities  repricing in the relatively  higher interest
     rate environment in fiscal year 2000.

     Net Interest Income

     Net interest income totaled $1.9 million,  on a tax equivalent  basis,  for
     the three months ended March 31, 2001 and 2000. The relative consistency in
     net interest income for the quarter endeds March 31, 2001 and 2000, was the
     result of an increase of $11.9 million,  or 5.9%, in the average balance of
     interest  earning assets,  combined with a increase in the average yield on
     interest  earning assets to 7.85% from 7.65%,  offset by an increase in the
     average balance of interest bearing  liabilities of $11.5 million, or 6.2%,
     and an increase in the average  cost of  interest  bearing  liabilities  to
     4.66% from 4.20%.

     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, 2001 of
     $121,000, as compared to a provision of $115,000 for the three months ended
     March 31, 2000. The increase in provision for loan losses  reflects  higher
     net charge-offs  for the period as well as the increased  risks  associated
     with the Company'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, 2001 were .89% and 66.93%, 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 increased  approximately  $311,000, to $364,000 for the
     three months ended March 31, 2001 as compared to $53,000 for the prior year
     quarter.  Non-interest  income,  exclusive of securities  gains and losses,
     increased  $34,000,  or 13.2%,  for the  quarter  ended  March 31,  2001 as
     compared to the same period in the prior year. The increase in non-interest
     income is attributable to a $26,000 increase in other charges,  commissions
     and fees and an $8,000  increase in loan servicing fees. Net gains (losses)
     on securities and loans increased $277,000,  from a loss of $208,000 in the
     first  quarter  of 2000,  to net gains of  $69,000  for the 3 month  period
     ending March 31, 2001.  The prior year  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 decreased $878,000,  or 33.9%, to $1.7 million for the
     three months ended March 31, 2001,  as compared to the same period in 2000.
     The primary  components  of this  decrease  were the  recording  of certain
     unusual items and  non-recurring  charges of $849,000 by the Company during
     the first quarter of 2000. These non-interest expense levels resulted in an
     operating  expense to total asset ratio of 2.94% and an efficiency ratio of
     77.33%.

     Income Taxes

                                                                -9-

<PAGE>




     Income taxes  increased  $270,000  for the quarter  ended March 31, 2001 as
     compared to the same period in the prior year.  This  increase was directly
     attributable to a $1.2 million increase 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.

     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

                                                                -10-

<PAGE>



     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, 2001,  the total interest  bearing  liabilities
     maturing  or  repricing  within one year  exceeded  total  interest-earning
     assets  maturing  or  repricing  in  the  same  period  by  $25.5  million,
     representing a cumulative one-year gap ratio of a negative 10.92%.

     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  value of assets and  liabilities  due to parallel shifts in
     the yield curve.  The base case assumes March 31, 2001 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.
<TABLE>
<CAPTION>

   Change in Interest Rates
     Increase(Decrease)
        Basis Points                       Net Interest Income         Net Portfolio Value
        (Rate Shock)                        Percentage Change            Percentage Change

<S>               <C>                             <C>                           <C>
                  300                            -15.65%                       -21.18%
                  200                            -10.01%                       -13.85%
                  100                             -4.88%                        -6.75%
               Base Case                              -                          -
                  (100)                           3.21%                         2.97%
                  (200)                           6.09%                         4.40%
                  (300)                           6.96%                         2.94%

</TABLE>
                                                   -11-

<PAGE>



     Part II - Other Information

     Legal Proceedings

     From time to time,  the Company 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 Company

     Changes in Securities

     Not applicable

     Defaults upon Senior Securities

     Not applicable

     Submission of Matters to a Vote of Security Holders

     Not applicable

     Other Information

     On March 20, 2001 the Board of Directors  declared a $.06 cash  dividend to
     shareholders of record as of March 31, 2001, payable on April 16, 2001.

     Exhibits and Reports on Form 8-K

     None



                                                                -12-

<PAGE>


                                   SIGNATUARES





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




                                   PATHFINDER BANCORP, INC.


                                    /s/ Thomas W. Schneider
             May 11, 2001           ------------------------------------
     Date:   ---------------        Thomas W. Schneider
                                    President, Chief Executive Officer

                                    /s/ James A. Dowd
             May 11, 2001           ------------------------------------
     Date:   ---------------        James A. Dowd
                                    Vice President, Chief Financial Officer






















                                                                -13-

<PAGE>