TABLE OF CONTENTS


President's Letter of Stockholders                                            2

The Business of Harvest Home Financial Corporation
  and Subsidiary                                                              3

Common Stock and Related Information                                          4

Selected Consolidated Financial Data                                          5

Management's Discussion and Analysis of Financial Condition
  and Results of Operations                                                   6

Discussion of Changes in Financial Condition from
  September 30, 1998 to September 30, 1999                                   10

Comparison of Results of Operations for Fiscal Years Ended
  September 30, 1999 and 1998                                                11

Comparison of Results of Operations for Fiscal Years Ended
  September 30, 1998 and 1997                                                13

Average Yield Analysis                                                       15

Rate/Volume Table                                                            16

Liquidity and Capital Resources                                              17

Potential Impact of Current Legislation on Future
  Results of Operations                                                      18

Effect of Recent Accounting Pronouncements                                   19

Year 2000 Compliance Matters                                                 20

Report of Independent Certified Public Accountants                           22

Consolidated Financial Statements                                            23

Directors and Officers                                                       53

Stockholder Services                                                         55





                                       1
<PAGE>

Dear Stockholder:

We are pleased to present Harvest Home Financial's Annual Report to Stockholders
for the fiscal year ending September 30, 1999.

Fiscal  1999  concluded  with  the most  significant  event  in  Harvest  Home's
illustrious 80 year history.  Specifically, on October 1, 1999, your Corporation
entered into a merger  agreement  with The People's  Building,  Loan and Savings
Company of Lebanon,  Ohio (immediately  following that Company's proposed merger
with Oakley Improved of Cincinnati).  The resulting  company,  Peoples Community
Bancorp, will have pro forma assets of approximately $215 million, ranking fifth
in size among Tri-State  thrift holding  companies.  While we still believe that
Harvest Home could press  forward as an  independent  community  bank, it is our
present opinion that our stockholders  could receive greater rewards through the
revenue  opportunities  associated  with  immediate  asset growth.  We are truly
excited with the prospects  presented by our merger with People's.  At the heart
of this combination is a continued commitment to remain an independent community
bank.

Our branch network after the merger will position the new holding company as one
of two Cincinnati  thrift  franchises  with both an east and west side presence.
Moreover,  our  proposed  expansion  plans  call for  near-term  entry  into the
fast-growing  Butler County  market.  We operate in an  environment of declining
margins where growth is critical to our success. We believe that our merger with
People's  provides  the perfect  avenue for  achieving  the  requisite  level of
profitable growth in the future.

The continuing margin compression in the financial services industry was evident
in our fiscal year  results.  Net  earnings  for fiscal 1999  totaled  $514,000,
representing a modest 5% reduction from the $541,000 of net earnings reported in
fiscal 1998.

The aforementioned economic considerations with respect to interest margins were
the foundation of your Board's  decision to affiliate with People's.  We believe
that  Harvest Home  Financial  is receiving a fair price along with  significant
upside  potential  in  Peoples  Community  common  stock.  Adding to an  already
impressive return on our shares, we are pleased to advise you that approximately
47% of your calendar  1999  dividends  will be tax-free.  You will be advised in
January 2000 as to the exact percentage of the 1999 dividend  distributions that
are considered tax-free.

As always, we sincerely appreciate your past and continuing support.


Very truly yours,


/s/John E. Rathkamp

John E. Rathkamp
President










                                       2
<PAGE>


          BUSINESS OF HARVEST HOME FINANCIAL CORPORATION AND SUBSIDIARY

Harvest  Home  Financial   Corporation   ("HHFC",   or  the  "Corporation")  was
incorporated in February 1994 under Ohio law for the purpose of acquiring all of
the capital stock issued by Harvest Home Savings Bank  ("Harvest  Home",  or the
"Bank") in connection with its conversion from a state chartered  mutual savings
bank to a state chartered stock savings bank (the "Conversion").  The Conversion
was  consummated  in 1994 and,  as a result,  the  Corporation  became a unitary
savings and loan holding company for its wholly-owned subsidiary,  Harvest Home.
The  Corporation  has no significant  assets other than the shares of the Bank's
common stock acquired in the Conversion and has no significant liabilities.

As a community oriented financial  institution,  Harvest Home seeks to serve the
financial  needs of the families and community  businesses in its primary market
area. Harvest Home is principally engaged in the business of attracting deposits
from the general public,  which are insured to applicable  limits by the Savings
Association  Insurance  Fund (the "SAIF"),  and using such deposits to originate
residential loans. To a lesser extent, Harvest Home also originates construction
loans and loans secured by multi-family residential real estate,  nonresidential
real estate, and deposits. In addition,  Harvest Home invests in mortgage-backed
securities,  other investment grade U.S.  Government and agency securities,  and
short-term  interest-bearing  deposits.  Harvest  Home also offers a credit card
program through a correspondent relationship with a commercial bank.

Harvest Home conducts  business  from its main office in Cheviot,  Ohio and from
two full-service  branch offices located in the Cincinnati area.  Harvest Home's
primary  market area consists of western  Hamilton  County,  Ohio,  although its
market  also  extends to the  remainder  of  Hamilton  County and to  contiguous
townships in the counties of Butler, Clermont, and Warren.

























                                       3
<PAGE>


                      COMMON STOCK AND RELATED INFORMATION

The  Corporation's  common stock is listed on the Nasdaq System under the symbol
HHFC.

Presented  below are the market values for the  Corporation's  common stock,  as
well as the amount of cash dividends paid on the common stock,  for each quarter
of fiscal 1999, 1998 and 1997. Such values represent actual  transactions and do
not include retail markups,  markdowns or commissions.  Information  relating to
prices has been obtained by the  Corporation  from Nasdaq for fiscal 1999,  1998
and 1997.
<TABLE>
<CAPTION>

                                                   Market              Cash
Fiscal year ending September 30, 1999               value          dividends (1)
<S>                                                 <C>                 <C>
Quarter ending December 31, 1998                  $14.750              $.11
Quarter ending March 31, 1999                     $14.875              $.11
Quarter ending June 30, 1999                      $11.750              $.11
Quarter ending September 30, 1999                 $14.375              $.11

                                                   Market              Cash
Fiscal year ending September 30, 1998               value          dividends (2)

Quarter ending December 31, 1997                   $15.75              $.11
Quarter ending March 31, 1998                      $15.00              $.11
Quarter ending June 30, 1998                       $14.75              $.11
Quarter ending September 30, 1998                  $12.88              $.11

                                                   Market              Cash
Fiscal year ending September 30, 1997               value          dividends (3)

Quarter ending December 31, 1996                  $  9.75              $.10
Quarter ending March 31, 1997                      $11.50              $.10
Quarter ending June 30, 1997                       $10.88              $.10
Quarter ending September 30, 1997                  $12.00              $.10
</TABLE>


As of December 10, 1999,  the  Corporation  had  outstanding  875,289  shares of
common stock, held by approximately  350 stockholders of record.  This number of
stockholders  does not reflect  the number of persons or  entities  who may hold
stock in nominee or  "street"  name  through  brokerage  firms or others.  As of
December 10, 1999, the Corporation  held a total of 116,586 shares of its common
stock in treasury.




1)   Approximately  $.21 of fiscal 1999  dividends  are deemed to  constitute  a
     non-taxable return of capital.

2)   Approximately  $.33 of fiscal 1998  dividends  are deemed to  constitute  a
     non-taxable return of capital.

3)   Approximately  $.37 of fiscal 1997  dividends  are deemed to  constitute  a
     non-taxable return of capital.






                                       4
<PAGE>


                      SELECTED CONSOLIDATED FINANCIAL DATA

Selected consolidated financial condition and other data:

<TABLE>
<CAPTION>
                                                                           At September 30,
                                                      1999           1998           1997            1996           1995
                                                                       (Dollars in thousands)
Total amount of:
<S>                                                   <C>            <C>           <C>              <C>            <C>
  Assets                                           $98,935        $96,894        $93,832         $78,718        $69,532
  Cash and cash equivalents (1)                      2,849          2,887          5,264           1,708          2,313
  Investment securities held to maturity -
    at cost                                             -              -              -               -          18,032
  Investment securities available for sale -
    at market                                        5,951          4,032          8,039          12,105             -
  Mortgage-backed securities held to
    maturity - at cost                                  -              -              -               -           9,009
  Mortgage-backed securities available for
    sale - at market                                33,711         37,864         32,466          20,429             -
  Loans receivable - net                            52,790         48,797         45,229          42,267         38,245
  Deposits                                          66,220         60,225         58,786          57,958         56,425
  Advances from the FHLB                            22,600         25,850         24,000          10,000             -
  Stockholders' equity                               9,653          9,977         10,344           9,725         12,706
Number of:
  Real estate loans outstanding                        925            919          1,054           1,038          1,000
  Deposit accounts                                   7,226          6,879          6,946           7,078          7,164
  Full service offices                                   3              3              3               3              3

</TABLE>


<TABLE>
<CAPTION>

Summary of consolidated earnings and other data:
                                                                           Year ended September 30,
                                                      1999           1998           1997            1996           1995
                                                                      (In thousands, except share data)
<S>                                                   <C>            <C>           <C>              <C>            <C>

Interest income                                     $6,482         $6,367         $5,983          $5,209         $4,872
Interest expense                                     4,211          4,143          3,689           2,969          2,569
                                                     -----          -----          -----           -----          -----
Net interest income                                  2,271          2,224          2,294           2,240          2,303
Provision for losses on loans                           12             12              9               1             12
                                                     -----          -----          -----           -----          -----
Net interest income after provision for
  losses on loans                                    2,259          2,212          2,285           2,239          2,291
Other income                                            92            109             64              74             50
General, administrative and other expense            1,572          1,516          1,409           2,136          1,372
                                                     -----          -----          -----           -----          -----
Earnings before income taxes                           779            805            940             177            969
Federal income taxes                                   265            264            313              45            329
                                                     -----          -----          -----           -----          -----
Net earnings                                        $  514         $  541         $  627          $  132         $  640
                                                     =====          =====          =====           =====          =====
Earnings per share:
  Basic                                               $.60           $.63           $.71            $.16           $.73
                                                       ===            ===            ===             ===            ===
  Diluted                                             $.59           $.60           $.70            $.16           $.73
                                                       ===            ===            ===             ===            ===
</TABLE>

<TABLE>
<CAPTION>
                                                                            Year ended September 30,
                                                      1999           1998           1997            1996           1995
<S>                                                    <C>             <C>           <C>            <C>            <C>
Interest rate spread                                   1.96%           1.95%        2.17%          2.24%          2.48%
Net yield on average interest-earning assets           2.35            2.45         2.76           3.07           3.27
Return on equity (net earnings divided by
  average equity)                                      5.14            5.28         6.09           1.05           5.09
Return on assets (net earnings
  divided by average total assets)                     0.51            0.58         0.73           0.18           0.89
Equity-to-assets ratio (average equity
  divided by average total assets)                    10.01           11.05        12.06          16.94          17.56
Loan loss allowance as a percentage of
  non-performing loans                               556.00%         259.18%      121.05%         67.68%         76.92%

</TABLE>

1)   Includes cash and due from banks,  federal funds sold and  interest-bearing
     deposits in other financial institutions.




                                       5

<PAGE>


                       Harvest Home Financial Corporation

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

As stated previously,  the Corporation's  activities have been primarily limited
to holding the stock of Harvest Home. As a result,  the discussion  that follows
focuses primarily on the operations of Harvest Home.

Harvest Home's  operating  results are dependent to a significant  degree on its
net interest  income,  which is the difference  between interest income on loans
and  investments  and  interest  expense on deposits and  borrowings.  Like most
thrift  institutions,  the interest income and interest  expense of Harvest Home
changes as interest rates fluctuate and assets and liabilities reprice. Interest
rates may  fluctuate  because of general  economic  conditions,  the policies of
various regulatory  authorities and other factors beyond Harvest Home's control.
Assets and liabilities will reprice in accordance with the contractual  terms of
the asset or liability  instrument and in accordance  with customer  reaction to
general economic trends.

Harvest Home's interest-earning assets repricing within one year after September
30, 1999, are greater than  interest-bearing  liabilities  repricing  within the
same period by approximately  $1.7 million,  resulting in a positive  cumulative
one-year gap of 1.7% of total assets. The Corporation's  interest-earning assets
repricing  within three years of September 30, 1999,  were $3.6 million  greater
than interest bearing liabilities repricing during the same period, resulting in
a positive cumulative gap for such period of 3.7% of total assets.

In the event that  interest  rates rise  during the  forthcoming  year,  Harvest
Home's positive  cumulative  one-year gap may have a positive effect on earnings
because   interest-earning   assets   may   reprice   at  a  faster   pace  than
interest-bearing  liabilities.  However, rising interest rates could also affect
Harvest  Home's  earnings in a negative  manner as a result of  diminished  loan
demand and the increased risk of delinquencies  resulting from increased payment
amounts on adjustable-rate loans.

Harvest Home's  earnings are also vulnerable to changes in interest rates due to
the  amount of  adjustable-rate  mortgage  loans  ("ARMs")  originated  with low
margins and  adjustment  caps.  Harvest Home  originates  ARMs which provide for
interest rate adjustments every three years. Moreover,  many of these loans have
adjustment  caps of 2% in any three year period.  Therefore,  if interest  rates
rise rapidly,  Harvest Home may be unable to increase the interest rates on such
loans as rapidly as the cost of liabilities increase.

Notwithstanding  the foregoing risks, the Bank is operating within  management's
predetermined  level of interest rate risk and management  believes that Harvest
Home's interest rate risk posture and the strategies discussed below will result
in the Bank  maintaining  acceptable  operating  results in the current interest
rate environment.







                                       6

<PAGE>

                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Asset and Liability Management

Harvest Home's interest rate spread is the principal  determinant of income. The
interest rate spread,  and therefore net interest income,  can vary considerably
over time because asset and liability repricing do not coincide.  Moreover,  the
long-term or  cumulative  effect of interest  rate  changes can be  substantial.
Interest rate risk is defined as the  sensitivity of an  institution's  earnings
and net asset values to changes in interest rates. In managing its interest rate
risk,  Harvest  Home begins with an  objective  to increase  the  interest  rate
sensitivity  of its assets by  originating  loans with interest rates subject to
period adjustment and market conditions and/or shorter maturities.  Harvest Home
has  historically had to rely primarily upon retail deposit accounts as a source
of funds and intends to continue to do so. Management  believes that reliance on
retail deposit  accounts as a source of funds compared to brokered  deposits and
long-term  borrowings  may reduce  the  effects of  interest  rate  fluctuations
because  these  deposits  generally  represent  a more  stable  source of funds.
However,  Harvest  Home has utilized  FHLB  advances as a source of financing to
fund purchases of certain  mortgage-backed  securities  when  favorable  spreads
became available.

























                                       7
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Asset and Liability Management (continued)

The  following  table sets  forth the  amounts  of  interest-earning  assets and
interest-bearing  liabilities  outstanding  at  September  30,  1999,  which are
expected to reprice or mature in each of the future periods shown.  The analysis
of this  interest-rate  sensitivity,  which is prepared quarterly by a financial
advisory firm,  Performance Analysis,  Inc., for Harvest Home,  incorporates the
assumptions set forth in the footnotes of the following table.

<TABLE>
<CAPTION>

                                                  Six
                                  Within       Months
                                    Six        to One          1-3           3-5         5-10      Over 10
                                  Months         Year        Years         Years        Years        Years        Total
<S>                                <C>           <C>           <C>          <C>           <C>         <C>         <C>
Interest-earning assets

Loans

  Adjustable Rate(1)            $  6,173      $13,235     $     -        $    -        $   -        $   -       $19,408

  Fixed Rate(2)                    2,842        2,491        6,686         4,718        6,872        3,039       26,648

  Non-Residential
    Adjustable Rate(1)             1,742        3,630           -             -            -            -         5,372

  Other Loans
    Home Equity                    1,480           -            -             -            -            -         1,480

    Consumer                          20           -            -             -            -            -            20

Investments(3)                     1,823           -         6,000            -            -            -         7,823

Mortgage-backed securities        27,628        2,442        4,645            -            -            -        34,715
                                  ------      -------      -------        ------        -----        -----       ------

TOTAL RATE
SENSITIVE ASSETS                  41,708       21,798       17,331         4,718        6,872        3,039       95,466

Interest-bearing
liabilities

Deposits

  Certificates of Deposit (4)      9,502       24,871        9,097         3,570           -            -        47,040

  Money Market Deposits (5)          649          562        1,591           895          877          273        4,847

  NOW Accounts                       564          489        1,382           777          762          237        4,211

  Passbook Accounts                1,370        1,186        3,355         1,887        1,851          575       10,224

FHLB Advances                     19,100        3,500           -             -            -            -        22,600
                                  ------       ------       ------         -----        -----        -----       ------


TOTAL RATE
SENSITIVE LIABILITIES             31,185       30,608       15,425         7,129        3,490        1,085       88,922
                                  ------       ------       ------         -----        -----        -----       ------


Interest Sensitivity
Gap                              $10,523      $(8,810)     $ 1,906       $(2,411)      $3,382       $1,954      $ 6,544
                                  ======       ======       ======         =====        =====        =====       ======

Cumulative Interest Rate
Sensitivity Gap                  $10,523      $ 1,713      $ 3,619        $1,208       $4,590       $6,544      $ 6,544
                                  ======       ======       ======         =====        =====        =====       ======

Cumulative Interest Rate
Sensitivity Gap as a Percent
of Total Assets                    10.64%        1.73%         3.66%        1.22%        4.64%         6.61%        6.61%
                                   =====         ====          ====         ====         ====          ====         ====
</TABLE>
(Footnotes on next page)

                                       8

<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

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

1)   Includes all adjustable  rate mortgage  loans based on contractual  term to
     repricing.

2)   Includes  all  fixed-rate  mortgage  loans  which are assumed to reprice in
     accordance   with  prepayment   assumptions   supplied  by  Harvest  Home's
     asset/liability  management software provider.  Such prepayment assumptions
     have been derived from prepayment  assumption models previously utilized by
     the OTS.

3)   Includes all investment securities,  interest-bearing  deposits and federal
     funds  sold.

4)   Certificates of deposit are shown  repricing based on contractual  terms to
     maturity.

5)   Based on assumptions supplied by Harvest Home's asset/liability  management
     provider,  money market  deposits,  NOW accounts and passbook  accounts are
     assumed to decay over a five-year period.


Savings  banks  have  historically  presented  a gap  analysis  as a measure  of
interest rate risk. The gap analysis above presents the projected maturities and
periods  to  repricing  of  the  Savings  Bank's  rate   sensitive   assets  and
liabilities. As stated previously, Harvest Home's cumulative one-year gap, which
represents  the  difference  between  the amount of  interest  sensitive  assets
maturing  or  repricing  in one  year  and  the  amount  of  interest  sensitive
liabilities  maturing or repricing in the same  period,  was a positive  1.7% of
total assets at September 30, 1999. A positive  cumulative  gap  indicates  that
interest  sensitive assets exceed interest  sensitive  liabilities at a specific
date.  In  a  rising  interest  rate  environment,  institutions  with  positive
repricing  or  maturity  gaps  generally  experience  a more rapid  increase  in
interest income earned on assets than the interest  expense paid on liabilities.
Conversely,  in an environment of falling interest rates, interest income earned
on assets will generally decrease more rapidly than the interest expense paid on
liabilities. A negative gap will have the opposite effect. Harvest Home's one to
three year gap was a positive 1.9% (of total assets), while all other maturities
greater than three years  reflected a positive gap of 3.0% of total assets.  The
foregoing  totals have been based on certain  prepayment and repricing data that
may not reflect actual  performance  in a rapidly  rising or declining  interest
rate environment.

Forward-Looking Statements

In addition to historical information contained herein, the following discussion
contains  forward-looking  statements  that  involve  risks  and  uncertainties.
Economic  circumstances,  the  Corporation's  operations  and the  Corporation's
actual  results  could  differ   significantly   from  those  discussed  in  the
forward-looking  statements.  Some of the factors that could cause or contribute
to such differences are discussed herein but also include changes in the economy
and interest rates in the nation and the Corporation's market area generally.

Some of the  forward-looking  statements  included  herein  are  the  statements
regarding management's determination of the amount and adequacy of the allowance
for loan losses,  the effect of the year 2000 on information  technology systems
and the effect of recent accounting pronouncements.





                                       9
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Discussion  of  Changes  in  Financial  Condition  from  September  30,  1998 to
September 30, 1999

The  Corporation's  assets  totaled  $98.9  million at September  30,  1999,  an
increase of $2.0 million,  or 2.1%, over September 30, 1998 levels. The increase
in total assets was funded  primarily  by a $6.0  million  increase in deposits,
partially offset by a $3.3 million decrease in Federal Home Loan Bank advances.

Cash,  federal  funds  sold and  interest-bearing  deposits  in other  financial
institutions  totaled $2.8 million at September 30, 1999, a decrease of $38,000,
or 1.3%,  from 1998 levels.  Federal  funds sold  decreased  by $100,000,  while
interest-bearing  deposits and cash increased by $62,000,  or 2.3%, during 1999.
Investment securities totaled $6.0 million at September 30, 1999, an increase of
$1.9 million,  or 47.6%,  over the balance at September 30, 1998.  This increase
resulted  primarily from the purchase of $6.0 million of investment  securities,
offset by the maturity of $4.0 million of investment  securities during the 1999
period.

Mortgage-backed  securities  decreased by $4.2 million,  or 11.0%, to a total of
$33.7  million at  September  30,  1999,  compared to  September  30,  1998,  as
principal  repayments  of $15.0  million  exceeded  purchases of $12.0  million.
During   fiscal  1999,   management   purchased   $8.0  million  of   long-term,
adjustable-rate U.S. Government agency collateralized  mortgage obligations with
a weighted-average yield of 6.38%. Such purchases were funded with proceeds from
Federal Home Loan Bank  advances.  Additionally,  the Savings Bank acquired $4.0
million of  intermediate-term  U. S. Government agency  collateralized  mortgage
obligations at a fixed rate of 5.50%.

Loans receivable increased by $4.0 million, or 8.2%, to a total of $52.8 million
at September 30, 1999, compared to September 30, 1998 levels. Loan disbursements
totaled  $15.8 million  during fiscal 1999, as compared to $13.9 million  during
fiscal 1998, and were partially  offset by principal  repayments  totaling $11.9
million.  Growth  in the  loan  portfolio  was  primarily  focused  on  one-  to
four-family residential and construction loans, which increased by $3.2 million,
or 6.9%, year to year.

At  September  30,  1999,  Harvest  Home's  allowance  for loan  losses  totaled
$139,000, representing .25% of total loans and 556.0% of nonperforming loans. At
September 30, 1998, the allowance for loan losses totaled  $127,000,  or .25% of
total loans, and 259.2% of nonperforming loans.  Nonperforming loans amounted to
$25,000,  or .1%, and $49,000, or .1%, of total assets at September 30, 1999 and
1998,  respectively.  Although  management  believes that its allowance for loan
losses at September  30, 1999,  was adequate  based on the  available  facts and
circumstances,  there can be no assurance  that additions to such allowance will
not be necessary in future periods,  which could adversely affect Harvest Home's
results of operations.

Deposits  totaled  $66.2  million at  September  30,  1999,  an increase of $6.0
million,  or 10.0%, over the $60.2 million total at September 30, 1998.  Harvest
Home has  historically  sought to  maintain  a moderate  rate of deposit  growth
through marketing and pricing strategies. The increase in deposits during fiscal
1999 can be attributed  primarily to  consolidation  in the  financial  services
industry in Harvest  Home's  market  area,  and the  consumers'  preference  for
conducting financial business with a smaller, locally-owned institution.



                                       10
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Discussion  of  Changes  in  Financial  Condition  from  September  30,  1998 to
September 30, 1999 (continued)

Federal Home Loan Bank  advances  totaled $22.6 million at September 30, 1999, a
decrease of $3.3 million,  or 12.6%,  from  September 30, 1998, as repayments of
mortgage-backed  securities were used to repay advances.  At September 30, 1999,
the advances carried a 5.23% weighted-average interest rate and are scheduled to
mature through fiscal 2008.

Stockholders'  equity  totaled $9.7 million at September 30, 1999, a decrease of
$324,000,  or 3.2%,  from  September  30, 1998  levels.  The  decrease  resulted
primarily from cash dividends paid totaling  $376,000,  coupled with an increase
of $781,000 in unrealized losses on securities designated as available for sale,
which were partially  offset by net earnings of $514,000,  amortization of stock
benefit  plan expense of $197,000,  and the exercise of stock  options  totaling
$122,000.


Comparison  of Results of  Operations  for the Fiscal Years Ended  September 30,
1999 and 1998

General

Net earnings for the year ended September 30, 1999, totaled $514,000, a decrease
of $27,000,  or 5.0%, from the $541,000 in net earnings  reported for the fiscal
year ended September 30, 1998. The decrease in net earnings  resulted  primarily
from a $56,000 increase in general,  administrative  and other expense,  coupled
with a $17,000  decrease  in other  income,  which  were  partially  offset by a
$47,000 increase in net interest income.

Net Interest Income

Total  interest  income  amounted  to $6.5  million  for the  fiscal  year ended
September 30, 1999, an increase of $115,000, or 1.8%, over fiscal 1998. Interest
income on loans totaled $3.7 million in fiscal 1999, an increase of $177,000, or
5.0%.  This increase was due primarily to a $3.7 million,  or 7.9%,  increase in
the  weighted-average  balance  outstanding,  which was partially offset by a 21
basis  point  decrease in  weighted-average  yield,  to 7.49% in 1999.  Interest
income on mortgage-backed  securities increased by $41,000, or 2.0%, as a result
of a $2.9 million increase in the weighted-average  balance  outstanding,  which
was partially offset by a 38 basis point decrease in weighted-average  yield, to
5.86%  in  fiscal  1999.   Interest   income  on   investment   securities   and
interest-bearing deposits decreased by $103,000, or 14.5%, due to a $515,000, or
4.7%, decrease in the weighted-average  balance  outstanding,  coupled with a 64
basis point decrease in weighted-average yield, to 5.85% in fiscal 1999.

Interest  expense  totaled $4.2 million for the fiscal year ended  September 30,
1999, an increase of $68,000,  or 1.6%,  over the $4.1 million total recorded in
fiscal 1998.  Interest expense on deposits increased by $79,000, or 2.7%, due to
a $5.1 million, or 8.5%, increase in the  weighted-average  balance outstanding,
which was partially offset by a 27 basis point decrease in the  weighted-average
cost of  funds, to 4.61% during  fiscal  1999. Interest  expense  on  borrowings




                                       11
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Comparison  of Results of  Operations  for the Fiscal Years Ended  September 30,
1999 and 1998 (continued)

Net Interest Income (continued)

totaled $1.2 million  during  fiscal 1999, a decrease of $11,000,  or .9%,  from
fiscal  1998,  due to a  decrease  of 54 basis  points  in the  weighted-average
interest rate, to 5.08% during fiscal 1999,  partially  offset by a $2.1 million
increase  in the  weighted-average  balance  of  advances  outstanding  from the
Federal Home Loan Bank.

As a result of the foregoing  changes in interest  income and interest  expense,
net interest  income  increased by $47,000,  or 2.1%,  from $2.2 million for the
fiscal year ended  September  30, 1998,  to $2.3  million for fiscal  1999.  The
interest  rate spread  increased by 1 basis point  during  fiscal 1999 to 1.96%,
while  the  net  interest  margin  declined  by 10  basis  points  year-to-year,
amounting to 2.35% in fiscal 1999.

Provision for Losses on Loans

A  provision  for  losses on loans is  charged  to  earnings  to bring the total
allowance for loan losses to a level considered  appropriate by management based
on  historical  experience,  the  volume and type of  lending  conducted  by the
Savings Bank,  the status of past due principal and interest  payments,  general
economic  conditions,  particularly  as such  conditions  relate to the  Savings
Bank's  market area,  and other  factors  related to the  collectibility  of the
Savings Bank's loan portfolio. As a result of such analysis, management recorded
a $12,000  provision  for losses on loans  during each of the fiscal years ended
September 30, 1999 and 1998.  The  provisions  for each of the fiscal years 1999
and 1998 have been predicated  primarily upon growth in the loan portfolio and a
stable  level  of  nonperforming  loans.  There  can be no  assurance  that  the
allowance  for loan losses of the Savings  Bank will be adequate to cover losses
on nonperforming assets in the future.

Other Income

Other income decreased by $17,000,  or 15.6%,  from $109,000 for the fiscal year
ended  September 30, 1998 to $92,000 for fiscal 1999. The decrease was primarily
due to the absence of the  $43,000  gain on sale of  mortgage-backed  securities
recorded in fiscal 1998,  partially  offset by a $20,000 increase in NOW account
fees.

General, Administrative and Other Expense

General,  administrative  and other expense increased by $56,000,  or 3.7%, to a
total of $1.6 million for the year ended September 30, 1999, as compared to $1.5
million for fiscal 1998.  The increase  resulted  primarily  from an increase of
$33,000, or 3.9%, in employee compensation and benefits and a $21,000, or 11.4%,
increase  in  occupancy  and  equipment   expense.   The  increase  in  employee
compensation  and benefits  resulted from normal merit increases and an increase
in staffing levels, while the increases in occupancy and equipment resulted from
the addition of new computer technology.




                                       12
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Comparison  of Results of  Operations  for the Fiscal Years Ended  September 30,
1999 and 1998 (continued)

Federal Income Taxes

The  provision  for federal  income taxes  totaled  $265,000 for the fiscal year
ended  September  30,  1999,  an increase of $1,000 from the  $264,000  total in
fiscal 1998. The effective tax rates for the years ended  September 30, 1999 and
1998 were 34.0% and 32.8%, respectively.


Comparison  of Results of  Operations  for the Fiscal Years Ended  September 30,
1998 and 1997

General

Net earnings for the year ended September 30, 1998, totaled $541,000, a decrease
of $86,000,  or 13.7%, from the $627,000 in net earnings reported for the fiscal
year ended September 30, 1997. The decrease in net earnings  resulted  primarily
from a $70,000 decline in net interest income,  coupled with a $107,000 increase
in general,  administrative and other expense,  which were partially offset by a
$45,000  increase in other income and a $49,000  decrease in the  provision  for
federal income taxes.

Net Interest Income

Total  interest  income  amounted  to $6.4  million  for the  fiscal  year ended
September 30, 1998, an increase of $384,000, or 6.4%, over fiscal 1997. Interest
income on loans totaled $3.6 million in fiscal 1998, an increase of $114,000, or
3.3%.  This increase was due primarily to a $2.5 million,  or 5.6%,  increase in
the weighted-average  balance outstanding,  which was offset by a 17 basis point
decrease  in  weighted-average  yield,  to  7.70% in 1998.  Interest  income  on
mortgage-backed  securities  increased by $431,000,  or 26.1%,  as a result of a
$7.5 million, or 28.7%,  increase in the  weighted-average  balance outstanding,
which was  partially  offset by a 14 basis point  decrease  in  weighted-average
yield,  to 6.24% in fiscal 1998.  Interest  income on investment  securities and
interest-bearing  deposits  decreased by $161,000,  or 18.5%, due primarily to a
$2.5 million decrease in the weighted-average balance outstanding.

Interest  expense  totaled $4.1 million for the fiscal year ended  September 30,
1998, an increase of $454,000, or 12.3%, over the $3.7 million total recorded in
fiscal 1997.  Interest expense on deposits  increased by $136,000,  or 4.9%, due
primarily to a 6 basis point increase in the weighted-average  cost of funds, to
4.87% during fiscal 1998.  Interest  expense on borrowings  totaled $1.2 million
during fiscal 1998, an increase of $318,000,  or 35.2%, over fiscal 1997, due to
the   previously   discussed   $6.1   million,   or  39.2%,   increase   in  the
weighted-average  balance of advances  outstanding  from the  Federal  Home Loan
Bank.

As a result of the foregoing  changes in interest  income and interest  expense,
net interest  income  decreased by $70,000,  or 3.1%,  from $2.3 million for the
fiscal year ended  September  30, 1997,  to $2.2  million for fiscal  1998.  The
interest  rate spread  declined by 22 basis points  during fiscal 1998 to 1.95%,
while  the  net  interest  margin  declined  by 31  basis  points  year-to-year,
amounting to 2.45% in fiscal 1998.




                                       13
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Comparison  of Results of  Operations  for the Fiscal Years Ended  September 30,
1998 and 1997 (continued)

Provision for Losses on Loans

Based upon managements  analysis of historical loss  experience,  the volume and
type of lending  conducted by the Savings Bank, the status of past due principal
and  interest  payments,  general  economic  conditions,  particularly  as  such
conditions  relate to the Savings Bank's market area, and other factors  related
to the collectibility of the Savings Bank's loan portfolio,  management recorded
a $12,000  provision for losses on loans during the fiscal year ended  September
30, 1998, as compared to $9,000 for fiscal 1997.

Other Income

Other income  increased by $45,000,  or 70.0%,  from $64,000 for the fiscal year
ended  September  30, 1997 to $109,000  for fiscal  1998.  The  increase was due
primarily   to  a  $36,000   increase  in  gain  on  sale  of   investment   and
mortgage-backed securities during the year.

General, Administrative and Other Expense

General,  administrative and other expense increased by $107,000,  or 7.6%, to a
total of $1.5 million for the year ended September 30, 1998, as compared to $1.4
million for fiscal 1997.  The increase  resulted  primarily  from an increase of
$48,000,  or 6.0%, in employee  compensation and benefits,  a $14,000,  or 8.2%,
increase in occupancy and equipment expense and a $23,000, or 11.5%, increase in
other operating  expenses.  The increase in employee  compensation  and benefits
resulted from normal merit increases and additional  staffing levels,  while the
increases in occupancy and equipment  resulted from the addition of new computer
technology and other related corporate expenses, respectively.

Federal Income Taxes

The  provision  for federal  income taxes  totaled  $264,000 for the fiscal year
ended  September  30, 1998, a decrease of $49,000,  or 15.7%,  from the $313,000
total in fiscal 1997. The decrease resulted primarily from a $135,000, or 14.4%,
decrease  in  pre-tax  earnings.  The  effective  tax rates for the years  ended
September 30, 1998 and 1997 were 32.8% and 33.3%, respectively.











                                       14

<PAGE>


                       Harvest Home Financial Corporation
                             AVERAGE YIELD ANALYSIS


The  following  table  presents for the periods  indicated,  the total amount of
interest income from average  interest-earning  assets and the resulting yields,
and the interest expense on average interest-bearing liabilities, expressed both
in dollars and rates, and the net interest margin. Balances are based on average
monthly balances which, in the opinion of management,  do not differ  materially
from daily balances.

<TABLE>
<CAPTION>
                                                                             Year ended September 30,
                                                          1999                           1998                         1997
                                               Average Interest              Average Interest             Average Interest
                                           outstanding  earned/   Yield/ outstanding  earned/  Yield/ outstanding  earned/   Yield/
                                               balance     paid     rate     balance     paid    rate     balance     paid     rate
                                                                            (Dollars in thousands)
<S>                                              <C>       <C>      <C>        <C>       <C>     <C>       <C>        <C>      <C>
Interest-earning assets:
  Loans receivable                             $50,060   $3,748     7.49%    $46,391  $3,571    7.70%    $43,929   $3,457     7.87%
  Mortgage-backed securities                    36,286    2,126     5.86      33,391   2,085    6.24      25,938    1,654     6.38
  Investment securities                          5,046      301     5.97       5,900     402    6.81       9,846      675     6.86
  Interest-bearing deposits and other            5,347      307     5.74       5,008     309    6.17       3,538      197     5.57
                                                ------    -----    -----     -------   -----  ------     -------   ------   ------
     Total interest-earning assets              96,739    6,482     6.70      90,690   6,367    7.02      83,251    5,983     7.19

Non-interest-earning assets                      3,161                         2,031                       2,153
                                                ------                       -------                      ------

     Total assets                              $99,900                       $92,721                     $85,404
                                                ======                        ======                      ======

Interest-bearing liabilities:
  Deposits
    NOW accounts                               $ 3,997       75     1.88    $  3,533      77    2.18    $  3,477      110     3.16
    Passbook                                     9,926      250     2.52       9,264     250    2.70       9,057      252     2.78
    Money market demand deposits                 4,398      132     3.00       4,354     130    2.99       4,436      144     3.25
    Certificates                                46,745    2,544     5.44      42,814   2,465    5.76      40,909    2,280     5.57
  Borrowings                                    23,827    1,210     5.08      21,738   1,221    5.62      15,615      903     5.78
                                                ------    -----    -----      ------   -----  ------      ------    -----   ------
     Total interest-bearing liabilities         88,893    4,211     4.74      81,703   4,143    5.07      73,494    3,689     5.02
                                                          -----    -----               -----  ------                -----   ------
Non-interest-bearing liabilities                 1,003                           770                       1,608
                                                ------                        ------                      ------

     Total liabilities                          89,896                        82,473                      75,102

Stockholders' equity                            10,004                        10,248                      10,302
                                                ------                        ------                      ------

     Total liabilities and stockholders'
       equity                                  $99,900                       $92,721                     $85,404
                                                ======                        ======                      ======

Net interest income; interest rate
  spread (1)                                             $2,271     1.96%             $2,224    1.95%               $2,294    2.17%
                                                          =====   ======               =====  ======                 =====  ======

Net yield (net interest income as a percent
  of average interest-earning assets)                               2.35%                       2.45%                         2.76%
                                                                  ======                      ======                        ======

Ratio of average interest-earning assets
  to average interest-bearing liabilities                         108.83%                     111.00%                       113.28%
                                                                  ======                      ======                        ======

</TABLE>


(1)  Represents  the  difference  between the average yield on  interest-earning
     assets and the average cost of interest-bearing liabilities.


                                       15
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Rate/Volume Table

The following  table describes the extent to which changes in interest rates and
changes in volume of interest-earning  assets and  interest-bearing  liabilities
have affected the  Corporation's  interest  income and expense during the fiscal
years   indicated.   For  each   category   of   interest-earning   assets   and
interest-bearing liabilities, information is provided on changes attributable to
(i) changes in volume  (change in volume  multiplied  by prior year rate),  (ii)
changes in rate  (change in rate  multiplied  by prior year  volume),  and (iii)
total changes in rate and volume. The combined effects of changes in both volume
and  rate,   which  cannot  be  separately   identified,   have  been  allocated
proportionately to the change due to volume and the change due to rate:
<TABLE>
<CAPTION>

                                                                     Year ended September 30,
                                                                   1999 vs. 1998 1998 vs. 1997
                                                          Increase                             Increase
                                                         (decrease)                           (decrease)
                                                           due to                               due to
                                                     Volume       Rate      Total          Volume       Rate      Total
                                                                                (In thousands)
<S>                                                   <C>         <C>        <C>             <C>         <C>        <C>
Interest income attributable to:
  Loans receivable                                     $276     $  (99)      $177            $190       $(76)      $114
  Mortgage-backed securities                            175       (134)        41             469        (38)       431
  Investment securities                                 (54)       (47)      (101)           (269)        (4)      (273)
  Other interest-earning assets(1)                       21        (23)        (2)             87         25        112
                                                        ---       ----        ---             ---        ---        ---
     Total interest income                              418       (303)       115             477        (93)       384

Interest expense attributable to:
  Deposits(2)                                           240       (161)        79             100         36        136
  Borrowings                                            112       (123)       (11)            345        (27)       318
                                                        ---       ----        ---             ---        ---        ---
     Total interest expense                             352       (284)        68             445          9        454
                                                        ---       ----        ---             ---        ---        ---


Increase (decrease) in net interest income                                   $ 47                                  $(70)
                                                                              ===                                   ===
</TABLE>

(1)  Includes  interest-bearing  deposits in other  financial  institutions  and
     other  interest-earning   assets.

(2)  Includes interest-bearing escrow deposits.









                                       16
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Liquidity and Capital Resources

Harvest Home's principal sources of funds are deposits,  repayments on loans and
mortgage-backed  securities,  maturities  of  investment  securities,  and funds
provided by  operations.  While  scheduled loan and  mortgage-backed  securities
amortization and maturing  interest-bearing  deposits and investment  securities
are  relatively  predictable  sources  of  funds,  deposit  flows  and  loan and
mortgage-backed  securities  prepayments  are  greatly  influenced  by  economic
conditions, the general level of interest rates, and competition. The particular
sources of funds  utilized by Harvest Home from time to time are selected  based
on comparative costs and availability.

The FDIC requires  savings banks to maintain a level of investments in specified
types of liquid assets sufficient to protect and ensure the safety and soundness
of the Savings Bank. The FDIC has no specific minimum guideline for liquidity.

The primary  investing  activities  of Harvest Home include  investing in loans,
mortgage-backed  securities  and investment  securities.  Such  investments  are
funded primarily from loans and mortgage-backed securities repayments, increases
in customer deposit  liabilities and borrowings from the Federal Home Loan Bank.
During the fiscal year ended September 30, 1999, loan originations totaled $15.8
million and purchases of mortgage-backed and investment securities totaled $18.0
million, representing the deployment of funds from deposit growth, proceeds from
Federal  Home Loan Bank  advances  and  proceeds  from  maturity  of  investment
securities.  Customer deposits  increased during the fiscal year ended September
30, 1999, by $6.0 million and increased  during the fiscal year ended  September
30, 1998 by $1.4 million.

The FDIC has adopted  risk-based  capital ratio guidelines to which Harvest Home
is subject.  The  guidelines  establish a systematic  analytical  framework that
makes  regulatory  capital  requirements  more  sensitive to differences in risk
profiles among banking  organizations.  Risk-based capital ratios are determined
by allocating  assets and specified  off-balance  sheet commitments to four risk
weighted  categories,  with  higher  levels of capital  being  required  for the
categories perceived as representing greater risk.

These  guidelines  divide the capital into two tiers.  The first tier ("Tier I")
includes  common  equity,  certain  non-cumulative   perpetual  preferred  stock
(excluding  auction rate issues) and  minority  interests in equity  accounts of
consolidated  subsidiaries,  less goodwill and certain other  intangible  assets
(except  mortgage  servicing  rights and  purchased  credit card  relationships,
subject to certain  limitations).  Supplementary  ("Tier II") capital  includes,
among other items,  cumulative  perpetual and long-term  limited-life  preferred
stock,  mandatory  convertible  securities,  certain hybrid capital instruments,
term subordinated debts and the allowance for loan and lease losses,  subject to
certain  limitations,  less required  deductions.  Savings Banks are required to
maintain a total risk-based capital (the sum of Tier 1 and Tier 2 capital) ratio
of 8%, of which 4% must be Tier I  capital.  The FDIC may,  however,  set higher
capital  requirements  when a bank's  particular  circumstances  warrant.  Banks
experiencing or anticipating  significant growth are expected to maintain a Tier
I leverage ratio,  including tangible capital positions,  well above the minimum
levels.



                                       17

<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Liquidity and Capital Resources (continued)

In  addition,  the FDIC  established  guidelines  prescribing  a minimum  Tier I
leverage  ratio (Tier I capital to adjusted  total  assets as  specified  in the
guidelines).  These guidelines provide for a minimum Tier I leverage ratio of 3%
for banks that meet certain  specified  criteria,  including  that they have the
highest  regulatory rating and are not experiencing or anticipating  significant
growth.  All other banks are required to maintain a Tier I leverage  ratio of 3%
plus an additional cushion of at least 100 to 200 basis points.

The  following  table sets  forth the  regulatory  capital  of  Harvest  Home at
September 30, 1999:

    Total Capital to Risk-Weighted Assets                          23.5%
    Tier I Capital to Risk-Weighted Assets                         23.2%
    Tier I Leverage Ratio                                           9.8%

Potential Impact of Current Legislation on Future Results of Operations

On November 12,  1999,  the  Gramm-Leach-Bliley  Act (the "GLB Act") was enacted
into law. The GLB Act makes sweeping changes in the financial  services in which
various types of financial  institutions  may engage.  The  Glass-Steagall  Act,
which had  generally  prevented  banks  from  affiliating  with  securities  and
insurance firms,  was repealed.  A new "financial  holding  company," which owns
only  well  capitalized  and  well  managed  depository  institutions,  will  be
permitted to engage in a variety of financial  activities,  including  insurance
and securities underwriting and agency activities.

The GLB Act is not expected to have a material effect on the activities in which
HHFC and Harvest Home currently  engage,  except to the extent that  competition
with other  types of  financial  institutions  may  increase  as they  engage in
activities not permitted prior to enactment of the GLB Act.



















                                       18
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Effect of Recent Accounting Pronouncements

In June 1997,  the  Financial  Accounting  Standards  Board (the "FASB")  issued
Statement  of  Financial  Accounting  Standards  ("SFAS")  No.  130,  "Reporting
Comprehensive  Income."  SFAS No. 130  established  standards  for reporting and
display of comprehensive income and its components  (revenues,  expenses,  gains
and losses) in a full set of general-purpose financial statements.  SFAS No. 130
requires  that all items that are  required to be  recognized  under  accounting
standards  as  components  of  comprehensive  income be  reported in a financial
statement  that is  displayed  with  the  same  prominence  as  other  financial
statements.  It does not require a specific format for that financial  statement
but  requires  that  an  enterprise   display  an  amount   representing   total
comprehensive income for the period in that financial statement.

SFAS  No.  130  requires  that  an  enterprise   (a)  classify  items  of  other
comprehensive  income by their nature in a financial  statement  and (b) display
the accumulated balance of other  comprehensive  income separately from retained
earnings and additional  paid-in  capital.  SFAS No. 130 is effective for fiscal
years  beginning  after  December  15,  1997.   Reclassification   of  financial
statements for earlier periods  provided for  comparative  purposes is required.
Management adopted SFAS No. 130 effective October 1, 1998, as required,  without
material impact on the Corporation's financial statements.

In June 1997,  the FASB issued SFAS No. 131,  "Disclosures  about Segments of an
Enterprise and Related  Information." SFAS No. 131 significantly changes the way
that public business  enterprises report information about operating segments in
annual financial  statements and requires that those enterprises report selected
information  about reportable  segments in interim  financial  reports issued to
shareholders.  It also  established  standards  for  related  disclosures  about
products and services, geographic areas and major customers. SFAS No. 131 uses a
"management  approach" to disclose  financial and descriptive  information about
the way that management  organizes the segments within the enterprise for making
operating  decisions  and  assessing  performance.  For  many  enterprises,  the
management  approach  will likely  result in more segments  being  reported.  In
addition,  SFAS No. 131 requires  significantly more information to be disclosed
for each reportable segment than is presently being reported in annual financial
statements  and also requires that selected  information  be reported in interim
financial statements. SFAS No. 131 is effective for fiscal years beginning after
December 15, 1997. Management adopted SFAS No. 131 effective October 1, 1998, as
required, without material effect on the Corporation's financial statements.

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments and Hedging  Activities,"  which requires  entities to recognize all
derivatives  in their  financial  statements  as either  assets  or  liabilities
measured at fair value.  SFAS No. 133 also  specifies  new methods of accounting
for hedging  transactions,  prescribes  the items and  transactions  that may be
hedged,  and  specifies  detailed  criteria  to be  met  to  qualify  for  hedge
accounting.




                                       19
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Effect of Recent Accounting Pronouncements (continued)

The definition of a derivative  financial instrument is complex, but in general,
it is an instrument  with one or more  underlyings,  such as an interest rate or
foreign exchange rate, that is applied to a notional  amount,  such as an amount
of currency,  to determine the settlement  amount(s).  It generally  requires no
significant initial investment and can be settled net or by delivery of an asset
that is  readily  convertible  to cash.  SFAS No.  133  applies  to  derivatives
embedded in other contracts, unless the underlying of the embedded derivative is
clearly and closely related to the host contract.

SFAS No.  133,  as amended  by SFAS No.  137,  is  effective  for  fiscal  years
beginning  after June 15, 2000. On adoption,  entities are permitted to transfer
held-to-maturity  debt securities to the  available-for-sale or trading category
without  calling into  question  their intent to hold other debt  securities  to
maturity in the future.  SFAS No. 133 is not expected to have a material  impact
on the Corporation's financial statements.


Year 2000 Compliance Matters

As with all providers of financial  services,  the Corporation's  operations are
heavily  dependent  on  information  technology  systems.  The  Corporation  has
addressed  the  potential  problems  associated  with the  possibility  that the
computers  that  control or operate  the  Corporation's  information  technology
system and  infrastructure  may not be programmed to read  four-digit date codes
and, upon arrival of the year 2000, may recognize the two-digit code "00" as the
year 1900, causing systems to fail to function or to generate erroneous data.

Harvest Home's primary data processing applications are handled by a third-party
service  bureau,  NCR.  NCR has advised  Harvest  Home that it has migrated to a
fully Year 2000  compliant  processing  system that has been fully  tested as of
January 1, 1999. Management has also reviewed Harvest Home's ancillary equipment
and has provided the appropriate remedial measures, including requesting service
providers to assure the Savings  Bank that their  systems and products are fully
year 2000  compliant.  Harvest Home has upgraded its existing  teller  operating
system with capital expense of approximately $170,000.

No  assurance  can be  given,  however,  that  significant  expense  will not be
incurred in future  periods.  In the  unlikely  event that the  Savings  Bank is
ultimately  required to purchase  replacement  computer  systems,  programs  and
equipment,  or incur  substantial  expense to make the  Savings  Bank's  current
systems,  programs and equipment  year 2000  compliant,  the Savings  Bank's net
earnings and financial condition could be adversely affected.




                                       20
<PAGE>


                       Harvest Home Financial Corporation

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS (CONTINUED)


Year 2000 Compliance Matters (continued)

Management  has  developed  a  contingency  plan  which  includes  access  to an
alternative processing site provided by NCR. Additionally,  the Savings Bank can
process transactions manually for a period of several weeks, if necessary,  upon
arrival of the year 2000.

In addition to possible  expense related to its own systems,  Harvest Home could
incur losses if loan  payments are delayed due to year 2000  problems  affecting
any major  borrowers in Harvest  Home's  primary  market area.  Because  Harvest
Home's loan portfolio is highly diversified with regard to individual  borrowers
and  types  of  businesses  and  Harvest  Home's  primary  market  area  is  not
significantly  dependent  upon one employer or  industry,  Harvest Home does not
expect any significant or prolonged  difficulties  that will affect net earnings
or cash flow.
































                                       21
<PAGE>


               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
Harvest Home Financial Corporation

We have audited the accompanying  consolidated statements of financial condition
of Harvest Home Financial Corporation as of September 30, 1999 and 1998, and the
related consolidated statements of earnings, comprehensive income, stockholders'
equity,  and cash flows for each of the three years ended  September  30,  1999,
1998 and 1997. These consolidated financial statements are the responsibility of
the  Corporation's  management.  Our  responsibility is to express an opinion on
these consolidated financial statements based on our audits.

We  conducted  our  audits  in  accordance  with  generally   accepted  auditing
standards.  Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,  the  consolidated  financial  position of Harvest Home
Financial  Corporation as of September 30, 1999 and 1998,  and the  consolidated
results  of its  operations  and its  cash  flows  for each of the  years  ended
September  30,  1999,  1998 and 1997,  in  conformity  with  generally  accepted
accounting principles.



/s/GRANT THORNTON LLP

Cincinnati, Ohio
November 19, 1999







                                       22
<PAGE>
                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

                                  September 30,
                        (In thousands, except share data)

         ASSETS                                                                                1999                1998
<S>                                                                                            <C>                  <C>
Cash and due from banks                                                                     $ 1,347             $ 1,505
Federal funds sold                                                                              100                 200
Interest-bearing deposits in other financial institutions                                     1,402               1,182
                                                                                             ------              ------
         Cash and cash equivalents                                                            2,849               2,887

Investment securities designated as available for sale - at market                            5,951               4,032
Mortgage-backed securities designated as available for sale - at market                      33,711              37,864
Loans receivable - net                                                                       52,790              48,797
Office premises and equipment - at depreciated cost                                           1,236               1,117
Federal Home Loan Bank stock - at cost                                                        1,723               1,606
Accrued interest receivable on loans                                                            287                 257
Accrued interest receivable on mortgage-backed securities                                       160                 173
Accrued interest receivable on investments and interest-
  bearing deposits                                                                               55                  47
Prepaid expenses and other assets                                                               117                 114
Deferred federal income tax asset                                                                56                  -
                                                                                             ------              ------

         Total assets                                                                       $98,935             $96,894
                                                                                             ======              ======

         LIABILITIES AND STOCKHOLDERS' EQUITY

Deposits                                                                                    $66,220              $60,225
Advances from the Federal Home Loan Bank                                                     22,600               25,850
Advances by borrowers for taxes and insurance                                                   105                  119
Accrued interest payable                                                                        115                  126
Other liabilities                                                                               232                  230
Accrued federal income taxes                                                                     10                   65
Deferred federal income taxes                                                                    -                   302
                                                                                             ------               ------
         Total liabilities                                                                   89,282               86,917

Commitments                                                                                      -                    -

Stockholders' equity
  Common stock - 2,000,000 shares of no par value authorized;
    991,875 shares issued                                                                        -                    -
  Additional paid-in capital                                                                  6,887                6,903
  Retained earnings - restricted                                                              5,329                5,191
  Shares acquired by Employee Stock Ownership Plan                                             (224)                (301)
  Shares acquired by Recognition and Retention Plan                                            (194)                (291)
  Accumulated other comprehensive income, unrealized gains (losses)
    on securities designated as available for sale, net of related tax effects                 (694)                  87
  Less 116,586 and 129,518 shares of treasury stock - at cost                                (1,451)              (1,612)
                                                                                             ------               ------
         Total stockholders' equity                                                           9,653                9,977
                                                                                             ------               ------

         Total liabilities and stockholders' equity                                         $98,935              $96,894
                                                                                             ======               ======
</TABLE>



The accompanying notes are an integral part of these statements.

                                       23
<PAGE>


                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                       CONSOLIDATED STATEMENTS OF EARNINGS

                            Year ended September 30,
                        (In thousands, except share data)


                                                                                  1999              1998            1997
<S>                                                                               <C>              <C>               <C>
Interest income
  Loans                                                                         $3,748            $3,571          $3,457
  Mortgage-backed securities                                                     2,126             2,085           1,654
  Investment securities                                                            417               504             734
  Interest-bearing deposits and other                                              191               207             138
                                                                                 -----             -----           -----
         Total interest income                                                   6,482             6,367           5,983

Interest expense
  Deposits                                                                       3,001             2,922           2,786
  Borrowings                                                                     1,210             1,221             903
                                                                                 -----             -----           -----
         Total interest expense                                                  4,211             4,143           3,689
                                                                                 -----             -----           -----

         Net interest income                                                     2,271             2,224           2,294

Provision for losses on loans                                                       12                12               9
                                                                                 -----             -----           -----
         Net interest income after provision
           for losses on loans                                                   2,259             2,212           2,285

Other income
  Gain on sale of investment and mortgage-backed securities                         -                 43               7
  Other operating                                                                   92                66              57
                                                                                 -----             -----           -----
         Total other income                                                         92               109              64

General, administrative and other expense
  Employee compensation and benefits                                               884               851             803
  Occupancy and equipment                                                          205               184             170
  Federal deposit insurance premiums                                                37                36              28
  Franchise taxes                                                                  115               124             121
  Data processing                                                                  107                98              87
  Other operating                                                                  224               223             200
                                                                                 -----             -----           -----
         Total general, administrative and
           other expense                                                         1,572             1,516           1,409
                                                                                 -----             -----           -----

         Earnings before income taxes                                              779               805             940

Federal income taxes
  Current                                                                          219               241             130
  Deferred                                                                          46                23             183
                                                                                 -----             -----           -----
         Total federal income taxes                                                265               264             313
                                                                                 -----             -----           -----

         NET EARNINGS                                                           $  514            $  541          $  627
                                                                                 =====             =====           =====

         EARNINGS PER SHARE
           Basic                                                                  $.60              $.63            $.71
                                                                                   ===               ===             ===

           Diluted                                                                $.59              $.60            $.70
                                                                                   ===               ===             ===

</TABLE>

The accompanying notes are an integral part of these statements.

                                       24

<PAGE>


                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

                            Year ended September 30,
                                 (In thousands)


                                                                                    1999            1998           1997
<S>                                                                                 <C>             <C>             <C>
Net earnings for the year                                                          $ 514            $541           $627

Other comprehensive income (loss), net of tax effects:
  Unrealized holding gains (losses) on securities during
    the period, net of tax effects of $(403), $39 and $28
    in 1999, 1998 and 1997, respectively                                            (781)             75             54

Reclassification adjustment for unrealized gains included
  in earnings, net of tax effects of $15 and $2 in 1998
  and 1997, respectively                                                              -              (28)            (5)
                                                                                     ---            ----          -----

Comprehensive income (loss)                                                        $(267)           $588           $676
                                                                                    ====             ===            ===

Accumulated comprehensive income (loss)                                            $(694)           $ 87           $ 40
                                                                                    ====             ===            ===

</TABLE>


























The accompanying notes are an integral part of these statements.

                                       25
<PAGE>


                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

              For the years ended September 30, 1999, 1998 and 1997
                       (In thousands, except share data)

                                                                                                  Unrealized
                                                                                         Shares   gain (loss)
                                                                                       acquired  n securities
                                                              Additional               by stock  esignated as
                                                       Common    paid-in    Retained    benefit     available   Treasury
                                                        stock    capital    earnings      plans      for sale      stock     Total
<S>                                                      <C>        <C>         <C>        <C>           <C>        <C>      <C>
Balance at October 1, 1996                                $-      $6,740      $4,787    $(1,160)       $   (9)  $   (633)  $ 9,725

Net earnings for the year ended September 30, 1997         -          -          627         -             -          -        627
Cash dividends of $.40 per share                           -          -         (371)        -             -          -       (371)
Purchase of treasury shares - at cost                      -          -           -          -             -        (223)     (223)
Amortization of expense related to stock benefit plans     -         144          -         393            -          -        537
Unrealized gains on securities designated as available
  for sale, net of related tax effects                     -          -           -          -             49         -         49
                                                           --      -----       -----     ------          ----     ------    ------

Balance at September 30, 1997                              -       6,884       5,043       (767)           40       (856)   10,344

Net earnings for the year ended September 30, 1998         -          -          541         -             -          -        541
Cash dividends of $.44 per share                           -          -         (393)        -             -          -       (393)
Purchase of treasury shares - at cost                      -          -           -          -             -        (756)     (756)
Amortization of expense related to stock benefit plans     -          19          -         175            -          -        194
Unrealized gains on securities designated as available
  for sale, net of related tax effects                     -          -           -          -             47         -         47
                                                           --      -----       -----     ------          ----     ------    ------

Balance at September 30, 1998                              -       6,903       5,191       (592)           87     (1,612)    9,977

Net earnings for the year ended September 30, 1999         -          -          514         -             -          -        514
Cash dividends of $.44 per share                           -          -         (376)        -             -          -       (376)
Exercise of stock options                                  -         (39)         -          -             -         161       122
Amortization of expense related to stock benefit plans     -          23          -         174            -          -        197
Unrealized losses on securities designated as available
  for sale, net of related tax effects                     -          -           -          -           (781)        -       (781)
                                                           --      -----       -----     ------          ----     ------    ------

Balance at September 30, 1999                             $-      $6,887      $5,329   $   (418)        $(694)   $(1,451)  $ 9,653
                                                           ==      =====       =====    =======          ====     ======    ======
</TABLE>


The accompanying notes are an integral part of these statements.

                                       26
<PAGE>


                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                            Year ended September 30,
                                 (In thousands)


                                                                                    1999            1998           1997
<S>                                                                                 <C>              <C>           <C>
Cash flows from operating activities:
  Net earnings for the year                                                      $   514         $   541         $  627
  Adjustments to reconcile net earnings to net cash
  provided by (used in) operating activities:
    Amortization of deferred loan origination fees                                   (44)            (34)           (34)
    Depreciation and amortization                                                     77              57             51
    Amortization of premiums on mortgage-backed securities                            15               5              6
    Amortization of premiums (discounts) on investment securities - net                5             (33)            17
    Gain on sale of investment and mortgage-backed securities                         -              (43)            (7)
    Amortization expense of stock benefit plans                                      197             194            537
    Provision for losses on loans                                                     12              12              9
    Federal Home Loan Bank stock dividends                                          (117)           (102)           (59)
    Increase (decrease) in cash due to changes in:
      Accrued interest receivable on loans                                           (30)            (12)           (36)
      Accrued interest receivable on mortgage-backed securities                       13             (34)           (37)
      Accrued interest receivable on investments and interest-
        bearing deposits                                                              (8)             79             85
      Prepaid expenses and other assets                                               (3)            (41)             1
      Accrued interest payable                                                       (11)             37             12
      Other liabilities                                                                2             (23)          (563)
      Federal income taxes
        Current                                                                      (55)            116             22
        Deferred                                                                      46              23            183
                                                                                  ------          ------          ------
         Net cash provided by operating activities                                   613             742            814

Cash flows provided by (used in) investing activities:
  Principal repayments on mortgage-backed securities                              14,992          19,867          2,644
  Purchase of mortgage-backed securities                                         (11,963)        (26,992)       (18,205)
  Proceeds from sale of mortgage-backed securities
    available for sale                                                                -            1,878            141
  Proceeds from maturity of mortgage-backed securities                                -               -           3,500
  Purchase of investment securities                                               (6,000)             -              -
  Proceeds from maturity of investment securities                                  4,000           4,000          2,003
  Proceeds from sale of investment securities available
    for sale                                                                          -               -           2,003
  Principal repayments on loans                                                   11,883          10,376          5,976
  Loan disbursements                                                             (15,844)        (13,922)        (8,913)
  Purchase of Federal Home Loan Bank stock                                            -             (285)          (572)
  Purchase of office equipment                                                      (196)           (193)           (80)
                                                                                  ------          ------         ------
         Net cash used in investing activities                                    (3,128)         (5,271)       (11,503)
                                                                                  ------          ------         ------

         Net cash used in operating and investing
           activities (balance carried forward)                                   (2,515)         (4,529)       (10,689)
                                                                                  ------          ------         ------
</TABLE>



                                       27
<PAGE>


                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                            Year ended September 30,
                                 (In thousands)


                                                                                    1999            1998           1997
<S>                                                                                 <C>             <C>            <C>
         Net cash used in operating and investing
           activities (balance brought forward)                                  $(2,515)        $(4,529)      $(10,689)

Cash flows provided by (used in) financing activities:
  Net increase in deposits                                                         5,995           1,439            828
  Proceeds from Federal Home Loan Bank advances                                   10,000          38,200         18,200
  Repayment of Federal Home Loan Bank advances                                   (13,250)        (36,350)        (4,200)
  Advances by borrowers for taxes and insurance                                      (14)             12             11
  Dividends on common stock                                                         (376)           (393)          (371)
  Proceeds from exercise of stock options                                            122              -              -
  Purchase of treasury stock                                                          -             (756)          (223)
                                                                                  ------          ------        -------
         Net cash provided by financing activities                                 2,477           2,152         14,245
                                                                                  ------          ------        -------

Net increase (decrease) in cash and cash equivalents                                 (38)         (2,377)         3,556

Cash and cash equivalents at beginning of year                                     2,887           5,264          1,708
                                                                                  ------          ------        -------

Cash and cash equivalents at end of year                                         $ 2,849         $ 2,887       $  5,264
                                                                                  ======          ======        =======

Supplemental disclosure of cash flow information:
 Cash paid during the year for:
    Federal income taxes                                                         $   180         $   121       $     96
                                                                                  ======          ======        =======

    Interest paid on deposits and borrowings                                     $ 4,222         $ 4,106       $  3,677
                                                                                  ======          ======        =======


Supplemental disclosure of noncash investing activities:
  Unrealized gains (losses) on securities designated as
    available for sale, net of related tax effects                               $  (781)        $    47       $     49
                                                                                  ======          ======        =======



</TABLE>









The accompanying notes are an integral part of these statements.

                                       28
<PAGE>


                       Harvest Home Financial Corporation

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

    Harvest Home Financial Corporation (the "Corporation") is a savings and loan
    holding company whose activities are primarily  limited to holding the stock
    of Harvest  Home  Savings  Bank,  (the  "Savings  Bank").  The Savings  Bank
    conducts a general banking  business in southwestern  Ohio which consists of
    attracting  deposits from the general  public and primarily  applying  those
    funds  to  the   origination   of  loans  for   residential,   consumer  and
    nonresidential  purposes.  The Savings Bank's profitability is significantly
    dependent on net interest income,  which is the difference  between interest
    income generated from  interest-earning  assets (i.e. loans and investments)
    and the interest expense paid on interest-bearing liabilities (i.e. customer
    deposits  and  borrowed  funds).  Net  interest  income is  affected  by the
    relative amount of interest-earning assets and interest-bearing  liabilities
    and the interest  received or paid on these balances.  The level of interest
    rates paid or received by the Savings Bank can be  significantly  influenced
    by a number of environmental  factors, such as governmental monetary policy,
    that are outside of management's control.

    The consolidated financial information presented herein has been prepared in
    accordance  with  generally  accepted  accounting  principles  ("GAAP")  and
    general  accounting  practices within the financial  services  industry.  In
    preparing   consolidated  financial  statements  in  accordance  with  GAAP,
    management  is required to make  estimates and  assumptions  that affect the
    reported  amounts of assets and liabilities and the disclosure of contingent
    assets and liabilities at the date of the financial  statements and revenues
    and expenses during the reporting  period.  Actual results could differ from
    such estimates.

    The  following  is a summary  of the  Corporation's  significant  accounting
    policies  which have been  consistently  applied in the  preparation  of the
    accompanying consolidated financial statements.

    1.  Principles of Consolidation

    The  consolidated   financial   statements   include  the  accounts  of  the
    Corporation and the Savings Bank. All significant  intercompany balances and
    transactions have been eliminated.

    2.  Investment Securities and Mortgage-Backed Securities

    The Corporation  accounts for investment and  mortgage-backed  securities in
    accordance with Statement of Financial Accounting Standards ("SFAS") No. 115
    "Accounting for Certain Investments in Debt and Equity Securities". SFAS No.
    115 requires that  investments in debt and equity  securities be categorized
    as held-to-maturity,  trading, or available for sale.  Securities classified
    as  held-to-maturity  are  carried at cost only if the  Corporation  has the
    positive  intent and ability to hold these  securities to maturity.  Trading
    securities  and  securities  designated as available for sale are carried at
    fair value with resulting  unrealized gains or losses recorded to operations
    or stockholders' equity, respectively.


                                       29
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    2.  Investment Securities and Mortgage-Backed Securities (continued)

    At September 30, 1999, the Corporation's  stockholders' equity reflected net
    unrealized  losses on  securities  designated as available for sale totaling
    $694,000.  At September 30, 1998,  the  Corporation's  stockholders'  equity
    reflected net  unrealized  gains on  securities  designated as available for
    sale totaling $87,000.

     Realized gains and losses on sales of securities  are recognized  using the
     specific identification method.

    3.  Loans Receivable

    Loans  receivable are stated at the principal amount  outstanding,  adjusted
    for  deferred  loan  origination  fees and the  allowance  for loan  losses.
    Interest is accrued as earned  unless the  collectibility  of the loan is in
    doubt.  Interest on loans that are contractually past due is charged off, or
    an allowance is established based on management's  periodic evaluation.  The
    allowance  is  established  by a  charge  to  interest  income  equal to all
    interest previously accrued,  and income is subsequently  recognized only to
    the extent that cash payments are received until, in management's  judgment,
    the borrower's  ability to make periodic interest and principal payments has
    returned to normal, in which case the loan is returned to accrual status. If
    the ultimate  collectibility  of the loan is in doubt,  in whole or in part,
    all payments  received on nonaccrual  loans are applied to reduce  principal
    until such doubt is eliminated.

    4.  Loan Origination Fees

    The Savings Bank accounts for loan  origination fees in accordance with SFAS
    No.  91  "Accounting  for  Nonrefundable  Fees  and  Costs  Associated  with
    Originating or Acquiring Loans and Initial Direct Cost of Leases".  Pursuant
    to the provisions of SFAS No. 91,  origination fees received from loans, net
    of direct  origination  costs, are deferred and amortized to interest income
    using the  level-yield  method,  giving  effect to actual loan  prepayments.
    Additionally,   SFAS  No.  91  generally   limits  the  definition  of  loan
    origination  costs  to  the  direct  costs  of  originating  a  loan,  i.e.,
    principally  actual personnel costs. Fees received for loan commitments that
    are expected to be drawn upon,  based on the Savings Bank's  experience with
    similar  commitments,  are deferred and amortized  over the life of the loan
    using the level-yield  method.  Fees for other loan commitments are deferred
    and amortized over the loan commitment period on a straight-line basis.







                                       30
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    5.  Allowance for Losses on Loans

    It is  the  Savings  Bank's  policy  to  provide  valuation  allowances  for
    estimated losses on loans based on past loss experience, trends in the level
    of delinquent  and problem  loans,  adverse  situations  that may affect the
    borrower's   ability  to  repay,  the  estimated  value  of  any  underlying
    collateral and current and  anticipated  economic  conditions in the primary
    lending area. When the collection of a loan becomes  doubtful,  or otherwise
    troubled, the Savings Bank records a loan charge-off equal to the difference
    between  the fair  value of the  property  securing  the loan and the loan's
    carrying  value.  Major loans  (including  development  projects)  and major
    lending areas are reviewed  periodically to determine  potential problems at
    an early date.  The  allowance  for loan losses is  increased  by charges to
    earnings and decreased by charge-offs (net of recoveries).

    The Savings Bank  accounts for impaired  loans in  accordance  with SFAS No.
    114, "Accounting by Creditors for Impairment of a Loan," which requires that
    impaired loans be measured  based upon the present value of expected  future
    cash  flows  discounted  at the  loan's  effective  interest  rate or, as an
    alternative,  at the  loan's  observable  market  price or fair value of the
    collateral.  The Savings Bank's current  procedures for evaluating  impaired
    loans result in carrying such loans at the lower of cost or fair value.

    A loan is  defined  under SFAS No. 114 as  impaired  when,  based on current
    information  and events,  it is probable  that a creditor  will be unable to
    collect all  amounts  due  according  to the  contractual  terms of the loan
    agreement.  In applying  the  provisions  of SFAS No. 114,  the Savings Bank
    considers  its  investment  in one- to  four-family  residential  loans  and
    consumer  installment  loans to be homogeneous  and therefore  excluded from
    separate  identification  for evaluation of impairment.  With respect to the
    Savings Bank's investment in multi-family and nonresidential  loans, and its
    evaluation of impairment thereof, such loans are collateral  dependent,  and
    as a result,  are carried as a practical  expedient  at the lower of cost or
    fair value.

    It is the Savings  Bank's  policy to charge off  unsecured  credits that are
    more than ninety days  delinquent.  Similarly,  collateral  dependent  loans
    which are more than ninety days delinquent are considered to constitute more
    than a minimum delay in repayment and are  evaluated  for  impairment  under
    SFAS No. 114 at that time.

    At  September  30,  1999,  the Savings  Bank had one loan  account  totaling
    $195,000  that is defined as impaired  under SFAS No. 114.  The Savings Bank
    had no such loans at September  30, 1998.  No portion of the  allowance  for
    credit losses was allocated to such impaired  loans at September 30, 1999 or
    1998.





                                       31
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    6.  Office Premises and Equipment

    Office  premises and equipment are carried at cost and include  expenditures
    which extend the useful lives of existing assets.  Maintenance,  repairs and
    minor   renewals  are  expensed  as  incurred.   For  financial   reporting,
    depreciation  and  amortization  are  provided  on  the   straight-line  and
    accelerated  methods  over the useful  lives of the assets,  estimated to be
    forty years for buildings, ten to forty years for building improvements, and
    five to ten years for furniture and equipment. An accelerated method is used
    for tax reporting purposes.

    7.  Real Estate Acquired Through Foreclosure

    Real  estate  acquired  through  foreclosure  is carried at the lower of the
    loan's unpaid principal  balance (cost) or fair value less estimated selling
    expenses  at the  date of  acquisition.  Real  estate  loss  provisions  are
    recorded  if the  properties'  fair value  subsequently  declines  below the
    amount determined at the recording date. In determining the lower of cost or
    fair value at acquisition,  costs relating to development and improvement of
    property are  capitalized.  Costs  relating to holding real estate  acquired
    through  foreclosure,  net of rental income, are charged against earnings as
    incurred.

    8.  Federal Income Taxes

    The  Corporation  accounts for federal  income taxes in accordance  with the
    provisions of SFAS No. 109,  "Accounting for Income Taxes".  Pursuant to the
    provisions  of SFAS No. 109, a deferred tax  liability or deferred tax asset
    is computed by applying  the current  statutory  tax rates to net taxable or
    deductible  differences  between the tax basis of an asset or liability  and
    its  reported  amount in the  consolidated  financial  statements  that will
    result in taxable or  deductible  amounts in future  periods.  Deferred  tax
    assets are  recorded  only to the extent  that the amount of net  deductible
    temporary  differences or  carryforward  attributes may be utilized  against
    current period earnings,  carried back against prior years' earnings, offset
    against  taxable  temporary  differences  reversing  in future  periods,  or
    utilized to the extent of management's  estimate of future taxable income. A
    valuation  allowance  is provided for deferred tax assets to the extent that
    the  value  of  net  deductible   temporary   differences  and  carryforward
    attributes exceeds management's estimates of taxes payable on future taxable
    income.  Deferred  tax  liabilities  are provided on the total amount of net
    temporary differences taxable in the future.

    The Corporation's  principal temporary  differences between pretax financial
    income and taxable  income result from  different  methods of accounting for
    deferred  loan  origination  fees and  costs,  Federal  Home Loan Bank stock
    dividends,   retirement  expense,   the  general  loan  loss  allowance  and
    percentage of earnings bad debt deductions. Additional temporary differences
    result  from  depreciation   computed  using  accelerated  methods  for  tax
    purposes.






                                       32
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

    9.  Benefit Plans

    The Savings  Bank  provides a  supplemental  retirement  plan to certain key
    officers.  The Savings Bank's  obligations  under the supplemental plan have
    been funded via the  purchase of key man life  insurance  policies for which
    the Savings Bank is the  beneficiary.  Expense under the  supplemental  plan
    totaled approximately $1,000 during each of the fiscal years ended September
    30, 1999, 1998 and 1997.

    The Corporation has an Employee Stock Ownership Plan ("ESOP") which provides
    retirement  benefits for  substantially  all  full-time  employees  who have
    completed  one year of service.  The  Corporation  accounts  for the ESOP in
    accordance with Statement of Position ("SOP") 93-6,  "Employers'  Accounting
    for Employee Stock  Ownership  Plans".  SOP 93-6 requires that  compensation
    expense  recorded by employers equal the fair value of ESOP shares allocated
    to participants  during a given fiscal year.  Expense  recognized related to
    the ESOP totaled approximately $114,000, $111,000 and $48,000 for the fiscal
    years ended September 30, 1999, 1998 and 1997, respectively.

    The Corporation  also has a Recognition  and Retention Plan ("RRP").  During
    fiscal 1996,  the RRP purchased  39,675 shares of the  Corporation's  common
    stock in the open market.  At September  30,  1999,  37,211  shares had been
    awarded to  executive  officers and members of the Board of Directors of the
    Corporation.  Common stock  awarded  under the RRP vests ratably over a five
    year period,  commencing  with the date of the award. A provision of $97,000
    related to the RRP was charged to expense for each of the fiscal years ended
    September 30, 1999, 1998 and 1997.

    10.  Earnings Per Share and Dividends Per Share

    Basic  earnings per share for the years ended  September 30, 1999,  1998 and
    1997 is computed based upon the  weighted-average  shares outstanding during
    the period, less 20,337, 28,252 and 36,774 shares, respectively, in the ESOP
    that are  unallocated  and not  committed to be  released.  Weighted-average
    common shares deemed  outstanding  totaled 851,799,  859,891 and 881,720 for
    the years ended September 30, 1999, 1998 and 1997, respectively.

    Diluted  earnings  per share is computed  taking into  consideration  common
    shares  outstanding and dilutive  potential common shares to be issued under
    the Corporation's stock option plan.  Weighted-average  common shares deemed
    outstanding  for purposes of computing  diluted  earnings per share  totaled
    878,289,  894,437 and 893,942 for the fiscal years ended September 30, 1999,
    1998 and 1997,  respectively.  Incremental  shares  related  to the  assumed
    exercise of stock options  included in the  computation of diluted  earnings
    per share  totaled  26,490,  34,546 and 12,222  for the fiscal  years  ended
    September 30, 1999, 1998 and 1997,  respectively.  Options to purchase 1,000
    shares of common  stock  with an  exercise  price of $14.00  per share  were
    outstanding at September 30, 1999, but were excluded from the computation of
    diluted  earnings per share because the exercise  price was greater than the
    average market price of the common shares.





                                       33
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

    10.  Earnings Per Share and Dividends Per Share (continued)

    Capital  distributions  paid in excess  of the  Corporation's  earnings  and
    profits  (computed on a stand-alone  basis for federal  income tax purposes)
    are  deemed  by  management  to  constitute  a  return  of  excess  capital.
    Management has determined  that $.21, $.33 and $.37 of fiscal 1999, 1998 and
    1997 dividends constitute tax-free distributions.

    11.  Fair Value of Financial Instruments

    SFAS No.  107,  "Disclosures  About  Fair Value of  Financial  Instruments",
    requires disclosure of the fair value of financial instruments,  both assets
    and liabilities  whether or not recognized in the consolidated  statement of
    financial condition, for which it is practicable to estimate that value. For
    financial  instruments  where quoted market prices are not  available,  fair
    values  are based on  estimates  using  present  value  and other  valuation
    methods.

    The methods used are greatly affected by the assumptions applied,  including
    the discount  rate and estimates of future cash flows.  Therefore,  the fair
    values  presented  may not  represent  amounts  that could be realized in an
    exchange for certain financial instruments.

    The  following  methods  and  assumptions  were used by the  Corporation  in
    estimating its fair value disclosures for financial instruments at September
    30, 1999 and 1998:

                  Cash and cash  equivalents:  The carrying amounts presented in
                  the  consolidated  statements of financial  condition for cash
                  and cash equivalents are deemed to approximate fair value.

                  Investment and mortgage-backed  securities: For investment and
                  mortgage-backed  securities, fair value is deemed to equal the
                  quoted market price.

                  Loans receivable:  The loan portfolio has been segregated into
                  categories  with  similar  characteristics,  such  as  one- to
                  four-family   residential,    multi-family   residential   and
                  nonresidential real estate. These loan categories were further
                  delineated into fixed-rate and adjustable-rate loans. The fair
                  values for the  resultant  loan  categories  were computed via
                  discounted  cash flow analysis,  using current  interest rates
                  offered for loans with  similar  terms to borrowers of similar
                  credit quality. For loans on deposit accounts and consumer and
                  other  loans,  fair values  were deemed to equal the  historic
                  carrying  values.  The historical  carrying  amount of accrued
                  interest on loans is deemed to approximate fair value.

                  Federal Home Loan Bank stock: The carrying amount presented in
                  the consolidated  statements of financial  condition is deemed
                  to approximate fair value.




                                       34

<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

    11.  Fair Value of Financial Instruments (continued)

                  Deposits:  The fair value of NOW accounts,  passbook accounts,
                  money  market   demand  and  escrow   deposits  is  deemed  to
                  approximate  the amount  payable on  demand.  Fair  values for
                  fixed-rate certificates of deposit have been estimated using a
                  discounted  cash flow  calculation  using the  interest  rates
                  currently   offered   for   deposits   of  similar   remaining
                  maturities.

                  Advances  from the Federal  Home Loan Bank:  The fair value of
                  these advances is estimated using the rates currently  offered
                  for similar advances of similar remaining maturities.

                  Commitments   to   extend    credit:    For   fixed-rate   and
                  adjustable-rate  loan  commitments,  the fair  value  estimate
                  considers the  difference  between  current levels of interest
                  rates and committed rates. At September 30, 1999 and 1998, the
                  difference  between the fair value and notional amount of loan
                  commitments was not material.

    Based on the foregoing methods and assumptions,  the carrying value and fair
    value of the  Corporation's  financial  instruments  at  September 30 are as
    follows:
<TABLE>
<CAPTION>

                                                                    1999                            1998
                                                        Carrying            Fair       Carrying           Fair
                                                           value           value          value          value
                                                                              (In thousands)
<S>                                                        <C>               <C>          <C>            <C>
    Financial assets
      Cash and cash equivalents                          $ 2,849         $ 2,849        $ 2,887        $ 2,887
      Investment securities                                5,951           5,951          4,032          4,032
      Mortgage-backed securities                          33,711          33,711         37,864         37,864
      Loans receivable                                    52,790          52,512         48,797         50,590
      Federal Home Loan Bank stock                         1,723           1,723          1,606          1,606
                                                          ------          ------         ------         ------

                                                         $97,024         $96,746        $95,186        $96,979
                                                          ======          ======         ======         ======
    Financial liabilities
      Deposits                                           $66,220         $66,439        $60,225        $61,304
      Advances from Federal Home Loan Bank                22,600          22,598         25,850         25,775
      Escrow deposits                                        105             105            119            119
                                                          ------          ------         ------         ------

                                                         $88,925         $89,142        $86,194        $87,198
                                                          ======          ======         ======         ======
</TABLE>




                                       35
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

    12.  Comprehensive Income

    The Corporation adopted SFAS No. 130, "Reporting  Comprehensive  Income," as
    of October 1, 1998.  The Statement  established  standards for reporting and
    presentation  of  comprehensive  income and its  components in a full set of
    general-purpose  financial  statements.  It requires that all items that are
    required to be  recognized  under  accounting  standards  as  components  of
    comprehensive  income be reported in a financial statement that is presented
    with the  same  prominence  as  other  financial  statements.  SFAS No.  130
    requires that companies (i) classify items of other comprehensive  income by
    their  nature in a financial  statement  and (ii)  display  the  accumulated
    balance of other comprehensive  income separately from retained earnings and
    additional  paid-in capital.  Financial  statements for earlier periods were
    restated   for   comparative   purposes.   The   Corporation's   accumulated
    comprehensive  income consists solely of the change in unrealized  gains and
    losses on securities  designated  as available  for sale in accordance  with
    SFAS No. 115.

    13.  Cash and Cash Equivalents

    For purposes of reporting cash flows, cash and cash equivalents include cash
    and due from  banks,  federal  funds sold and  interest-bearing  deposits in
    other financial  institutions  with original  maturities of less than ninety
    days.

    14.  Reclassifications

    Certain  prior year  amounts have been  reclassified  to conform to the 1999
consolidated financial statement presentation.


NOTE B - INVESTMENTS AND MORTGAGE-BACKED SECURITIES

    The amortized cost, gross unrealized  gains,  gross unrealized  losses,  and
    estimated  fair values of  investment  securities  at September 30, 1999 and
    1998 are summarized as follows:
<TABLE>
<CAPTION>

                                                                                1999
                                                                        Gross           Gross        Estimated
                                                   Amortized       unrealized      unrealized             fair
                                                        cost            gains          losses            value
    Available for sale:                                                     (In thousands)
<S>                                                     <C>              <C>             <C>             <C>
      U.S. Government agency
        obligations                                   $6,000              $-            $  49           $5,951
                                                       =====               ==            ====            =====
</TABLE>





36
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE B - INVESTMENTS AND MORTGAGE-BACKED SECURITIES (continued)
<TABLE>
<CAPTION>

                                                                         1998
                                                                 Gross           Gross    Estimated
                                              Amortized     unrealized      unrealized         fair
                                                   cost          gains          losses        value
    Available for sale:                                              (In thousands)
<S>                                                <C>           <C>               <C>         <C>
      U.S. Government agency
        obligations                              $4,005            $27             $-        $4,032
                                                  =====             ==              ==        =====
</TABLE>

    The  amortized  cost and  estimated  fair values of U.S.  Government  agency
    obligations by contractual term to maturity at September 30 are shown below:
<TABLE>
<CAPTION>

                                                        1999                         1998
                                                            Estimated                    Estimated
                                             Amortized           fair       Amortized         fair
                                                  cost          value            cost        value
                                                                  (In thousands)
<S>                                              <C>             <C>             <C>          <C>
    Due within one year                         $   -          $   -           $4,005       $4,032
    Due after one year through
      five years                                 6,000          5,951              -            -
                                                 -----          -----           -----        -----

                                                $6,000         $5,951          $4,005       $4,032
                                                 =====          =====           =====        =====
</TABLE>

    The amortized cost, gross  unrealized  gains,  gross  unrealized  losses and
    estimated  fair values of  mortgage-backed  securities at September 30, 1999
    and 1998 are summarized as follows:
<TABLE>
<CAPTION>

                                                                              1999
                                                                     Gross           Gross    Estimated
                                                  Amortized     unrealized      unrealized         fair
                                                       cost          gains          losses        value
    Available for sale:                                                  (In thousands)
<S>                                                   <C>            <C>             <C>           <C>
      Federal Home Loan Mortgage Corporation:
        Participation certificates                 $  4,901            $-          $   128     $  4,773
        Collateralized mortgage obligations          22,236             -              858       21,378
      Federal National Mortgage Association:
        Participation certificates                    2,158              2              52        2,108
        Collateralized mortgage obligations           5,420             33               1        5,452
                                                    -------           ----          ------      -------

         Total mortgage-backed securities           $34,715          $  35          $1,039      $33,711
                                                     ======           ====           =====       ======

</TABLE>





                                       37
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE B - INVESTMENTS AND MORTGAGE-BACKED SECURITIES (continued)
<TABLE>
<CAPTION>

                                                                                1998
                                                                       Gross           Gross    Estimated
                                                    Amortized     unrealized      unrealized         fair
                                                         cost          gains          losses        value
    Available for sale:                                                    (In thousands)
<S>                                                     <C>            <C>              <C>         <C>
      Federal Home Loan Mortgage Corporation:
        Participation certificates                   $  6,140         $    3           $  26     $  6,117
        Collateralized mortgage obligations            15,358              8              29       15,337
      Federal National Mortgage Association:
        Participation certificates                      3,068             29              37        3,060
        Collateralized mortgage obligations            13,193            172              15       13,350
                                                       ------            ---            ----       ------

         Total mortgage-backed securities             $37,759           $212            $107      $37,864
                                                       ======            ===             ===       ======
</TABLE>

    The amortized cost of  mortgage-backed  securities,  by contractual terms to
    maturity at September 30, are shown below.  Expected  maturities will differ
    from  contractual   maturities   because   borrowers  may  generally  prepay
    obligations without prepayment penalties.
<TABLE>
<CAPTION>

                                                           1999                1998
                                                                 (In thousands)
<S>                                                        <C>                 <C>
    Due within three years                             $  1,044            $  1,010
    Due in three to five years                            4,016               5,713
    Due in five to ten years                              8,055               8,761
    Due in ten to twenty years                            1,261               2,857
    Due after twenty years                               20,339              19,418
                                                         ------              ------

                                                        $34,715             $37,759
                                                         ======              ======
</TABLE>

















                                       38
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE C - LOANS RECEIVABLE

    The  composition  of the loan  portfolio at September  30 is  summarized  as
follows:
<TABLE>
<CAPTION>

                                                             1999           1998
                                                               (In thousands)
<S>                                                        <C>             <C>
    Residential real estate
      One-to-four family                                  $43,083        $41,214
      Home equity lines of credit                           1,480          1,275
      Multifamily                                           2,178          1,367
      Construction                                          5,964          4,663
    Nonresidential real estate and land                     3,085          3,024
    Deposit account                                            20             25
                                                           ------         ------
                                                           55,810         51,568
    Less:
      Undisbursed portion of loans in process               2,823          2,556
      Deferred loan origination fees                           58             88
      Allowance for loan losses                               139            127
                                                           ------         ------

                                                          $52,790        $48,797
                                                           ======         ======
</TABLE>


    As depicted  above,  the Savings  Bank's lending  efforts have  historically
    focused on one-to-four family  residential and multifamily  residential real
    estate loans,  which comprise  approximately  $49.9 million,  or 94%, of the
    total loan portfolio at September 30, 1999,  and $46.0  million,  or 94%, of
    the total loan portfolio at September 30, 1998.  Generally,  such loans have
    been underwritten on the basis of no more than an 80%  loan-to-value  ratio,
    which has  historically  provided the Savings Bank with adequate  collateral
    coverage in the event of default.  Nevertheless,  the Savings  Bank, as with
    any lending institution, is subject to the risk that residential real estate
    values could  deteriorate in its primary lending area of southwestern  Ohio,
    thereby impairing  collateral values.  However,  management is of the belief
    that  residential  real estate values in the Savings Bank's primary  lending
    area are presently stable.

    The Savings Bank had sold participating  interests in loans in the secondary
    market,  retaining  servicing on the loans sold. Loans sold and serviced for
    others totaled  approximately  $196,000 at September 30, 1998. There were no
    loans serviced for others at September 30, 1999.

    In the ordinary  course of business,  the Savings Bank has granted  loans to
    some of its directors,  officers and their related business  interests.  All
    loans to related parties have been made on  substantially  the same terms as
    those  prevailing at the time for  unrelated  third  parties.  The aggregate
    dollar amount of loans to officers and directors was approximately  $132,000
    and $157,000 at September 30, 1999 and 1998, respectively. During the fiscal
    year ended  September  30,  1999,  $75,000 in new loans  were  disbursed  to
    officers and directors, while principal repayments of $100,000 were received
    from officers and directors.






                                       39
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE D - ALLOWANCE FOR LOAN LOSSES

     The activity in the  allowance for loan losses is summarized as follows for
     the years ended September 30:
<TABLE>
<CAPTION>

                                                  1999         1998         1997
                                                         (In thousands)
<S>                                               <C>          <C>          <C>
    Balance at beginning of year                  $127         $115         $111
    Provision for losses on loans                   12           12            9
    Charge-off of loans                             -            -            (5)
                                                   ---          ---          ---

    Balance at end of year                        $139         $127         $115
                                                   ===          ===          ===
</TABLE>

    At September  30, 1999,  the Savings  Bank's  allowance  for loan losses was
    comprised solely of a general loan loss allowance,  which is includible as a
    component of regulatory risk-based capital.

    At September 30, 1999,  1998 and 1997,  the Savings  Bank's  nonaccrual  and
    nonperforming  loans  totaled  $25,000,  $49,000 and $95,000,  respectively.
    Interest income which would have been recognized if such loans had performed
    pursuant to  contractual  terms  totaled  approximately  $1,000,  $2,000 and
    $6,000 for the years ended September 30, 1999, 1998 and 1997, respectively.


NOTE E - OFFICE PREMISES AND EQUIPMENT

     Office  premises and  equipment are comprised of the following at September
     30:
<TABLE>
<CAPTION>

                                                      1999           1998
                                                        (In thousands)
<S>                                                   <C>            <C>
    Land and improvements                          $   119        $   119
    Office buildings and improvements                1,425          1,397
    Furniture, fixtures and equipment                  642            474
    Automobile                                          14             14
                                                   -------        -------
                                                     2,200          2,004
      Less accumulated depreciation                    964            887
                                                    ------         ------

                                                    $1,236         $1,117
                                                     =====          =====

</TABLE>







                                       40
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE F - DEPOSITS

    Deposits consist of the following major classifications at September 30:
<TABLE>
<CAPTION>

    Deposit type and weighted-average                                            1999                        1998
    interest rate                                                           Amount      %              Amount      %
                                                                                    (Dollars in thousands)
<S>                                                                           <C>         <C>            <C>         <C>
    NOW accounts - 1.84% in 1999 and
      1998                                                                 $ 3,806        5.7          $ 3,208      5.3
    Super NOW accounts - 2.75% in 1999
      and 1998                                                                 405         .6              253       .4
    Passbook accounts - 2.53% in 1999
      and 1998                                                              10,437       15.8            9,494     15.8
    Money market demand deposit -
      3.00% in 1999 and 1998                                                 4,534        6.9            4,107      6.8
                                                                            ------      -----           ------    -----
           Total demand, transaction and
             passbook deposits                                              19,182       29.0           17,062     28.3

    Certificates of deposit:
      Original maturities of:
        Less than 12 months
          4.57% in 1999 and 5.13% in 1998                                    4,012        6.1            3,163      5.3
        12 months
          4.90% in 1999 and 5.15% in 1998                                   21,751       32.8           21,945     36.4
        18 months
          5.45% in 1999 and 5.86% in 1998                                    5,231        7.9            4,760      7.9
        30 months
          5.60% in 1999 and 5.80% in 1998                                    6,844       10.3            5,254      8.7
        48 months and greater
          6.02% in 1999 and 6.12% in 1998                                    9,200       13.9            8,041     13.4
                                                                            ------      -----           ------    ------

           Total certificates of deposit                                    47,038       71.0           43,163     71.7
                                                                            ------      -----           ------    ------

           Total deposits                                                  $66,220      100.0%         $60,225    100.0%
                                                                            ======      =====           ======    =====
</TABLE>

    At September 30, 1999 and 1998, the Savings Bank had  certificate of deposit
    accounts with balances greater than $100,000  totaling $4.1 million and $2.9
    million, respectively.








                                       41
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997

NOTE F - DEPOSITS (continued)

     Interest expense on deposit accounts is summarized as follows for the years
     ended September 30:
<TABLE>
<CAPTION>

                                                    1999         1998         1997
                                                           (In thousands)
<S>                                                 <C>           <C>         <C>
    Money market demand deposit accounts         $   132      $   130      $   144
    Passbook and escrow accounts                     253          254          256
    NOW and Super NOW accounts                        72           73          107
    Certificates of deposit                        2,544        2,465        2,279
                                                   -----        -----        -----

                                                  $3,001       $2,922       $2,786
                                                   =====        =====        =====
</TABLE>

     Maturities of outstanding certificates of deposit are summarized as follows
     at September 30:
<TABLE>
<CAPTION>

                                                       1999             1998
                                                         (In thousands)
<S>                                                   <C>              <C>
    Less than six months                            $18,130          $13,202
    Six months to one year                           16,242           16,864
    One to two years                                  7,906            6,976
    Two to three years                                1,191            4,358
    Three to four years                               1,347              341
    Over four years                                   2,222            1,422
                                                     ------           ------

                                                    $47,038          $43,163
                                                     ======           ======
</TABLE>


NOTE G - ADVANCES FROM THE FEDERAL HOME LOAN BANK

    Advances  from the Federal Home Loan Bank,  collateralized  at September 30,
    1999 by pledges of certain residential mortgage loans totaling $33.9 million
    and the Savings  Bank's  investment  in Federal  Home Loan Bank  stock,  are
    summarized as follows:
<TABLE>
<CAPTION>

Interest Rate                      Maturing fiscal                           September 30,
                                    year ending in                     1999              1998
                                                                     (Dollars in thousands)
<S>                                      <C>                          <C>                 <C>
5.58%                                     2000                     $     -           $  3,000
5.38%                                     2001                        5,600                -
5.43% - 5.71%                             2007                           -                950
4.66% - 5.64%                             2008                       17,000            21,900
                                                                     ------            ------

                                                                    $22,600           $25,850
                                                                     ======            ======

Weighted-average interest rate                                         5.23%             5.26%
                                                                       ====              ====
</TABLE>



                                       42
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE H - COMMITMENTS

    The Savings Bank is a party to financial instruments with  off-balance-sheet
    risk in the normal  course of  business to meet the  financing  needs of its
    customers including  commitments to extend credit. Such commitments involve,
    to varying degrees,  elements of credit and interest-rate  risk in excess of
    the amount recognized in the consolidated  statement of financial condition.
    The contract or notional  amounts of the  commitments  reflect the extent of
    the Savings Bank's involvement in such financial instruments.

    The Savings Bank's exposure to credit loss in the event of nonperformance by
    the other party to the financial instrument for commitments to extend credit
    is represented by the contractual notional amount of those instruments.  The
    Savings  Bank  uses the same  credit  policies  in  making  commitments  and
    conditional obligations as those utilized for on-balance-sheet instruments.

    At September 30, 1999, the Savings Bank had  commitments for unused lines of
    credit under home equity loans of $3.0  million.  Management  believes  that
    such  loan  commitments  are  able  to be  funded  through  cash  flow  from
    operations and existing excess  liquidity.  Fees received in connection with
    these commitments have not been recognized in earnings.

    Commitments to extend credit are agreements to lend to a customer as long as
    there  is no  violation  of  any  condition  established  in  the  contract.
    Commitments  generally  have  fixed  expiration  dates or other  termination
    clauses and may require  payment of a fee. Since many of the commitments may
    expire  without  being  drawn  upon,  the total  commitment  amounts  do not
    necessarily  represent future cash requirements.  The Savings Bank evaluates
    each  customer's  creditworthiness  on a case-by-case  basis.  The amount of
    collateral  obtained,  if it is deemed  necessary  by the Savings  Bank upon
    extension  of credit,  is based on  management's  credit  evaluation  of the
    counterparty.  Collateral on loans may vary but the  preponderance  of loans
    granted generally include a mortgage interest in real estate as security.


NOTE I - FEDERAL INCOME TAXES

    The  Corporation's  provision  for  federal  income  taxes  does not  differ
    materially from the amounts computed at the statutory corporate tax rate for
    the years ended September 30, 1999, 1998 and 1997.











                                       43
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE I - FEDERAL INCOME TAXES (continued)

     The composition of the  Corporation's net deferred tax asset (liability) at
     September 30 is as follows:
<TABLE>
<CAPTION>

                                                                    1999           1998
                                                                       (In thousands)
<S>                                                                 <C>             <C>
     Taxes (payable) refundable on temporary
     differences at estimated corporate tax rate:
       Deferred tax assets:
         General loan loss allowance                                $ 47          $  43
         Stock benefit plans                                          25             25
         Unrealized losses on securities designated as
           available for sale                                        359             -
                                                                     ---           ----
           Total deferred tax assets                                 431             68

     Deferred tax liabilities:
         Percentage of earnings bad debt deduction                  (104)          (125)
         Deferred loan origination costs                             (39)           (24)
         Federal Home Loan Bank stock dividends                     (230)          (176)
         Unrealized gains on securities designated as
           available for sale                                         -             (45)
         Other                                                        (2)            -
                                                                     ---           ----
           Total deferred tax liabilities                           (375)          (370)
                                                                     ---           ----

           Net deferred tax asset (liability)                       $ 56          $(302)
                                                                     ===           ====
</TABLE>

    The  Savings  Bank was  allowed  a  special  bad debt  deduction  based on a
    percentage of earnings,  generally limited to 8% of otherwise taxable income
    and  subject to certain  limitations  based on  aggregate  loans and savings
    account   balances  at  the  end  of  the  year.   This  deduction   totaled
    approximately  $1.7  million as of September  30, 1999.  If the amounts that
    qualify as  deductions  for federal  income tax  purposes are later used for
    purposes  other  than  for  bad  debt  losses,  including  distributions  in
    liquidation,  such  distributions will be subject to federal income taxes at
    the then current  corporate  income tax rate. The approximate  amount of the
    unrecognized  deferred tax  liability  relating to the  cumulative  bad debt
    deduction is $450,000.

    Due to recent  legislation,  the Savings  Bank is required to  recapture  as
    taxable  income  approximately  $370,000 of its tax bad debt reserve,  which
    represents  the  post-1987  additions to the reserve,  and will be unable to
    utilize the percentage of earnings  method to compute its bad debt deduction
    in the future.  The Savings Bank has provided deferred taxes for this amount
    and will  amortize the  recapture of the bad debt reserve in taxable  income
    over a six year period, which commenced in fiscal 1999.






                                       44

<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE J - REGULATORY CAPITAL

    The Savings Bank is subject to the regulatory  capital  requirements  of the
    Federal Deposit Insurance Corporation (the "FDIC").  Failure to meet minimum
    capital   requirements  can  initiate  certain   mandatory  -  and  possibly
    additional discretionary - actions by regulators that, if undertaken,  could
    have a direct  material effect on the Savings Bank's  financial  statements.
    Under capital  adequacy  guidelines and the regulatory  framework for prompt
    corrective  action,  the Savings Bank must meet specific capital  guidelines
    that  involve   quantitative   measures  of  the  Savings   Bank's   assets,
    liabilities,   and  certain  off-balance-sheet  items  as  calculated  under
    regulatory  accounting  practices.  The Savings Bank's  capital  amounts and
    classification  are also subject to qualitative  judgments by the regulators
    about components, risk weightings, and other factors.

    During the  calendar  year,  the  Savings  Bank was  notified by its primary
    regulator that it was categorized as "well-capitalized" under the regulatory
    framework   for   prompt   corrective   action.   To   be   categorized   as
    "well-capitalized"  the Savings Bank must maintain minimum capital ratios as
    set forth in the table that follows.

    The FDIC has  adopted  risk-based  capital  ratio  guidelines  to which  the
    Savings Bank is subject.  The guidelines  establish a systematic  analytical
    framework  that makes  regulatory  capital  requirements  more  sensitive to
    differences in risk profiles among banking organizations. Risk-based capital
    ratios are determined by allocating  assets and specified  off-balance sheet
    commitments to four risk-weighting categories, with higher levels of capital
    being required for the categories perceived as representing greater risk.

    These  guidelines  divide the capital into two tiers.  The first tier ("Tier
    1") includes common equity, certain non-cumulative perpetual preferred stock
    (excluding auction rate issues) and minority interests in equity accounts of
    consolidated subsidiaries, less goodwill and certain other intangible assets
    (except mortgage  servicing rights and purchased credit card  relationships,
    subject to certain limitations).  Supplementary ("Tier 2") capital includes,
    among other items, cumulative perpetual and long-term limited-life preferred
    stock, mandatory convertible securities, certain hybrid capital instruments,
    term subordinated debt and the allowance for loan losses, subject to certain
    limitations,  less  required  deductions.  Savings  banks  are  required  to
    maintain a total  risk-based  capital (the sum of Tier 1 and Tier 2 capital)
    ratio of 8%, of which 4% must be Tier 1 capital.  The FDIC may, however, set
    higher capital requirements when particular  circumstances warrant.  Savings
    banks  experiencing  or  anticipating  significant  growth are  expected  to
    maintain capital ratios,  including tangible capital  positions,  well above
    the minimum levels.







                                       45
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE J - REGULATORY CAPITAL (continued)

    In addition,  the FDIC established  guidelines  prescribing a minimum Tier 1
    leverage  ratio (Tier 1 capital to adjusted total assets as specified in the
    guidelines). These guidelines provide for a minimum Tier 1 leverage ratio of
    3% for savings banks that meet certain  specified  criteria,  including that
    they  have  the  highest  regulatory  rating  and  are not  experiencing  or
    anticipating  significant  growth.  All other  savings banks are required to
    maintain  a Tier 1  leverage  ratio of 3% plus an  additional  cushion of at
    least 100 to 200 basis points.

    As of September 30, 1999 and 1998, management believes that the Savings Bank
    met all capital adequacy requirements to which it was subject.
<TABLE>
<CAPTION>

                                                                          1999
                                                                                                 To be "well-
                                                                                              capitalized" under
                                                                     For capital               prompt corrective
                                             Actual                adequacy purposes          action provisions
                                         Amount    Ratio           Amount    Ratio             Amount     Ratio
                                                                  (Dollars in thousands)
<S>                                       <C>       <C>             <C>        <C>              <C>         <C>
    Total capital
      (to risk-weighted assets)          $9,876    23.5%         =>$3,365    =>8.0%          =>$4,206     =>10.0%

    Tier I capital
      (to risk-weighed assets)           $9,737    23.2%         =>$1,682    =>4.0%          =>$2,523     => 6.0%

    Tier I leverage                      $9,737     9.8%         =>$3,985    =>4.0%          =>$4,981     => 5.0%

</TABLE>

<TABLE>
<CAPTION>

                                                                          1998
                                                                                                 To be "well-
                                                                                              capitalized" under
                                                                     For capital               prompt corrective
                                             Actual                adequacy purposes          action provisions
                                         Amount    Ratio           Amount    Ratio             Amount     Ratio
                                                                  (Dollars in thousands)
<S>                                      <C>        <C>              <C>       <C>              <C>         <C>
    Total capital
      (to risk-weighted assets)          $9,419    23.7%         =>$3,174    =>8.0%          =>$3,967     =>10.0%

    Tier I capital
      (to risk-weighed assets)           $9,292    23.4%         =>$1,587    =>4.0%          =>$2,380     => 6.0%

    Tier I leverage                      $9,292     9.6%         =>$3,860    =>4.0%          =>$4,825     => 5.0%

</TABLE>

    The Savings Bank's  management  believes that, under the current  regulatory
    capital  regulations,  the  Savings  Bank will  continue to meet its minimum
    capital requirements in the foreseeable future.  However,  events beyond the
    control of the Savings Bank, such as increased  interest rates or a downturn
    in the economy in the primary  market area,  could  adversely  affect future
    earnings and,  consequently,  the ability to meet future minimum  regulatory
    capital requirements.



                                       46
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE K - STOCK OPTION PLAN

    The Board of  Directors  adopted a Stock  Option Plan that  provided for the
    issuance of 129,333 shares (adjusted) of authorized,  but unissued shares of
    common stock at fair value at the date of grant.  During  fiscal  1996,  the
    Corporation  granted  options to  purchase  74,297  shares to members of the
    Board of Directors and executive officers at an initial fair value of $12.25
    per share. In order to give effect to a return of capital  distribution paid
    in fiscal 1996,  the number of shares  granted under option and the exercise
    price  were  adjusted  in  fiscal  1997  to  96,879  and  $9.42  per  share,
    respectively.

    The  Corporation  accounts for its stock option plan in accordance with SFAS
    No. 123,  "Accounting for Stock-Based  Compensation,"  which contains a fair
    value-based  method for valuing  stock-based  compensation that entities may
    use,  which measures  compensation  cost at the grant date based on the fair
    value of the award. Compensation is then recognized over the service period,
    which is usually the  vesting  period.  Alternatively,  SFAS No. 123 permits
    entities  to  continue  to account  for stock  options  and  similar  equity
    instruments  under  Accounting  Principles  Board  ("APB")  Opinion  No. 25,
    "Accounting  for Stock  Issued to  Employees."  Entities  that  continue  to
    account for stock  options using APB Opinion No. 25 are required to make pro
    forma  disclosures  of net earnings  and earnings per share,  as if the fair
    value-based method of accounting defined in SFAS No. 123 had been applied.

    The Corporation  applies APB Opinion No. 25 and related  Interpretations  in
    accounting for its stock option plan. Accordingly,  no compensation cost has
    been recognized for the plan. Had  compensation  cost for the  Corporation's
    stock option plan been determined based on the fair value at the grant dates
    for awards under the plan consistent with the accounting  method utilized in
    SFAS No. 123,  the  Corporation's  net earnings and earnings per share would
    have resulted in the pro forma amounts indicated below:
<TABLE>
<CAPTION>

                                                               1999             1998         1997
<S>                                   <C>                       <C>              <C>          <C>
    Net earnings (In thousands)     As reported                $514             $541         $627
                                                                ===              ===          ===

                                      Pro-forma                $514             $541         $627
                                                                ===              ===          ===

    Earnings per share
      Basic                         As reported                $.60             $.63         $.71
                                                                ===              ===          ===

                                      Pro-forma                $.60             $.63         $.71
                                                                ===              ===          ===

      Diluted                       As reported                $.59             $.60         $.70
                                                                ===              ===          ===

                                      Pro-forma                $.59             $.60         $.70
                                                                ===              ===          ===
</TABLE>

    The fair value of each option  grant is estimated on the date of grant using
    the  modified   Black-Scholes   options-pricing  model  with  the  following
    weighted-average  assumptions used for grants in fiscal 1999: dividend yield
    of 5.5%, expected volatility of 20.0%, a risk-free interest rate of 6.5% and
    expected lives of ten years.


                                       47
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE K - STOCK OPTION PLAN (continued)

    A  summary  of the  status  of the  Corporation's  stock  option  plan as of
    September 30, 1999,  1998 and 1997, and changes during the periods ending on
    those dates is presented below:
<TABLE>
<CAPTION>

                                                1999                        1998                         1997
                                                      Weighted-                  Weighted-                    Weighted-
                                                        average                    average                      average
                                                       exercise                   exercise                     exercise
                                            Shares        price        Shares        price          Shares        price
<S>                                           <C>          <C>           <C>          <C>            <C>           <C>
    Outstanding at beginning of year        96,879      $  9.42        96,879       $9.42           74,297       $12.25
    Adjustment for return of capital
     distribution                               -           -              -            -           22,582        (2.83)
    Granted                                  1,000        14.00            -            -               -           -
    Exercised                              (12,932)        9.42            -            -               -           -
    Forfeited                                   -           -              -            -               -           -
                                           -------        -----       ------        ----          ------        ----
    -

    Outstanding at end of year              84,947       $ 9.47        96,879       $9.42           96,879       $ 9.42
                                            ======        =====        ======        ====           ======        =====

    Options exercisable at year-end         84,947       $ 9.47        96,879       $9.42           96,879       $ 9.42
                                            ======        =====        ======        ====           ======        =====
    Weighted-average fair value of
      options granted during the year                    $ 2.98                       N/A                           N/A
                                                          =====                       ===                           ===
</TABLE>

     The following  information  applies to options outstanding at September 30,
     1999:
<TABLE>
<CAPTION>

<S>                                                                             <C>
    Number outstanding                                                           84,947
    Range of exercise prices                                             $9.42 - $14.00
    Weighted-average exercise price                                               $9.47
    Weighted-average remaining contractual life                              6.25 years
</TABLE>












                                       48
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE L - CONDENSED FINANCIAL STATEMENTS OF HARVEST HOME FINANCIAL
  CORPORATION

    The  following  condensed  financial   statements  summarize  the  financial
    position of Harvest Home Financial  Corporation as of September 30, 1999 and
    1998,  and the  results of its  operations  and its cash flows for the three
    years ended September 30, 1999, 1998 and 1997.
<TABLE>
<CAPTION>

                       Harvest Home Financial Corporation
                        STATEMENTS OF FINANCIAL CONDITION
                                  September 30,
                                 (In thousands)

    ASSETS                                                                     1999                1998
<S>                                                                            <C>                 <C>
    Cash and cash equivalents                                                $  174             $   130
    Mortgage-backed securities designated as available for
      sale - at market                                                          191                 397
    Loan receivable from ESOP                                                   224                 301
    Investment in Harvest Home Savings Bank                                   9,041               9,370
    Prepaid expenses and other                                                   48                  69
                                                                              -----              ------

          Total assets                                                       $9,678             $10,267
                                                                              =====              ======

    LIABILITIES AND STOCKHOLDERS' EQUITY

    Other liabilities                                                        $   25             $   290

    Stockholders' equity
      Common stock and additional paid-in capital                             6,887               6,903
      Retained earnings                                                       5,329               5,191
      Shares acquired by stock benefit plans                                   (418)               (592)
      Unrealized gains (losses) on securities designated as available
        for sale, net of tax effects                                           (694)                 87
      Less treasury stock - at cost                                          (1,451)             (1,612)
                                                                              -----              ------
         Total stockholders' equity                                           9,653               9,977
                                                                              -----              ------

          Total liabilities and stockholders' equity                         $9,678             $10,267
                                                                              =====              ======

</TABLE>








                                       49

<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE L - CONDENSED FINANCIAL STATEMENTS OF HARVEST HOME FINANCIAL
  CORPORATION (continued)

                       Harvest Home Financial Corporation
<TABLE>
<CAPTION>
                             STATEMENTS OF EARNINGS
                        For the year ended September 30,
                                 (In thousands)
                                                                                    1999            1998           1997
<S>                                                                                 <C>             <C>            <C>
    Revenue
      Interest income                                                              $  29           $  57           $108
      Other income                                                                     7              26             27
      Equity in earnings of Harvest Home Savings Bank                                548             542            602
                                                                                     ---             ---            ---
         Total revenue                                                               584             625            737

    General and administrative expenses                                               87              98            100
                                                                                     ---             ---            ---

         Earnings before income taxes (credits)                                      497             527            637

    Federal income taxes (credits)                                                   (17)            (14)            10
                                                                                     ---             ---            ---

         NET EARNINGS                                                               $514            $541           $627
                                                                                     ===             ===            ===

</TABLE>

























                                       50
<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE L - CONDENSED FINANCIAL STATEMENTS OF HARVEST HOME FINANCIAL
  CORPORATION (continued)
<TABLE>
<CAPTION>

                       Harvest Home Financial Corporation
                            STATEMENTS OF CASH FLOWS
                            Year ended September 30,
                                 (In thousands)

                                                                                    1999            1998           1997
<S>                                                                                  <C>             <C>            <C>
    Cash provided by (used in) operating activities:
      Net earnings for the year                                                     $514         $   541           $627
      Adjustments to reconcile net earnings to net
      cash provided by (used in) operating activities
        Accretion of discounts on mortgage-backed securities                          (1)             (4)            (4)
        Undistributed earnings of consolidated subsidiary                           (248)           (542)          (602)
        Amortization expense of stock benefit plans                                   -                8            144
        Gain on sale of mortgage-backed securities                                    -               (6)            -
        Increase (decrease) in cash due to changes in:
          Prepaid expenses and other assets                                           21             (25)            66
          Other liabilities                                                         (261)            257           (199)
                                                                                     ---          ------            ---
          Net cash provided by operating activities                                   25             229             32

    Cash flows provided by investing activities:
      Proceeds from repayment of loan to ESOP                                         77              77            296
      Proceeds from sale of mortgage-backed securities                                -              337             -
      Principal repayments on mortgage-backed securities                             196             281            228
                                                                                     ---          ------            ---
          Net cash provided by investing activities                                  273             695            524

    Cash flows provided by (used in) financing activities:
      Payment of dividends on common stock                                          (376)           (393)          (371)
      Purchase of treasury stock                                                      -             (756)          (223)
      Proceeds from exercise of stock options                                        122              -              -
                                                                                     ---           -----             --
          Net cash used in financing activities                                     (254)         (1,149)          (594)
                                                                                     ---           -----            ---

    Net increase (decrease) in cash and cash equivalents                              44            (225)           (38)

    Cash and cash equivalents at beginning of year                                   130             355            393
                                                                                     ---           -----            ---

    Cash and cash equivalents at end of year                                        $174          $  130           $355
                                                                                     ===           =====            ===

</TABLE>





                                       51

<PAGE>


                       Harvest Home Financial Corporation

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                        September 30, 1999, 1998 and 1997


NOTE M - PENDING MERGER

    On October 1, 1999,  the  Corporation  entered into an Agreement and Plan of
    Merger  (the  "Agreement")  whereby the  Corporation  would be acquired by a
    newly  formed  holding  company of The People's  Building,  Loan and Savings
    Company  ("People's") for total consideration of approximately $16.5 million
    in cash and common  stock.  In  connection  with the  acquisition,  People's
    (following a merger with The Oakley Improved Building and Loan Company) will
    convert from a mutual to a stock  institution and form the holding  company.
    Under the terms of the  Agreement,  each share of the  Corporation's  common
    stock will be exchanged  for a  combination  of $9.00 per share in cash plus
    new common shares of Peoples'  holding  company with a value of $9.00. It is
    currently anticipated that the number of shares of common stock that will be
    exchanged  for each share of the  Corporation's  common stock is 0.9 shares,
    assuming  the initial  offering  price of People's  common  stock is $10 per
    share.



































                                       52
<PAGE>


                       HARVEST HOME FINANCIAL CORPORATION
                             DIRECTORS AND OFFICERS


BOARD OF DIRECTORS                      OFFICERS

Walter A. Schuch                        John E. Rathkamp
Chairman of the Board                   President, Chief Executive Officer
                                          and Secretary
John E. Rathkamp
Director                                Dennis J. Slattery
                                        Executive Vice President and Treasurer
Richard F. Hauck
Director                                Teresa O'Quinn
                                        Vice President and Controller
Marvin J. Ruehlman
Director                                Deborah Mundstock
                                        Assistant Vice President and
Thomas L. Eckert                          Loan Officer
Director

Herbert E. Menkhaus
Director

George C. Eyrich
Director



























                                       53
<PAGE>


                            HARVEST HOME SAVINGS BANK
                             DIRECTORS AND OFFICERS


John E. Rathkamp
Director, President, Chief Executive Officer and Secretary

Dennis J. Slattery
Executive Vice President, Treasurer

Teresa O'Quinn
Vice President, Controller

Deborah Mundstock
Assistant Vice President, Loan Officer

Richard F. Hauck
Director

Walter A. Schuch
Director

Thomas L. Eckert
Director

Marvin J. Ruehlman
Director

Herbert E. Menkhaus
Director

George C. Eyrich
Director

                                BANKING LOCATIONS

                                   Main Office
                              3621 Harrison Avenue
                             Cincinnati, Ohio 45211

3663 Ebenezer Road                                       7030 Hamilton Avenue
Cincinnati, Ohio  45248                                  Cincinnati, Ohio  45231









                                       54
<PAGE>


                              STOCKHOLDER SERVICES


The Fifth Third Bank serves as transfer  agent and dividend  distributing  agent
for HHFC's  shares.  Communications  regarding  change of  address,  transfer of
shares, lost certificates and dividends should be sent to:

                                 Dana S. Hushak
                                 Vice President
                                Fifth-Third Bank
                          Trust and Investment Services
                               Fifth-Third Center
                             Cincinnati, Ohio 45263


                                 ANNUAL MEETING

Harvest Home  Financial  Corporation  executed a merger  agreement with People's
Building Loan and Savings  Company on October 1, 1999. Due to the need to hold a
special  meeting of  shareholders  to ratify  the  proposed  merger,  the Annual
Meeting  of  Shareholders  usually  held in  December  of  each  year  has  been
postponed.  Subject to regulatory approval of the merger, a special shareholders
meeting is anticipated during the second calendar quarter of year 2000.


                          ANNUAL REPORT ON FORM 10-KSB

A copy of HHFC's Annual Report on Form 10-KSB,  as filed with the Securities and
Exchange Commission, will be available at no charge to stockholders upon written
request to:

                       Harvest Home Financial Corporation
                          Attention: Dennis J. Slattery
                            Executive Vice President
                              3621 Harrison Avenue
                               Cheviot, Ohio 45211


























                                       55