----

----

| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

|   | For the quarterly period ended: September 30, 2010 |
|--------|----------------------------------------------------|

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------|

|   | For the transition period from ___________ to ____________ |
|--------|------------------------------------------------------------|

| 000-53370                |   |   |
|--------------------------|--------|--------|
| (Commission File Number) |   |   |

|   | Auburn Bancorp, Inc.                                   |   |
|--------|--------------------------------------------------------|--------|
|   | (Exact name of registrant as specified in its charter) |   |

| United States                                 |   |   |   | 26-2139168                       |
|-----------------------------------------------|--------|--------|--------|----------------------------------|
| (State or other jurisdictionof incorporation) |   |   |   | (IRS EmployerIdentification No.) |

|   | 256 Court Street, P.O. Box 3157, Auburn, Maine 04212  |   |
|--------|-------------------------------------------------------|--------|
|   | (Address and zip code of principal executive offices) |   |

|   | (207) 782-0400                                             |   |
|--------|------------------------------------------------------------|--------|
|   | (Registrant’s telephone number, including area code) |   |

|   | None                                                                               |   |
|--------|------------------------------------------------------------------------------------|--------|
|   | (Former name, former address and former fiscal year, if changed since last report) |   |

----

|     |                                                                                                                                |   | Page   |
|----------|-------------------------------------------------------------------------------------------------------------------------------------|--------|--------|
|     |                                                                                                                                |   |   |
|     | PART I. FINANCIAL INFORMATION (Unaudited)                                                                                           |   |   |
|     |                                                                                                                                |   |   |
| Item 1.  | Financial Statements                                                                                                                |   |   |
|     |                                                                                                                                |   |   |
|     | Consolidated Balance Sheets as of September 30, 2010 (Unaudited) and June 30, 2010                                                  |   | 3      |
|     |                                                                                                                                |   |   |
|     | Consolidated Statements of Operations (Unaudited) for the Three Months Ended September 30, 2010 and 2009                            |   | 4      |
|     |                                                                                                                                |   |   |
|     | Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) for the Three Months Ended September 30, 2010 and 2009 |   | 5      |
|     |                                                                                                                                |   |   |
|     | Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended September 30, 2010 and 2009                            |   | 6      |
|     |                                                                                                                                |   |   |
|     | Notes to Consolidated Financial Statements (Unaudited)                                                                              |   | 7      |
|     |                                                                                                                                |   |   |
| Item 2.  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                                |   | 15     |
|     |                                                                                                                                |   |   |
| Item 3.  | Quantitative and Qualitative Disclosures About Market Risk                                                                          |   | 23     |
|     |                                                                                                                                |   |   |
| Item 4T. | Controls and Procedures                                                                                                             |   | 23     |
|     |                                                                                                                                |   |   |
|     | PART II. OTHER INFORMATION                                                                                                          |   |   |
|     |                                                                                                                                |   |   |
| Item 1.  | Legal Proceedings                                                                                                                   |   | 24     |
|     |                                                                                                                                |   |   |
| ITEM 1A. | Risk Factors                                                                                                                        |   | 24     |
|     |                                                                                                                                |   |   |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                         |   | 24     |
|     |                                                                                                                                |   |   |
| Item 3.  | Defaults Upon Senior Securities                                                                                                     |   | 24     |
|     |                                                                                                                                |   |   |
| Item 4.  | [REMOVED AND RESERVED]                                                                                                              |   |   |
|     |                                                                                                                                |   | 24     |
| Item 5.  | Other Information                                                                                                                   |   |   |
|     |                                                                                                                                |   |   |
| Item 6.  | Exhibits                                                                                                                            |   | 25     |
|     |                                                                                                                                |   |   |
|     | Signatures                                                                                                                          |   | 26     |

----

|                                                                                                                                          |   | September 30, |       |   | June 30, |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|------------|--------|----------|--------|
|                                                                                                                                          |   | 2010          |       |   | 2010     |   |
|                                                                                                                                          |   | (Unaudited)   |       |   |     |   |
|                                                                                                                                          |   |          |       |   |     |   |
| Cash and due from banks                                                                                                                       |   | $             | 1,568,235  |   |     | $      | 1,573,526 |   |
| Interest-earning deposits                                                                                                                     |   |          | 1,561,804  |   |     |   | 3,705,910 |   |
| Total cash and cash equivalents                                                                                                               |   |          | 3,130,039  |   |     |   | 5,279,436 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Certificates of deposit                                                                                                                       |   |          | 845,000    |   |     |   | 845,000 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Investment securities available for sale, at fair value                                                                                       |   |          | 1,819,356  |   |     |   | 1,112,507 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Federal Home Loan Bank stock, at cost                                                                                                         |   |          | 1,251,700  |   |     |   | 1,251,700 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Loans                                                                                                                                         |   |          | 71,715,383 |   |     |   | 69,374,825 |   |
| Less allowance for loan losses                                                                                                                |   |          | (719,251   | )      |     |   | (492,112 | ) |
| Net loans                                                                                                                                     |   |          | 70,996,132 |   |     |   | 68,882,713 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Property and equipment, net                                                                                                                   |   |          | 1,846,034  |   |     |   | 1,852,414 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Foreclosed real estate, net of allowance of $0 at September 30, 2010 and $50,333 at June 30, 2010                                             |   |          | 802,127    |   |     |   | 680,712 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Accrued interest receivable:                                                                                                                  |   |          |       |   |     |   |   |   |
| Investments                                                                                                                                   |   |          | 16,593     |   |     |   | 13,820 |   |
| Mortgage-backed securities                                                                                                                    |   |          | 498        |   |     |   | 573 |   |
| Loans                                                                                                                                         |   |          | 279,219    |   |     |   | 263,353 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Prepaid expenses and other assets                                                                                                             |   |          | 441,378    |   |     |   | 405,246 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Total assets                                                                                                                                  |   | $             | 81,428,076 |   |     | $      | 80,587,474 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                    |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Liabilities:                                                                                                                                  |   |          |       |   |     |   |   |   |
| Deposits                                                                                                                                      |   | $             | 55,290,865 |   |     | $      | 55,769,248 |   |
| Federal Home Loan Bank advances                                                                                                               |   |          | 19,894,463 |   |     |   | 18,430,662 |   |
| Accrued interest and other liabilities                                                                                                        |   |          | 193,298    |   |     |   | 337,611 |   |
| Total liabilities                                                                                                                             |   |          | 75,378,626 |   |     |   | 74,537,521 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Stockholders’ equity:                                                                                                                   |   |          |       |   |     |   |   |   |
| Preferred stock, 1,000,000 shares authorized, no shares issued or outstanding                                                                 |   |          | —    |   |     |   | — |   |
| Common stock, $.01 par value per share, 10,000,000 shares authorized, 503,284 shares issued and outstanding at September 30 and June 30, 2010 |   |          | 5,033      |   |     |   | 5,033 |   |
| Additional paid-in-capital                                                                                                                    |   |          | 1,468,009  |   |     |   | 1,468,928 |   |
| Retained earnings                                                                                                                             |   |          | 4,701,673  |   |     |   | 4,719,099 |   |
| Accumulated other comprehensive gain                                                                                                          |   |          | 16,320     |   |     |   | 1,368 |   |
| Unearned compensation (ESOP shares)                                                                                                           |   |          | (141,585   | )      |     |   | (144,475 | )  |
| Total stockholders’ equity                                                                                                              |   |          | 6,049,450  |   |     |   | 6,049,953 |   |
|                                                                                                                                          |   |          |       |   |     |   |   |   |
| Total liabilities and stockholders’ equity                                                                                              |   | $             | 81,428,076 |   |     | $      | 80,587,474 |   |

----

|                                                                                |   | Three Months Ended September 30, |            |
|-------------------------------------------------------------------------------------|--------|----------------------------------|-----------------|
|                                                                                |   |  2010                       |            |   |  2009 |   |
|                                                                                |   |   (Unaudited)               |            |
| Interest and dividend income:                                                       |   |                             |            |   |   |   |
| Interest on loans                                                                   |   | $                                | 1,067,571       |   |   | $ | 965,444 |   |
| Interest on investments and other interest-earning deposits                         |   |                             |  14,508    |   |   |   | 46,731 |   |
| Total interest and dividend income                                                  |   |                             |  1,082,079 |   |   |   | 1,012,175 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Interest expense:                                                                   |   |                             |            |   |   |   |   |   |
| Interest on deposits and escrow accounts                                            |   |                             | 234,217         |   |   |   | 268,059 |   |
| Interest on Federal Home Loan Bank advances                                         |   |                             | 146,180         |   |   |   | 190,933 |   |
| Total interest expense                                                              |   |                             | 380,397         |   |   |   | 458,992 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Net interest income                                                                 |   |                             | 701,682         |   |   |   | 553,183 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Provision for loan losses                                                           |   |                             | 278,797         |   |   |   | 17,848 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Net interest income after provision for loan losses                                 |   |                             | 422,885         |   |   |   |  535,335 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Non-interest income (loss):                                                         |   |                             |            |   |   |   |   |   |
|        Net gain on sales of loans                |   |                             | 22,395          |   |   |   | 21,593 |   |
|        Net loss on sale of other assets          |   |                             | (6,384          | ) |   |   | (6,914 | ) |
|        Net loss on sale of investment securities |   |                             | -          |   |   |   | (159,163 | ) |
|    Other non-interest income                                              |   |                             | 39,703          |   |   |   | 35,894 |   |
| Total non-interest income (loss)                                                    |   |                             |  55,714    |   |   |   | (108,590 | ) |
|                                                                                |   |                             |            |   |   |   |   |   |
| Non-interest expenses:                                                              |   |                             |            |   |   |   |   |   |
| Salaries and employee benefits                                                      |   |                             | 229,519         |   |   |   | 231,943 |   |
| Occupancy expense                                                                   |   |                             | 23,816          |   |   |   | 24,846 |   |
| Depreciation                                                                        |   |                             | 24,055          |   |   |   | 26,008 |   |
| Federal deposit insurance premiums                                                  |   |                             | 13,441          |   |   |   | 52,363 |   |
| Computer charges                                                                    |   |                             | 42,113          |   |   |   | 45,467 |   |
| Advertising expense                                                                 |   |                             | 22,490          |   |   |   | 13,463 |   |
| Consulting expense                                                                  |   |                             | 16,040          |   |   |   | 13,975 |   |
| Net recovery of losses on foreclosed real estate                                    |   |                             | (4,142          | ) |   |   | - |   |
| Other operating expenses                                                            |   |                             | 135,903         |   |   |   | 110,061 |   |
| Total non-interest expenses                                                         |   |                             |  503,235   |   |   |   | 518,126 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Loss before income taxes                                                            |   |                             | (24,636         | ) |   |   | (91,381 | ) |
|                                                                                |   |                             |            |   |   |   |   |   |
| Income tax benefit                                                                  |   |                             |  7,210     |   |   |   | 29,649 |   |
|                                                                                |   |                             |            |   |   |   |   |   |
| Net loss                                                                            |   | $                                | (17,426         | ) |   | $ | (61,732 | ) |
|                                                                                |   |                             |            |   |   |   |   |   |
| Net loss per common share                                                           |   | $                                | (.04            | ) |   | $ | (.13 | ) |

----

|                                                                                           |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
|------------------------------------------------------------------------------------------------|--------|--------------------------|----------|--------|----------------------------------------|--------|-----------------|------------------------------|--------|--------|--------------------------------------------------------|--------|--------|-------------------------------------------|-----------------------|--------|--------|--------|-----------------|--------|--------|--------|-----------------------|--------|
|                                                                                           |   |  Common Stock  |     |   |  Additional Paid-in-Capital  |   |            |  RetainedEarnings  |   |   |  AccumulatedOtherComprehensiveIncome (Loss)  |   |   |  Unearned Compensation (ESOP Shares) |                  |   | Total  |   |
|  Balance, June 30, 2009                                                                   |   | $                        | 5,033    |   |                                   | $      | 1,470,790       |                         |   | $      | 4,611,470                                              |   |   | $                                         | (26,225               | )      |   | $      | (157,189        | )      |   | $      | 5,903,879             |   |
|                                                                                           |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Comprehensive loss                                                                             |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Net loss                                                                                       |   |                     | -        |   |                                   |   | -               |                         |   |   | (61,732                                                | )      |   |                                      | -                     |   |   |   | -               |   |   |   | (61,732               | )      |
| Other comprehensive income                                                                     |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Unrealized holding loss on securities, net of taxes of $(29,659)                               |   |                     |   - |   |                                   |   |   -        |                         |   |   |   -                                               |   |   |                                      | (57,574               | )      |   |   |   -        |   |   |   | (57,574               | )      |
|  Less reclassification adjustment for items included in net loss, net of taxes of $54,115 |   |                     |   - |   |                                   |   |     - |                         |   |   |     -                                        |   |   |                                      |     105,048 |   |   |   |     - |   |   |   |     105,048 |   |
|                                                                                           |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Total comprehensive loss                                                                       |   |                     | -        |   |                                   |   | -               |                         |   |   | (61,732                                                | )      |   |                                      | 47,474                |   |   |   | -               |   |   |   | (14,258               | )      |
|                                                                                           |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Common stock held by ESOP committed to be  released  (405 shares)          |   |                     | -        |   |                                   |   | (230            | )                            |   |   | -                                                      |   |   |                                      | -                     |   |   |   | 4,046           |   |   |   | 3,816                 |   |
|                                                                                           |   |                     |     |   |                                   |   |            |                         |   |   |                                                   |   |   |                                      |                  |   |   |   |            |   |   |   |                  |   |
| Balance, September 30, 2009                                                                    |   | $                        | 5,033    |   |                                   | $      | 1,470,560       |                         |   | $      | 4,549,738                                              |   |   | $                                         | 21,249                |   |   | $      | (153,143        | )      |   | $      | 5,893,437             |   |

|    Balance, June 30, 2010                                              |   | $      | 5,033  |   |   | $      | 1,468,928 |   |   | $      | 4,719,099 |   |   | $      | 1,368  |   |   | $      | (144,475 | )      |   | $      | 6,049,953 |   |
|---------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|-----------|--------|--------|--------|-----------|--------|--------|--------|--------|--------|--------|--------|----------|--------|--------|--------|-----------|--------|
|                                                                                  |   |   |   |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |     |   |   |   |      |   |
| Comprehensive loss                                                                    |   |   |   |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |     |   |   |   |      |   |
| Net loss                                                                              |   |   | -      |   |   |   | -         |   |   |   | (17,426   | )      |   |   | -      |   |   |   | -        |   |   |   | (17,426   | )      |
| Other comprehensive income                                                            |   |   |   |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |     |   |   |   |      |   |
| Unrealized holding gain on securities, net of taxes of $7,703                         |   |   | -      |   |   |   | -         |   |   |   | -         |   |   |   | 14,952 |   |   |   | -        |   |   |   | 14,952    |   |
|  Total comprehensive loss                                                        |   |   | -      |   |   |   | -         |   |   |   | (17,426   | )      |   |   | 14,952 |   |   |   | -        |   |   |   | (2,474    | )      |
|                                                                                  |   |   |   |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |     |   |   |   |      |   |
| Common stock held by ESOP committed to be  released  (289 shares) |   |   | -      |   |   |   | (919      | )      |   |   | -         |   |   |   | -      |   |   |   | 2,890    |   |   |   | 1,971     |   |
|                                                                                  |   |   |   |   |   |   |      |   |   |   |      |   |   |   |   |   |   |   |     |   |   |   |      |   |
| Balance, September 30, 2010                                                           |   | $      | 5,033  |   |   | $      | 1,468,009 |   |   | $      | 4,701,673 |   |   | $      | 16,320 |   |   | $      | (141,585 | )      |   | $      | 6,049,450 |   |

----

|                                                                                         |   | Three Months EndedSeptember 30, |
|----------------------------------------------------------------------------------------------|--------|---------------------------------|
|                                                                                         |   |                            |   |   |
|                                                                                         |   |                            | 2010 |   |   |   | 2009 |   |
|                                                                                         |   |                            |   |   |   |   |   |   |
| Net loss                                                                                     |   | $                               | (17,426 | ) |   | $ | (61,732 | ) |
| Adjustments to reconcile net income to net cash  provided by operating activities: |   |                            |   |   |   |   |
| Depreciation                                                                                 |   |                            | 24,055 |   |   |   | 26,008 |   |

| Net accretion of discounts on investment securities available for sale |   |   | (8,589 | ) |   |   | (2,100 | ) |
|------------------------------------------------------------------------|--------|--------|--------|---|--------|--------|--------|---|

|         Provision for loan losses |   |   | 278,797 |   |   |   | 17,848  |   |
|---------------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|
| Net recovery of losses on foreclosed real estate                          |   |   | (4,142  | )      |   |   | -       |   |
| Deferred income tax benefit                                               |   |   | -       |   |   |   | (11,380 | )      |
| Net loss on sale of investment securities available for sale              |   |   |  - |   |   |   | 159,163 |   |
| Gain on sales of loans |   |   | (22,395 | ) |   |   | (21,593 | ) |
|------------------------|--------|--------|---------|---|--------|--------|---------|---|

| Loss on foreclosed real estate |   |   | 6,384 |   |   |   | 6,914 |   |
|--------------------------------|--------|--------|-------|--------|--------|--------|-------|--------|

| ESOP compensation expense                                      |   |   | 1,971    |   |   |   | 3,816   |   |
|----------------------------------------------------------------|--------|--------|----------|--------|--------|--------|---------|--------|
| Net increase in prepaid expenses and other assets              |   |   | (36,132  | )      |   |   | (37,232 | )      |
| Net increase in accrued interest receivable                    |   |   | (18,564  | )      |   |   | (16,752 | )      |
| Net decrease in accrued interest payable and other liabilities |   |   | (152,014 | )      |   |   | (96,494 | )      |

|                                                |   |   |   |   |   |   |
|-----------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Net cash provided by (used in) operating activities |   |   | 51,945 |   |   |   | (33,534 | ) |
|                                                |   |   |   |   |   |   |

| Cash flows from investing activities:                                                       |   |   |       |   |   |   |
|---------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|
| Purchase of investment securities available for sale                                        |   |   | (708,594   | )      |   |   | - |   |
| Proceeds from sales of investment securities available for sale                             |   |   | -          |   |   |   | 316,381 |   |
| Proceeds from maturities and principal paydowns on investment securities available for sale |   |   | 32,987     |   |   |   | 46,817 |   |
| Net change in certificates of deposit                                                       |   |   | -          |   |   |   | 588,515 |   |
| Net increase in loans to customers                                                          |   |   | (2,493,478 | )      |   |   | (2,102,852 | ) |
| Purchase of Federal Home Loan Bank stock                                                    |   |   | -          |   |   |   | (53,700 | ) |
| Capital expenditures                                                                        |   |   | (17,675    | )      |   |   | (10,765 | ) |
|                                                                                        |   |   |       |
| Net cash used in investing activities                                                       |   |   | (3,186,760 | )      |   |   | (1,215,604 | ) |

|                                                 |   |   |       |   |   |   |      |   |
|------------------------------------------------------|--------|--------|------------|--------|--------|--------|-----------|--------|
| Cash flows from financing activities:                |   |   |       |   |   |   |      |   |
| Advances from Federal Home Loan Bank                 |   |   | 2,000,000  |   |   |   | 750,000   |   |
| Repayment of advances from Federal Home Loan Bank    |   |   | (500,000   | )      |   |   | (500,000  | )      |
| Net change in short-term borrowings                  |   |   | (36,199    | )      |   |   | (11,888   | )      |
| Net increase (decrease) in deposits                  |   |   | (478,383   | )      |   |   | 1,978,528 |   |
| Net cash provided by financing activities            |   |   | 985,418    |   |   |   | 2,216,640 |   |
|                                                 |   |   |       |   |   |   |      |   |
| Net increase (decrease) in cash and cash equivalents |   |   | (2,149,397 | )      |   |   | 967,502   |   |
|  Cash and cash equivalents, beginning of period |   |   | 5,279,436  |   |   |   | 2,374,636 |   |
|                                                 |   |   |       |   |   |   |      |   |
| Cash and cash equivalents, end of period             |   | $      | 3,130,039  |   |   | $      | 3,342,138 |   |
|                                                 |   |   |       |   |   |   |      |   |
| Supplementary cash flow information:                 |   |   |       |   |   |   |      |   |
| Cash paid during the period for:                     |   |   |       |   |   |   |      |   |
| Interest                                             |   | $      | 380,983    |   |   | $      | 459,156   |   |
| Taxes                                                |   | $      | 80,830     |   |   | $      | 6,300     |   |
| Transfer of loans to foreclosed real estate          |   | $      | 123,657    |   |   | $      | 87,103    |   |
|                                                 |   |   |       |   |   |   |      |   |

----

----

----

|                                            |   |          |      |   |                 |   |   |                  |   |   |      |   |
|-------------------------------------------------|--------|---------------|-----------|--------|----------------------|--------|--------|-----------------------|--------|--------|-----------|--------|
|                                            |   | AmortizedCost |      |   | GrossUnrealizedGains |   |   | GrossUnrealizedLosses |   |   | FairValue |   |
|                                            |   |          |      |   |                 |   |   |                  |   |   |      |   |
| Municipal bond                                  |   | $             | 178,738   |   |                 | $      | 9,011  |                  |   | $      | -         |   |   | $ | 187,749 |   |
| Corporate bonds                                 |   |          | 1,499 292 |   |                 |   | 25,216 |                  |   |   | (12,200   | )      |   |   | 1,512,308 |   |
| FNMA mortgage-backed securities                 |   |          | 106,597   |   |                 |   | 2,093  |                  |   |   | -         |   |   |   | 108,690 |   |
| U.S. Government sponsored enterprise securities |   |          | 2         |   |                 |   | 607    |                  |   |   | -         |   |   |   | 609 |   |
| Corporate common stock                          |   |          | 10,000    |   |                 |   | -      |                  |   |   | -         |   |   |   | 10,000 |   |
|                                            |   |          |      |   |                 |   |   |                  |   |   |      |   |   |   |   |   |
| Total investment securities available for sale  |   | $             | 1,794,629 |   |                 | $      | 36,927 |                  |   | $      | (12,200   | )      |   | $ | 1,819,356 |   |

| June 30, 2010                                   |   |          |      |   |                 |   |   |                  |   |   |      |   |
|-------------------------------------------------|--------|---------------|-----------|--------|----------------------|--------|--------|-----------------------|--------|--------|-----------|--------|
|                                            |   | AmortizedCost |      |   | GrossUnrealizedGains |   |   | GrossUnrealizedLosses |   |   | FairValue |   |
| Corporate bonds                                 |   | $             | 982,415   |   |                 | $      | 13,366 |                  |   | $      | (15,640   | )      |   | $ | 980,141 |   |
| FNMA mortgage-backed securities                 |   |          | 118,017   |   |                 |   | 3,499  |                  |   |   | -         |   |   |   | 121,516 |   |
| U.S. Government sponsored enterprise securities |   |          | 2         |   |                 |   | 848    |                  |   |   | -         |   |   |   | 850 |   |
| Corporate common stock                          |   |          | 10,000    |   |                 |   | -      |                  |   |   | -         |   |   |   | 10,000 |   |
|                                            |   |          |      |   |                 |   |   |                  |   |   |      |   |   |   |   |   |
| Total investment securities available for sale  |   | $             | 1,110,434 |   |                 | $      | 17,713 |                  |   | $      | (15,640   | )      |   | $ | 1,112,507 |   |

|   |                           |   |               |      |          |   |          |   |      |      |   |   |      |   |
|--------|--------------------------------|--------|--------------------|-----------|---------------|--------|---------------|--------|-----------|-----------|--------|--------|-----------|--------|
|   |                           |   | September 30, 2010 |      | June 30, 2010 |   |
|   |                           |   | AmortizedCost      |      | FairValue     |   | AmortizedCost |   | FairValue |      |
|   |                           |   |               |      |          |   |          |   |      |      |   |   |      |   |
|   | Over 1 year through 5 years    |   | $                  | 1,299,292 |          | $      | 1,291,028     |   | $         | 782,415   |   | $      | 766,775   |   |
|   | After 5 years through 10 years |   |               | 200,000   |          |   | 221,281       |   |      | 200,000   |   |   | 213,366   |   |
|   | After 10 years                 |   |               | 178,738   |          |   | 187,748       |   |      | -         |   |   | -         |   |
|   |                           |   |               | 1,678,030 |          |   | 1,700,057     |   |      | 982,415   |   |   | 980,141   |   |
|   | Mortgage-backed securities     |   |               | 106,597   |          |   | 108,690       |   |      | 118,017   |   |   | 121,516   |   |
|   |                           |   |               |      |          |   |          |   |      |      |   |   |      |   |
|   |                           |   | $                  | 1,784,627 |          | $      | 1,808,747     |   | $         | 1,100,432 |   | $      | 1,101,657 |   |

----

|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|--------|--------------------|--------|---------------------|---------|-----------------------|--------|------------|--------|-----------------------|---------|------------|--------|-----------------------|--------|--------|---------|--------|--------|--------|--------|
|   |               |   | Less Than 12 Months |    | 12 Months or Greater  |   | Total      |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |
|   |               |   | Fair Value          |    | GrossUnrealizedLosses |   | Fair Value |   | GrossUnrealizedLosses |    | Fair Value |   | GrossUnrealizedLosses |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |
|   | September 30, 2010 |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   | Corporate bonds    |   | $                   | -       |                  | $      | -          |   | $                     | 250,000 |       | $      | 12,200                |   | $      | 250,000 |   | $      | 12,200 |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   | Total              |   | $                   | -       |                  | $      | -          |   | $                     | 250,000 |       | $      | 12,200                |   | $      | 250,000 |   | $      | 12,200 |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   | June 30, 2010      |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   | Corporate bonds    |   | $                   | 530,525 |                  | $      | 1,890      |   | $                     | 236,250 |       | $      | 13,750                |   | $      | 766,775 |   | $      | 15,640 |   |
|   |               |   |                |    |                  |   |       |   |                  |    |       |   |                  |   |   |    |   |   |   |   |
|   | Total              |   | $                   | 530,525 |                  | $      | 1,890      |   | $                     | 236,250 |       | $      | 13,750                |   | $      | 766,775 |   | $      | 15,640 |   |

|   |                                                                                        |   | Three Months EndedSeptember 30, |    |
|--------|---------------------------------------------------------------------------------------------|--------|---------------------------------|---------|
|   |                                                                                        |   | 2010                            |    |   | 2009 |   |
|   | Net loss                                                                                    |   | $                               | (17,426 | ) |   | $ | (61,732 | ) |
|   |                                                                                        |   |                            |
|   | Weighted average common     shares outstanding                     |   |                            | 503,284 |   |   |   | 503,284 |   |
|   | Less:  Average unallocated     ESOP shares               |   |                            | (14,159 | ) |   |   | (15,314 | ) |
|   |                                                                                        |   |                            |
|   | Adjusted weighted average     common  shares outstanding |   |                            | 489,125 |   |   |   | 487,970 |   |
|   |                                                                                        |   |                            |
|   | Net loss per common     share                                      |   | $                               | (.04    | ) |   | $ | (.13 | ) |
|   |                                                                                        |   |                            |    |   |   |   |   |   |

----

|                                                                                                                |   |                                  |    |
|---------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------|---------|
|                                                                                                                |   | Three Months Ended September 30, |    |
|                                                                                                                |   | 2010                                  |    |   | 2009 |   |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Net loss                                                                                                            |   | $                                     | (17,426 | ) |   | $ | (61,732 | ) |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Other comprehensive income, net of tax:                                                                             |   |                                  |    |   |   |   |   |   |
| Unrealized holding gains (losses) on securities    available for sale arising during the period |   |                                  | 22,655  |   |   |   | (87,233 | ) |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Reclassification adjustment for items included   in net loss                                         |   |                                  | -       |   |   |   | 159,163 |   |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Tax effect                                                                                                          |   |                                  | (7,703  | ) |   |   | (24,456 | ) |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Other comprehensive income, net of  tax                                                                   |   |                                  | 14,952  |   |   |   | 47,474 |   |
|                                                                                                                |   |                                  |    |   |   |   |   |   |
| Total comprehensive loss                                                                                            |   | $                                     | (2,474  | ) |   | $ | (14,258 | ) |

----

|   |                                            |   |        |      |   | Fair Value Measurements Using                    |   |
|--------|-------------------------------------------------|--------|-------------|-----------|--------|------------------------------------------------------------|--------|
|   |                                            |   |  Total |      |   | Quoted PricesIn ActiveMarkets forIdentical Assets(Level 1) |   |   |  SignificantOtherObservableInputs(Level 2) |   |   |  SignificantUnobservableInputs(Level 3) |   |
|   | September 30, 2010                              |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Assets:                                         |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Investment securities available for sale        |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Municipal bond                                  |   | $           | 187,749   |   |                                                       | $      | --- |   |   | $ | 187,749 |   |   | $ | --- |   |
|   | Corporate bonds                                 |   |        | 1,512,308 |   |                                                       |   | --- |   |   |   | 1,512,308 |   |   |   | --- |   |
|   | FNMA mortgage-backed securities                 |   |        | 108,690   |   |                                                       |   | --- |   |   |   | 108,690 |   |   |   | --- |   |
|   | U.S. Government sponsored enterprise securities |   |        | 609       |   |                                                       |   | --- |   |   |   | 609 |   |   |   | --- |   |
|   | Corporate common stock                          |   |        | 10,000    |   |                                                       |   | --- |   |   |   | 10,000 |   |   |   | --- |   |
|   |                                            |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | June 30, 2010                                   |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Assets:                                         |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Investment securities available for sale        |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Corporate bonds                                 |   | $           | 980,141   |   |                                                       | $      | --- |   |   | $ | 980,141 |   |   | $ | --- |   |
|   | FNMA mortgage-backed securities                 |   |        | 121,516   |   |                                                       |   | --- |   |   |   | 121,516 |   |   |   | --- |   |
|   | U.S. Government sponsored enterprise securities |   |        | 850       |   |                                                       |   | --- |   |   |   | 850 |   |   |   | --- |   |
|   | Corporate common stock                          |   |        | 10,000    |   |                                                       |   | --- |   |   |   | 10,000 |   |   |   | --- |   |
|   |                                            |   |        |      |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |

----

|   |               |   |         |    |   |  Fair Value Measurements Using                        |   |
|--------|--------------------|--------|--------------|---------|--------|------------------------------------------------------------|--------|
|   |               |   |   Total |    |   | Quoted PricesIn ActiveMarkets forIdentical Assets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   |   SignificantUnobservableInputs(Level 3) |   |
|   | September 30, 2010 |   |         |    |   |                                                       |   |   |   |   |   |   |   |
|   | Assets:            |   |         |    |   |                                                       |   |   |   |   |   |   |   |
|   | Impaired loans     |   | $            | 255,000 |   |                                                       | $      | --- |   |   | $ | 255,000 |   |   | $ | --- |   |
|   |               |   |         |    |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | June 30, 2010      |   |         |    |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Assets:            |   |         |    |   |                                                       |   |   |   |   |   |   |   |   |   |   |   |
|   | Impaired loans     |   | $            | 328,939 |   |                                                       | $      | --- |   |   | $ | 328,939 |   |   | $ | --- |   |

----

|   |                            |   | September 30, 2010 |   |   | June 30, 2010 |   |
|--------|---------------------------------|--------|--------------------|--------|--------|---------------|--------|
|   |                            |   | CarryingAmount     |   |   | FairValue     |   |   | CarryingAmount |   |   | FairValue |   |
|   |                            |   | (In thousands)     |   |
|   | Financial assets                |   |               |   |   |          |   |   |   |   |   |   |   |
|   | Cash and cash equivalents       |   | $                  | 3,130  |   |          | $      | 3,130 |   |   | $ | 5,279 |   |   | $ | 5,279 |   |
|   | Certificates of deposit         |   |               | 845    |   |          |   | 845 |   |   |   | 845 |   |   |   | 845 |   |
|   | Securities available for sale   |   |               | 1,819  |   |          |   | 1,819 |   |   |   | 1,113 |   |   |   | 1,113 |   |
|   | Federal Home Loan Bank stock    |   |               | 1,252  |   |          |   | 1,252 |   |   |   | 1,252 |   |   |   | 1,252 |   |
|   | Loans, net                      |   |               | 70,996 |   |          |   | 73,491 |   |   |   | 68,883 |   |   |   | 71,067 |   |
|   | Accrued interest receivable     |   |               | 296    |   |          |   | 296 |   |   |   | 278 |   |   |   | 278 |   |
|   |                            |   |               |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|   | Financial liabilities           |   |               |   |   |          |   |   |   |   |   |   |   |   |   |   |   |
|   | Deposits                        |   |               | 55,291 |   |          |   | 55,024 |   |   |   | 55,769 |   |   |   | 55,396 |   |
|   | Federal Home Loan Bank advances |   |               | 19,894 |   |          |   | 20,574 |   |   |   | 18,431 |   |   |   | 19,010 |   |

| ● | Those comprising events or transactions providing additional evidence about conditions that existed at the balance sheet date, including estimates inherent in the financial statement preparation process (referred to as recognized subsequent events). |
|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|  ● | Those comprising events that provide evidence about conditions not existing at the balance sheet date but, rather, that arose after such date (referred to as non-recognized subsequent events). |
|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
|---------|---------------------------------------------------------------------------------------------|

----

----

----

----

|                                      |   |  Three Months Ended September 30, 2010Compared to Three MonthsEnded September 30, 2009 |    |
|-------------------------------------------|--------|---------------------------------------------------------------------------------------------|---------|
|                                      |   |   Volume                                                                          |    |   |   Rate |   |   |  Netchange |   |
|                                      |   |                                                                                        |    |   |   |   |   |   |   |   |   |   |
| Interest-earning assets:                  |   |                                                                                        |    |   |   |   |   |   |   |   |   |   |
| Loans                                     |   | $                                                                                           | 105,000 |   |   | $ | (3,000 | ) |   | $ | 102,000 |   |
| Investment securities                     |   |                                                                                        | 5,000   |   |   |   | (7,000 | ) |   |   | (2,000 | ) |
| Federal Home Loan Bank stock              |   |                                                                                        | -       |   |   |   | - |   |   |   | - |   |
| Interest-earning deposits                 |   |                                                                                        | (13,000 | ) |   |   | (17,000 | ) |   |   | (30,000 | ) |
| Total interest-earning assets             |   | $                                                                                           | 97,000  |   |   | $ | (27,000 | ) |   | $ | 70,000 |   |
| Interest-bearing liabilities:             |   |                                                                                        |    |   |   |   |   |   |   |   |   |   |
| Savings deposits                          |   | $                                                                                           | 2,000   |   |   | $ | (1,000 | ) |   | $ | 1,000 |   |
| NOW accounts                              |   |                                                                                        | 1,000   |   |   |   | (2,000 | ) |   |   | (1,000 | ) |
| Money market accounts                     |   |                                                                                        | 7,000   |   |   |   | (20,000 | ) |   |   | (13,000 | ) |
| Certificates of deposit                   |   |                                                                                        | 24,000  |   |   |   | (46,000 | ) |   |   | (22,000 | ) |
| Total deposits                            |   |                                                                                        | 34,000  |   |   |   | (69,000 | ) |   |   | (35,000 | ) |
| Federal Home Loan Bank of Boston advances |   |                                                                                        | (19,000 | ) |   |   | (25,000 | ) |   |   | (44,000 | ) |
| Total interest-bearing liabilities        |   | $                                                                                           | 15,000  |   |   | $ | (94,000 | ) |   | $ | (79,000 | ) |
| Change in net interest income             |   | $                                                                                           | 82,000  |   |   | $ | 67,000 |   |   | $ | 149,000 |   |

----

----

|                                                               |   | For the Three Months Ended September 30, |   |
|--------------------------------------------------------------------|--------|------------------------------------------|--------|
|                                                               |   | 2010                                     |   |   | 2009 |   |
|                                                               |   | AverageOutstandingBalance                |   |   | Interest |   |   | Yield/Rate |   |   | AverageOutstandingBalance |   |   | Interest |   |   | Yield/Rate |   |
|                                                               |   | (Dollars in Thousands)                   |   |
| Interest-earning assets:                                           |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                                              |   | $                                        | 70,463 |   |   | $ | 1,068 |   |   |   | 6.06 | % |   | $ | 63,527 |   |   | $ | 965 |   |   |   | 6.08 | % |
| Investment securities(1)                                           |   |                                     | 1,765  |   |   |   | 12 |   |   |   | 2.76 | % |   |   | 1,195 |   |   |   | 14 |   |   |   | 4.64 | % |
| Federal Home Loan Bank stock                                       |   |                                     | 1,252  |   |   |   | - |   |   |   | 0.00 | % |   |   | 1,183 |   |   |   | - |   |   |   | 0.00 | % |
| Interest-earning deposits                                          |   |                                     | 2,184  |   |   |   | 2 |   |   |   | 0.42 | % |   |   | 5,879 |   |   |   | 33 |   |   |   | 2.24 | % |
| Total interest-earning assets                                      |   |                                     | 75,664 |   |   | $ | 1,082 |   |   |   | 5.72 | % |   |   | 71,784 |   |   | $ | 1,012 |   |   |   | 5.64 | % |
| Non-interest-earning assets                                        |   |                                     | 5,116  |   |   |   |   |   |   |   |   |   |   |   | 4,126 |   |   |   |   |   |   |   |   |   |
| Total assets                                                       |   | $                                        | 80,780 |   |   |   |   |   |   |   |   |   |   | $ | 75,910 |   |   |   |   |   |   |   |   |   |
|                                                               |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest-bearing liabilities:                                      |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Savings deposits                                                   |   | $                                        | 4,192  |   |   | $ | 8 |   |   |   | 0.81 | % |   | $ | 3,284 |   |   | $ | 7 |   |   |   | 0.89 | % |
| NOW accounts                                                       |   |                                     | 2,803  |   |   |   | 4 |   |   |   | 0.61 | % |   |   | 2,490 |   |   |   | 5 |   |   |   | 0.76 | % |
| Money market accounts                                              |   |                                     | 13,562 |   |   |   | 31 |   |   |   | 0.91 | % |   |   | 11,382 |   |   |   | 43 |   |   |   | 1.52 | % |
| Certificates of deposit                                            |   |                                     | 31,855 |   |   |   | 191 |   |   |   | 2.39 | % |   |   | 28,397 |   |   |   | 213 |   |   |   | 3.00 | % |
| Total interest-bearing deposits                                    |   |                                     | 52,412 |   |   |   | 234 |   |   |   | 1.79 | % |   |   | 45,553 |   |   |   | 268 |   |   |   | 2.35 | % |
| FHLB advances                                                      |   |                                     | 18,509 |   |   |   | 146 |   |   |   | 3.16 | % |   |   | 20,738 |   |   |   | 191 |   |   |   | 3.68 | % |
| Total interest-bearing liabilities                                 |   | $                                        | 70,921 |   |   | $ | 380 |   |   |   | 2.15 | % |   | $ | 66,291 |   |   | $ | 459 |   |   |   | 2.77 | % |
|                                                               |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Non-interest-bearing liabilities:                                  |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Demand deposits                                                    |   | $                                        | 3,336  |   |   |   |   |   |   |   |   |   |   | $ | 3,446 |   |   |   |   |   |   |   |   |   |
| Other non-interest-bearing                                         |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| liabilities                                                        |   |                                     | 304    |   |   |   |   |   |   |   |   |   |   |   | 209 |   |   |   |   |   |   |   |   |   |
| Total liabilities                                                  |   |                                     | 74,561 |   |   |   |   |   |   |   |   |   |   |   | 69,946 |   |   |   |   |   |   |   |   |   |
| Total capital                                                      |   |                                     | 6,219  |   |   |   |   |   |   |   |   |   |   |   | 5,964 |   |   |   |   |   |   |   |   |   |
| Total liabilities and capital                                      |   | $                                        | 80,780 |   |   |   |   |   |   |   |   |   |   | $ | 75,910 |   |   |   |   |   |   |   |   |   |
|                                                               |   |                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                |   |                                     |   |   |   | $ | 702 |   |   |   |   |   |   |   |   |   |   | $ | 553 |   |   |   |   |   |
| Net interest rate spread(2)                                        |   |                                     |   |   |   |   |   |   |   |   | 3.57 | % |   |   |   |   |   |   |   |   |   |   | 2.87 | % |
| Net interest-earning assets(3)                                     |   | $                                        | 4,743  |   |   |   |   |   |   |   |   |   |   | $ | 5,493 |   |   |   |   |   |   |   |   |   |
| Net interest margin(4)                                             |   |                                     |   |   |   |   |   |   |   |   | 3.71 | % |   |   |   |   |   |   |   |   |   |   | 3.08 | % |
| Average of interest-earning assets to interest-bearing liabilities |   |                                     | 106.69 | % |   |   |   |   |   |   |   |   |   |   | 108.29 | % |   |   |   |   |   |   |   |   |

----

| (1) | Consists of taxable investment securities and one municipal bond.  The municipal bond is presented on a fully taxable basis as the tax equivalent adjustment is not material to the yield. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities. |
|-----|---------------------------------------------------------------------------------------------------------------|

| (4) | Net interest margin represents net interest income divided by average total interest-earning assets. |
|-----|------------------------------------------------------------------------------------------------------|

----

----

|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   | Minimum    |   |
|-----------------------------------------------------|--------|--------|--------|--------|-------------|--------|---------|-------------------|--------|-------------------|--------|--------|--------|------------|--------|
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   | To Be Well |   |
|                                                |   |   |   |   |        |   | Minimum |              |   | Capitalized Under |   |
|                                                |   |   |   |   |        |   | Capital |              |   | Prompt Corrective |   |
|                                                |   | Actual |   |   | Requirement |   |    | Action Provisions |   |
|                                                |   | Amount |   |   | Ratio       |   |    | Amount            |   |              | Ratio  |   |   | Amount     |   |   | Ratio |   |
|                                                |   |   |   |   |        |   |    | (In Thousands)    |   |              |   |   |   |       |   |
| September 30, 2010                                  |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |
| Total capital to risk weighted assets               |   | $      | 6,110  |   |        |   | 11.27   | %                 |   | $                 | 4,338  |   |   |       | 8.00   | % |   | $ | 5,423 |   |   |   | 10.00 | % |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tier 1 risked-based capital to risk weighted assets |   | $      | 5,476  |   |        |   | 10.10   | %                 |   | $                 | 2,169  |   |   |       | 4.00   | % |   | $ | 3,254 |   |   |   | 6.00 | % |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital to total assets                      |   | $      | 5,843  |   |        |   | 7.17    | %                 |   | $                 | 3,261  |   |   |       | 4.00   | % |   | $ | 4,076 |   |   |   | 5.00 | % |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| June 30, 2010                                       |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Total capital to risk weighted assets               |   | $      | 5,933  |   |        |   | 11.67   | %                 |   | $                 | 4,069  |   |   |       | 8.00   | % |   | $ | 5,086 |   |   |   | 10.00 | % |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tier 1 risked-based capital to risk weighted assets |   | $      | 5,483  |   |        |   | 10.78   | %                 |   | $                 | 2,034  |   |   |       | 4.00   | % |   | $ | 3,052 |   |   |   | 6.00 | % |
|                                                |   |   |   |   |        |   |    |              |   |              |   |   |   |       |   |   |   |   |   |   |   |   |   |   |
| Tier 1 capital to total assets                      |   | $      | 5,838  |   |        |   | 7.24    | %                 |   | $                 | 3,224  |   |   |       | 4.00   | % |   | $ | 4,031 |   |   |   | 5.00 | % |

| ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
|---------|------------------------------------------------------------|

| ITEM 4T. | CONTROLS AND PROCEDURES |
|----------|-------------------------|

----

| ITEM 1. | LEGAL PROCEEDINGS |
|---------|-------------------|

| ITEM 1A. | RISK FACTORS |
|----------|--------------|

| ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
|---------|-------------------------------------------------------------|

| ITEM 3. | DEFAULTS UPON SENIOR SECURITIES |
|---------|---------------------------------|

| ITEM 4. | [REMOVED AND RESERVED] |
|---------|------------------------|

| ITEM 5. | OTHER INFORMATION |
|---------|-------------------|

| (a) | None. |
|-----|-------|

| (b)   | There were no material changes to the procedures by which security holders may recommend nominees to the Company’s board of directors during the period covered by the Form 10Q. |
|-----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ITEM 6. | EXHIBITS |
|---------|----------|

| ExhibitNumber |   | Exhibit Description                                                                                                                       |
|---------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
|          |   |                                                                                                                                      |
| 2.1           |   | Plan of Reorganization from Mutual Savings Bank to Mutual Holding Company and Stock Issuance Plan **                                      |
|          |   |                                                                                                                                      |
| 3.1           |   | Charter of Auburn Bancorp, Inc. **                                                                                                        |
|          |   |                                                                                                                                      |
| 3.2           |   | Bylaws of Auburn Bancorp, Inc. **                                                                                                         |
|          |   |                                                                                                                                      |
| 4.1           |   | Stock Certificate of Auburn Bancorp, Inc. **                                                                                         |
|          |   |                                                                                                                                      |
| 10.1          |   | Form of Auburn Savings Bank Employee Stock Ownership Plan and Trust **                                                               |
|          |   |                                                                                                                                      |
| 10.2          |   | Form of ESOP Loan Commitment Letter and ESOP Loan Documents **                                                                       |
|          |   |                                                                                                                                      |
| 10.3          |   | Form of Employment Agreement between Auburn Savings Bank and Allen T. Sterling **                                                         |
|          |   |                                                                                                                                      |
| 31.1          |   | Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer of the Company                                                          |
|          |   |                                                                                                                                      |
| 31.2          |   | Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer of the Company                                                      |
|          |   |                                                                                                                                      |
| 32.1          |   | Section 1350 Certification of Chief Executive Officer of the Company in accordance with Section 906 of the Sarbanes-Oxley Act of 2002     |
|          |   |                                                                                                                                      |
| 32.2          |   | Section 1350 Certification of Principal Financial Officer of the Company in accordance with Section 906 of the Sarbanes-Oxley Act of 2002 |
|          |   |                                                                                                                                      |

| ** |  Incorporated by reference into this document from the Exhibits filed with the Securities and Exchange Commission on the Company’s Registration Statement on Form S-1, as amended, initially filed on March 14, 2008 and declared effective on May 13, 2008 (File Number 333-149723). |
|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                               |   |   | Auburn Bancorp, Inc.                                                            |
|------------------------------------|--------|--------|---------------------------------------------------------------------------------|
|                               |   |   | (Registrant)                                                                    |
|                               |   |   |                                                                            |
| Date:  November 12, 2010 |   | By:    | /s/  Allen T. Sterling                                                |
|                               |   |   | Allen T. Sterling                                                               |
|                               |   |   | President and Chief Executive Officer(Principal Executive Officer)              |
|                               |   |   |                                                                            |
| Date:  November 12, 2010 |   | By:    | /s/  Rachel A. Haines                                                 |
|                               |   |   | Rachel A. Haines                                                                |
|                               |   |   | Senior Vice President and Treasurer(Principal Accounting and Financial Officer) |