SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2003

                           OR

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

For the transition period from                 to
                                 -------------    -------------


                         Commission file number 0-24353

                           THISTLE GROUP HOLDINGS, CO.
                           ---------------------------
             (Exact name of registrant as specified in its charter)

         Pennsylvania                                    23-2960768
--------------------------------------------------------------------------------
  (State or other jurisdiction of              (IRS employer identification no.)
   Incorporation or organization)

         6060 Ridge Avenue, Philadelphia, Pennsylvania             19128
--------------------------------------------------------------------------------
         (Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code             (215) 483-2800

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

         Indicate  by check  whether  the  registrant  (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

         Yes            X                   No
                  -------------                      -------------

         Indicate by check whether the  registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act.)

         Yes                                No              X
                  -------------                      -------------

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

         Indicate  the  number of  shares  outstanding  of each of the  issuer's
classes of common stock, as of the latest practicable date, November 5, 2003.


                  Class                                   Outstanding
--------------------------------------------------------------------------------
         $.10 par value common stock                       5,208,744

<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
                                    FORM 10-Q
                    FOR THE QUARTER ENDED SEPTEMBER 30, 2003

                                      INDEX

                                                                           Page
                                                                          Number
                                                                          ------

PART I - UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION OF
               THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES

    Item 1.    Unaudited Condensed Consolidated Financial Statements and
               Notes Thereto...................................................3

    Item 2.    Management's Discussion and Analysis of Financial
               Condition and Results of Operations............................11

    Item 3.    Quantitative and Qualitative Disclosures about Market Risk.....15

    Item 4.    Controls and Procedures........................................16

PART II - OTHER INFORMATION

    Item 1.    Legal Proceedings..............................................17

    Item 2.    Changes in Securities and Use of Proceeds......................17

    Item 3.    Defaults upon Senior Securities................................17

    Item 4.    Submission of Matters to a Vote of Security Holders............17

    Item 5.    Other Information..............................................17

    Item 6.    Exhibits and Reports on Form 8-K...............................17

SIGNATURES        ............................................................18

EXHIBITS          ............................................................19

<PAGE>

THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollars in Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------
                                                                                            September 30,    December 31,
ASSETS                                                                                            2003           2002
                                                                                              -----------    -----------
<S>                                                                                         <C>            <C>
Cash on hand and in banks                                                                     $     6,226    $     4,819
Interest-bearing deposits                                                                          35,064         19,841
                                                                                              -----------    -----------
        Total cash and cash equivalents                                                            41,290         24,660
Investments available for sale at fair value
   (amortized cost - 2003, $52,747;  2002, $65,098)                                                55,431         66,239
Mortgage-backed securities available for sale
  at fair value (amortized cost - 2003, $357,400;  2002, $361,869)                                358,985        369,571
Trading securities                                                                                 16,359         43,714
Loans receivable (net of allowance for loan losses - 2003, $3,033;  2002, $2,209)                 322,847        299,963
Accrued interest receivable                                                                         3,786          4,260
Federal Home Loan Bank stock - at cost                                                             13,409         12,497
Real estate acquired through foreclosure - net                                                      1,456          1,717
Office properties and equipment - net                                                               8,161          6,346
Prepaid expenses and other assets                                                                   5,226          5,706
Cash surrender value of life insurance                                                             15,623         15,069
Goodwill                                                                                            7,680          7,680
                                                                                              -----------    -----------
TOTAL ASSETS                                                                                  $   850,253    $   857,422
                                                                                              ===========    ===========

LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
  Deposits                                                                                    $   553,596    $   492,880
  FHLB advances                                                                                   181,884        220,884
  Payable to brokers and dealers                                                                   15,524         41,924
  Other borrowings                                                                                  1,650          3,650
  Accrued interest payable                                                                            892            976
  Advances from borrowers for taxes and insurance                                                   1,889          2,611
  Accounts payable and accrued expenses                                                             9,397          7,625
  Dividends payable                                                                                   521            473
                                                                                              -----------    -----------
        Total liabilities                                                                         765,353        771,023
                                                                                              -----------    -----------
Company-obligated manditorily redeemable preferred securities of a subsidiary trust holding
  solely junior subordinated debentures of the Company                                             10,000         10,000
                                                                                              -----------    -----------
Commitments and Contingencies
Stockholders' Equity:
  Preferred stock, no par value, 10,000,000 shares authorized,
    none issued in 2003 or 2002
  Common stock, $.10 par value,  40,000,000 shares authorized,  8,999,989 shares
    issued and 5,208,744  shares  outstanding  at September 30, 2003; 8,999,989
    issued and 5,259,424 shares outstanding at December 31, 2002                                      900            900
  Additional paid-in capital                                                                       92,897         92,884
  Common stock acquired by stock benefit plans                                                     (4,920)        (5,537)
  Treasury stock at cost, 3,791,245 shares at September 30, 2003
    and 3,740,565 shares at December 31, 2002                                                     (39,959)       (39,068)
  Accumulated other comprehensive income                                                            2,817          5,836
  Retained earnings - partially restricted                                                         23,165         21,384
                                                                                              -----------    -----------
        Total stockholders' equity                                                                 74,900         76,399
                                                                                              -----------    -----------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                    $   850,253    $   857,422
                                                                                              ===========    ===========
</TABLE>

See notes to unaudited condensed consolidated financial statements.

                                       3

<PAGE>

THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands, Except Per Share Data)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                                                      For the Three Month     For the Nine Months
                                                                      Ended September 30,     Ended September 30,
                                                                     ---------------------- -------------------------
                                                                      2003        2002        2003        2002
                                                                             (As Restated -          (As Restated -
                                                                              See Note 13)            See Note 13)
<S>                                                             <C>         <C>         <C>         <C>
INTEREST INCOME:
   Interest on loans                                              $  5,497    $  6,419    $ 16,712    $ 16,791
   Interest on mortgage-backed securities                            2,923       3,538      10,409      11,679
   Interest on investments:
     Taxable                                                           264         282         669       1,250
     Tax-exempt                                                        722         804       2,305       2,427
     Dividends                                                          75          82         270         284
                                                                  --------    --------    --------    --------
           Total interest income                                     9,481      11,125      30,365      32,431
                                                                  --------    --------    --------    --------

INTEREST EXPENSE:
  Interest on deposits                                               3,004       3,376       9,036      10,262
  Interest on FHLB advances and other borrowings                     2,478       2,500       7,589       7,363
                                                                  --------    --------    --------    --------
           Total interest expense                                    5,482       5,876      16,625      17,625
                                                                  --------    --------    --------    --------

NET INTEREST INCOME                                                  3,999       5,249      13,740      14,806

PROVISION FOR LOAN LOSSES                                              134         150         851         500
                                                                  --------    --------    --------    --------

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES                  3,865       5,099      12,889      14,306
                                                                  --------    --------    --------    --------

OTHER INCOME:
  Service charges and other fees                                       354         749         978       1,212
  Trading revenues from brokerage operations                           415         436       1,058       1,418
  Writedown on real estate owned                                        (4)       (585)       (253)       (585)
  Gain (loss) on sale of real estate owned                               -           -           -           6
  Gain on sale of mortgage-backed securities available for sale        408         353       1,515         709
  Gain on sale of loans                                                 78          27         231         204
  Gain (loss) on sale of investments available for sale                526           2         738        (537)
  Rental income                                                         59          59         135         165
  Other income                                                           -           -          15           -
                                                                  --------    --------    --------    --------
           Total other income                                        1,836       1,041       4,417       2,592
                                                                  --------    --------    --------    --------

OTHER EXPENSES:
  Salaries and employee benefits                                     2,275       2,383       6,380       6,312
  Occupancy and equipment                                              749         705       2,271       2,036
  Professional fees                                                    660         151         991         548
  Advertising                                                           92          87         293         289
  Interest on redeemable preferred securities                          129         156         394         293
  Other                                                                949       1,010       3,148       2,809
                                                                  --------    --------    --------    --------

           Total other expenses                                      4,854       4,492      13,477      12,287
                                                                  --------    --------    --------    --------

INCOME BEFORE INCOME TAXES                                             847       1,648       3,829       4,611
                                                                  --------    --------    --------    --------

INCOME TAXES                                                            81         287         661         803
                                                                  --------    --------    --------    --------

NET INCOME                                                        $    766    $  1,361    $  3,168    $  3,808
                                                                  ========    ========    ========    ========

BASIC EARNINGS PER SHARE                                          $   0.16    $   0.28    $   0.66    $   0.68
                                                                  ========    ========    ========    ========

DILUTED EARNINGS PER SHARE                                        $   0.15    $   0.27    $   0.63    $   0.67
                                                                  ========    ========    ========    ========
</TABLE>

See notes to unaudited condensed consolidated financial statements.

                                       4

<PAGE>

THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------
                                                                             For The Nine Months
                                                                             Ended September 30,
                                                                           -----------------------
                                                                             2003         2002
                                                                                       (As Restated -
                                                                                        See Note 13)
<S>                                                                     <C>          <C>

OPERATING ACTIVITIES:
  Net income                                                               $   3,168    $   3,808
  Adjustments to reconcile net income to net cash provided by
    operating activities:
    Provision for loan losses                                                    851          500
    Depreciation                                                               1,014          968
    Amortization of stock benefit plans                                          785          678
    Loans held for sale originated                                           (17,511)           -
    Amortization of:
        Net premiums (discounts) on:
        Loans purchased                                                           97           73
        Investments                                                              (67)        (471)
        Mortgage-backed securities                                             3,560        3,482
    (Gain) loss on sale of investments                                          (738)         537
    Gain on sale of loans                                                       (231)        (204)
    Gain on sale of mortgage-backed securities                                (1,515)        (709)
    Gain on sale of real estate owned                                              -           (6)
    Proceeds from the sale of loans held for sale                             17,762        8,336
    Writedown of real estate owned                                               253          585
    Net decrease in trading securities                                        27,355        3,073
    Decrease (increase) in other assets                                          395       (4,494)
    Increase in other liabilities                                            (23,220)      (3,432)
                                                                           ---------    ---------

           Net cash provided by operating activities                          11,958       12,724
                                                                           ---------    ---------

INVESTING ACTIVITIES:
  Principal collected on:
    Mortgage-backed securities                                               137,082      108,909
    Loans                                                                    128,138       85,763
  Loans originated                                                          (147,873)    (133,717)
  Loans acquired                                                              (4,097)        (346)
  Purchases of:
    Investments                                                                  (36)      (4,762)
    Mortgage-backed securities                                              (258,156)    (194,900)
    Property and equipment                                                    (2,829)      (1,193)
    FHLB stock                                                                  (912)      (1,050)
  Maturities and calls of  investments                                         7,560        3,195
  Proceeds from the sale of:
    Mortgage-backed securities                                               123,498       45,976
    Investments                                                                5,632       16,101
    Loans                                                                          -            -
    Real estate owned                                                             13           72
                                                                           ---------    ---------

           Net cash provided by investing activities                         (11,980)     (75,952)
                                                                           ---------    ---------

FINANCING ACTIVITIES:
  Net increase in deposits                                                    60,716       42,117
  Net decrease in advances from borrowers for taxes and insurance               (722)        (683)
  Net (decrease) increase in FHLB borrowings                                 (39,000)      21,000
  Net (decrease) increase in other borrowings                                 (2,000)       3,500
  Issuance of capital securities                                                   -       10,000
  Purchase of treasury stock                                                  (1,091)     (16,551)
  Net proceeds from exercise of stock options                                    136           66
  Cash dividends                                                              (1,387)      (1,434)
                                                                           ---------    ---------
           Net cash provided by financing activities                          16,652       58,015
                                                                           ---------    ---------

NET INCREASE IN CASH AND CASH EQUIVALENTS                                     16,630       (5,213)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR                                  24,660       22,723
                                                                           ---------    ---------
CASH AND CASH EQUIVALENTS,  END OF YEAR                                    $  41,290    $  17,510
                                                                           =========    =========
SUPPLEMENTAL DISCLOSURES:
  Interest paid on deposits and funds borrowed                             $  16,709    $  17,612
  Income taxes paid                                                            1,117        1,345
 Noncash transfers from loans to real estate owned                                 -        3,164
 Noncash transfers of investments held to maturity to available for sale           -       51,385
</TABLE>

 See notes to unaudited condensed consolidated financial statements

                                        5

<PAGE>

THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)

NOTE 1 - PRINCIPLES OF CONSOLIDATION

Thistle Group  Holdings,  Co., (the  "Company")  organized in March of 1998, has
four  wholly  owned  subsidiaries:  TGH Corp.,  TGH  Securities,  Thistle  Group
Holdings  Capital Trust I, and Roxborough  Manayunk Bank (the "Bank").  The Bank
has three wholly owned subsidiaries:  RoxDel Corp., Montgomery Service Corp. and
Ridge Service Corp. The Company's business is conducted  principally through the
Bank.  All  significant   intercompany   accounts  and  transactions  have  been
eliminated in consolidation.

NOTE 2 - BASIS OF PRESENTATION

The accompanying  unaudited  condensed  consolidated  financial  statements were
prepared in accordance with  instructions for Form 10-Q and,  therefore,  do not
include all  information  necessary for a complete  presentation of consolidated
financial  condition,  results of operations,  and cash flows in conformity with
accounting  principles  generally  accepted  in the  United  States of  America.
However, all adjustments, consisting of normal recurring accruals, which, in the
opinion of management, are necessary for a fair presentation of the consolidated
financial  statements,  have been  included.  The results of operations  for the
three-month  period ended September 30, 2003 are not  necessarily  indicative of
the results which may be expected for the entire fiscal year or any other future
interim period.

These unaudited condensed  consolidated  financial  statements should be read in
conjunction with the consolidated  financial statements and related notes, which
are  incorporated in the Company's Annual Report on Form 10-K for the year ended
December 31, 2002.

NOTE 3 - INVESTMENTS

Investments  available  for sale at  September  30, 2003 and  December  31, 2002
consisted of the following:

<TABLE>
<CAPTION>
                                            September 30, 2003         December 31, 2002
                                          Amortized   Approximate    Amortized    Approximate
                                            Cost      Fair Value       Cost       Fair Value
                                            ----      ----------       ----       ----------
<S>                                    <C>         <C>            <C>          <C>
Municipal bonds - 1 to 5 years.........  $       -   $        -     $     511    $      541
Municipal bonds - 5 to 10 years........        255          256           255           256
Municipal bonds - more than 10 years...     40,199       40,747        50,651        51,328
Mutual funds...........................      1,586        1,586         1,569         1,569
Capital trust securities...............      6,694        6,659         7,457         6,668
Equity investments.....................      3,212        5,382         3,864         5,086
Other..................................        801          801           791           791
                                         ---------   ----------     ---------    ----------

Total..................................  $  52,747   $   55,431     $  65,098    $   66,239
                                         =========   ==========     =========    ==========
</TABLE>


NOTE 4 - MORTGAGE-BACKED SECURITIES AVAILABLE FOR SALE

Mortgage-backed securities at September 30, 2003 and December 31, 2002 consisted
of the following:

<TABLE>
<CAPTION>
                                                          September 30, 2003           December 31, 2002
                                                        Amortized    Approximate     Amortized   Approximate
                                                          Cost       Fair Value        Cost      Fair Value
                                                          ----       ----------        ----      ----------
<S>                                                  <C>          <C>             <C>          <C>
Agency pass-through certificates.....................  $ 322,531    $  324,114      $ 294,095    $  301,376
Agency real estate mortgage investment conduits......     28,680        28,670         38,362        38,693
Non-agency collateralized mortgage obligations.......      6,189         6,201         29,412        29,502
                                                       ---------    ----------      ---------    ----------
Total................................................  $ 357,400    $  358,985      $ 361,869    $  369,571
                                                       =========    ==========      =========    ==========
</TABLE>

NOTE 5 - TRADING SECURITIES

Trading  securities  are  securities  owned by TGH  Securities,  a wholly  owned
broker/dealer  subsidiary of the Company.  Trading  securities are recorded on a
trade  date basis and are  carried at fair  value.  These  securities  generally
consist of short-term municipal notes and bonds. Gains and losses, both realized
and unrealized, are included in operating income.

                                       6
<PAGE>

NOTE 6 - LOANS RECEIVABLE

Loans  receivable at September  30, 2003 and December 31, 2002  consisted of the
following:

<TABLE>
<CAPTION>
                                                      September 30, 2003    December 31, 2002
                                                      ------------------    -----------------
<S>                                                    <C>                   <C>
Mortgage loans:
         1 - 4 family residential.....................    $  110,859            $  125,827
         Commercial real estate.......................       111,503                92,760
Home equity lines of credit and improvement loans.....        35,368                28,525
Commercial loans  ....................................        39,008                26,557
Construction loans - net..............................        29,035                28,446
Loans on savings accounts.............................           544                   505
Consumer loans    ....................................         1,259                 1,034
                                                          ----------            ----------

         Total loans..................................       327,576               303,654
                                                          ----------            ----------
Plus: unamortized premiums............................            47                   144
Less:
         Net discounts on loans purchased.............           (10)                  (12)
         Deferred loan fees...........................        (1,733)               (1,614)
         Allowance for loan losses....................        (3,033)               (2,209)
                                                          ----------            ----------
Total                                                     $  322,847            $  299,963
                                                          ==========            ==========
</TABLE>

A summary of changes in the  allowance for loan losses for the nine months ended
September 30, 2003 and for the year ended December 31, 2002 is as follows:


                                       For the                For the
                                 Nine Months Ended          Year Ended
                                 September 30, 2003      December 31, 2002
                                 ------------------      -----------------

Balance, beginning.................  $   2,209                $  2,511
Provision..........................        851                     702
Charge-offs........................        (28)                 (1,004)
Recovery...........................          1                       -
                                     ---------                --------
Balance ending.....................  $   3,033                $  2,209
                                     =========                ========

NOTE 7 - DEPOSITS

The major types of deposits by amounts and percentages at September 30, 2003 and
December 31, 2002 were as follows:


                                September 30, 2003          December 31, 2002
                                Amount    % of Total      Amount      % of Total
                                ------    ----------      ------      ----------

Checking accounts            $  123,907     22.4%        $  91,584      18.6%
Money market accounts            45,966      8.3%           44,191       9.0%
Passbook accounts               138,335     25.0%          124,660      25.3%
Certificate accounts            245,388     44.3%          232,445      47.1%
                             ----------     -----        ---------      -----

Total                        $  553,596    100.0%        $ 492,880     100.0%
                             ==========    ======        =========     ======

NOTE 8 - EARNINGS PER SHARE

Basic  earnings per share excludes  dilution and is computed by dividing  income
available to common stockholders by the weighted-average number of common shares
outstanding  for the period.  Diluted  earnings per share reflects the potential
dilution that could occur if securities or other contracts to issue common stock
were  exercised  or  converted  into common stock or resulted in the issuance of
common  stock that then shared in the  earnings  of the  Company.  The  weighted
average shares used in the basic and diluted earnings per share computations for
the  three and nine  month  periods  ended  September  30,  2003 and 2002 are as
follows:

                                       7
<PAGE>

<TABLE>
<CAPTION>
                                                               For the                           For the
                                                         Three Months Ended                 Nine Months Ended
                                                            September 30,                     September 30,
                                                        2003            2002              2003           2002
                                                        --------------------              -------------------
<S>                                               <C>              <C>                <C>           <C>
Average common shares outstanding- basic              4,794,771      4,888,078          4,812,378     5,639,952
Increase in shares due to dilutive options              214,967         71,805            178,076        91,323
                                                    -----------    -----------        -----------   -----------
Adjusted shares outstanding - diluted                 5,009,738      4,959,883          4,990,454     5,731,275
                                                    ===========    ===========        ===========   ===========
</TABLE>

NOTE 9 - COMPREHENSIVE INCOME

For the three and nine month  periods  ended  September  30,  2003,  the Company
reported total  comprehensive  (loss) income of approximately  $(940), and $149,
respectively.  For the three and  nine-month  periods  of the  prior  year,  the
Company reported total comprehensive  income of approximately $2,900 and $6,800,
respectively.  Items of other comprehensive income consisted of unrealized gains
or (losses), net of taxes, on available for sale securities and reclassification
adjustments for gains or (losses) included in net income.

NOTE 10 - DIVIDENDS

On September 18, 2003, the Company declared a dividend of $.10 per share payable
October 15, 2003 to stockholders of record on September 30, 2003.

NOTE 11 - STOCK-BASED COMPENSATION

In December  2002, the Financial  Accounting  Standards  Board  ("FASB")  issued
Statement of  Financial  Accounting  Standards  (SFAS) No. 148,  Accounting  for
Stock-Based  Compensation  --Transition  and  Disclosure,  an  amendment of FASB
Statement  No.  123.  SFAS No.  148 amends  SFAS No. 123 to provide  alternative
methods of transition  for a voluntary  change to the fair value based method of
accounting for stock-based employee  compensation.  In addition,  this Statement
amends  the  disclosure  requirements  of  SFAS  No.  123 to  require  prominent
disclosures in both annual and interim financial  statements about the method of
accounting for stock-based  employee  compensation  and the effect of the method
used on reported results.  This statement is effective for financial  statements
for fiscal years ending  after  December 15, 2002.  The Company has provided the
required interim disclosures below.

The Company applies APB Opinion No. 25 and related interpretations in accounting
for stock options and, accordingly,  no compensation expense has been recognized
in the financial  statements.  Had the Company determined  compensation  expense
based on the fair value at the grant date for its stock  options  under SFAS No.
123,  the  Company's  net income and income per share would have been reduced to
the pro forma amounts indicated below:

<TABLE>
<CAPTION>
                                           For the Three Months      For the Nine Months
                                            Ended September 30,      Ended September 30,
                                             2003         2002        2003         2002
                                           --------    ---------   ---------    ---------
<S>                                      <C>         <C>         <C>          <C>
Net income, as reported                    $    766    $   1,361   $   3,168    $   3,808

Deduct: Total stock-based employee
   compensation expense determined
   under fair value based method for all
   awards, net of related tax effects           (26)           -         (78)           -
                                           --------    ---------   ---------    ---------
Pro forma net income                       $    740    $   1,361   $   3,090    $   2,447
                                           ========    =========   =========    =========

Earnings per share:
   Basic-as reported                       $   0.16    $    0.28   $    0.66    $    0.68
   Basic-pro forma                             0.15         0.28        0.64         0.68

   Diluted-as reported                         0.15         0.27        0.63         0.67
   Diluted-pro forma                           0.15         0.27        0.62         0.67

</TABLE>
                                       8
<PAGE>

NOTE 12 - RECENT ACCOUNTING STANDARDS

In April  2003,  the FASB issued SFAS No. 149,  Amendment  of  Statement  133 on
Derivative  Instruments  and  Hedging  Activities.   The  Statement  amends  and
clarifies  accounting for derivative  instruments,  including certain derivative
instruments  embedded  in other  contracts,  and for  hedging  activities  under
Statement 133.

The  new  guidance  amends  Statement  133  for  decisions  made  as part of the
Derivatives Implementation Group process that effectively required amendments to
Statement  133, in connection  with other FASB projects  dealing with  financial
instruments  and  regarding  implementation  issues  raised in  relation  to the
application  of the  definition  of a  derivative,  particularly  regarding  the
meaning of an "underlying" and the characteristics of a derivative that contains
financing components.

The  amendments  set forth in  Statement  149  improve  financial  reporting  by
requiring  that  contracts  with  comparable  characteristics  be accounted  for
similarly.  In particular,  this Statement  clarifies under what circumstances a
contract with an initial net investment meets the characteristic of a derivative
as  discussed  in Statement  133. In  addition,  it clarifies  when a derivative
contains a financing  component that warrants special reporting in the statement
of cash flows. Statement 149 amends certain other existing pronouncements. Those
changes  will  result  in  more  consistent  reporting  of  contracts  that  are
derivatives in their entirety or that contain embedded  derivatives that warrant
separate accounting.

This  Statement  is  effective  for  contracts  entered  into or modified  after
September 30, 2003, and for hedging relationships designated after September 30,
2003. The guidance will be applied prospectively.  Currently, the Company has no
derivatives that require application of this statement.

In January 2003, the FASB issued FIN No. 46,  Consolidation of Variable Interest
Entities.  The Interpretation  clarifies the application of Accounting  Research
Bulletin No. 51, Consolidated Financial Statements, to certain entities in which
equity  investors do not have the  characteristics  of a  controlling  financial
interest or do not have sufficient  equity at risk for the entity to finance its
activities without additional subordinated financial support from other parties.
The Company has participated in the issue of trust preferred  securities through
a trust  established for such purpose.  Currently,  the Company  classifies such
securities  after  total  liabilities  and  before  stockholders'  equity on the
Consolidated  Balance  Sheet.  The  Company  is  currently  assessing  the trust
preferred  securities  structure and the continued  consolidation of the related
trust  pursuant to FIN No. 46.  Management  does not believe the results of such
assessment  will  result  in  a  material  impact  on  the  Company's  financial
statements when FIN No. 46 is applied in the fourth quarter of 2003.

In May 2003,  the FASB  issued SFAS No. 150,  Accounting  for Certain  Financial
Instruments with Characteristics of both Liabilities and Equity. This statement
requires  that  certain  financial   instruments,   which  previously  could  be
designated as equity,  now be classified as liabilities on the balance sheet. As
noted above,  the Company  currently  classifies its trust preferred  securities
after  total  liabilities  on the balance  sheet.  As noted  above,  the Company
currently  classifies its trust preferred securities after total liabilities and
before  stockholders'  equity  on the  Consolidated  Balance  Sheet.  Under  the
provisions of SFAS No. 150, these  securities  would be reclassified as borrowed
funds. The effective date of SFAS No. 150 has been indefinitely  deferred by the
FASB when certain  criteria are met. As the  structure  of the  Company's  trust
preferred securities meets such criteria, the Company qualifies for this limited
deferral.  Therefore,  the Company will assess the  classification  of the trust
preferred  securities in  conjunction  with adoption of FIN No. 46 in the fourth
quarter of 2003, as noted above.

NOTE 13 - ACCOUNTING FOR GOODWILL

On October 1, 2002, the Company  adopted SFAS No. 147,  Acquisitions  of Certain
Financial  Institutions,  which allows financial  institutions,  meeting certain
criteria, to reclassify their identifiable intangible asset balances to goodwill
and  retroactively   cease  amortization   beginning  as  of  January  1,  2002.
Accordingly, the Company retroactively ceased amortization of goodwill beginning
January 1, 2002 and  restated  earnings  for the  quarterly  periods in the year
ended December 31, 2002.

                                       9
<PAGE>

The  following  table is a summary of net income and basic and diluted  earnings
per share for the three and nine month  periods  ended  September  30, 2002,  as
previously  reported on Form 10-Q and for the same quarterly  period as restated
for the adoption of SFAS No. 147:

<TABLE>
<CAPTION>
                                                         Three Months Ended   Nine  Months Ended
                                                         September 30, 2002   September 30, 2002

<S>                                                        <C>                   <C>
Net income, as previously reported......................     $    1,210            $    3,338
Amortization of goodwill, net of tax....................            151                   470
                                                             ----------            ----------
Net income, as restated.................................     $    1,361            $    3,808
                                                             ==========            ==========

Earnings per share:
   Basic earnings per share, as previously reported.....     $      .25            $      .59
   Amortization of goodwill, net of tax.................            .03                   .09
                                                             ----------            ----------
   Basic earnings per share, as restated................     $      .28            $      .68
                                                             ==========            ==========

   Dilute earnings per share, as previously reported....     $      .24            $      .58
   Amortization of goodwill, net of tax.................            .03                   .09
                                                             ----------            ----------
   Diluted earnings per share, as restated..............     $      .27            $      .67
                                                             ==========            ==========
</TABLE>

NOTE 14 - PENDING MERGER

On September 22, 2003, the Company  entered into an agreement and plan of merger
with Citizens Bank of Pennsylvania and Citizens  Financial Group,  Inc. pursuant
to which the Company would merge with a to-be-formed subsidiary of Citizens Bank
and each outstanding share of the Company's common stock would be converted into
the  right to  receive  $26.00  per share in cash.  The  merger  is  subject  to
customary  conditions  including  shareholder  and  regulatory  approval  and is
expected to close in January 2004.

                                       10
<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The  Private  Securities  Litigation  Reform Act of 1995  contains  safe  harbor
provisions regarding forward-looking  statements.  When used in this discussion,
the words  "believes",  "anticipates",  "contemplates",  "expects",  and similar
expressions are intended to identify forward-looking statements. Such statements
are subject to certain risks and uncertainties, which could cause actual results
to differ materially from those projected. Those risks and uncertainties include
changes in interest  rates,  risks  associated  with the effect of opening a new
branch,  the  ability  to  control  costs  and  expenses,  new  legislation  and
regulations and general market conditions.

Pending Merger

On September 22, 2003, the Company  entered into an agreement and plan of merger
with Citizens Bank of Pennsylvania and Citizens  Financial Group,  Inc. pursuant
to which the Company would merge with a to-be-formed subsidiary of Citizens Bank
and each outstanding share of the Company's common stock would be converted into
the  right to  receive  $26.00  per share in cash.  The  merger  is  subject  to
customary  conditions  including  shareholder  and  regulatory  approval  and is
expected to close in January 2004.

Linked Quarter Highlights

Net income for the quarter  decreased by $265,000 or $.06  diluted  earnings per
share from the quarter  ended June 30,  2003.  Set forth below is the  Company's
earnings information for the quarter ended September 30, 2003 as compared to the
quarter ended June 30, 2003.
(the "Linked Quarter Highlights")

                            LINKED QUARTER HIGHLIGHTS
                            -------------------------
                             (Dollars in Thousands)
----------------------------------------------------------------------------
                                QTR         QTR       INCREASE    % INCREASE
                              9/30/03     6/30/03    (DECREASE)    (DECREASE)
----------------------------------------------------------------------------
Interest Income               $  9,481   $ 10,262    $    (781)       (7.6%)
----------------------------------------------------------------------------
Interest Expense                 5,482      5,581          (99)       (1.8%)
----------------------------------------------------------------------------
Net Interest Income              3,999      4,681         (682)      (14.6%)
----------------------------------------------------------------------------
Provision for loan losses          134        320         (186)      (58.1%)
----------------------------------------------------------------------------
Other Income                     1,836      1,442          394        27.3%
----------------------------------------------------------------------------
Other Expense                    4,854      4,545          309         6.8%
----------------------------------------------------------------------------
Net Income                         766      1,031         (265)      (25.7%)
----------------------------------------------------------------------------
Cash and cash equivalents       41,290     66,262      (24,972)      (37.7%)
----------------------------------------------------------------------------
Loans                          322,847    320,255        2,592          .8%
----------------------------------------------------------------------------
Deposits                       553,596    549,975        3,621          .7%
----------------------------------------------------------------------------
Stockholders' Equity            74,900     76,320       (1,420)       (1.9%)
----------------------------------------------------------------------------

     o    Net income decreased $265,000 due to a decrease in net interest income
          of  $682,000  and an  increase in  non-interest  expense of  $309,000,
          partially offset by an increase in non-interest income of $394,000 and
          a decrease  in the  provision  for loan  losses  and  income  taxes of
          $186,000 and $146,000, respectively.

     o    Net  interest  income  decreased  $682,000  primarily as a result of a
          decrease  in  interest  income  on  mortgage-backed   securities.  The
          mortgage-backed  securities  portfolio  continued to experience  rapid
          repayments during the third quarter. As a result, the average yield on
          the  portfolio  decreased 29 basis points as funds were  reinvested at
          lower rates.

     o    The provision for loan losses decreased $186,000. In the quarter ended
          June 30,  2003,  the Company  recognized a higher  provision  for loan
          losses due to the  classification  of a $2.0 million  commercial  real
          estate loan as substandard.

     o    Non-interest  income for the quarter increased  $394,000 due mainly to
          gains on the sale of securities.

     o    Non-interest  expense  increased  $309,000  quarter over quarter.  The
          increase was primarily the result of an increase in professional  fees
          incurred in connection with the pending  acquisition of the Company by
          Citizens Bank.

     o    Cash  and cash  equivalents  decreased  $25.0  million  as funds  were
          reinvested into mortgage-backed securities.


                                       11
<PAGE>

Comparison of Financial Condition at September 30, 2003 from December 31, 2002
------------------------------------------------------------------------------

Total assets were $850.3 million at September 30, 2003,  representing a decrease
of $7.2 million from the balance of $857.4 million at December 31, 2002.

Trading   securities   decreased  $27.4  million,   which  also  resulted  in  a
corresponding decrease in the payable to brokers and dealers.

Mortgage-backed  securities decreased $10.6 million, primarily due to repayments
of $137.1  million,  sales of $123.5  million,  and a decrease in the unrealized
gain of $5.7 million, offset by purchases of $258.2 million.

Loans receivable increased $22.9 million, or 7.6% to $322.8 million at September
30, 2003 from $300.0  million at December 31, 2002.  The increase was  primarily
the result of $152.0 million in loan originations and loan purchases,  offset by
principal  repayments of $128.1 million.  One-to-four  family  residential loans
decreased  $15.0 million,  or 11.9% while  commercial real estate and commercial
loans  increased  $31.2  million,  or 26.1%  and home  equity  loans  and  lines
increased $6.8 million, or 24.0%.

Deposits  increased $60.7 million,  or 12.3%, to $553.6 million at September 30,
2003 from $492.9 million at December 31, 2002. Checking accounts increased $32.3
million  or 35.3%,  money  market  accounts  increased  $1.8  million,  or 4.0%,
passbook accounts  increased $13.7 million,  or 11.0 % and certificate  accounts
increased $12.9 million, or 5.6 %.

FHLB advances  decreased  $39.0 million to $181.9  million at September 30, 2003
from $220.9  million at December  31,  2002.  The decrease was due mainly to the
repayment of overnight borrowings.

Total stockholders'  equity decreased $1.5 million to $74.9 million at September
30, 2003 from $76.4 million at December 31, 2002, primarily due to a decrease in
accumulated other comprehensive income of $3.0 million, and by dividends paid of
$1.4  million  offset by net income of $3.2  million.  Because of interest  rate
changes,  the  Company's  accumulated  other  comprehensive  income  (loss)  may
fluctuate for each interim and year-end period.

Non-performing Assets

The following table sets forth information  regarding  non-performing  loans and
real estate owned.

<TABLE>
<CAPTION>
                                                    At                 At
                                             September 30, 2003  December 31, 2002
                                             ------------------  -----------------
                                                  (Dollars in Thousands)
<S>                                            <C>                 <C>
Total non-performing loans (1).................  $    975            $    506
Real estate owned..............................     1,456               1,717
                                                 --------            --------

Total non-performing assets....................  $  2,431            $  2,223
                                                 ========            ========

Total non-performing loans to
total loans......................................    0.30%               0.17%

Total non-performing assets to
total assets...................................      0.29%               0.26%

Allowance for loan loss........................  $  3,033            $  2,209

Allowance for loan losses as a percentage
of total non-performing assets.................    124.76%              99.37%

Allowance for loan losses as a percentage
of total non-performing loans..................    311.08%             437.00%

Allowance for loan losses as a percentage
of total average loans.........................      0.95%               0.78%
</TABLE>

(1)  Non-performing  loans exclude loans restructured and performing under their
     modified  terms.  Such loans  totaled $ 2.0  million and $0 for the periods
     ended September 30, 2003 and December 31, 2002, respectively.

                                       12
<PAGE>
Comparison  of  Operations  for the  Three-Month  and  Nine-Month  Periods Ended
--------------------------------------------------------------------------------
September 30, 2003 and 2002
---------------------------

Net income for the quarter ended September 30, 2003 decreased  $595,000 or 43.7%
over the quarter ended  September 30, 2002. Net income for the nine months ended
September  30,  2003  decreased  $640,000  or 16.8% over the nine  months  ended
September 30, 2002.

Net interest  income for the quarter  ended  September 30, 2003  decreased  $1.2
million or 23.8% over the quarter ended  September 30, 2002. Net interest income
for the nine months ended September 30, 2003 decreased $1.1 million or 7.2% over
the nine months ended September 30, 2002.

Interest  income for the quarter ended September 30, 2003 decreased $1.6 million
or 14.8% over the quarter ended September 30, 2002,  primarily due to a decrease
in the average yield on interest-earning  assets of 137 basis points,  partially
offset by an increase in the average balance of $68.4 million.  Interest expense
for the quarter  ended  September 30, 2003  decreased  $394,000 or 6.7% over the
quarter ended  September 30, 2002 due to a decrease in the average cost of funds
on  interest-bearing  liabilities  of 61 basis  points,  partially  offset by an
increase in the average balance of $83.1 million.

Interest  income for the nine months ended  September  30, 2003  decreased  $2.1
million,  or 6.4%, over the nine months ended September 30, 2002,  primarily due
to a  decrease  in the  average  yield on  interest-earning  assets  of 99 basis
points, partially offset by an increase in the average balance of $80.6 million.
Interest  expense for the nine months ended  September 30, 2003  decreased  $1.0
million,  or 5.7%,  over the  nine  months  ended  September  30,  2002 due to a
decrease  in the average  cost of funds on  interest-bearing  liabilities  of 63
basis points,  partially  offset by an increase in the average  balance of $90.3
million.

The provision for loan losses for the quarter ended September 30, 2003 decreased
$16,000 over the quarter ended September 30, 2002. The provision for loan losses
for the nine months ended  September 30, 2003  increased  $351,000 over the nine
months ended  September 30, 2002.  The Company's  allowance for loan losses as a
percentage  of total average loans was .95% at September 30, 2003 versus .72% at
September 30, 2002. Loans classified  substandard were $2.9 million at September
30, 2003 versus $102,000 at September 30, 2002.

Non-interest  income for the quarter ended September 30, 2003 increased $795,000
over the quarter ended  September 30, 2002 primarily due to gains on the sale of
securities  and the absence of a  writedown  on real  estate  owned.  During the
quarter ended September 30, 2002,  there was a writedown on real estate owned of
$585,000.

Non-interest  income for the nine months ended September 30, 2003 increased $1.8
million over the nine months ended  September 30, 2002 primarily due to gains on
the sale of mortgage-backed and investment securities.

Non-interest expense for the quarter ended September 30, 2003 increased $362,000
or 8.1% over the quarter  ended  September 30, 2002 due mainly to an increase in
professional   fees  of  $509,000   incurred  in  connection  with  the  pending
acquisition of the Company by Citizens Bank.

Non-interest expense for the nine months ended September 30, 2003 increased $1.2
million or 9.7% over the nine  months  ended  September  30,  2002 due mainly to
increases  in  professional  fees,  occupancy  and  equipment  costs,  and other
operating  expenses  of  $443,000,  $235,000  and  $339,000,  respectively.  The
increase  in  professional  fees is due  mainly to the  pending  acquisition  as
discussed  above.  The  increase  in  occupancy  and  equipment  costs is due to
increases  in  maintenance  and  depreciation  expense.  The  increase  in other
operating expense is due to increases in operating expenses including telephone,
security, postage, supplies and information technology-related expenses.

The  Company's  income tax  expense  for the quarter  ended  September  30, 2003
decreased  $206,000,  or 71.8%.  For the nine-month  period,  income tax expense
decreased  $142,000,  or 17.7%.  The  decline in income tax expense for the 2003
periods  was  due to  lower  earnings  and,  in the  case of the  quarter  ended
September 30, 2003, a decline in the Company's effective tax rate. The Company's
effective tax rates for the three and nine months ended  September 30, 2003 were
9.6% and 17.3%,  respectively  compared  to 17.4% for the three and nine  months
ended  September 30, 2002. The Company's  effective tax rate has been lower than
the statutory rate of 34% due primarily to its holdings of municipal obligations
that are exempt from federal tax.

Critical Accounting Policies
----------------------------

The  following  is a  summary  of those  accounting  policies  that the  Company
considers to be critical as they require  management's most difficult  judgments
as a result of the need to make estimates  about the effects of matters that are
inherently uncertain.

                                       13
<PAGE>

Allowance for Loan Losses- the allowance for loan losses represents management's
estimate of probable losses based on information available as of the date of the
financial  statements.  The allowance  for loan losses is based on  management's
evaluation of the collectibility of the loan portfolio, including past loan loss
experience,  known and inherent  losses,  information  about  specific  borrower
situations and estimated collateral values, and economic conditions.

The Company's allowance review procedures consist of the following:
       - Identifying  large balance loans for individual  review under Statement
         of Financial Accounting Standards No. 114, "Accounting by Creditors for
         Impairment  of a Loan".  In  general,  these  consist of large  balance
         commercial loans and commercial mortgages (Statement 114 loans).

       - Calculating the estimated fair value,  using observable  market prices,
         discounted  cash flows or the value of the  underlying  collateral  for
         Statement  114 loans which are  determined to be impaired as defined by
         Statement 114.

       - Classifying all  non-impaired  large balance loans based on credit risk
         ratings  and   allocating   an  allowance  for  loan  losses  based  on
         appropriate factors, including recent loss history for similar loans.

       - Identifying  all  smaller  balance  homogeneous  loans  for  evaluation
         collectively under the provisions of Statement of Financial  Accounting
         Standards No. 5,  "Accounting  for  Contingencies".  In general,  these
         loans include residential mortgages, consumer loans, installment loans,
         smaller balance commercial loans and mortgages.

       - Reviewing  the  results to  determine  the  appropriate  balance of the
         allowance for loan losses.  This review gives additional  consideration
         to factors  such as the mix of loans in the  portfolio,  the balance of
         the allowance relative to total loans and non-performing assets, trends
         in the overall risk profile of the portfolio,  trends in  delinquencies
         and non-accrual loans and local and national economic conditions.

Goodwill- With the adoption of Statement of Financial  Accounting  Standards 142
and 147, effective January 1, 2002 the Company ceased  amortization of goodwill.
The recorded  goodwill is subject to  impairment  testing to  determine  whether
write-downs of the recorded balances are necessary. Such testing is based upon a
number of factors,  which are based upon  assumptions and management  judgments.
These factors include among other things,  future growth rates,  discount rates,
and earnings capitalization rates.

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

On September  30, 2003,  the Bank was in  compliance  with its three  regulatory
capital requirements as follows:

                                             Amount         Percent
                                             ------         -------
                                           (Dollars in Thousands)

Tangible capital......................     $  55,874          6.91%
Tangible capital requirement..........        12,127          1.50%
                                           ---------        -------
Excess over requirement...............     $  43,747          5.41%
                                           =========        =======

Core capital..........................     $  55,874          6.91%
Core capital requirement..............        32,339          4.00%
                                           ---------        -------
Excess over requirement...............     $  23,535          2.91%
                                           =========        =======

Risk based capital....................     $  58,907         13.21%
Risk based capital requirement........        35,668          8.00%
                                           ---------        -------
Excess over requirement...............     $  23,239          5.21%
                                           =========        =======

The Company's  primary sources of funds are deposits,  borrowings,  and proceeds
from principal and interest  payments on loans,  mortgage-backed  securities and
other  investments.  While  maturities and scheduled  amortization  of loans and
mortgage-backed  securities are a predictable source of funds, deposit flows and
mortgage prepayments are greatly influenced by general interest rates,  economic
conditions,  competition  and the  consolidation  of the  financial  institution
industry.

The primary  investment  activity of the Company is the origination and purchase
of mortgage loans, mortgage-backed securities and other investments.  During the
nine months ended September 30, 2003, the Company  originated  $147.9 million of
mortgage loans. The Company also purchases loans and mortgage-backed  securities
to reduce liquidity not otherwise  required for local loan demand.  Purchases of
loans  and   mortgage-backed   securities  totaled  $262.3  million  during  the
nine-month period ended September 30, 2003. Other investment  activities include
investment in U.S.

                                       14
<PAGE>

government  and federal agency  obligations,  municipal  bonds,  debt and equity
investments in financial  services firms, FHLB of Pittsburgh  stock,  commercial
and consumer loans.

The Company's  most liquid assets are cash and cash  equivalents,  which include
investments in highly liquid, short-term investments.  The level of these assets
is dependent on the Company's  operating,  financing  and  investing  activities
during any given  period.  At  September  30,  2003,  cash and cash  equivalents
totaled $41.3 million.  The Bank's  liquidity  ratio was 7.47 % at September 30,
2003.

The Company anticipates that it will have sufficient funds available to meet its
current commitments.  As of September 30, 2003, the Company had $35.3 million in
commitments  to fund loans.  Certificates  of deposit,  which were  scheduled to
mature in one year or less,  as of September  30, 2003 totaled  $136.4  million.
Management believes that a significant portion of such deposits will remain with
the Company.

Additional Key Operating Information and Ratios
-----------------------------------------------

<TABLE>
<CAPTION>
                                                       For the                   For the
                                                  Three Months Ended        Nine Months Ended
                                                     September 30,            September 30,
                                                     -------------            -------------
                                                2003(1)      2002(1)    2003(1)       2002(1)
                                                -------      -------    -------       -------


<S>                                           <C>         <C>         <C>          <C>
Return on average assets                          .36%        .71%        .51%         .68%
Return on average equity                         4.04%       7.18%       5.52%        6.13%
Yield on average interest-earning assets         4.89%       6.26%       5.28%        6.27%
Cost of average interest-bearing liabilities     2.94%       3.55%       3.02%        3.65%
Interest rate spread (2)                         1.95%       2.71%       2.26%        2.63%
Net interest margin (3)                          2.17%       3.07%       2.50%        2.99%

                                                 At September 30, 2003    At December 31, 2002
                                                 ---------------------    --------------------
Tangible book value per share (4)                       $12.91                   $13.07
</TABLE>

(1)  The ratios for the three and nine month periods are  annualized  and yields
     were adjusted for the effects of tax-free  investments  using the statutory
     tax rate.
(2)  Interest rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(3)  Net  interest  margin  represents  net interest  income as a percentage  of
     average interest-earning assets.
(4)  Tangible book value per share represents stockholders' equity less goodwill
     divided by the number of shares issued and outstanding.


Quantitative and Qualitative Disclosures about Market Risk
----------------------------------------------------------

Qualitative  Analysis.  There have been no material changes from the Qualitative
Analysis  information  regarding  market risk  disclosed  under the heading "Net
Portfolio  Value" in the  Company's  Management's  Discussion  and  Analysis  of
Financial  Condition and Results of Operations  included in the annual report on
Form 10-K for the year ended December 31, 2002.

Quantitative  Analysis.  Exposure to interest rate risk is actively monitored by
management.  The  Company's  objective  is to  maintain  a  consistent  level of
profitability  within  acceptable  risk  tolerances  across  a  broad  range  of
potential  interest  rate  environments.  The Company uses the OTS Net Portfolio
Value  ("NPV")  Model to monitor  its  exposure  to  interest  rate risk,  which
calculates  changes in net portfolio value.  Reports  generated from assumptions
provided  and  modified  by  management  are  reviewed  by  the  Asset/Liability
Management  Committee  and  reported to the Board of  Directors  quarterly.  The
Interest Rate  Sensitivity of the Net Portfolio Value Report shows the degree to
which balance sheet line items and net portfolio value are potentially  affected
by a 100 to 300 basis point (1 basis point equals 1/100th of a percentage point)
upward and downward parallel shift (shock) in the Treasury yield curve.

Since the NPV  Model  measures  exposure  to  interest  rate risk of the Bank to
assure capital  adequacy for the protection of the  depositors,  only the Bank's
financial  information is used for the model.  However,  the Bank is the primary
subsidiary  and most  significant  asset of the Company,  therefore  the OTS NPV
model provides a reliable basis upon which to perform the quantitative analysis.
The following  table  presents the Bank's NPV as of September 30, 2003.  The NPV
was calculated by the OTS, based on information provided by the Bank.

                                       15
<PAGE>

<TABLE>
<CAPTION>
                                                                                      Net Portfolio Value
                                    Net Portfolio Value                                 As a % of Assets
                                    -------------------                       ------------------------------------
Change in Rates                                                               Net Portfolio
In Basis Points    Dollar Amount       Dollar Change         % Change          Value Ratio      Basis Point Change
---------------    -------------       -------------         --------          -----------      ------------------
<S>                 <C>               <C>                    <C>                <C>                 <C>
     300              $ 29,072          $  (33,562)            (54%)              3.68%               (373)
     200                42,305             (20,329)            (32%)              5.24%               (218)
     100                54,084              (8,551)            (14%)              6.54%                (88)
       0                62,634                   -               -                7.42%                  -
    (100)               61,205              (1,430)             (2%)              7.17%                (25)
    (200)                    *                   *                *                  *                   *
    (300)                    *                   *                *                  *                   *
</TABLE>

     * Scenario not used due to the low prevailing interest rate environment

Controls and Procedures
-----------------------

         a)  Evaluation of disclosure  controls and  procedures.  Based on their
             --------------------------------------------------
evaluation of the Company's  disclosure  controls and  procedures (as defined in
Rule 13a-15(e) under the Securities  Exchange Act of 1934 (the "Exchange Act")),
the Company's  principal  executive officer and principal financial officer have
concluded that as of the end of the period  covered by this Quarterly  Report on
Form 10-Q such  disclosure  controls and procedures are effective to ensure that
information  required to be disclosed by the Company in reports that it files or
submits under the Exchange Act is recorded,  processed,  summarized and reported
within the time periods  specified in Securities and Exchange  Commission  rules
and forms.

         b) Changes in internal  control over  financial  reporting.  During the
            -------------------------------------------------------
quarter under report, there was no change in the Company's internal control over
financial  reporting that has materially  affected,  or is reasonably  likely to
materially affect, the Company's internal control over financial reporting.

                                       16

<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
                                     PART II

ITEM 1.    LEGAL PROCEEDINGS

The Company is a party to routine legal  proceedings  in the ordinary  course of
business,  such  as  claims  to  enforce  liens,   condemnation  proceedings  on
properties in which the Company holds a security interest,  claims involving the
making and servicing of real property  loans,  and other issues  incident to the
business of the Company.  In the Company's  opinion,  such  lawsuits  pending or
known to be contemplated against the Company at September 30, 2003 would have no
material effect on the operations or income of the Company or the Bank, taken as
a whole.

ITEM 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS

Not applicable

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

Not applicable

ITEM 4     OTHER INFORMATION

None

ITEM 5.    EXHIBITS AND REPORTS ON FORM 8-K

        a) The following Exhibits are filed as part of this report:

             2.1   Agreement and Plan of Merger, dated as of September 22, 2003,
                   by and among Citizens Bank of Pennsylvania, Citizens
                   Financial Group, Inc. and Thistle Group Holdings, Co.*******
             3(i)  Articles of Incorporation****
             3(ii) Amended Bylaws*****
             4.1   Shareholder Rights Plan**
            10.1   1992 Stock Option Plan of Roxborough-Manayunk Federal Savings
                   Bank*
            10.2   1992 Management  Stock Bonus Plan of  Roxborough-Manayunk
                   Bank*
            10.3   1994 Stock Option Plan of Roxborough-Manayunk  Bank*
            10.4   1994 Management Stock Bonus Plan of Roxborough-Manayunk Bank*
            10.5   Employment Agreement with John F. McGill, Jr.****
            10.6   Employment Agreement with Jerry Naessens*
            10.7   1999 Stock Option Plan ***
            10.8   1999 Restricted Stock Plan***
            10.9   Consulting Agreement with Jerry Naessens******
           10.10   Amended Non-Qualified Retirement and Death Benefit with
                   Jerry Naessens******
           10.11   Split Dollar Life Insurance Agreement with
                   Jerry Naessens******
           31      Certifications Pursuant to Rule 13a - 14 (a)
           32      Certification Pursuant to 18 U.S.C. Section 1350, as adopted
                   pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

        b) Reports on Form 8-K

           On October  21,  2003 the  Company  filed a Form 8-K (Items 7 and 9),
           which  included the Company's  third-quarter  2003 earnings  release,
           dated October 20, 2003.

           On September 24, 2003, the Company filed a Current Report on Form 8-K
           reporting  under Item 5 that it had entered into a definitive  merger
           agreement with Citizens Bank of Pennsylvania  and Citizens  Financial
           Group, Inc.

----------------
*    Incorporated  by  reference  to the  identically  numbered  exhibit  to the
     Company's Form S-1 Registration  Statement No. 333-48749 filed on March 27,
     1998.

**   Incorporated  by reference to Exhibit 1 to the Company's  Form 8-A filed on
     September 30, 1999.

***  Incorporated by reference to the appropriate exhibit of the Company's proxy
     material filed on June 21, 1999. (File No. 000-24353)

**** Incorporated by reference to the identically  numbered exhibits to the Form
     10-K for the year ended  December 31, 1999 filed on March 30,  2000.  (File
     No. 000-24353)

                                       17
<PAGE>

*****    Incorporated  by reference to the identically  numbered  exhibit to the
         Form 10-K for the year ended December 31, 2001 filed on March 12, 2002.
         (File No. 000-24353)

******   Incorporated by reference to the identically  numbered  exhibits to the
         Form 10-K for the year ended December 31, 2002 filed on March 19, 2003.
         (File No. 000-24353)

*******  Incorporated  by reference to the identically  numbered  exhibit to the
         Company's Current Report on Form 8-K filed September 24, 2003.


                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES

                                   SIGNATURES

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

                           THISTLE GROUP HOLDINGS, CO.



Date: November 14, 2003                    By:  /s/ John F. McGill, Jr.
                                                --------------------------------
                                                John F. McGill, Jr.
                                                Chief Executive Officer
                                                (Principal Executive Officer)




Date: November 14, 2003                    By:  /s/ Pamela M. Cyr
                                                --------------------------------
                                                Pamela M. Cyr
                                                Chief Financial Officer
                                                (Principal Financial Officer)