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 March 31, 2002

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

                      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, May 1, 2002.

                  Class                                      Outstanding
--------------------------------------------------------------------------------
         $.10 par value common stock                          6,496,655

<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
                                    FORM 10-Q
                      FOR THE QUARTER ENDED MARCH 31, 2002

                                      INDEX

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

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

    Item 2.    Management's Discussion and Analysis of Financial
               Condition and Results of Operations.............................9

    Item 3.    Quantitative and Qualitative Disclosures about Market Risk.....12

PART II - OTHER INFORMATION

    Item 1.    Legal Proceedings..............................................13

    Item 2.    Changes in Securities..........................................13

    Item 3.    Defaults upon Senior Securities................................13

    Item 4.    Submission of Matters to a Vote of Security Holders............13

    Item 5.    Other Information..............................................13

    Item 6.    Exhibits and Reports on Form 8-K...............................14

SIGNATURES        ............................................................15



<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
       UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                                     March 31, 2002        December 31, 2001
                                                                                     --------------        -----------------

<S>                                                                                <C>                        <C>

ASSETS
Cash on hand and in banks ......................................................       $    3,722                 $   3,909
Interest-bearing deposits ......................................................           17,179                    18,814
                                                                                       ----------                    ------
                  Total cash and cash equivalents ..............................           20,901                    22,723
Investments held to maturity
                  (approximate fair value of $65,819 and  $62,558)..............           68,292                    63,824
Investments available for sale at fair value
                  (amortized cost of $16,657 and $16,654) ......................           16,314                    16,078
Mortgage-backed securities available for sale at fair value
                  (amortized cost of $294,352 and $295,998) ....................          296,361                   299,216
Trading securities.............................................................            14,014                    14,261
Loans receivable (net of allowance for loan losses of
                  $2,661 and $2,511) ...........................................          278,730                   259,220
Accrued interest receivable ....................................................            4,060                     4,056
FHLB stock - at cost ...........................................................            8,994                     8,844
Real estate acquired through foreclosure - net .................................               81                        81
Office properties and equipment - net ..........................................            6,880                     6,340
Cash surrender value of life insurance .........................................           12,706                    12,563
Excess of cost over fair value of net assets acquired ..........................            7,499                     7,680
Prepaid expenses and other assets ..............................................            4,599                     4,240
Prepaid income taxes............................................................              409                       538
Deferred income taxes ..........................................................            1,073                       744
                                                                                       ----------                 ---------
                  TOTAL ASSETS .................................................       $  740,913                 $ 720,408
                                                                                       ==========                 =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Deposits .......................................................................       $  451,916                 $ 431,583
Accrued interest payable .......................................................              905                       918
Advances from borrowers for taxes and insurance ................................            1,468                     2,571
FHLB advances ..................................................................          179,884                   176,884
Payable to brokers and dealers .................................................           14,013                    14,109
Accounts payable and accrued expenses ..........................................            6,470                     7,360
Other borrowings ...............................................................            1,000                     1,000
Dividends payable ..............................................................              524                       528
                                                                                       ----------                 ---------
                  TOTAL LIABILITIES ............................................          656,180                   634,953
                                                                                       ----------                 ---------
Commitments and Contingencies
Stockholders' Equity:
Preferred stock, no par value - 10,000,000 shares authorized,
none issued in 2002 and 2001 ...................................................               --                        --
Common stock - $.10 par, 40,000,000 shares authorized, 8,999,989
issued in 2002 and 2001; 6,546,655 outstanding March 31, 2002
and 6,607,955 outstanding December 31, 2001 ....................................              900                       900
Additional paid-in capital .....................................................           92,867                    92,889
Common stock acquired by stock benefit plans ...................................           (6,171)                   (6,383)
Treasury stock at cost, 2,453,334 shares at March 31, 2002 and
2,392,034 shares at December 31, 2001 ..........................................          (22,394)                  (21,626)
Accumulated other comprehensive income..........................................              673                     1,286
Retained earnings - partially restricted .......................................           18,858                    18,389
                                                                                       ----------                 ---------
                  Total stockholders' equity ...................................           84,733                    85,455
                                                                                       ----------                 ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .....................................       $  740,913                 $ 720,408
                                                                                       ==========                 =========
</TABLE>

See notes to unaudited condensed consolidated financial statements.

                                       3
<PAGE>

                  Thistle Group Holdings, Co. and subsidiaries
              UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>

                                                                     For the Three Months
                                                                         Ended March 31,
                                                                         ---------------
                                                                       2002           2001
<S>                                                             <C>           <C>
INTEREST INCOME:
   Interest on loans.....................................           $ 5,004       $  4,674
   Interest on mortgage-backed securities................             4,083          4,467
   Interest and dividends on investments.................             1,441          2,509
                                                                    -------       --------
       Total interest income.............................            10,528         11,650
                                                                    -------       --------
INTEREST EXPENSE:
   Interest on deposits..................................             3,447          4,788
   Interest on borrowed money............................             2,382          2,367
                                                                    -------       --------
       Total interest expense............................             5,829          7,155
                                                                    -------       --------

NET INTEREST INCOME                                                   4,699          4,495

PROVISION FOR LOAN LOSSES................................               150            120
                                                                    -------       --------
NET INTEREST INCOME AFTER PROVISION
   FOR LOAN LOSSES.......................................             4,549          4,375
                                                                    -------       --------
OTHER INCOME:
   Service charges and other fees........................               248            196
   Loss on sale of loans.................................                --            (11)
    Loss on SBIC investments                                             --           (246)
   Rental income.........................................                55             50
   Trading revenues from brokerage operations............               299            360
   Miscellaneous other income............................                --             83
                                                                    -------       --------
       Total other income................................               602            432
                                                                    -------       --------

OTHER EXPENSES:
   Salaries and employee benefits........................             1,787          1,784
   Occupancy and equipment...............................               671            592
   Federal insurance premium.............................                18             20
   Professional fees.....................................               305            111
   Advertising and promotion.............................               103             94
   Amortization of excess of cost over fair value
   of assets acquired....................................               180            180
   Other.................................................               898            871
                                                                    -------       --------
       Total other expenses..............................             3,962          3,652
                                                                    -------       --------

INCOME BEFORE INCOME TAXES...............................             1,189          1,155
                                                                    -------       --------

INCOME TAXES.............................................               197            179
                                                                    -------       --------

NET INCOME...............................................           $   992       $    976
                                                                    =======       ========

BASIC EARNINGS PER SHARE.................................           $   .16       $   .15
DILUTED EARNINGS PER SHARE...............................           $   .16       $   .15

WEIGHTED AVERAGE SHARES
   OUTSTANDING - BASIC...................................         6,117,618     6,552,248
WEIGHTED AVERAGE SHARES
   OUTSTANDING - DILUTED.................................         6,196,791     6,599,527
</TABLE>

See notes to unaudited condensed consolidated financial statements.

                                       4
<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES
            UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                                For the Three Months
                                                                                                  Ended March 31,
                                                                                                  ---------------

                                                                                             2002                2001
                                                                                             ----                ----
<S>                                                                                     <C>                 <C>
OPERATING ACTIVITIES:
Net income..................................................................              $    992            $    976
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:
   Provision for loan losses................................................                   150                 120
   Depreciation.............................................................                   313                 244
   Amortization of stock benefit plans......................................                   220                 242
   Amortization of excess of cost over fair value of net assets acquired....                   180                 180
   Amortization of net premiums (discounts) on:
     Loans purchased........................................................                    16                  18
     Investments............................................................                  (269)               (261)
     Mortgage-backed securities.............................................                   862                 229
   Loss on sale of loans....................................................                    --                  11
   Net decrease in trading securities.......................................                   247              16,520
   Increase in other assets.................................................                  (375)               (567)
   Increase in other liabilities............................................                (1,002)            (17,243)
                                                                                          --------            --------
Net cash provided by operating activities...................................                 1,334                 469
                                                                                          --------            --------
INVESTING ACTIVITIES:
Principal collected on:
   Mortgage-backed securities...............................................                38,388              16,578
   Loans....................................................................                24,204               9,453
Loans originated............................................................               (43,880)            (21,195)
Purchases of:
   Investments .............................................................                (4,202)                (40)
   Mortgage-backed securities...............................................               (37,604)            (35,584)
   Office properties and equipment..........................................                  (853)               (468)
   FHLB Stock...............................................................                  (150)             (1,250)
Proceeds from the sale of loans.............................................                    --               3,199
Maturities and calls of investments.........................................                    30              14,627
                                                                                          --------            --------
Net cash used in investing activities.......................................               (24,067)            (14,680)
                                                                                          --------            --------
FINANCING ACTIVITIES:
Net increase in deposits....................................................                20,333                 458
Net decrease in advances from borrowers for taxes and insurance.............                (1,103)             (1,263)
Net increase in FHLB advances...............................................                 3,000              25,000
Net decrease in other borrowings............................................                    --                (250)
Purchase of treasury stock..................................................                  (858)               (687)
Net proceeds from exercise of stock options                                                     62                  --
Cash dividends..............................................................                  (523)               (493)
                                                                                          --------            --------
Net cash provided by financing activities...................................                20,911              22,765
                                                                                          --------            --------
Net (decrease) increase in cash and cash equivalents........................                (1,822)              8,554
Cash and cash equivalents, beginning of period..............................                22,723              20,320
                                                                                          --------            --------
Cash and cash equivalents, end of period....................................              $ 20,901            $ 28,874
                                                                                          ========            ========
SUPPLEMENTAL DISCLOSURES
Interest paid on deposits and funds borrowed................................              $  5,842            $  7,122
Income taxes paid...........................................................                   150                 431
Noncash transfers from loans to real estate owned...........................                    --                  19
</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  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
periods ended March 31, 2002 are not necessarily indicative of the results which
may be expected for the entire fiscal year or any other future interim period.

These unaudited  consolidated financial statements should be read in conjunction
with the consolidated financial statements and related notes, which are included
in the Company's  Annual Report to  stockholders on Form 10-K for the year ended
December 31, 2001.

NOTE 3 - INVESTMENTS


Investments  held to maturity at March 31, 2002 and December 31, 2001  consisted
of the following:

<TABLE>
<CAPTION>
                                                              March 31, 2002                        December 31, 2001
                                                        Amortized          Approximate         Amortized          Approximate
                                                          Cost             Fair Value            Cost             Fair Value
                                                          ----             ----------            ----             ----------

<S>                                                  <C>                <C>                 <C>                <C>
FHLB and FHLMC bonds - more than 10 years..........    $  15,443          $   13,632          $  15,201          $   14,408
Municipal bonds - 5 to 10 years....................          747                 757                777                 789
Municipal bonds - more than 10 years...............       52,102              51,430             47,846              47,361
                                                       ---------          ----------          ---------          ----------

Total..............................................    $  68,292          $   65,819          $  63,824          $   62,558
                                                       =========          ==========          =========          ==========
</TABLE>

Investments available for sale at March 31, 2002 and December 31, 2001 consisted
of the following:

<TABLE>
<CAPTION>
                                                              March 31, 2002                        December 31, 2001
                                                        Amortized          Approximate         Amortized          Approximate
                                                          Cost             Fair Value            Cost             Fair Value
                                                          ----             ----------            ----             ----------
<S>                                                  <C>                <C>                 <C>                <C>
Mutual funds.......................................    $   1,536          $    1,536          $   1,530          $    1,530
Capital trust securities...........................        9,067               7,970              9,077               8,040
Equity investments.................................        4,528               5,282              4,528               4,989
Other..............................................        1,526               1,526              1,519               1,519
                                                       ---------          ----------          ---------          ----------

Total..............................................    $  16,657          $   16,314          $  16,654          $   16,078
                                                       =========          ==========          =========          ==========
</TABLE>

                                       6

<PAGE>

NOTE 4 - MORTGAGE-BACKED SECURITIES AVAILABLE FOR SALE

Mortgage-backed  securities at March 31, 2002 and December 31, 2001 consisted of
the following:

<TABLE>
<CAPTION>

                                                              March 31, 2002                        December 31, 2001
                                                        Amortized          Approximate         Amortized          Approximate
                                                          Cost             Fair Value            Cost             Fair Value
                                                          ----             ----------            ----             ----------
<S>                                                    <C>                <C>                 <C>                <C>
GNMA pass-through certificates.......................  $ 117,414          $  119,585          $ 106,452          $  108,837
FNMA pass-through certificates.......................    104,245             104,391            114,634             115,109
FHLMC pass-through certificates......................     59,648              59,483             66,417              66,593
FHLMC collateralized mortgage obligations............      3,910               3,789              3,904               3,904
FHLMC real estate mortgage investment conduits.......      9,135               9,113              4,591               4,773
                                                       ---------          ----------          ---------          ----------
Total................................................  $ 294,352          $  296,361          $ 295,998          $  299,216
                                                       =========          ==========          =========          ==========
</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.

NOTE 6 - LOANS RECEIVABLE

Loans  receivable  at March  31,2002  and  December  31, 2001  consisted  of the
following:

<TABLE>
<CAPTION>
                                                                March 31, 2002           December 31, 2001
                                                                --------------           -----------------
<S>                                                             <C>                        <C>
Mortgage loans:
         1 - 4 family residential.............................    $  129,004                 $  125,504
         Commercial real estate...............................        82,242                     62,532
Home equity lines of credit and improvement loans.............        23,168                     20,923
Commercial non-mortgage loans.................................        20,939                     28,866
Construction loans - net......................................        25,486                     23,677
Loans on savings accounts.....................................           621                        637
Consumer loans    ............................................          1240                        879
                                                                  ----------                 ----------

         Total loans..........................................       282,700                    263,018
                                                                  ----------                 ----------
Plus: unamortized premiums....................................           249                        267
Less:
         Net discounts on loans purchased.....................           (13)                       (13)
         Deferred loan fees...................................        (1,545)                    (1,541)
         Allowance for loan losses............................        (2,661)                    (2,511)
                                                                  -----------                ----------
Total                                                             $  278,730                 $  259,220
                                                                  ==========                 ==========
</TABLE>

NOTE 7 - DEPOSITS

The major types of deposits by amounts and percentages were as follows:

<TABLE>
<CAPTION>
                                                          March 31, 2002                         December 31, 2001
                                                      Amount        % of Total                Amount        % of Total
                                                      ------        ----------                ------        ----------
<S>                                             <C>                  <C>               <C>                    <C>
NOW accounts and
   transaction checking                           $   61,768            13.7%             $   47,372             11.0%
Money Market Demand accounts                          42,215             9.3%                 40,029              9.3%
Passbook accounts                                    114,533            25.3%                109,257             25.3%
Certificate accounts                                 233,400            51.7%                234,925             54.4%
                                                  ----------            -----             ----------             -----

Total                                             $  451,916           100.0%             $  431,583            100.0%
                                                  ==========           ======             ==========            ======
</TABLE>

                                        7

<PAGE>

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.

NOTE 9 - COMPREHENSIVE INCOME

For the three-month  periods ended March 31, 2002 and 2001, the Company reported
total comprehensive (loss) income of approximately $379 and $5,500 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 March 20,  2002,  the Company  declared a dividend of $.08 per share  payable
April 15, 2002 to stockholders of record on March 31, 2002.

NOTE 11 - NEW ACCOUNTING STANDARDS

In June 2001, the Financial  Accounting  Standards Board ("FASB") issued two new
pronouncements:  SFAS No. 141, Business Combinations, and SFAS No. 142, Goodwill
and Other Intangible  Assets.  SFAS No. 141 is effective as follows:  (a) use of
the pooling-of-interest method is prohibited for business combinations initiated
after June 30, 2001;  and (b) the  provisions  of SFAS No. 141 also apply to all
business  combinations  accounted for by the purchase  method that are completed
after June 30, 2001.  SFAS No. 142 is effective for fiscal years beginning after
December 15, 2001 to all goodwill and other intangible  assets  recognized in an
entity's statement of financial position at that date,  regardless of when those
assets  were  initially  recognized.  However,  SFAS No. 142 does not change the
accounting   prescribed   for  certain   acquisitions   by  banking  and  thrift
institutions,  resulting  in continued  amortization  of the excess of cost over
fair value of net assets  acquired  under SFAS No. 72,  Accounting  for  Certain
Acquisitions  of  Banking or Thrift  Institutions.  In  October  2001,  the FASB
decided to undertake a limited scope project to reconsider  part of the guidance
in SFAS No. 72. In particular,  the FASB decided to reconsider the provisions of
that statement that require  recognition and  amortization of an  unidentifiable
intangible  asset-an asset that is sometimes referred to in practice as "SFAS 72
goodwill".  In March 2002, the FASB tentatively decided, that if the transaction
was a  business  combination  and the core  deposit  intangible  was  separately
recognized,  then  preparers  would  cease  amortization  of all  unidentifiable
intangible  assets. The FASB decided that the final Statement would be effective
upon  issuance  with  retroactive  restatement  for the  nonamortization  of the
unidentified  intangible asset to the beginning of the fiscal year in which SFAS
No. 142 was applied in its entirety.  At March 31, 2002, as the final  Statement
has not yet been issued, the Company's "SFAS 72 goodwill" amounted to $7,499 and
was subject to amortization of $180 for the three months ended March 31, 2002.

NOTE 12 - SUBSEQUENT EVENT

On March 26, 2002, the Company formed a wholly-owned  subsidiary,  Thistle Group
Holdings Capital Trust I, a Delaware business trust (the "Trust").  On April 10,
2002,  the Trust sold $10.0 million of pooled  floating rate capital  securities
(the "Capital Securities") to MM Community Funding III, Ltd. with a stated value
and  liquidation  preference of $1,000 per share.  The  obligations of the Trust
under the Capital  Securities  are fully and  unconditionally  guaranteed by the
Company and the Trust has no independent  operations.  The entire  proceeds from
the sale of the Capital  Securities were used by the Trust to invest in floating
rate  junior   subordinated   debt   securities  of  the  Company  (the  "Junior
Subordinated  Debt").  The  Junior  Subordinated  Debt  is  unsecured  and  rank
subordinate and junior in right of payment to all indebtedness,  liabilities and
obligations of the Company.  The Junior  Subordinated  Debt is the sole asset of
the  Trust.  Interest  on the  Capital  Securities  is  cumulative  and  payable
quarterly in arrears.  The Capital  Securities mature in April 2032. The Company
has the right to  optionally  redeem the Junior  Subordinated  Debt prior to the
maturity date, but no sooner than five years after the issuance,  at 100% of the
stated liquidation amount, plus accrued and unpaid distributions, if any, on the
redemption  date.  Upon the  occurrence of certain  events,  the Company has the
right to redeem the Junior  Subordinated  Debt in whole,  but not in part,  at a
special  redemption  price  before five years have  elapsed.  Proceeds  from any
redemption of the Junior Subordinated Debt will cause a mandatory  redemption of
Capital Securities having an aggregate liquidation amount equal to the principal
amount of the Junior Subordinated Debt redeemed.  Additionally,  under the terms
of the Junior  Subordinated  Debt, the Company will have the right, with certain
limitations, to defer the payment of interest on the Junior Subordinated Debt at
any  time for a period  not  exceeding  twenty  consecutive  quarterly  periods.
Consequently,  distributions  on the Capital  Securities  would be deferred  and
accumulate interest,  compounded  quarterly.  The Capital Securities were issued
without  registration under the Securities Act of 1933, as amended,  in reliance
upon an exemption from registration as provided by Regulation S.

                                       8

<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.

Overview

In January of 2002 the  Company  opened its 13th  banking  office in  Flourtown,
Pennsylvania.  Record growth was achieved in core deposits  (savings,  checking,
and money market accounts),  which increased $21.9 million over the December 31,
2001 quarter.  In addition,  loans  outstanding grew by $19.5 million,  which is
primarily from commercial  real estate mortgage loans.  Such growth reflects the
continuation of the Company's strategic plan.

<TABLE>
<CAPTION>
                                                    LINKED QUARTER HIGHLIGHTS
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
                                         QTR                QTR                 INCREASE              % INCREASE
                                       3/31/02            12/31/01             (DECREASE)             (DECREASE)
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
<S>                              <C>               <C>                 <C>                         <C>
Net Interest Income                $       4,699     $       4,589       $         110                   2.4  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Provision for loan losses*                  150                420                (270)                (64.3) %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Non-interest Income*                        602               (218)                820                 376.1  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Non-interest Expense                      3,962              3,807                 155                  4.07  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Net Income                                  992                299                 693                 231.8  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Loans                                   278,730            259,220              19,510                   7.5  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
Deposits                                451,916            431,583              20,333                   4.7  %
-------------------------------- ----------------- ------------------- ----------------------- ----------------------
</TABLE>

* The December 31, 2001 quarter  reflected a total of $800,000 of  non-recurring
after-tax charges, which were related to the provision for loan losses and sales
and write downs of the carrying values of certain  available for sale securities
and other assets.


Comparison of Financial Condition
---------------------------------

Total assets were $740.9 million at March 31, 2002,  representing an increase of
$20.5  million from the balance of $720.4  million at December  31,  2001.  This
increase was due primarily to an increase in loans  receivable of $19.5 million,
which was funded, by an increase in deposits of $20.3 million.

Loans  receivable  increased $19.5 million,  or 7.5%, to $278.7 million at March
31, 2002 from $259.2  million at December 31, 2001.  This increase was primarily
the result of $43.9 million of loan originations, offset by principal repayments
of $24.2 million.

Deposits  increased $20.3 million,  or 4.7%, to $451.9 million at March 31, 2002
from $431.6 million at December 31, 2001. NOW accounts, transaction checking and
money market accounts increased $16.5 million;  passbook accounts increased $5.3
million,  and  certificates  decreased  $1.5  million  as a  result  of  focused
marketing and business  development  initiatives aimed at building the Company's
core deposit base as well as to the addition of new banking offices.

Total stockholders' equity decreased $722,000 to $84.7 million at March 31, 2002
from $85.4  million at  December  31,  2001  primarily  due to a decrease in the
accumulated  other  comprehensive  income  of  $613,000  million  as a result of
changes  in the  net  unrealized  gain  on the  available  for  sale  securities
portfolio due to fluctuations in the interest rates, treasury stock purchases of
$857,000,  and  dividends  paid of  $524,000  offset by net income of  $992,000.
Because of interest rate changes, the Company's  accumulated other comprehensive
income (loss) may fluctuate for each interim and year-end period.

                                       9

<PAGE>

Non-performing Assets
---------------------

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

<TABLE>
<CAPTION>
                                                                 At                At
                                                           March 31, 2002   December 31, 2001
                                                           --------------   -----------------
                                                                  (Dollars in Thousands)

<S>                                                         <C>                 <C>
Total non-performing loans..................................   $3,198              $3,178
Real estate owned...........................................       81                  81
                                                               ------              ------

Total non-performing assets.................................   $3,279              $3,259
                                                               ======              ======

Total non-performing loans to
total loans.................................................     1.15%               1.23%

Total non-performing assets to
total assets................................................      .44%                .45%

Allowance for loan loss.....................................   $2,661              $2,511

Allowance for loan losses as a percentage
of total non-performing assets..............................       81%                 98%

Allowance for loan losses as a percentage
of total non-performing loans...............................       83%                 79%

Allowance for loan losses as a percentage
of total average loans......................................     1.01%               1.05%
</TABLE>


Comparison of Operations  for the  Three-Month  Periods Ended March 31, 2002 and
2001
--------------------------------------------------------------------------------

Net Income. Net income for the quarter ended March 31, 2002 was $992,000 or $.16
diluted earnings per share as compared to net income of $976,000 or $.15 diluted
earnings per share for the quarter ended March 31, 2001.

Total  Interest  Income.  Interest  income for the quarter  ended March 31, 2002
decreased $1.1 million over the quarter ended March 31, 2001, primarily due to a
decrease  in the  average  yield  of 97 basis  points,  partially  offset  by an
increase of $29.7 million in the average balance of interest-earning assets.

Total Interest  Expense.  Interest  expense for the quarter ended March 31, 2002
decreased  $1.3 million over the quarter  ended March 31, 2001 due to a decrease
in the  average  cost of funds  of 112  basis  points,  partially  offset  by an
increase  in the  average  balance  of  interest-bearing  liabilities  of  $33.3
million.

Net Interest  Income.  Net interest  income for the three months ended March 31,
2002 increased  $204,000,  or 4.5%,  over the three months ended March 31, 2001.
The net interest spread,  the difference between the average rate earned and the
average  rate paid,  increased  by 14 basis points to 2.65% for the three months
ended March 31, 2002 from 2.51% for the same period in 2001.

Provision  for Losses on Loans.  The provision for losses on loans for the three
months  ended March 31, 2002  totaled  $150,000 as compared to $120,000  for the
same period in 2001.  The increase in the  provision for losses on loans for the
three months ended March 31,  2002,  as compared to the same period in 2001,  is
precipitated  by  increased  non-performing  loans and a larger loan  portfolio,
specifically  commercial real estate loans,  commercial  non-mortgage  loans and
construction  loans-net.  See  "Note  6 -  Loans  Receivable"  in the  notes  to
unaudited  consolidated  financial  statements.  Provisions  for loan losses are
charged to  earnings  to bring the total  allowance  for loan  losses to a level
considered appropriate by management based on historical experience,  the volume
and type of  lending  conducted  by the  Company,  the  amount of the  Company's
classified  assets,  the status of past due  principal  and  interest  payments,
general  economic  conditions,  particularly  as they  relate  to the  Company's
primary  market area,  and other factors  related to the  collectibility  of the
Company's loan portfolio.  Management will continue to review its loan portfolio
to determine the extent,  if any, to which  additional  loss  provisions  may be
deemed  necessary.  The allowance for loan losses is at a level that  represents
management's best estimates of losses in the loan portfolio at the balance sheet
date.  There can be no assurance  that the allowance for losses will be adequate
to  cover  losses,  which  may in fact  be  realized  in the  future,  and  that
additional provisions for losses will not be required.

Other Income. Non-interest income for the quarter ended March 31, 2002 increased
$170,000 over the quarter ended March 31, 2001. The quarter ended March 31, 2001
reflected a net  operating  loss of $246,000 for a  subsidiary's  investment  in
small business investment companies, which was not a recurring item for the 2002
quarter.

                                       10
<PAGE>

Non-interest Expenses. Non-interest expense for the quarter ended March 31, 2002
increased  $310,000 over the quarter ended March 31, 2001.  The increase was due
primarily to increases in professional fees and occupancy and equipment costs of
$194,000 and $79,000 respectively. The increase in professional fees was related
to fees incurred in connection with the Company's  contested Annual Meeting held
on April 17, 2002.  Occupancy and  equipment  costs  increased  primarily due to
depreciation  expense in connection with the completion of the installation of a
new  enterprise  wide  telephone  system  in the  current  quarter,  as  well as
additional equipment purchases for two new banking offices.

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

On March 31, 2002 the Bank was in compliance with its three  regulatory  capital
requirements as follows:

                                                  Amount              Percent
                                                  ------              -------
                                                       (in Thousands)
Tangible capital..............................  $  52,441              7.49%
Tangible capital requirement..................     10,497              1.50%
                                                ---------           --------
Excess over requirement.......................  $  41,944              5.99%
                                                =========           ========

Core capital..................................  $  52,441              7.49%
Core capital requirement......................     27,992              4.00%
                                                ---------           --------
Excess over requirement.......................  $  24,449              3.49%
                                                =========           ========


Risk based capital............................  $  55,103             17.56%
Risk based capital requirement................     25,098              8.00%
                                                ---------           --------
Excess over requirement.......................  $  30,005              9.56%
                                                =========           ========

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
three months  ended March 31,  2002,  the Company  originated  $43.9  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
mortgage-backed  securities  totaled $37.6 million during the three-month period
ended March 31, 2002. Other  investment  activities  include  investment in U.S.
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 March 31, 2002, cash and cash  equivalents  totaled
$20.9 million. The Bank's liquidity ratio was 4.74% at March 31, 2002.

The Company anticipates that it will have sufficient funds available to meet its
current  commitments.  As of March 31,  2002,  the Company had $38.2  million in
commitments  to fund loans.  Certificates  of deposit,  which were  scheduled to
mature  in one year or less,  as of  March  31,  2002  totaled  $156.2  million.
Management believes that a significant portion of such deposits will remain with
the Company.

                                       11
<PAGE>

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


                                                                    For the
                                                              Three Months Ended
                                                                   March 31,
                                                                   ---------
                                                            2002(1)     2001(1)

Return on average assets                                      .55%        .57%
Return on average equity                                     4.58%       4.50%
Yield on average interest-earning assets                     6.42%       7.39%
Cost of average interest-bearing liabilities                 3.77%       4.88%
Interest rate spread (2)                                     2.65%       2.51%
Net interest margin                                          3.00%       3.00%

                                        At March 31, 2002  At December 31, 2001
                                        -----------------  --------------------
Tangible book value per share                $11.80               $11.77

(1)  The ratios for the  three-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.


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

There were no significant changes for the three months ended March 31, 2002 from
the  information  presented in the Form 10K for  December  31,  2001,  under the
caption "Asset and Liability Management" and "Market Risk Analysis".

                                       12
<PAGE>

                  THISTLE GROUP HOLDINGS, CO. AND SUBSIDIARIES

                                     PART II

ITEM 1.    LEGAL PROCEEDINGS

Neither  the  Company  nor the Bank was  engaged  in any legal  proceeding  of a
material  nature at March 31, 2002. From time to time, 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.  There were no
lawsuits  pending or known to be  contemplated  against the Company at March 31,
2002  that  would  have a  material  effect on the  operations  or income of the
Company or the Bank, taken as a whole.

The Company has been a party to a legal proceeding  involving a shareholder that
conducted  an  election  of  director's  contest,   Jewelcor  Management,   Inc.
("Jewelcor").  On March 19, 2002, Jewelcor filed a legal proceeding in the Court
of Common Pleas of  Philadelphia  County,  Pennsylvania  against the Company and
each of its  directors.  The  proceeding  requested  preliminary  and  permanent
injunctive relief and a declaratory  judgment to postpone the Company's April 3,
2002  Annual  Meeting of  Stockholders.  On March 26,  2002,  the court  granted
Jewelcor's  petition for a preliminary  injunction to delay the Company's Annual
Meeting to a date no earlier than April 17, 2002. The Company  complied with the
court's  order and held its Annual  Meeting of  Stockholders  on April 17, 2002.
However,  on March 27, 2002, the Company and each of its directors  appealed the
court's order and on April 29, 2002,  the Company filed  preliminary  objections
asking  the court to dismiss  Jewelcor's  action  since it was moot and  legally
defective.  Currently, the Company does not believe that this matter will have a
material effect on its financial statements.


ITEM 2.    CHANGES IN SECURITIES AND USE OF PROCEEDS

( c ) Reference is made to Footnote 12 to the Company's March 31, 2002 unaudited
condensed consolidated financial statements, incorporated herein by reference to
this Quarterly Report on Form 10-Q.

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES

Not applicable

ITEM 4.    SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

On April 17, 2002, the Annual Meeting of stockholders of the Company was held to
elect  nominees  for  director and to ratify the  appointment  of the  Company's
independent  auditors.  The following  individuals were elected as directors for
terms to expire in 2005.

                      Nominee                    For                Withheld
                      -------                    ---                --------
                      James C. Hellauer          3,454,752          12,681
                      John F. McGill, Jr.        3,454,727          12,706
                      Charles A. Murray          3,454,752          12,681


With  respect to the  ratification  of  Deloitte  & Touche LLP as the  Company's
independent certified accountants, the results were as follows:

                      For                         Against           Abstain
                      ---                         -------           -------
                      5,562,045                   21,634            68,802


ITEM 5.    OTHER INFORMATION

None

                                       13


<PAGE>

ITEM 6.    EXHIBITS AND REPORTS ON FORM 8-K

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

            3(i)   Articles of Incorporation****
            3(ii)   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***

b)       Reports on Form 8-K

c)       None

--------------------
*    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.

**** Incorporated  by reference to the  identically  number exhibits to the Form
     10-K for December 31, 1999 filed on March 30, 2000.


                                       14
<PAGE>

                  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: May 7, 2002                By:   /s/ John F. McGill, Jr.
                                       -----------------------------------------
                                       John F. McGill, Jr.
                                       President and Chief Executive Officer
                                       (Principal Executive Officer)




Date: May 7, 2002                 By:  /s/ Jerry Naessens
                                       -----------------------------------------
                                       Jerry Naessens
                                       Chief Financial Officer
                                       (Principal Financial Officer)