UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended                June 30, 2006
                                              -------------

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from __________________ to __________________

Commission File Number:   000-51234
                          ---------

                            NORTH PENN BANCORP, INC.
                            ------------------------
        (Exact name of small business issuer as specified in its charter)

         Pennsylvania                                            20-1882440
         ------------                                            ----------
(State or other jurisdiction of                                (IRS Employer
Incorporation or organization)                              Identification No.)

                      216 Adams Avenue, Scranton, PA 18503
                      ------------------------------------
                    (Address of principal executive offices)

                                 (570) 344-6113
                                 --------------
                          (Issuer's telephone number)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 mark whether the registrant is a shell company (as defined in
rule 12b-2 of the Exchange Act). Yes [ ] No [X]

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the last practical date: 1,443,555 as of August 14th 2006.

Transitional Small Business Disclosure Format  (Check One):  Yes [ ] No [X]

<PAGE>


PART I.  FINANCIAL INFORMATION

         Item 1.  Financial Statements

                  Consolidated Balance Sheets
                    at June 30, 2006 and December 31, 2005

                  Consolidated Statements of Income
                    for the Three and Six Months Ended June 30, 2006 and 2005

                  Consolidated Statements of Cash Flows
                    for the Six Months Ended June 30, 2006 and 2005

                  Notes to Unaudited Consolidated Financial Statements

         Item 2.  Management's Discussion and Analysis or Plan of Operation.

         Item 3.  Controls and Procedures.

PART II  OTHER INFORMATION

         Item 1.  Legal Proceedings.

         Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

         Item 3.  Defaults Upon Senior Securities.

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

         Item 5.  Other Information.

         Item 6.  Exhibits.

                                       2
<PAGE>

PART I - FINANCIAL INFORMATION

         North Penn Bancorp, Inc. (the "Company") was organized on November 22,
2004 in anticipation of the mutual holding company reorganization of North Penn
Bank (the "Bank"). The reorganization was completed on June 1, 2005. The Company
is a bank holding company and parent of the Bank. The principal activities of
the Company are the ownership and supervision of the Bank and, therefore, the
information presented in this report is primarily for the Bank and its
subsidiary.

ITEM I.  FINANCIAL STATEMENTS

                     NORTH PENN BANCORP, INC. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                JUNE 30, 2006    DECEMBER 31, 2005
                                                                                -------------    -----------------
                                                                                 (UNAUDITED)          (AUDITED)
                                                                                          (IN THOUSANDS)
<S>                                                                                <C>               <C>
ASSETS:
Cash and due from banks                                                            $   4,206         $   2,333
Interest bearing deposits                                                                 19                20
                                                                                   ---------         ---------
Total cash and cash equivalents                                                        4,225             2,353
Investment securities, available for sale                                             14,431            15,651
Investment securities, held to maturity                                                   --                --
Equity securities at cost, substantially restricted                                    1,098               991
Loans, net of allowance for loan losses                                               89,322            79,560
Bank premises and equipment - net                                                      4,430             3,592
Accrued interest receivable                                                              582               480
Cash surrender value of life insurance                                                 2,056             2,018
Deferred income taxes                                                                    572               448
Other real estate owned                                                                   --               105
Other assets                                                                              37               183
                                                                                   ---------         ---------
TOTAL ASSETS                                                                       $ 116,753         $ 105,381
                                                                                   =========         =========

LIABILITIES:
Deposits:
Non-interest bearing deposits                                                      $   6,131         $   7,306
Interest bearing demand deposits                                                      28,299            23,604
Interest bearing time deposits                                                        53,038            46,519
                                                                                   ---------         ---------
     Total deposits                                                                   87,468            77,429
Other borrowed funds                                                                  15,872            14,698
Accrued interest and other liabilities                                                   665               459
                                                                                   ---------         ---------
TOTAL LIABILITIES                                                                    104,005            92,586

STOCKHOLDERS' EQUITY
Preferred stock, no par; 20,000,000 authorized; issued and
outstanding, none                                                                         --                --
Common stock, par value $0.10; 80,000,000 authorized; issued
and outstanding, 1,443,555 (Note 5)                                                      144               144
Additional paid-in capital                                                             5,853             5,853
Retained earnings                                                                      7,656             7,481
Unearned ESOP shares                                                                    (509)             (509)
Accumulated other comprehensive income                                                  (396)             (174)
                                                                                   ---------         ---------
TOTAL STOCKHOLDERS' EQUITY                                                            12,748            12,795
                                                                                   ---------         ---------
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                                         $ 116,753         $ 105,381
                                                                                   =========         =========
</TABLE>
            See notes to unaudited consolidated financial statements.

                                       3
<PAGE>

                     NORTH PENN BANCORP, INC. AND SUBSIDIARY
                   UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
            FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2006 AND 2005
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                             SIX MONTHS ENDED                      THREE MONTHS ENDED
                                                      -------------------------------         -------------------------------
                                                       JUNE 30,            JUNE 30,             JUNE 30,            JUNE 30,
                                                         2006                2005                 2006                2005
                                                      -----------         -----------         -----------         -----------
<S>                                                   <C>                 <C>                 <C>                 <C>
INTEREST INCOME
Interest on loans                                     $     2,961         $     2,069         $     1,536         $     1,097
Interest and dividends on investments                         351                 419                 179                 180
                                                      -----------         -----------         -----------         -----------
     Total interest income                                  3,312               2,488               1,715               1,277
INTEREST EXPENSE
Interest on deposits                                        1,155                 792                 651                 396
Interest on borrowed funds                                    433                 169                 208                  81
                                                      -----------         -----------         -----------         -----------
     Total interest expense                                 1,588                 961                 859                 477

                                                      -----------         -----------         -----------         -----------
NET INTEREST INCOME                                         1,724               1,527                 856                 800

PROVISION FOR LOAN LOSSES                                      60                  45                  30                  30
                                                      -----------         -----------         -----------         -----------

NET INTEREST INCOME  AFTER PROVISION FOR LOAN
LOSSES                                                      1,664               1,482                 826                 770
                                                      -----------         -----------         -----------         -----------

OTHER INCOME
Service charges on deposit accounts                            66                  55                  35                  16
Other income                                                  107                 120                  41                  80
Gain on sale of securities                                     11                   4                  11                   0
                                                      -----------         -----------         -----------         -----------
TOTAL OTHER INCOME                                            184                 179                  87                  96

OTHER EXPENSE
Salaries and employee benefits                                880                 743                 436                 366
Occupancy and equipment expense                               311                 247                 169                 131
Other expenses                                                391                 438                 229                 282
                                                      -----------         -----------         -----------         -----------
TOTAL OTHER EXPENSE                                         1,582               1,428                 834                 779

                                                      -----------         -----------         -----------         -----------
INCOME BEFORE INCOME TAXES                                    266                 233                  79                  87

INCOME TAX EXPENSE                                             48                 102                   7                  48

                                                      -----------         -----------         -----------         -----------
NET INCOME                                                    218                 131                  72                  39
OTHER COMPREHENSIVE INCOME (LOSS):
Unrealized holding loss arising during period,
net of income tax                                            (222)               (114)               (112)                 23
                                                      -----------         -----------         -----------         -----------
COMPREHENSIVE INCOME                                  $        (4)        $        17         $       (40)        $        16
                                                      ===========         ===========         ===========         ===========

Weighted average number of shares outstanding           1,393,844
                                                                            1,443,555           1,393,844           1,443,555
Earnings per share                                    $      0.16         $      0.09         $      0.05         $      0.03
Dividends per share                                   $      0.03         $      0.00         $      0.03         $      0.00
</TABLE>

            See notes to unaudited consolidated financial statements.

                                       4
<PAGE>

                     NORTH PENN BANCORP, INC. AND SUBSIDIARY
                (UNAUDITED) CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2006 AND 2005
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                     2006        2005
                                                                   --------    --------
<S>                                                                <C>         <C>
Operating Activities:
Net income                                                         $    218    $    131
Items not requiring (providing) cash
  Depreciation                                                          135          97
  Provision for loan losses                                              60          45
  Amortization of securities (net of accretion)                          15          --
  Increase in cash surrender value of life insurance                    (38)        (37)
  Net realized gain on securities                                       (11)         (4)
  Net realized gain on other real estate owned                          (29)         --
  Changes in:
    Accrued interest income and other assets                             41         214
    Accrued interest expense and other liabilities                      206        (102)
                                                                   --------    --------
      Net Cash Provided by  Operating Activities                        597         344
                                                                   --------    --------

Investing Activities:
  Purchase bank premises and equipment                                 (973)       (118)
  Proceeds from sale of other real estate owned                         134          --
  Proceeds from sale of securities "available for sale"                  48       4,428
  Purchase of securities "available for sale"                          (220)       (291)
  Redemptions of securities "available for sale"                        500       3,593
  Redemptions of securities "held to maturity"                           --         500
  Redemptions of mortgage-backed securities "available for sale"        545       1,135
  Purchase of life insurance policies                                    --        (125)
  Net (purchase) sale of restricted stock                              (107)        312
  Net increase in loans to customers                                 (9,822)     (7,754)
                                                                   --------    --------
    Net Cash (Used in) Provided by Investing Activities              (9,895)      1,680
                                                                   --------    --------

Financing Activities:
  Net increase (decrease) in deposits                                10,039      (4,454)
  Increase (decrease) in borrowed funds                               1,174      (2,275)
  Net proceeds of initial public stock offering                          --       5,833
  Initial capitalization of North Penn Mutual Holding Company            --        (100)
  Cash dividends paid                                                   (43)         --
                                                                   --------    --------
    Net Cash Provided by (Used In) Financing Activities              11,170        (996)
                                                                   --------    --------
Net Increase in Cash and Cash Equivalents                             1,872       1,028
                                                                   --------    --------

Cash and Cash Equivalents, January 1                               $  2,353    $  1,659
                                                                   --------    --------
Cash and Cash Equivalents, June 30                                 $  4,225    $  2,687
                                                                   ========    ========

Supplementary Schedule of Cash Flow Information:
  Cash paid during the period for:
    Interest                                                       $  1,588    $    961
    Income taxes                                                         21          46

  Non-cash investing and financing activities:
    None
</TABLE>

            See notes to unaudited consolidated financial statements.

                                       5
<PAGE>

              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1.       NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         NATURE OF OPERATIONS

         North Penn Bancorp, Inc. was organized on November 22, 2004 to be the
         bank holding company for North Penn Bank (Bank) in connection with the
         Bank's mutual holding company reorganization and minority stock
         issuance. The common stock trades on the OTC Bulletin Board under the
         symbol "NPEN". The Bank operates from five offices under a state
         savings bank charter and provides financial services to individuals and
         corporate customers primarily in Northeastern Pennsylvania. The Bank's
         primary deposit products are savings and demand deposit accounts and
         certificates of deposit. Its primary lending products are real estate,
         commercial and consumer loans.

         PRINCIPLES OF CONSOLIDATION

         The accompanying consolidated financial statements include the accounts
         of North Penn Bancorp, Inc., its wholly-owned subsidiary, North Penn
         Bank, and North Penn Bank's wholly-owned subsidiary, Norpenco, Inc.
         These entities are collectively referred to herein as the Company. All
         significant intercompany accounts and transactions have been eliminated
         in consolidation. Norpenco, Inc. received approval and began purchasing
         bank stocks in October, 2004. Its sole activities are purchasing bank
         stocks and receiving dividends on such stocks.

         The accounting policies of the Company conform with accounting
         principles generally accepted in the United States of America and with
         general practices within the banking industry.

         BASIS OF PRESENTATION

         The unaudited consolidated financial statements have been prepared in
         accordance with generally accepted accounting principals for interim
         financial information. In the opinion of management, all adjustments
         that are of a normal recurring nature and are considered necessary for
         a fair presentation have been included. They are not, however,
         necessarily indicative of the results of consolidated operations for a
         full year.

         All information is presented in thousands of dollars, except per share
         amounts.

                                       6
<PAGE>

         USE OF ESTIMATES

         The preparation of financial statements in conformity with accounting
         principles generally accepted in the United States of America requires
         management to make estimates and assumptions that affect the reported
         amounts of assets and liabilities and disclosure of contingent assets
         and liabilities at the date of the financial statements and the
         reported amounts of revenue and expenses during the reporting period.
         Actual results could differ from those estimates.

         Material estimates that are particularly susceptible to significant
         change relate to the determination of the allowance for loan losses on
         loans and the valuation of real estate acquired in connection with
         foreclosures or in the satisfaction of loans. In connection with the
         determination of the allowances for losses on loans and foreclosed real
         estate, management periodically obtains independent appraisals for
         significant properties.

2.       INVESTMENT SECURITIES

         The Bank's investments in securities are classified in two categories
         and accounted for as follows:

         Securities Held-to-Maturity. Bonds, notes and debentures for which the
         Bank has the positive intent and ability to hold to maturity are
         reported at cost, adjusted for amortization of premiums and accretion
         of discounts.

         Securities Available-for-Sale. Securities available-for-sale consist of
         bonds, notes, debentures and equity securities not classified to be
         held-to-maturity and are carried at fair value with unrealized holding
         gains and losses, net of tax, reported as a separate component of other
         comprehensive income until realized.

         Purchase premiums and discounts are recognized in interest income on
         the straight-line basis over the terms of the securities, which
         approximates the interest method. Declines in the fair value of
         held-to-maturity and available-for-sale securities below their cost
         that are deemed to be other than temporary are reflected in earnings as
         realized losses. Gains and losses on the sale of securities are
         recorded on the trade date and are determined using the specific
         identification method and are reported as other income in the statement
         of income.

         The amortized cost and fair value of investment securities at June 30,
         2006 and December 31, 2005 are as follows:

                                       7
<PAGE>

                               AVAILABLE-FOR-SALE
                                  JUNE 30, 2006
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                           GROSS         GROSS
                                          AMORTIZED      UNREALIZED    UNREALIZED          FAIR
                                            COST           GAINS         LOSSES           VALUE
                                           -------       ----------    ----------        -------
<S>                                        <C>            <C>            <C>             <C>
         U.S. Agency securities            $   385        $    --        $   (16)        $   369
         Mortgage-backed securities          5,942             --           (252)          5,690
         Municipal securities                7,026             --           (301)          6,725
         Other securities                      756             --            (18)            738
                                           -------        -------        -------         -------
            Total debt securities           14,109             --           (587)         13,522
         Equity securities                     928             34            (53)            909
                                           -------        -------        -------         -------
           Total Available for Sale        $15,037        $    34        $  (640)        $14,431
                                           =======        =======        =======         =======
</TABLE>

                                HELD-TO-MATURITY
                                  JUNE 30, 2006
                                 (IN THOUSANDS)
         None

                               AVAILABLE-FOR-SALE
                                DECEMBER 31, 2005
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                           GROSS          GROSS
                                          AMORTIZED      UNREALIZED     UNREALIZED         FAIR
                                            COST           GAINS          LOSSES          VALUE
                                           -------        -------        -------         -------
<S>                                        <C>            <C>            <C>             <C>
         U.S. Agency securities            $   385        $    --        $    (8)        $   377
         Mortgage-backed securities          6,494              1           (149)          6,346
         Municipal securities                7,026             --            (74)          6,952
         Other securities                    1,264              3            (11)          1,256
                                           -------        -------        -------         -------
              Total debt securities         15,169              4           (242)         14,931
         Equity securities                     745             15            (40)            720
                                           -------        -------        -------         -------
           Total Available for Sale        $15,914        $    19        $  (282)        $15,651
                                           =======        =======        =======         =======
</TABLE>

                                HELD-TO-MATURITY
                                DECEMBER 31, 2005
                                 (IN THOUSANDS)
         None

                                       8
<PAGE>

         The gross fair value and unrealized losses of the Bank's investments,
         aggregated by investment category and length of time that individual
         securities have been in a continuous unrealized loss position at June
         30, 2006 is as follows:
<TABLE>
<CAPTION>
                                     LESS THAN 12 MONTHS               12 MONTHS OR LONGER                    TOTAL
                                  -------------------------         -------------------------         -------------------------
                                   FAIR           UNREALIZED         FAIR           UNREALIZED         FAIR           UNREALIZED
                                   VALUE            LOSSES           VALUE            LOSSES           VALUE            LOSSES
                                  --------        ----------        --------        ----------        --------        ----------
<S>                               <C>              <C>              <C>              <C>              <C>              <C>
         U.S. Agencies            $     --         $     --         $    369         $    (16)        $    369         $    (16)
         Mortgage-backed                --               --            5,690             (252)           5,690             (252)
         Municipal                   6,725             (301)              --               --            6,725             (301)
         Other securities              250               (1)             488              (17)             738              (18)
         Equity securities             377              (16)             182              (37)             559              (53)
                                  --------         --------         --------         --------         --------         --------
                                  $  7,352         $   (318)        $  6,729         $   (322)        $ 14,081         $   (640)
                                  ========         ========         ========         ========         ========         ========
</TABLE>

         The above table at June 30, 2006 includes 40 securities that have
         unrealized losses for less than 12 months and 24 securities that have
         been in an unrealized loss position for 12 or more months.

         The Bank invests in debt securities of the U.S. government, U.S.
         agencies, U.S. sponsored agencies, obligations of states and political
         subdivisions and corporate obligations. Changes in market value of all
         debt securities can result from changes in interest rates. Changes in
         credit quality can affect securities of states and political
         subdivisions and corporate obligations. The changes in market value of
         the debt securities held by the Bank have been due to changes in
         interest rates, and because the Bank has the ability to hold these
         investments until maturity, the Bank does not consider these
         investments to be other-than-temporarily impaired at June 30, 2006.

         The Bank invests in equity securities of other banks through its
         subsidiary, Norpenco, Inc. Management has evaluated the near-term
         prospects of the issuers with unrealized losses, in relation to the
         severity and duration of the impairment. Based on that evaluation, and
         the Bank's ability to hold these stocks for a reasonable period of time
         sufficient for a forecasted recovery of fair value, the management does
         not consider these investments to be other-than-temporarily impaired at
         June 30, 2006.

                                       9
<PAGE>

3.       LOANS

<TABLE>
<CAPTION>
                                                    JUNE 30,      DECEMBER 31,
                                                      2006           2005
                                                    --------      ------------
                                                        (IN THOUSANDS)
<S>                                                 <C>            <C>
         REAL ESTATE MORTGAGES:
           Construction and land development        $ 1,764        $ 1,126
           Residential, 1 - 4 family                 44,874         43,159
           Residential, multi-family                     37          1,997
           Commercial                                32,136         23,738
                                                    -------        -------
              Total real estate mortgages            78,811         70,020
         Commercial                                   1,564          1,069
         Consumer                                    10,000          9,496
                                                    -------        -------
               Total loans                           90,375         80,585
         Allowance for loan loss                      1,053          1,025
                                                    -------        -------
              Total loans, net                      $89,322        $79,560
                                                    =======        =======
</TABLE>

         Loans are stated at the principal amount outstanding, net of any
         unearned income, deferred loan fees and the allowance for loan losses.
         Interest on mortgage and commercial loans is calculated at the time of
         payment based on the current outstanding balance of the loan. Interest
         on consumer loans is recognized on the simple interest method.

         The allowance for loan losses is increased by charges to income and
         decreased by charge-offs (net of recoveries). Management's periodic
         evaluation of the adequacy of the allowance is based on the bank's past
         loan loss experience, known and inherent risks in the portfolio,
         adverse situations that may affect the borrower's ability to pay, the
         estimated value of any underlying collateral and current economic
         conditions.

         Uncollectible interest on loans that are contractually past due 90 days
         or more is credited to an allowance established through management's
         periodic evaluation. The allowance is established by a charge to
         interest income equal to all interest previously accrued, and income is
         subsequently recognized only to the extent that cash payments are
         received until, in management's judgment, the borrower's ability to
         make periodic interest and principal payments is back to normal, in
         which case the loan is returned to accrual status.


4.       OTHER BORROWINGS

         The Bank has a line of credit agreement with FHLBank of Pittsburgh for
         short term borrowings varying from one day to three years. Advances on
         this line must be secured by "qualifying collateral" as defined in the
         agreement and bear interest at fixed or variable rates as determined at
         the date advances are made. The line expires in June, 2011. At June 30,
         2006, the Bank borrowed $3,872 in overnight funds.

                                       10
<PAGE>

         The Bank also has a $5,000 borrowing with FHLBank of Pittsburgh at a
         fixed rate of 6.19%, which was issued in July of 2000, and matures July
         of 2010. The loan requires monthly interest payments, with the
         principal due at maturity.

         The Bank also has a $7,000 borrowing with FHLBank of Pittsburgh at a
         fixed rate of 4.34%, which was issued in July of 2005, and matures July
         of 2015. The loan requires quarterly interest payments, with the
         principal due at maturity.


5.       EARNINGS PER SHARE

         Earnings per share are calculated based on 1,443,555 shares outstanding
         less 49,711 unearned ESOP shares for the current period.

6.       CONSTRUCTION OF A BRANCH

         On May 1, 2006, a new branch office opened in Effort, Pennsylvania. At
         December 31, 2004, the land was purchased by the Bank in the amount of
         $571, and was recorded in "Other Assets," since it was intended to be
         transferred to North Penn Bancorp, Inc. At June 30, 2006, the total
         cost of the branch facility, including furniture, fixtures and
         equipment was approximately $1,380, not including the land acquisition
         costs of $571. The cost is no longer designated
         "construction-in-progress," but is now included in "Bank premises and
         equipment". The company recorded $9 of depreciation expense as of June
         30, 2006. The land is still held as an asset of North Penn Bank.

                                       11
<PAGE>

ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

FORWARD-LOOKING STATEMENTS

         This report contains certain "forward-looking statements" within the
         meaning of the federal securities laws. These statements are not
         historical facts but rather are statements based on North Penn Bancorp,
         Inc.'s current expectations regarding its business strategies, intended
         results and future performance. Forward-looking statements may be
         preceded by terms such as "expects," "believes," "anticipates,"
         "intends" and similar expressions.

         Management's ability to predict results or the effect of future plans
         or statements is inherently uncertain. Factors which could affect
         actual results in which North Penn Bancorp, Inc. operates, as well as
         nationwide, include North Penn Bancorp, Inc.'s ability to control costs
         and expenses, competitive products and pricing, loan delinquency rates
         and changes in federal and state legislation and regulation. These
         factors should be considered in evaluating the forward-looking
         statements and undue reliance should not be placed on such statements.
         North Penn Bancorp, Inc. assumes no obligation to update any
         forward-looking statements.

FINANCIAL CONDITION

         Our total assets increased $11,372, or 11%, from $105,381 at December
         31, 2005 to $116,753 at June 30, 2006. The increase was primarily due
         to loan growth in the commercial real estate sector.

         Net loans increased $9,762 or 12%, from $79,560 at December 31, 2005 to
         $89,322 million at June 30, 2006, mainly due to an increase in
         commercial loans. The Bank has been increasing its commercial loan
         portfolio to diversify its loan portfolio and reduce its exposure to
         the interest rate risk associated with residential mortgages. Most of
         the Bank's commercial loans are secured by real estate in order to
         minimize their risk.

         The allowance for loan losses was $1,053 at June 30, 2006, compared to
         $1,025 at December 31, 2005. We recorded $30 in loan loss provision
         expense for the three months and $60 for the six months ended June 30,
         2006. The Bank had five loans charged-off and no recoveries during the
         three months ending in June 2006. The loans charged off during the
         second quarter totaled $31 and all were consumer type loans. Management
         assesses the adequacy of the allowance for loan losses based on
         evaluating known and inherent risks in the loan portfolio and upon
         management's continuing analysis of the factors underlying the quality
         of the loan portfolio.

         While management believes that, based on information currently
         available, the allowance for loan losses is sufficient to cover losses


                                       12
<PAGE>

         inherent in its loan portfolio at this time, no assurance can be given
         that the level of the allowance for loan losses is sufficient to cover
         future possible loan losses incurred by the Bank or that future
         adjustments to the allowance for loan losses will not be necessary if
         economic and other conditions differ substantially from the economic
         and other conditions used by management to determine the current level
         of the allowance for loan losses. Management may in the future increase
         the level of the allowance for loan losses as a percentage of total
         loans and non-performing loans in the event it increases the level of
         commercial or consumer lending as a percentage of its total loan
         portfolio. In addition, various regulatory agencies, as an integral
         part of their examination process, periodically review the allowance
         for loan losses. Such agencies may require the Bank to provide
         additions to the allowance based upon judgments different from
         management.

         Non-performing loans, which are loans past due 90 days or more and
         non-accruing loans, totaled $306 at June 30, 2006, compared to $539 at
         December 31, 2005. The improvement was primarily in non-accruing
         residential mortgages which decreased by $255, while non-accruing
         consumer loans increased by $6. The ratio of the Bank's allowance for
         loan losses to total loans was 1.17% at June 30, 2006 and 1.27% at
         December 31, 2005.

         Total deposits increased $10,039, or 13%, from $77,429 at December 31,
         2005 to $87,468 at June 30, 2006. Non-interest bearing deposits
         decreased by $1,175 or 16%, while interest bearing demand deposits
         increased $4,695, or 20%, and time deposits increased $6,519, or 14%.
         The decrease in non-interest bearing deposits is primarily due to
         fluctuations in consumer and commercial accounts. The increases in
         interest bearing demand deposits and time deposits are primarily due to
         accounts being opened through our new branch in Effort, PA.

         Other borrowings increased $1,174, or 8%, from $14,698 at December 31,
         2005 to $15,872 at June 30, 2006, due to increases in overnight
         borrowings from FHLBank of Pittsburgh. Borrowings are primarily being
         used to fund loan growth when deposit growth is inadequate.

RESULTS OF OPERATIONS

COMPARISON OF THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2006 AND 2005

         Net income for the second quarter of 2006 increased $33, or 85%, to
         $72, compared to $39 in 2005. Net income for the six months ended June
         30, 2006 increased $87, or 67%, to $218, compared to $131 in 2005. Net
         income increased primarily due to the increase in loan interest and
         fees coupled with an increase in tax exempt income.

                                       13
<PAGE>

         Interest income for the second quarter of 2006 increased $438, or 34%,
         to $1,715, compared to $1,277 in 2005. Interest income for the six
         months ended June 30, 2006 increased $824, or 33%, to $3,312 compared
         to $2,488 for June 30, 2005. Interest on loans increased $439, or 40%,
         from $1,097 in 2005 to $1,536 during the second quarter in 2006. For
         the six months ended June 30, interest on loans increased $892, or 43%,
         from $2,069 for 2005, to $2,961 for 2006. The increases are due to
         higher loan volumes and the increase in the prime rate. Interest on
         investments decreased $1, or 1%, from $180 to $179 during the second
         quarter, and $68, or 16%, from $419 to $351 for the six months ended
         June 30, 2006 due to lower balances of investments.

         Interest expense during the second quarter increased $382, or 80%, from
         $477 in 2005 to $859 in 2006. For the six months ended June 30, 2006,
         interest expense increased $627, or 65%, from $961 in 2005 to $1,588 in
         2006. Interest on deposits for the second quarter increased $255, or
         64%, from $396 in 2005 to $651 in 2006, due to increases in volume and
         rate of time and demand deposits. For the six months ended June 30,
         interest on deposits increased $363, or 46%, from $792 in 2005 to
         $1,155 in 2006. Interest on borrowed funds increased $127, or 157%, for
         the second quarter of 2006 and $264, or 156%, for the six months ended
         June 30, 2006 due to the increases in the rate and volume of overnight
         borrowings, along with the additional fixed rate long term note issued
         in July of 2005.

         Net interest income for the second quarter increased $56, or 7%, from
         $800 in 2005, to $856 in 2006. For the six months ended June 30, 2006,
         net interest income increased $197, or 13%, from $1,527 to $1,724.

         Other income for the second quarter decreased $9, or 9%, from $96, in
         2005, to $87 in 2006. Total other expenses increased $55, or 7%, from
         $779 in 2005 to $834 in 2006. Salaries and employee benefits increased
         $70, or 19%, from $366 in 2005, to $436 in 2006, while occupancy and
         equipment expense increased $38, or 29%, from $131 in 2005, to $169 in
         2006, and other expenses decreased $53, or 19%, from $282 in 2005 to
         $229 in 2006. Other expenses incurred during the second quarter of 2006
         include costs involved with opening and supplying our new branch, while
         2005 expenses include the contribution to fund the North Penn
         Charitable Foundation.

         For the six months ended June 30, other income increased $5, or 3%,
         from $179 in 2005 to $184 in 2006. Total other expenses increased $154,
         or 11%, from $1,428 in 2005 to $1,582 in 2006. Salaries and employee
         benefits increased $137, or 18%, from $743 in 2005 to $880 in 2006,
         while occupancy and equipment expense increased $64, or 26%, from $247
         in 2005 to $311 in 2006. Other expenses decreased $47, or 11%, from
         $438 in 2005 to $391 in 2006, primarily due to the contribution to our
         charitable foundation in 2005, offset by expenses incurred in opening
         and supplying our new branch in the second quarter of 2006.

                                       14
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

LIQUIDITY AND CAPITAL RESOURCES

         The Bank's primary sources of funds are deposits, principal and
         interest payments on loans and FHLBank advances. While maturities and
         scheduled amortization of loans are predictable sources of funds,
         deposit flows and mortgage prepayments are greatly influenced by
         general interest rates, economic conditions, and competition. The
         Bank's regulators require the Bank to maintain sufficient liquidity to
         ensure its safe and sound operation.

         A review of the Consolidated Statements of Cash Flows included in the
         accompanying financial statements shows that the Bank's cash and cash
         equivalents increased $1,872 for the six months ended June, 2006.
         During that period, cash was primarily provided from earnings and
         customer deposits and primarily used to fund loans to customers and
         continued construction of the new branch building.

         The Company's and North Penn Bank's capital ratios at June 30, 2006 and
         December 31, 2005 as well as the required minimum ratios for capital
         adequacy purposes and to be well capitalized under the prompt
         corrective action provisions as defined by the FDIC are summarized as
         follows:

                                       15
<PAGE>
<TABLE>
<CAPTION>
                                                                                                    TO BE WELL
                                                                                                CAPITALIZED UNDER
                                                                       FOR CAPITAL              PROMPT CORRECTIVE
                                               ACTUAL               ADEQUACY PURPOSES           ACTION PROVISIONS
                                          -----------------        -------------------         -------------------
                                          AMOUNT      RATIO        AMOUNT        RATIO         AMOUNT        RATIO
                                          ------      -----        ------        -----         ------        -----
<S>                                       <C>         <C>          <C>            <C>          <C>            <C>
              AT JUNE 30, 2006:
              -----------------
              Tier 1 Capital to risk-weighted
              assets:
                 Consolidated             $13,144     14.21%       >$3,520        >4.0%        >$5,281        >6.0%
                                                                   -              -            -              -
                 North Penn Bank          $11,053     12.09%       >$3,489        >4.0%        >$5,233        >6.0%
                                                                   -              -            -              -
              Total Capital to risk-weighted
              assets:
                 Consolidated             $12,748     13.78%       >$7,041        >8.0%        >$8,801       >10.0%
                                                                   -              -            -             -
                 North Penn Bank          $10,681     11.69%       >$6,977        >8.0%        >$8,722       >10.0%
                                                                   -              -            -             -
              Tier 1 Capital to total average
              assets:
                 Consolidated             $13,144     11.40%       >$4,431        >4.0%        >$5,538        >5.0%
                                                                   -              -            -              -
                 North Penn Bank          $11,053     10.00%       >$4,302        >4.0%        >$5,378        >5.0%
                                                                   -              -            -              -
              Tangible Capital to total average
              assets:
                 Consolidated             $13,144     11.40%       >$1,661        >1.5%            N/A          N/A
                                                                   -              -                ---          ---
                 North Penn Bank          $11,053     10.00%       >$1,613        >1.5%            N/A          N/A
                                                                   -              -                ---          ---

              Risk-Weighted Assets:
                 Consolidated             $92,515
                 North Penn Bank          $91,388
              Average Assets:
                 Consolidated            $115,327
                 North Penn Bank         $110,540

              AT DECEMBER 31, 2005:
              ---------------------
              Tier 1 Capital to risk-weighted
              assets:
                 Consolidated             $13,450     17.03%       >$3,158        >4.0%        >$4,737        >6.0%
                                                                   -              -            -              -
                 North Penn Bank          $10,824     13.76%       >$3,146        >4.0%        >$4,720        >6.0%
                                                                   -              -            -              -
              Total Capital to risk-weighted
              assets:
                 Consolidated             $13,304     16.85%       >$6,317        >8.0%        >$7,896       >10.0%
                                                                   -              -            -             -
                 North Penn Bank          $10,677     13.57%       >$6,293        >8.0%        >$7,866       >10.0%
                                                                   -              -            -             -
              Tier 1 Capital to total average
              assets:
                 Consolidated             $13,450     13.44%       >$4,002        >4.0%        >$5,003        >5.0%
                                                                   -              -            -              -
                 North Penn Bank          $10,824     11.20%       >$3,866        >4.0%        >$4,833        >5.0%
                                                                   -              -            -              -
              Tangible  Capital to total average
              assets:
                 Consolidated             $13,450     13.44%       >$1,501        >1.5%            N/A          N/A
                                                                   -              -                ---          ---
                 North Penn Bank          $10,824     11.20%       >$1,450        >1.5%            N/A          N/A
                                                                   -              -                ---          ---

              Risk-Weighted Assets:
                 Consolidated             $78,958
                 North Penn Bank          $78,659
              Average Assets:
                 Consolidated            $100,060
                 North Penn Bank          $96,659
</TABLE>


                                       16
<PAGE>

RELATED PARTIES

         The Company does not have any material transactions involving related
         persons or entities, other than traditional banking transactions, which
         are made on the same terms and conditions as those prevailing at the
         time for comparable transactions with unrelated parties.

ITEM 3.  CONTROLS AND PROCEDURES.

         The Company's management, including the Company's principal executive
         officer and principal financial officer, have evaluated the
         effectiveness of the Company's "disclosure controls and procedures," as
         such term is defined in Rule 13a-15(e) promulgated under the Securities
         Exchange Act of 1934, as amended, (the "Exchange Act"). Based upon
         their evaluation, the principal executive officer and principal
         financial officer concluded that, as of the end of the period covered
         by this report, the Company's disclosure controls and procedures were
         effective for the purpose of ensuring that the information required to
         be disclosed in the reports that the Company files or submits under the
         Exchange Act with the Securities and Exchange Commission (the "SEC")
         (1) is recorded, processed, summarized and reported within the time
         periods specified in the SEC's rules and forms, and (2) is accumulated
         and communicated to the Company's management, including its principal
         executive and principal financial officers, as appropriate to allow
         timely decisions regarding required disclosure.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

         The Company is not involved in any pending legal proceedings other than
         routine legal proceedings occurring in the ordinary course of business.
         Such routine legal proceedings, in the aggregate, are believed by
         management to be immaterial to the Company's financial condition or
         results of operations.

                                       17
<PAGE>

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

USE OF PROCEEDS

1.       The effective date of the Securities Act statement for which the use of
         proceeds information is being disclosed is December 10, 2004. The
         Commission file number assigned to the registration statement is
         333-121121.

2.       From March 28, 2005 to June 30, 2006, the amount of net offering
         proceeds used for certain items and any other purposes for which at
         least 5% of the Company's total offering proceeds or $100,000
         (whichever is less) has been used are listed below:
<TABLE>
<CAPTION>
                                                               AMOUNT OF NET
         ACTIVITY                                                PROCEEDS
         --------                                               ----------
<S>                                                             <C>
         Net Offering Proceeds                                  $5,714,000

         Construction of Plant, Building and Facilities          1,000,000
         Purchase and Installation of Machinery and Equipment      380,000
         Purchase of Real Estate                                        --
         Acquisition of Other Business(es)                              --
         Repayment of Indebtedness                                      --
         Working Capital                                                --
         Temporary Investments                                          --
         North Penn Bank                                         2,929,000
         North Penn Mutual Holding Company                         100,000
         North Penn Charitable Foundation                          100,000
         North Penn Bank Employee Stock Ownership Plan             545,000
         Dividends Paid                                             86,000
                                                                ----------

         Proceeds Remaining at North Penn Bancorp, Inc.         $  574,000
                                                                ==========
</TABLE>

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

None.

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

         A.       The Annual Meeting of Shareholders of North Penn Bancorp, Inc.
                  on May 23, 2006.

         B.-C.    The results of the items submitted for a vote are as follows:

                                       18
<PAGE>

                  The following three Directors were elected for a term of three
         years, expiring in 2009 -
<TABLE>
<CAPTION>
                  NAME                       VOTES FOR     VOTES AGAINST     VOTES NOT CAST
                  ----                       ---------     -------------     --------------
<S>                                          <C>               <C>                <C>
                  Herbert C. Kneller         1,368,944         47,959             26,652
                  Frank H. Mechler           1,368,843         48,060             26,652
                  David Samuel               1,368,694         48,209             26,652
</TABLE>

                  The approval of the North Penn Bancorp, Inc. 2006 Omnibus
         Stock Option Plan

<TABLE>
<S>                                            <C>
                  Votes for                    373,799
                  Votes against                137,477
                  Votes abstained                2,912
                  Votes not cast               929,367
</TABLE>

                  The ratification of Appointment of McGrail Merkel Quinn &
         Associates as Independent Registered Public Accounting Firm of North
         Penn Bancorp, Inc. for the fiscal year ending December 31, 2006.

<TABLE>
<S>                                          <C>
                  Votes for                  1,371,927
                  Votes against                  2,351
                  Votes abstained               42,625
                  Votes not cast                26,652
</TABLE>

                  Name of Each Director Whose Term of Office Continued After the
         Annual Meeting:

<TABLE>
<CAPTION>
                  NAME                                     TERM EXPIRES
                  ----                                     ------------
<S>                                                            <C>
                  Kevin M. Lamont                              2007
                  Otto P. Robinson, Esq.                       2007
                  Frederick L. Hickman, President & CEO        2007
                  Gordon S. Florey                             2008
                  James W. Reid, Esq.                          2008
                  John Schumaker                               2008
</TABLE>

ITEM 5   OTHER INFORMATION.

None

                                       19
<PAGE>

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

         EXHIBITS

         3.1      Certificate of Incorporation of North Penn Bancorp, Inc.*

         3.2      By-laws of North Penn Bancorp, Inc.*

         4.       Specimen Stock Certificate of North Penn Bancorp, Inc.*

         11.1     Statement re: computation of per share earnings: Refer to
                  Note 5

         31.1     Rule 13a-14(a) /15d-14(a) Chief Executive Officer
                  Certification

         31.2     Rule 13a-14(a) /15d-14(a) Principal Accounting Officer
                  Certification

         32.1     Section 1350 Certification of Chief Executive Officer

         32.2     Section 1350 Certification of Principal Accounting Officer

----------

     *   Incorporated herein by reference into this document from Form SB-2
         Registration Statement, as amended, filed on December 10, 2004,
         Registration No. 333-121121.

                                       20
<PAGE>
                                   SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be so signed on its behalf by the undersigned, thereunto duly
authorized.

                                                  North Penn Bancorp, Inc

    Dated:           August 14, 2006              /s/   Frederick L. Hickman
                --------------------------        ------------------------------
                                                  Frederick L. Hickman
                                                  President and
                                                  Chief Executive Officer

    Dated:           August 14, 2006              /s/   Glenn J. Clark
                --------------------------        ------------------------------
                                                  Glenn J. Clark
                                                  Assistant Vice President and
                                                  Principal Accounting Officer

                                       21