SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM l0-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, 2000
                               -------------------------------------------------

                                       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   0-24168
                                                  -------

                            TF FINANCIAL CORPORATION
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



               Delaware                                 74-2705050
--------------------------------------------------------------------------------
(State or other jurisdiction of             (I.R.S. employer identification no.)
incorporation or organization)

3 Penns Trail, Newtown, Pennsylvania                      18940
--------------------------------------------------------------------------------
(Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code    215-579-4000
                                                   ------------------

                                       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: April 28, 2000
                                                   --------------

                  Class                             Outstanding
        ---------------------------               ----------------
        $.10 par value common stock               2,823,574 shares


<PAGE>



                    TF FINANCIAL CORPORATION AND SUBSIDIARIES

                                    FORM 1O-Q

                      FOR THE QUARTER ENDED MARCH 31, 2000


                                      INDEX


                                                                           Page
                                                                          Number
                                                                          ------

PART I - CONSOLIDATED FINANCIAL INFORMATION

Item     1.       Consolidated Financial Statements                            3
Item     2.       Management's Discussion and Analysis of Financial
                  Condition and Results of Operations                          8
Item     3.       Quantitative and Qualitative Disclosures about Market Risk  13

PART II- OTHER INFORMATION

Item     1.       Legal Proceedings                                           14
Item     2.       Changes in Securities and Use of Proceeds                   14
Item     3.       Defaults Upon Senior Securities                             14
Item     4.       Submission of Matters to a Vote of Security Holders         14
Item     5.       Other Information                                           14
Item     6.       Exhibits and Reports on Form 8-K                            14

SIGNATURES                                                                    15



                                       2
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                       Unaudited       Audited        Unaudited
                                                                                       March 31,     December 31,     March 31,
                                                                                         2000           1999            1999
                                                                                         ----           ----            ----
<S>                                                                                   <C>            <C>             <C>
                                   Assets
Cash and cash equivalents                                                               $16,661        $16,715         $35,795
Certificates of deposit in other financial institutions                                     547            847           2,038
Investment securities available for sale - at fair value                                 22,534         21,930           5,016
Investment securities held to maturity (fair value of $59,514, $64,538 and               61,798         66,760          96,651
    $96,478, respectively)
Mortgage-backed securities available for sale - at fair value                           139,557        132,515          69,682
Mortgage-backed securities held to maturity (fair value of $148,796,                    154,345        159,888         191,321
    $154,188, and $191,819, respectively)
Loans receivable, net                                                                   294,715        287,979         302,083
Federal Home Loan Bank stock - at cost                                                   13,042         13,042          12,668
Accrued interest receivable                                                               4,789          4,958           4,420
Real estate held for investment                                                              --             --           2,348
Goodwill and other intangible assets                                                      6,376          6,570           7,181
Premises and equipment, net                                                               9,260          9,177           8,924
Other assets                                                                              2,810          1,493           1,290
                                                                                       --------      ---------        --------
                                Total assets                                           $726,434      $721,874         $739,417
                                                                                       ========      =========        ========

                    Liabilities and stockholders' equity
Liabilities
   Deposits                                                                            $408,597       $401,698        $424,869
   Advances from the Federal Home Loan Bank                                             223,359        248,533         253,359
   Other borrowings                                                                      36,530         15,766              --
   Advances from borrowers for taxes and insurance                                        1,124          1,198           1,111
   Accrued interest payable                                                               5,081          3,749           5,557
   Other liabilities                                                                      3,292          2,483           3,256
                                                                                       --------       --------           -----
                              Total liabilities                                         677,983        673,427         688,152
                                                                                       --------       --------         -------

Commitments and contingencies
Stockholders' equity
   Preferred stock, no par value; 2,000,000 shares authorized
       and none issued
   Common stock,  $0.10  par  value;  10,000,000  shares  authorized,  5,290,000
       issued; 2,553,599, 2,576,160, and 2,755,279 shares outstanding
       at March 31, 2000, December 31, 1999 and March 31, 1999, net of
       treasury shares of 2,462,826, 2,437,226, and 2,248,990, respectively.                529            529             529
   Retained earnings                                                                     49,154         48,760          46,392
   Additional paid-in capital                                                            52,098         52,076          51,988
   Unearned ESOP shares                                                                  (2,736)        (2,766)         (2,857)
   Shares acquired by MSBP                                                                  (55)           (71)           (362)
   Treasury stock - at cost                                                             (47,143)       (46,996)        (44,311)
   Accumulated other comprehensive income (loss)                                         (3,396)        (3,085)           (114)
                                                                                       --------       --------        --------
                         Total stockholders' equity                                      48,451         48,447          51,265
                                                                                       --------       --------        --------

Total liabilities and stockholders' equity                                             $726,434      $721,874         $739,417
                                                                                       ========      =========        ========
</TABLE>

                 See notes to consolidated financial statements

                                       3
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES
                  UNAUDITED CONSOLIDATED STATEMENTS OF EARNINGS
                      (in thousands, except per share data)
<TABLE>
<CAPTION>

                                                                           For Three Months
                                                                            Ended March 31,
                                                                            ---------------
                                                                             2000        1999
                                                                             ----        ----

<S>                                                                      <C>         <C>
Interest income
   Loans                                                                   $ 5,556     $ 5,089
   Mortgage-backed securities                                                4,870       4,097
   Investment securities                                                     1,531       1,581
   Interest bearing deposits and other                                          72         326
                                                                           -------     -------
       Total interest income                                                12,029      11,093
                                                                           -------     -------
Interest expense
   Deposits                                                                  3,576       3,857
   Advances from the Federal Home Loan Bank and other borrowings             3,603       2,775
                                                                           -------     -------
       Total interest expense                                                7,179       6,632
                                                                           -------     -------
       Net interest income                                                   4,850       4,461
Provision for loan losses                                                       44          30
                                                                           -------     -------
       Net interest income after provision for loan losses                   4,806       4,431
                                                                           -------     -------

Non-interest income
   Service fees, charges and other operating income                            374         324
                                                                           -------     -------
       Total non-interest income                                               374         324
                                                                           -------     -------
Non-interest expense
   Compensation and benefits                                                 1,827       1,640
   Occupancy and equipment                                                     626         494
   Federal deposit insurance premium                                            22          68
   Professional fees                                                           187         165
   Amortization of goodwill and other intangible assets                        194         209
   Advertising                                                                 170          90
   Other operating                                                             598         554
                                                                           -------     -------
       Total non-interest expense                                            3,624       3,220
                                                                           -------     -------
       Income before income taxes                                            1,556       1,535
Income taxes                                                                   527         551
                                                                           -------     -------
       Net income                                                          $ 1,029     $   984
                                                                           =======     =======

Basic earnings per share                                                     $0.40       $0.35
Diluted earnings per share                                                   $0.39       $0.33
Weighted average number of shares outstanding - basic                        2,569       2,822
Weighted average number of shares outstanding - diluted                      2,654       2,996
</TABLE>

                 See notes to consolidated financial statements

                                       4
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES
                 UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                    For the three months ended
                                                                                              March 31,
                                                                                              ---------
                                                                                          2000          1999
                                                                                          ----          ----
<S>                                                                                  <C>          <C>
Cash flows from operating activities
Net Income                                                                             $   1,029    $     984
Adjustments to reconcile net income to net cash provided by operating activities:
                 Mortgage loan servicing rights                                                3            3
                 Deferred loan origination fees                                               (1)         (25)
                 Premiums and discounts on investment securities, net                          5           23
                 Premiums and discounts on mortgage-backed securities and loans, net          27          230
                 Amortization of goodwill and other intangible assets                        111          209
Provision for loan losses                                                                     44           30
Depreciation of premises and equipment                                                       248          231
Recognition of ESOP and MSBP expenses                                                         68          167
Gain on sale of real estate acquired through foreclosure                                       3          (12)
(Increase) decrease in:
                 Accrued interest receivable                                                 169          138
                 Other assets                                                             (1,469)        (167)
Increase (decrease) in:
                 Accrued interest payable                                                  1,332        1,391
                 Other liabilities                                                           808       (2,222)
                                                                                       ---------    ---------
                 Net cash provided by operating activities                                 2,377          980
                                                                                       ---------    ---------

Cash flows  from investing activities
Loan origination and principal payments on loans, net                                       (953)      15,253
Purchases of loans                                                                        (5,855)     (76,553)
Proceeds from loan sales                                                                      --           --
Maturities of certificates of deposit in other financial institutions, net                   300          200
Purchases of investment securities available for sale                                       (429)          --
Purchases of investment securities  held to maturity                                          --     (102,576)
Purchases of mortgage-backed securities  available for sale                               (9,843)      (2,346)
Purchase of mortgage-backed securities  held to maturity                                    (353)     (41,632)
Proceeds from maturities of investment securities held to maturity                         4,895       89,140
Proceeds from maturities of investment securities available for sale                          --        2,000
Principal repayments from mortgage-backed securities held to maturity                      5,865       31,162
Principal repayments from mortgage-backed securities available for sale                    2,493        7,458
Purchases and redemption of Federal Home Loan Bank Stock, net                                 --       (3,500)
Proceeds from sales of real estate acquired through foreclosure                              146           60
Purchase of premises and equipment                                                          (331)        (138)
                                                                                       ---------    ---------
                 Net cash used in investing activities                                    (4,065)     (81,472)
                                                                                       ---------    ---------
</TABLE>

                 See notes to consolidated financial statements

                                       5
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES
           UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                                 (in thousands)
<TABLE>
<CAPTION>
                                                                                 For the three months ended
                                                                                          March 31,
                                                                                          ---------
                                                                                      2000          1999
                                                                                      ----          ----
<S>                                                                                <C>          <C>
Cash flows from financing activities
Net increase (decrease ) in deposits                                                   6,899     (14,044)
Net increase (decrease) in advances from Federal Home Loan Bank                      (25,174)     90,000
Net increase in other borrowings                                                      20,764          --
Net decrease in advances from borrowers for taxes and insurance                          (74)        (93)
Exercise of stock options                                                                437          34
Purchase of treasury stock, net                                                         (879)     (1,970)
Common stock cash dividend                                                              (339)       (343)
                                                                                    --------    --------
                 Net cash provided by financing activities                             1,634      73,584
                                                                                    --------    --------

                 Net decrease in cash and cash equivalents                               (54)     (6,908)

Cash and cash equivalents at beginning of period                                      16,715      42,703
                                                                                    --------    --------

Cash and cash equivalents at end of period                                          $ 16,661    $ 35,795
                                                                                    ========    ========

Supplemental disclosure of cash flow information
Cash paid for
                 Interest on deposits and advances                                  $  5,947    $  5,241
                 Income taxes                                                       $  2,538    $    512
Non-cash transactions
                 Transfers from loans to real estate acquired through foreclosure   $     --    $     13
</TABLE>

                 See notes to consolidated financial statements

                                       6
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES
              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1 - PRINCIPLES OF CONSOLIDATION

         The consolidated  financial  statements as of March 31, 2000,  December
         31, 1999,  March 31, 1999 and for the  three-month  periods ended March
         31, 2000 and 1999 include the accounts of TF Financial Corporation (the
         "Company") and its wholly owned subsidiaries Third Federal Savings Bank
         (the  "Savings  Bank"),   TF  Investments   Corporation,   Penns  Trail
         Development   Corporation  and  Teragon  Financial   Corporation.   The
         Company's business is conducted  principally  through the Savings 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 of  the  disclosures  or  footnotes  required  by
         generally accepted accounting principles. In the opinion of management,
         all adjustments, consisting of normal recurring accruals, necessary for
         fair  presentation of the consolidated  financial  statements have been
         included. The results of operations for the period ended March 31, 2000
         are not necessarily indicative of the results which may be expected for
         the entire  fiscal year or any other period.  For further  information,
         refer  to  consolidated  financial  statements  and  footnotes  thereto
         included  in the  Company's  Annual  Report on Form 10-K for the fiscal
         year ended December 31, 1999.

NOTE 3 - CONTINGENCIES

         The Company,  from time to time, is a party to routine  litigation that
         arises in the normal course of business.  In the opinion of management,
         the  resolution of this  litigation,  if any, would not have a material
         adverse  effect on the Company's  consolidated  financial  condition or
         results of operations.

NOTE 4 - OTHER COMPREHENSIVE INCOME (LOSS)

         The Company's  other  comprehensive  income  consists of net unrealized
         gains (losses) on investment securities and mortgage-backed  securities
         available  for sale.  Total  comprehensive  income for the  three-month
         periods ended March 31, 2000 and 1999 was $718,000 and $716,000, net of
         applicable income tax of $367,000 and $172,000, respectively.

NOTE 5- RECLASSIFICATIONS

         Certain  prior year  amounts have been  reclassified  to conform to the
         current period presentation.

                                       7

<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES

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

GENERAL

TF  Financial   Corporation   may  from  time  to  time  make  written  or  oral
"forward-looking  statements",  including  statements contained in the Company's
filings with the Securities and Exchange  Commission  (including  this Quarterly
Report on Form 10-Q and the exhibits  thereto),  in its reports to  stockholders
and in other communications by the Company,  which are made in good faith by the
Company  pursuant to the "Safe  Harbor"  Provisions  of the  Private  Securities
Litigation Reform Act of 1995.

These  forward-looking  statements  involve  risks  and  uncertainties,  such as
statements  of the  Company's  plans,  objectives,  expectations,  estimates and
intentions,  that are subject to change based on various important factors (some
of which are beyond the Company's control). The following factors, among others,
could cause the Company's  financial  performance to differ  materially from the
plans,  objectives,  expectations,  estimates and  intentions  expressed in such
forward-looking statements: the strength of the United States economy in general
and  the  strength  of  the  local  economies  in  which  the  Company  conducts
operations;  the effects of, and changes in, trade, monetary and fiscal policies
and laws,  including  interest  rate  policies of the Board of  Governors of the
Federal  Reserve  System,   inflation,   interest  rate,   market  and  monetary
fluctuations;  the timely  development  of and  acceptance  of new  products and
services of the Company and the perceived  overall  value of these  products and
services by users,  including  the  features,  pricing  and quality  compared to
competitors'  products and  services;  the  willingness  of users to  substitute
competitors' products and services for the Company's products and services;  the
success of the  Company in  gaining  regulatory  approval  of its  products  and
services,  when required;  the impact of changes in financial services' laws and
regulations   (including  laws  concerning   taxes,   banking,   securities  and
insurance);  technological changes,  acquisitions;  changes in consumer spending
and saving habits; and the success of the Company at managing the risks involved
in the foregoing.

The  Company  cautions  that the  foregoing  list of  important  factors  is not
exclusive.  The  Company  does  not  undertake  to  update  any  forward-looking
statement,  whether written or oral, that may be made from time to time by or on
behalf of the Company.

Financial Condition

The  Company's  total  assets at March 31, 2000 and  December  31, 1999  totaled
$726.4 million and $721.9 million, respectively, an increase of $4.5 million, or
0.6%, during the three-month period. This increase was primarily the result of a
$6.7 million increase in loans receivable.  The increase in loans receivable was
primarily funded by a $6.9 million increase in deposits.

Total  liabilities  increased by $4.6  million  during the first three months of
2000 primarily as a result of a $6.9 million increase in deposits.

                                       8
<PAGE>


Total  consolidated  stockholders'  equity of the Company  was $48.5  million at
March 31, 2000,  relatively  unchanged from December 31, 1999.  During the first
quarter of 2000, the net increase in retained earnings, which is net income less
dividends  paid,  was  partially  offset  by the  net  cost of  treasury  shares
purchased plus the decrease in accumulated other  comprehensive  income.  During
January of 2000  management  announced that the Company's board of directors had
authorized  the  purchase of up to 142,368  additional  shares of the  Company's
stock in the open market during the subsequent  twelve  months.  As of March 31,
2000,  there were  approximately  116,500 shares  available for repurchase under
this plan.

Asset Quality

Management  of the  Company  believes  that there has been no  material  adverse
change in the Company's asset quality during the three-month  period ended March
31, 2000. The increase in  non-performing  loans is largely  attributable to one
loan with a balance of $547,000,  secured by four residential condominium units.
The  Savings  Bank is  presently  working  with  the  borrower  to  resolve  the
situation,  and  one  of  the  units  representing   approximately  40%  of  the
non-performing  balance is under  contract  of sale.  Non-performing  loans also
include  $338,000  in student  loans that are  guaranteed  by the United  States
Department of Education,  through the Pennsylvania  Higher Education  Assistance
Association,  unless the Savings Bank is notified  that it has failed to perform
all the necessary procedures to preserve the guarantee. In such a situation, the
Savings Bank would attempt to have the guarantee  reinstated;  if  unsuccessful,
these loans become unsecured loans that the Savings Bank will attempt to collect
or charge-off.

      The following table sets forth  information  regarding the Company's asset
quality (dollars in thousands):
<TABLE>
<CAPTION>
                                                                    March 31,      December 31,      March 31,
                                                                    ---------      ------------      ---------
                                                                      2000             1999             1999
                                                                      ----             ----             ----
<S>                                                               <C>              <C>              <C>
       Non-performing loans                                         $2,183           $1,356           $1,561
       Ratio of non-performing loans to gross loans                   0.74%            0.47%            0.51%
       Ratio of non-performing loans to total assets                  0.30%            0.19%            0.21%
       Foreclosed property                                            $321             $546             $274
       Foreclosed property to total assets                            0.04%            0.08%            0.04%
       Ratio of total non-performing assets to total assets           0.34%            0.26%            0.25%
</TABLE>

Management maintains an allowance for loan losses at levels that are believed to
be adequate; however, there can be no assurances that further additions will not
be necessary or that losses  inherent in the existing loan  portfolios  will not
exceed  the  allowance.  The  following  table sets  forth the  activity  in the
allowance for loan losses during the periods indicated (in thousands):


                                                 2000           1999
                                                 ----           ----
Beginning balance, January 1,                  $1,970         $1,909
Provision                                          44             30
Less: charge-off's (recoveries), net
                                                  127             --
                                               ------         ------
Ending balance, March 31,                      $1,887         $1,939
                                               ======         ======

                                       9
<PAGE>
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999

Net Income. The Company recorded net income of $1,029,000,  or $0.39 per diluted
share,  for the three months  ended March 31, 2000 as compared to  $984,000,  or
$0.33 per diluted share, for the three months ended March 31, 1999.

Average Balance Sheet

The following  table sets forth  information  relating to the Company's  average
balance  sheet and  reflects  the average  yield on assets and  average  cost of
liabilities  for the  periods  indicated.  The yields and costs are  computed by
dividing income or expense by the average balance of interest-earning  assets or
interest-bearing liabilities, respectively for the periods indicated.
<TABLE>
<CAPTION>

                                                                         Three months ended March 31,
                                                                         ----------------------------
                                                                 2000                                    1999
                                                    ----------------------------------      ----------------------------------
                                                    Average                   Average       Average                   Average
                                                    Balance     Interest      Yld/Cost      Balance     Interest      Yld/Cost
                                                    -------     --------      --------      -------     --------      --------
                                                                            (dollars in thousands)
<S>                                              <C>            <C>            <C>       <C>            <C>            <C>
Assets:
  Interest-earning assets:
    Loans receivable (4).......................    $289,660       $5,556         7.71%     $282,072       $5,089         7.22%
    Mortgage-backed securities.................     292,754        4,870         6.69%      261,124        4,097         6.28%
    Investment securities......................     101,928        1,531         6.04%      113,605        1,581         5.57%
    Other interest-earning assets(1)...........       7,454           72         3.88%       34,181          326         3.81%
                                                    -------       ------                   --------      -------
      Total interest-earning assets............     691,796       12,029         6.99%      690,982       11,093         6.42%
                                                                  ------                                 -------
Non interest-earning assets....................      27,622                                  24,562
                                                    -------                                 -------
      Total assets.............................     719,418                                 715,544
                                                    =======                                 =======

Liabilities and stockholders' equity:
  Interest-bearing liabilities
    Deposits...................................     404,091        3,576         3.56%      430,115        3,857         3.59%
    Advances from the FHLB and other
               borrowings......................     259,676        3,603         5.58%      223,359        2,775         4.97%
                                                    -------       ------                    -------       ------
      Total interest-bearing liabilities.......     663,767        7,179         4.35%      653,474        6,632         4.06%
                                                                  ------                                  ------
Non interest-bearing liabilities...............       7,840                                   9,964
                                                    -------                                 -------
      Total liabilities..........................   671,607                                 663,438
Stockholders' equity...........................      47,811                                  52,106
                                                    -------                                 -------
   Total liabilities and stockholders' equity....  $719,418                                $715,544
                                                   ========                                ========
Net interest income............................                   $4,850                                  $4,461
                                                                  ======                                  ======
Interest rate spread (2).......................                                  2.64%                                   2.36%
Net yield on interest-earning assets (3).......                                  2.82%                                   2.58%
Ratio of average interest-earning assets to
average interest bearing liabilities...........                                   104%                                    106%
</TABLE>


(1)  Includes interest-bearing deposits in other banks.
(2)  Interest-rate spread represents the difference between the average yield on
     interest-earning   assets  and  the   average   cost  of   interest-bearing
     liabilities.
(3)  Net yield on  interest-earning  assets  represents net interest income as a
     percentage of average interest-earning assets.
(4)  Nonaccrual loans have been included in the appropriate average loan balance
     category,  but  interest  on  nonaccrual  loans has not been  included  for
     purposes of determining interest income.

                                       10
<PAGE>
Rate/Volume Analysis

The following table presents, for the periods indicated,  the change in interest
income and interest  expense (in thousands)  attributed to (i) changes in volume
(changes in the weighted average balance of the total interest earning asset and
interest bearing  liability  portfolios  multiplied by the prior year rate), and
(ii) changes in rate (changes in rate multiplied by prior year volume).  Changes
attributable  to the  combined  impact  of volume  and rate have been  allocated
proportionately based on the absolute value of changes due to volume and changes
due to rate.
<TABLE>
<CAPTION>
                                                                           Three months ended
                                                                                March 31,
                                                                              2000 vs. 1999
                                                                   -------------------------------------------
                                                                           Increase (decrease)
                                                                                 due to
                                                                   -------------------------------------------
                                                                     Volume              Rate            Net
                                                                   -------------------------------------------
     Interest income:
<S>                                                                 <C>               <C>             <C>
          Loans receivable, net                                        $133              $334            $467
          Mortgage-backed securities                                    502               271             773
          Investment securities                                        (614)              564             (50)
          Other interest-earning assets                                (295)               41            (254)
                                                                   -------------------------------------------
             Total interest-earning assets                             (274)            1,210             936
                                                                   ===========================================

     Interest expense:
          Deposits                                                     (247)              (34)           (281)
          Advances from the FHLB and other borrowings                   472               356             828
                                                                   -------------------------------------------
             Total interest-bearing liabilities                         225               322             547
                                                                   ===========================================

     Net change in net interest income                                $(499)             $888            $389
                                                                   ===========================================
</TABLE>

Total Interest  Income.  Total interest income  increased by $936,000 or 8.4% to
$12.0  million for the three months ended March 31, 2000 compared with the first
quarter of 1999  primarily  because of  increases in the rates earned on average
interest-earning  assets.  The  increase in the rate earned on loans  receivable
occurred for two reasons:  first,  the Company  purchased $76.6 million in loans
receivable late in the first quarter of 1999 at yields that were higher than the
current portfolio yields.  Second,  market interest rates rose steadily from the
first quarter of 1999 through year-end 1999.

The increase in interest earned on mortgage-backed securities also occurred as a
result of purchases,  throughout  the last three  quarters of 1999,  with yields
higher than the existing portfolio because of higher market interest rates.

Total Interest Expense. Total interest expense increased to $7.2 million for the
three-month period ended March 31, 2000 from $6.6 million for the same period in
1999  primarily  due to increased  advances  from the Federal Home Loan Bank and
other borrowings which were used to fund asset growth and deposit outflows.  The
average  rate  paid on  Federal  Home Loan Bank  advances  and other  borrowings
increased due to the effect of higher interest rates on new borrowings.

 Interest  expense  on  deposits  decreased  during  the first  quarter  of 2000
compared to the first  quarter of 1999  because the average  balance of deposits
decreased  $26.0 million or 6.1%,  from $430.0  million to $404.1  million.  The
decrease in the average balance of deposits resulted from  management's  efforts
to price deposits at lower interest rates.

                                       11
<PAGE>

Non-interest  income. Total non-interest income was $374,000 for the three-month
period ended March 31, 2000  compared with $323,000 for the same period in 1999.
The increase is due in part to $33,000 of  non-recurring  loan  prepayment  fees
received during the first quarter of 2000.

Non-interest  expense.  Total non-interest expense increased by $404,000 to $3.6
million for the three months ended March 31, 2000 compared to the same period in
1999.  Compensation and benefits expenses increased by $187,000 during the first
quarter of 2000  compared  to the year  earlier  period due in large part to the
increase in full time equivalent  employees from 144 at March 31, 1999 to 167 at
March 31, 2000.  These  additional  employees were related to the two additional
branch  offices  open  during the first  quarter of 2000  compared  to the first
quarter of 1999, and additional staff in the lending areas of the Company.

In  addition,  these  additional  branch  offices  are  largely the cause of the
increases in occupancy and equipment and other operating expenses.  The increase
in  advertising  expense is the result of a planned  increase  in the  Company's
advertising expenses in order to attract new retail banking customers.

                                       12
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES

Liquidity

The  Company's  liquidity  is a  measure  of its  ability  to  fund  loans,  pay
withdrawals of deposits, and other cash outflows in an efficient, cost-effective
manner.  The  Company's   short-term  sources  of  liquidity  include  maturity,
repayment and sales of assets,  excess cash and cash equivalents,  new deposits,
broker deposits,  other borrowings,  and new advances from the Federal Home Loan
Bank. There has been no material adverse change during  three-month period ended
March 31, 2000 in the ability of the Company and its  subsidiaries to fund their
operations.

The Savings  Bank is required  under  federal  regulations  to maintain  certain
specified  levels of "liquid  investments",  which include certain United States
government  obligations  and other  approved  investments.  Current  regulations
require the Savings  Bank to maintain  liquid  assets of not less than 4% of its
net withdrawable  accounts plus short term borrowings.  Short-term liquid assets
must consist of not less than 1% of such accounts and  borrowings,  which amount
is also  included  within the 4%  requirement.  These levels may be changed from
time to time by the  regulators  to reflect  current  economic  conditions.  The
Savings  Bank had  regulatory  liquidity  ratios of 18.9% and 27.8% at March 31,
2000 and 1999, respectively.

At March 31, 2000,  the Company had  commitments  outstanding  under  letters of
credit of $3.7 million,  commitments  to originate  loans of $4.2  million,  and
commitments  to fund  undisbursed  balances of closed  loans and unused lines of
credit of $43.1 million.

Capital Requirements

The Savings Bank is in  compliance  with all of its capital  requirements  as of
March 31, 2000.


YEAR 2000

Risk Assessment

There has been no information  that has come to the Company's  attention  during
the  three-months  ended March 31,  2000 to indicate  that there are any adverse
consequences  that might  affect the  Company in the future  related to the year
2000 problem.


QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Asset and Liability Management

The  Company's  market risk  exposure is  predominately  caused by interest rate
risk,  which is defined as the  sensitivity of the Company's  current and future
earnings, the values of its assets and liabilities, and the value of its capital
to changes in the level of market  interest  rates.  Management  of the  Company
believes that there has not been a material adverse change in market risk during
the three months ended March 31, 2000.

                                       13
<PAGE>
                    TF FINANCIAL CORPORATION AND SUBSIDIARIES

                                     PART II

     ITEM 1.     LEGAL PROCEEDINGS
                 Not applicable.

     ITEM 2.     CHANGES IN SECURITIES AND USE OF PROCEEDS
                 Not applicable.

     ITEM 3.     DEFAULTS UPON SENIOR SECURITIES
                 Not applicable.

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

          The Annual Meeting of Stockholders  (the "Meeting") of the Company was
     held on April 26, 2000.  There were outstanding and entitled to vote at the
     Meeting 2,843,874 shares of Common Stock of the Company. There were present
     at the meeting or by proxy the holders of 2,443,390  shares of Common Stock
     representing  85.92% of the total eligible votes to be cast. Proposal 1 was
     to  elect  two  directors  of the  Company.  Proposal  2 was a  shareholder
     proposal to repeal or amend various provisions of the Company's Certificate
     of  Incorporation  and  by-laws.  Proposal  3  was a  shareholder  proposal
     recommending  that the Board of Directors take certain action to initiate a
     possible sale of the Company.  The results of the voting at the Meeting are
     as follows (percentages in terms of votes cast):

         Proposal 1
         Carl F. Gregory    FOR: 2,097,880             PERCENT FOR: 85.86%
         Robert N. Dusek    FOR: 2,064,022             PERCENT FOR: 84.47%

         Proposal 2         FOR: 675,702               PERCENT FOR: 33.27%
                            AGAINST: 1,331,816         PERCENT AGAINST: 65.57%
                            ABSTAIN: 23,405            PERCENT ABSTAIN: 1.16%

         Proposal 3         FOR: 563,233               PERCENT FOR: 27.73%
                            AGAINST: 1,445,420         PERCENT AGAINST: 71.17%
                            ABSTAIN: 22,270            PERCENT ABSTAIN: 1.10%

     ITEM 5.     OTHER INFORMATION
                 None

     ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K
                 (a)     Exhibits
                 Exhibit 27 - Financial data schedule
                              (in electronic filing only)
                 (b)     Reports on Form 8-K

     During the quarter  ended March 31, 2000,  the  Registrant  filed a Current
     Report on Form 8-K dated January 19, 2000 (Items 5 and 7) to report that it
     intended to repurchase in the open market up to 5% or 142,368 shares of its
     outstanding  common stock.  The repurchases  will be made from time to time
     over the subsequent twelve months, subject to the availability of stock.

                                       14
<PAGE>

                                   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.


                            TF FINANCIAL CORPORATION




                                    /s/ John R. Stranford
                                    ---------------------
Date:      May 5, 2000              John R. Stranford
    -------------------
                                    President and CEO
                                    (Principal Executive Officer)


                                    /s/ Dennis R. Stewart
                                    ---------------------
Date:      May 5, 2000              Dennis R. Stewart
     ------------------
                                    Senior Vice President and
                                    Chief Financial Officer
                                    (Principal Financial & Accounting Officer)

                                       15